EXHIBIT 4.2
MACDERMID'S CREDIT AGREEMENT - SIXTH AMENDMENT WITH BANK OF AMERICA
SIXTH AMENDMENT
This SIXTH AMENDMENT (this "Amendment") to the Credit Agreement (as defined
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below) is entered into as of November 9, 2001 by and among MacDERMID
INCORPORATED, a Connecticut corporation (the "Company"), the several financial
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institutions party hereto (collectively, with Bank of America, N.A., the
"Lenders"; individually a "Lender"), BANK OF AMERICA, N.A., as letter of credit
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issuing bank, swing line lender and administrative agent for the Lenders (the
"Administrative Agent") and BANC OF AMERICA SECURITIES, LLC, as lead arranger
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and book manager. Unless otherwise specified herein, capitalized terms used in
this Amendment shall have the meanings ascribed to them by the Credit Agreement
(as defined below).
PRELIMINARY STATEMENTS:
(1) The Company, the Lenders from time to time party thereto and the
Administrative Agent are party to the Second Amended and Restated Multicurrency
Credit Agreement, dated as of October 25, 1998, amended and restated as of
December 15, 1998 and further amended and restated as of June 15, 1999 (as
amended by the First Amendment dated as of September 24, 1999, the Second
Amendment dated as of November 12, 1999, the Third Amendment and Waiver dated as
of June 2, 2000, the Fourth Amendment dated as of December 19, 2000 and the
Fifth Amendment dated as of May 25, 2001 and as the same may be further amended,
supplemented, restated or otherwise modified from time to time in accordance
with its terms and in effect, the "Credit Agreement"); and
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(2) The Company, the Administrative Agent and the Majority Lenders desire to
make certain amendments to the Credit Agreement as specified below.
NOW, THEREFORE, in consideration of the mutual execution hereof and other good
and valuable consideration, the parties hereto agree as follows
SECTION 1. Amendments to Credit Agreement
The Credit Agreement is hereby amended, effective as of the Sixth Amendment
Effective Date in accordance with Section 4 hereof, as follows:
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1.1 New Definitions. Section 1.01 of the Credit Agreement is hereby amended by
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adding the following definitions in the proper alphabetical location:
"Level VI" shall exist at any time the Leverage Ratio is equal to or less than
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2.5:1.0 but greater than 2.0:1.0.
"Level VII" shall exist at any time the Leverage Ratio is equal to or less than
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2.0:1.0.
"Mortgage Policies" has the meaning specified in Section 7.19(b).
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"Mortgages" has the meaning specified in Section 2(d) of the Sixth Amendment.
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"Permitted Encumbrances" has the meaning specified in the Mortgages.
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"Secured Parties" has the meaning specified in the Security Agreement.
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"Security Agreement" has the meaning specified in Section 2(c) of the Sixth
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Amendment.
"Sixth Amendment" means that certain Sixth Amendment to this Agreement dated as
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of November 9, 2001.
"Sixth Amendment Effective Date" has the meaning assigned to that term in the
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Sixth Amendment.
1.2 Amended Definitions.
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(a) Aggregate Revolving Loan Commitment. The definition of "Aggregate
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Revolving Loan Commitment" is hereby deleted in its entirety and replaced with
the following new definition:
"Aggregate Revolving Loan Commitment" means the aggregate Revolving Loan
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Commitments of the Lenders equal to One Hundred Seventy Five Million Dollars
($175,000,000), as the same may be reduced pursuant to Section 2.05.
(b) Applicable Margin. The definition of "Applicable Margin" in
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Section 1.01 of the Credit Agreement is hereby amended (i) by deleting the chart
in its entirety and by adding the following new chart thereto:
Level Base Rate Loans Offshore Rate Loans Commitment Fee
I 2.00% 3.00% 0.75%
II 1.75% 2.75% 0.75%
III 1.25% 2.25% 0.50%
IV 1.00% 2.00% 0.375%
V 0.75% 1.75% 0.275%
VI 0.50% 1.50% 0.25%
VII 0.25% 1.25% 0.25%
and (ii) by deleting the first proviso thereto and substituting therefor the
following: "provided, however, that the Applicable Margin shall be determined
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pursuant to the most recent Compliance Certificate; and"
(c) Collateral Documents. The definition of "Collateral Documents" in
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Section 1.01 of the Credit Agreement is hereby deleted in its entirety and
replaced with the following new definition:
"Collateral Documents" means, collectively (if and when each such document is
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required to be executed and delivered hereunder), (a) each Credit Agreement
Guaranty, the Pledge Agreements, the Security Agreement, the Mortgages and all
other pledge agreements, security agreements, mortgages, guarantees and other
similar agreements between a Borrower or its Subsidiaries and the Lenders or the
Administrative Agent, for the benefit of the Secured Parties, now or hereafter
delivered to the Lenders or the Administrative Agent pursuant to or in
connection with the transactions contemplated hereby, and all financing
statements (or comparable documents now or hereafter filed in accordance with
the Uniform Commercial Code or comparable law) against a Borrower or any of its
Subsidiaries as debtor in favor of the Lenders or the Administrative Agent, for
the benefit of the Secured Parties, and (b) any amendments, supplements,
modifications, renewals, replacements, consolidations, substitutions and
extensions of any of the foregoing.
(d) Consolidated EBIT. The definition of "Consolidated EBIT" in
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Section 1.01 of the Credit Agreement is hereby deleted in its entirety and
replaced with the following new definition:
"Consolidated EBIT" means, for any period, the sum of Consolidated Net Income of
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the Company and its Consolidated Subsidiaries for such period, plus (i) to the
extent incurred during such period by the Company and its Subsidiaries, any
one-time non-cash charges not in excess of $30,000,000 in the aggregate for all
test periods, (ii) to the extent incurred during such period by the Company and
its Subsidiaries, any one-time non-cash charges not in excess of $40,000,000 in
connection with the write down of intangible assets in the aggregate for all
test periods, (iii) Consolidated Interest Expense, (iv) consolidated taxes of
the Company and its Consolidated Subsidiaries for such period and (v) to the
extent incurred during such period by the Company and its Subsidiaries, losses
incurred in connection with the operations of Dynacircuits; provided, however,
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that for all purposes for any businesses acquired (whether by purchase
accounting or pooling accounting) during the period of determination,
Consolidated EBIT for such period shall be determined on a pro forma basis as if
such acquisition had occurred as of the beginning of such period (including
synergies agreed to by the Administrative Agent in its reasonable discretion);
provided, further, that without the consent of the Administrative Agent and the
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Majority Lenders, the Consolidated EBIT being added as a result of any such
acquisition shall not exceed (a) in the case that only unaudited financial
statements are available with respect to the assets, Person or division being
acquired (whether by merger, stock or asset purchase, or otherwise), the amount
of Consolidated EBIT of the acquiree on a stand alone basis being added from
such acquisition shall not exceed 15% of the otherwise applicable amount of
Consolidated EBIT of the Company and its Subsidiaries (other than the acquiree)
taken as a whole, or (b) in the instance that unqualified audited financial
statements in accordance with GAAP are available for the acquiree, then 100% of
the Consolidated EBIT of the acquiree.
(e) Consolidated EBITDA. The definition of "Consolidated EBITDA" in
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Section 1.01 of the Credit Agreement is hereby deleted in its entirety and
replaced with the following new definition:
"Consolidated EBITDA" means, for any period, the sum of Consolidated Net Income
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of the Company and its Consolidated Subsidiaries for such period, plus (i) to
the extent incurred during such period by the Company and its Subsidiaries and
not for determination of the Leverage Ratio related to pricing Levels in the
Applicable Margin definition, any one-time non-cash charges not in excess of
$30,000,000 in the aggregate for all test periods, (ii) to the extent incurred
during such period by the Company and its Subsidiaries, any one-time non-cash
charges not in excess of $40,000,000 in connection with the write down of
intangible assets in the aggregate for all test periods, (iii) Consolidated
Interest Expense, (iv) consolidated depreciation and amortization expense, (iv)
consolidated taxes of the Company and its Consolidated Subsidiaries for such
period and (v) to the extent incurred during such period by the Company and its
Subsidiaries, losses incurred in connection with the operations of Dynacircuits;
provided, however, that for all purposes for any businesses acquired (whether by
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purchase accounting or pooling accounting) during the period of determination,
Consolidated EBITDA for such period shall be determined on a pro forma basis as
if such acquisition had occurred as of the beginning of such period (including
synergies agreed to by the Administrative Agent in its reasonable discretion);
provided, further, that without the consent of the Administrative Agent and the
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Majority Lenders, the Consolidated EBITDA being added as a result of any such
acquisition shall not exceed (a) in the case that only unaudited financial
statements are available with respect to the assets, Person or division being
acquired (whether by merger, stock or asset purchase, or otherwise), the amount
of Consolidated EBITDA of the acquiree on a stand alone basis being added from
such acquisition shall not exceed 15% of the otherwise applicable amount of
Consolidated EBITDA of the Company and its Subsidiaries (other than the
acquiree) taken as a whole, or (b) in the instance that unqualified audited
financial statements in accordance with GAAP are available for the acquiree,
then 100% of the Consolidated EBITDA of the acquiree.
(f) Eligible Borrower. The definition of "Eligible Borrower" in
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Section 1.01 of the Credit Agreement is hereby amended by (i) inserting
immediately after the word "means" in the first sentence thereof the phrase "(i)
the Company and (ii)" and (ii) inserting immediately after the phrase "and in
each case" in the first sentence thereof the phrase "described in this clause
(ii)".
(g) GAAP. The definition of "GAAP" in Section 1.01 of the Credit
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Agreement is hereby deleted in its entirety and replaced with the following new
definition:
"GAAP" means U.S. generally accepted accounting principles set forth from time
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to time in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U. S.
accounting profession), which are applicable to the circumstances as of the date
of determination; provided, however, that for purposes of all computations
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required to be made with respect to compliance by the Company with Sections
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9.01, 9.02 and 9.03, such term shall mean generally accepted accounting
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principles as in effect on the date of this Agreement applied in a manner
consistent with those used in preparing the financial statements referred to in
Section 6.05(a), except that such computations shall give effect to the adoption
of FAS 142 (Accounting for Goodwill and Intangible Assets) from and after the
Sixth Amendment Effective Date.
(h) Pricing Levels. The definitions of "Level", "Level I", "Level II",
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"Level III", "Level IV", and "Level V" are respectively deleted and replaced
with the following definitions:
"Level" means, and includes, Level I, Level II, Level III, Level IV, Level V,
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Level VI or Level VII, whichever is in effect at the relevant time.
"Level I" shall exist at any time the Leverage Ratio is greater than 4.5:1.0.
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"Level II" shall exist at any time the Leverage Ratio is equal to or less than
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4.5:1.0 but greater than 4.00:1.0.
"Level III" shall exist at any time the Leverage Ratio is equal to or less than
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4.0:1.0 but greater than 3.5:1.0.
"Level IV" shall exist at any time the Leverage Ratio is equal to or less than
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3.5:1.0 but greater than 3.0:1.0.
"Level V" shall exist at any time the Leverage Ratio is equal to or less than
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3.0:1.0 but greater than 2.5:1.0.
(i) Subsidiary Guarantor. The definition of "Subsidiary Guarantor" in
Section 1.01 of the Credit Agreement is hereby deleted in its entirety and
replaced with the following new definition:
"Subsidiary Guarantor" means, collectively, (a) each Domestic Subsidiary whose
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tangible assets or revenue constitutes 2% or more of the total tangible assets
or the total revenue, as applicable, of the Company and its Subsidiaries taken
as a whole and (b) to the extent required pursuant to Section 7.11, each Foreign
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Subsidiary.
1.3 Section 2.01(c)(ii). Section 2.01(c)(ii) of the Credit Agreement is
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hereby amended by deleting the text thereof in its entirety and replacing it
with the words "intentionally omitted".
1.4 Section 2.07 Termination of Commitments; Mandatory Prepayments of Loans;
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and Mandatory Commitment Reductions. Section 2.07 of the Credit Agreement is
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hereby amended by (a) deleting the parenthetical in sub-clause (iii) of clause
(f) thereof and replacing it with "(with a reduction in the Aggregate Revolving
Loan Commitment as set forth in clause (l) below)" and (b) adding to the end
thereof the following new clause (l):
(l) If the ratio of Consolidated Total Debt to Consolidated EBITDA is 3.50
to 1.00 or greater at the time of an Asset Disposition, the aggregate Revolving
Loan Commitments shall be automatically and permanently reduced on the date, and
in an aggregate amount equal to 50%, of the prepayment of Loans required to be
made (whether or not such prepayment is not made because all outstanding Loans
have been repaid or prepaid) pursuant to Section 2.07(f), provided, however,
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that if the ratio of Consolidated Total Debt to EBITDA is less than 3.50 to 1.00
at the time of an Asset Disposition, no reduction in the Revolving Loan
Commitments shall occur.
1.5 Section 7.01. Section 7.01 of the Credit Agreement is hereby amended by
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adding to the end thereof the following new clause (l):
(l) simultaneously with the delivery of each set of financial statements
referred to in Sections 7.01(a) and 7.01(b), a supplement to Schedule IV to the
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Security Agreement setting forth the After-Acquired Intellectual Property (as
defined in the Security Agreement) referred to in Section 9(b)(iii) of the
Security Agreement.
1.6 Section 8.01(h). Section 8.01(h) of the Credit Agreement is hereby
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deleted in its entirety.
1.7 Section 8.03(i). Section 8.03(i) of the Credit Agreement is hereby
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amended by deleting the text thereof in its entirety and replacing it with the
words "Intentionally omitted".
1.8 Section 8.04 Negative Pledge. Section 8.04 of the Credit Agreement is
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hereby amended by (i) deleting clause (c) thereof and replacing such clause with
the following new clause (c):
(c) Liens not in excess of 15% of Tangible Assets securing (i) factoring
programs of Foreign Subsidiaries in an aggregate amount up to $20 million at any
time outstanding and (ii) Debt permitted by Section 8.01(c) provided that no
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such Lien shall extend to or cover any Collateral and provided, further, that
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Liens permitted under this clause (c) shall at all times be limited such that,
after giving effect to such Liens, the credit lines set forth on Schedule I to
the Sixth Amendment are or could be secured by Liens permitted under this clause
(c) (or any replacement, extension or renewal of such credit lines without
increase in the amount or change in any direct or contingent obligor); and
and (ii) adding to the end thereof the following new clause (f):
(f) Liens existing or created pursuant to the Collateral Documents.
1.9 Section 8.05(b)(ii). Section 8.05(b)(ii) of the Credit Agreement is
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hereby amended in full to read as follows:
(ii) the Company or any Subsidiary may make Asset Dispositions the
aggregate net proceeds of which received by the Company after the Announcement
Date shall not exceed (x) $17,500,000 (other than an Asset Disposition subject
to the following clause (y)) (and, subject to compliance with Section 2.07(f),
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the Lenders hereby agree not to unreasonably withhold their consent for Asset
Dispositions in excess of such aggregate amount) and (y) 15% of Tangible Assets
with respect to Asset Dispositions consisting of equipment in connection with a
sale-leaseback transaction pursuant to which the Company or a Subsidiary of the
Company will be the lessee.
1.10 Section 9.01 Consolidated EBIT to Consolidated Interest Expense Ratio.
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Section 9.01 of the Credit Agreement is hereby deleted in its entirety and
replaced with the following new Section 9.01:
9.01 Consolidated EBIT to Consolidated Interest Expense Ratio.
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The ratio of Consolidated EBIT to Consolidated Interest Expense tested at the
end of each fiscal quarter for the preceding four fiscal quarters shall not
during the periods set forth below be less than the following:
Period Ratio
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October 1, 2001 through December 31, 2001 1.50 to 1.00
January 1, 2002 through September 30, 2002 1.25 to 1.00
October 1, 2002 through December 31, 2002 1.50 to 1.00
January 1, 2003 and thereafter 1.75 to 1.00
1.11 Section 9.03 Maximum Total Debt to Consolidated EBITDA. Section 9.03
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of the Credit Agreement is hereby deleted in its entirety and replaced with the
following new Section 9.03:
9.03 Maximum Total Debt to Consolidated EBITDA.
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The ratio of Consolidated Total Debt to Consolidated EBITDA tested at the end of
each fiscal quarter for the preceding four fiscal quarters shall not during the
periods set forth below exceed the following:
Period Ratio
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October 1, 2001 to June 30, 2002 4.75 to 1.00
July 1, 2002 to September 30, 2002 4.50 to 1.00
October 1, 2002 to December 31, 2002 4.25 to 1.00
January 1, 2003 and thereafter 4.00 to 1.00
provided that on and after the date the Administrative Agent releases any
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Collateral from the assignment and security interest granted under the Security
Agreement and the Mortgages in accordance with Section 12.20(b), the ratio of
Adjusted Consolidated Total Debt to Consolidated EBITDA tested at the end of
each fiscal quarter for the preceding four fiscal quarters shall not exceed 4.00
to 1.00.
1.12 Addition of Affirmative Covenants. Article VII of the Credit Agreement
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is amended by adding to the end thereof the following new covenants:
7.15 Covenant to Guarantee Obligations and Give Security. Upon (x) the
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request of the Administrative Agent following the occurrence and during the
continuance of a Default or an Event of Default, (y) the formation or
acquisition of any new direct Subsidiaries organized under the laws of the
United States by the Company or any Subsidiary Guarantor or (z) the acquisition
of any property located in the United States having an aggregate value in any
one or series of related transactions in excess of $500,000 by the Company or
any Subsidiary Guarantor, and such property, in the judgment of the
Administrative Agent, shall not already be subject to a perfected first priority
security interest in favor of the Administrative Agent for the benefit of the
Secured Parties, then the Company shall, in each case at the Company's expense:
(a) in connection with the formation or acquisition of a direct
Subsidiary organized under the laws of the United States, within 20 days after
such formation or acquisition, cause such Subsidiary, and cause each direct and
indirect parent of such Subsidiary that is organized under the laws of the
United States (if it has not already done so), to duly execute and deliver to
the Administrative Agent a guaranty or guaranty supplement, in form and
substance reasonably satisfactory to the Administrative Agent, guaranteeing the
obligations of the Company, the other Borrowers and the other Subsidiary
Guarantors, under the Loan Documents,
(b) within 10 days after such request, formation or acquisition, furnish to
the Administrative Agent a description of the real and personal properties
located in the United States of the Company and its Subsidiaries in detail
satisfactory to the Administrative Agent,
(c) within 20 days after such request, formation or acquisition, duly
execute and deliver, and cause each such direct Subsidiary organized under the
laws of the United States and each direct and indirect parent of such Subsidiary
(if it has not already done so) to duly execute and deliver, to the
Administrative Agent mortgages, pledges, assignments, security agreement
supplements and other security agreements, as specified by and in form and
substance reasonably satisfactory to the Administrative Agent, securing payment
of all the Obligations of the Company, each other Borrower, each other
Subsidiary Guarantor, such Subsidiary or such parent, as the case may be, under
the Loan Documents and constituting Liens on all such properties,
(d) within 30 days after such request, formation or acquisition, take, and
cause such direct Subsidiary organized under the laws of the United States or
such parent to take, whatever action (including, without limitation, the
recording of mortgages, the filing of Uniform Commercial Code financing
statements, the giving of notices and the endorsement of notices on title
documents) may be necessary or reasonably advisable in the opinion of the
Administrative Agent to vest in the Administrative Agent (or in any
representative of the Administrative Agent designated by it), for the benefit of
the Secured Parties, valid and subsisting Liens on the properties purported to
be subject to the mortgages, pledges, assignments, security agreement
supplements and security agreements delivered pursuant to this Section 7.15,
enforceable against all third parties in accordance with their terms,
(e) within 60 days after such request, formation or acquisition, deliver to
the Administrative Agent, upon the request of the Administrative Agent in its
sole discretion, a signed copy of a favorable opinion, addressed to the
Administrative Agent and the other Secured Parties, of counsel for the Company
acceptable to the Administrative Agent as to the matters contained in clauses
(a), (c) and (d) above, as to such guaranties, guaranty supplements, mortgages,
pledges, assignments, security agreement supplements and security agreements
being legal, valid and binding obligations of the Company and each Subsidiary
Guarantor party thereto enforceable in accordance with their terms, as to the
matters contained in clause (d) above, as to such recordings, filings, notices,
endorsements and other actions being sufficient to create valid perfected Liens
on such properties, and as to such other matters as the Administrative Agent may
reasonably request, and
(f) at any time and from time to time, promptly execute and deliver any and
all further instruments and documents and take all such other action as the
Administrative Agent may reasonably deem necessary or desirable in obtaining the
full benefits of, or in perfecting and preserving the Liens of, such guaranties,
mortgages, pledges, assignments, security agreement supplements and security
agreements.
7.16 Further Assurances. (a) Promptly upon request by the Administrative
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Agent, correct, and cause each of its Subsidiaries promptly to correct, any
material defect or error that may be discovered in any Loan Document or in the
execution, acknowledgment, filing or recordation thereof, and
(b) Promptly upon request by the Administrative Agent, do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and re-register
any and all such further acts, deeds, conveyances, pledge agreements, mortgages,
deeds of trust, trust deeds, assignments, financing statements and continuations
thereof, termination statements, notices of assignment, transfers, certificates,
assurances and other instruments as the Administrative Agent may reasonably
require from time to time in order to (A) carry out more effectively the
purposes of the Loan Documents, (B) to the fullest extent permitted by
applicable law, subject the Company's and each of its Subsidiaries' properties,
assets, rights or interests to the Liens now or hereafter intended to be covered
by any of the Collateral Documents, (C) perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and any of the
Liens intended to be created thereunder and (D) assure, convey, grant, assign,
transfer, preserve, protect and confirm more effectively unto the Secured
Parties the rights granted or now or hereafter intended to be granted to the
Secured Parties under any Loan Document or under any other instrument executed
in connection with any Loan Document to which the Company or any of its
Subsidiaries is or is to be a party, and cause each of its Subsidiaries to do
so.
7.17 Preparation of Environmental Reports. Upon the occurrence and during
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continuation of a Default or an Event of Default and at the request of the
Administrative Agent from time to time, provide to the Lenders within 60 days
after such request, at the expense of the Company, an environmental site
assessment report for any of its or its Subsidiaries' properties described in
the Mortgages, prepared by an environmental consulting firm acceptable to the
Administrative Agent, indicating the presence or absence of Hazardous Materials
and the estimated cost of any compliance, removal or remedial action in
connection with any Hazardous Materials on such properties; without limiting the
generality of the foregoing, if the Administrative Agent determines at any time
(upon the occurrence and continuance of a Default or an Event of Default) that a
material risk exists that any such report will not be provided within the time
referred to above, the Administrative Agent may retain an environmental
consulting firm to prepare such report at the expense of the Company, and the
Company hereby grants and agrees to cause any Subsidiary that owns any property
described in the Mortgages to grant at the time of such request to the
Administrative Agent, the Lenders, such firm and any agents or representatives
thereof an irrevocable non-exclusive license, subject to the rights of tenants,
to enter onto their respective properties to undertake such an assessment.
7.18 Perfection of Security Interest under Security Agreement. Within 30
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days after the Sixth Amendment Effective Date (or within such other longer
period as the Administrative Agent may deem advisable), the Company shall
furnish to the Administrative Agent and in sufficient copies for each Lender:
(a) acknowledgment copies of proper financing statements, duly filed under
the Uniform Commercial Code of all jurisdictions that the Administrative Agent
may deem necessary or reasonably desirable in order to perfect and protect the
liens and security interests created under the Security Agreement, covering the
Collateral described in the Security Agreement,
(b) completed requests for information, listing the financing statements
referred to in clause (a) above and all other effective financing statements
filed in the jurisdictions referred to in clause (a) above that name the
Guarantor or any Subsidiary Guarantor as debtor, together with copies of such
other financing statements, and
(c) evidence of the completion of all other recordings and filings of or
with respect to the Security Agreement that the Administrative Agent may deem
necessary or desirable in order to perfect and protect the Liens created
thereby.
7.19 Perfection of the Mortgages. Within 60 days after the Sixth Amendment
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Effective Date (or within such other longer period as the Administrative Agent
may deem advisable), the Company shall furnish to the Administrative Agent and
in sufficient copies for each Lender:
(a) evidence that counterparts of the Mortgages have been duly recorded in
all filing or recording offices that the Administrative Agent may deem necessary
or reasonably desirable in order to create a valid and subsisting Lien on the
property described therein in favor of the Administrative Agent for the benefit
of the Secured Parties and that all filing and recording taxes and fees have
been paid,
(b) fully paid American Land Title Association Lender's Extended Coverage
title insurance policies (the "Mortgage Policies") in form and substance, with
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endorsements and in amount reasonably acceptable to the Administrative Agent,
issued by title insurers acceptable to the Administrative Agent, insuring the
Mortgages to be valid and subsisting Liens on the property described therein,
free and clear of all defects (including, but not limited to, mechanics' and
materialmen's Liens) and encumbrances, excepting only encumbrances of record
which do not materially affect the property and Permitted Encumbrances, and
providing for such other affirmative insurance (including endorsements for
future advances under the Loan Documents and for mechanics' and materialmen's
Liens) as the Administrative Agent may deem necessary or desirable,
(c) acknowledgment copies of proper financing statements, duly filed under
the Uniform Commercial Code of all jurisdictions that the Administrative Agent
may deem necessary or reasonably desirable in order to perfect and protect the
liens and security interests in all fixtures attached to all real property
described in the Mortgages,
(d) such consents and agreements of lessors and other third parties, and
such estoppel letters and other confirmations, as the Administrative Agent may
deem necessary or reasonably desirable,
(e) evidence of the insurance required by the terms of the Mortgages,
(f) evidence that all other action that the Administrative Agent may deem
necessary or reasonably desirable in order to create valid and subsisting Liens
on the property described in the Mortgages has been taken, and
(g) favorable opinions of local counsels with respect to each of the
Mortgages, in form and substance satisfactory to the Administrative Agent.
1.13 Addition to Representations and Warranties. Article VI of the Credit
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Agreement is hereby amended by adding the following new Sections:
6.28 Representations and Warranties Incorporated From the Sixth Amendment.
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Each of the representations and warranties given by Company to the
Administrative Agent and the Lenders in the Sixth Amendment are true and correct
in all material respects as of the date of the Sixth Amendment, except to the
extent such representations and warranties are expressly made as of a specified
date in which event such representations and warranties shall be true and
correct as of such specified date, and all representations and warranties in the
Collateral Documents are true and correct in all material respects, and such
representations and warranties are incorporated herein by this reference with
the same effect as though set forth in their entirety herein.
6.29 Perfection of Security Interests. All filings and other actions
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necessary or desirable to perfect and protect the security interest in the
Collateral created under the Collateral Documents will be duly made or taken as
provided for herein and will be in full force and effect, and the Collateral
Documents create in favor of the Administrative Agent for the benefit of the
Secured Parties a valid and, together with such filings and other actions,
perfected priority security interest in the Collateral, securing the payment of
the Secured Obligations (in each case, as defined in each Collateral Document),
and all filings and other actions necessary or desirable to perfect and protect
such security interest will be duly taken as provided herein. The Company and
its Subsidiaries are the legal and beneficial owners of the Collateral free and
clear of any Lien, except for the liens and security interests created or
permitted under the Loan Documents.
1.14 Section 11.09. Section 11.09 of the Credit Agreement is amended by
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adding to the end thereof the following:
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent and upon the execution and filing or recording of
such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may be
necessary or desirable, or as the Majority Lenders may request, in order to
continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents, such successor Administrative Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of
the retiring Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations under the Loan Documents.
1.15 Additional Provision. Article XII of the Credit Agreement is hereby
---------------------
amended by adding the following new Section:
12.20 Release of Collateral. (a) Upon the sale, lease, transfer or other
-----------------------
disposition of any item of Collateral of the Company or any Subsidiary
(including, without limitation, as a result of the sale, in accordance with the
terms of the Loan Documents, of any Subsidiary that owns such Collateral) in
accordance with, and to the extent permitted by, the terms of the Loan
Documents, the Administrative Agent will, at the Company's expense, execute and
deliver to the Company or such Subsidiary such documents as such Person may
reasonably request to evidence the release of such item of Collateral from the
assignment and security interest granted under the Collateral Documents in
accordance with the terms of the Loan Documents.
(b) If the ratio of Adjusted Consolidated Total Debt to Consolidated EBITDA
tested at the end of each fiscal quarter for the preceding four fiscal quarters
does not exceed 3.50 to 1.00 at the end of two consecutive fiscal quarters
ending at any time after the Sixth Amendment Effective Date, the Administrative
Agent will, upon the Company's request and at the Company's expense, execute and
deliver to the Company or such Subsidiary Guarantor such documents as such
Person may reasonably request to evidence the permanent release of the
Collateral from the assignment and security interest granted under the Security
Agreement and the Mortgages (excluding the Pledge Agreements) in accordance with
the terms of the Loan Documents.
SECTION 2. Conditions of Effectiveness
-----------------------------
This Amendment shall become effective as of the date first above written when,
and only when, the Administrative Agent shall have received counterparts of this
Amendment executed by the Company and the Majority Lenders or, as to any of the
Lenders, advice satisfactory to the Administrative Agent that such Lender has
executed this Amendment and the Administrative Agent shall have additionally
received all of the following documents, each such document (unless otherwise
specified) dated the date of receipt thereof by the Administrative Agent, in
sufficient copies for each Lender and in form and substance satisfactory to the
Administrative Agent:
(a) Certified copies of the resolutions of the Board of Directors of
the Company and each Subsidiary Guarantor approving this Amendment and the
Collateral Agreements (as hereinafter defined) to which it is or is to be a
party, and the matters contemplated hereby and thereby.
(b) A certificate of the Secretary or an Assistant Secretary of the Company
and each Subsidiary Guarantor certifying the names and true signatures of the
officers of the Company and such Subsidiary Guarantor authorized to sign this
Amendment and the Collateral Agreements to which they are or are to be a party
and the other documents to be delivered hereunder and thereunder.
(c) A security agreement in substantially the form of Exhibit A hereto
(together with each other security agreement and security agreement supplement
delivered pursuant to Section 7.15 of the Credit Agreement, in each case as
amended, the "Security Agreement"), duly executed by the Company and each
-------------------
Subsidiary Guarantor, together with evidence of the insurance required by the
terms of the Security Agreement.
(d) Deeds of trust, trust deeds, mortgages, leasehold mortgages and
leasehold deeds of trust in substantially the form of Exhibit B hereto and
covering the properties listed on Schedule II hereto (together with each other
mortgage delivered pursuant to Section 7.15 of the Credit Agreement, in each
case as amended, the "Mortgages", and together with the Security Agreement, the
---------
"Collateral Agreements"), duly executed by the Company or the appropriate
----------------------
Subsidiary.
(e) Evidence of insurance naming the Administrative Agent as additional
insured with such responsible and reputable insurance companies or associations,
and in such amounts and covering such risks, as is satisfactory to the Lenders.
(f) A favorable opinion of Carmody & Torrance LLP, counsel for the Company
and each Subsidiary Guarantor, in substantially the form of Exhibit C hereto and
as to such other matters as any Lender through the Administrative Agent may
reasonably request.
(g) A certificate signed by a duly authorized officer of the Company
stating that:
(i) The representations and warranties contained in Section 3 and in each of
the Collateral Agreements delivered pursuant to this Section 2 are correct on
and as of the date of such certificate as though made on and as of such date
other than any such representations or warranties that, by their terms, refer to
a date other than the date of such certificate; and
(ii) No event has occurred and is continuing that constitutes a Default or
an Event of Default.
This Amendment is subject to the provisions of Section 12.01 of the Credit
Agreement.
SECTION 3. Representations and Warranties of the Company
The Company represents and warrants to Administrative Agent and the Lenders as
follows:
3.1 Incorporation of Representation and Warranties from Agreement. The
------------------------------------------------------------------
representations and warranties contained in the Credit Agreement, as amended
hereby, and in the other Loan Documents are true and correct in all material
respects at and as of the Sixth Amendment Effective Date (except to the extent
specifically made with regard to a particular date in which case such
representations and warranties shall be true and correct as of such date).
3.2 Absence of Default or Event of Default. Before and after giving effect
---------------------------------------
to this Amendment, no Default or Event of Default exists, will exist or will be
continuing.
3.3 Corporate Power and Authority. The Company has the corporate power and
------------------------------
authority to execute, deliver and perform the terms and provisions of this
Amendment and has taken all necessary corporate action to authorize the
execution, delivery and performance by it of this Amendment.
3.4 No Additional Consents Required. No authorization or approval or other
--------------------------------
action by, and no notice to or filing or registration with, any Person is
required in connection with, the execution, delivery and performance hereof
other than those obtained and in full force and effect.
3.5 Binding Obligation. This Amendment has been duly executed and delivered
------------------
by the Company and is the legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and general principles of equity (regardless of whether
enforcement is sought in equity or at law).
3.6 No Violation or Conflict. Neither the execution, delivery and
---------------------------
performance of this Amendment by the Company nor the consummation of the
transactions contemplated hereby will (i) contravene any provision of any
Requirement of Law applicable to the Company or (ii) conflict with or result in
a breach by the Company of any Organizational Document.
3.7 Good Standing. On the Sixth Amendment Effective Date, the Company is a
--------------
duly organized and validity existing corporation in good standing in its state
of incorporation.
3.8 No Amendments to Bylaws. A true and complete copy of the bylaws of the
------------------------
Company has been delivered to Administrative Agent prior to or on the date of
this Amendment.
SECTION 4. Reference to and Effect on the Credit Agreement
------------------------------------------------------
On and after the date hereof each reference in the Credit Agreement to "this
Agreement," "hereunder," "hereof," "herein," or words of like import, and each
reference to the Credit Agreement in the Loan Documents and all other documents
(the "Ancillary Documents") delivered in connection with the Credit Agreement,
--------------------
shall mean and be a reference to the Credit Agreement as amended hereby.
Except as specifically amended above, the Credit Agreement and the other Loan
Documents shall remain in full force and effect and are hereby ratified and
confirmed.
The execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy of
the Lenders or Administrative Agent under the Credit Agreement or the other Loan
Documents.
SECTION 5. Fees, Costs and Expenses. On the Sixth Amendment Effective Date,
--------------------------
(a) the Company agrees to pay a fee to the Administrative Agent on behalf of
each Lender (other than any Lender who has waived such fee) which has executed
and delivered this Amendment on or prior to 12:00 noon, E.S.T. on November 9,
2001 (or at any other time otherwise agreed by the Borrower) equal to 10 bps
times the Commitment of such Lender as in effect under the Credit Agreement on
the Sixth Amendment Effective Date; (b) the Company agrees to pay to the
Administrative Agent for the Administrative Agent's own account those fees
specified in that certain Fee Letter dated as of November 9, 2001 among the
Company and the Administrative Agent; and (c) the Company also agrees to pay all
reasonable costs and expenses in connection with the negotiation, preparation,
printing, typing, reproduction, execution and delivery of this Amendment and all
other documents furnished pursuant hereto or in connection herewith, including
without limitation, the reasonable fees and out-of-pocket expenses of Shearman &
Sterling, special counsel to Administrative Agent, or the reasonable allocated
costs of staff counsel as well as the fees and out-of-pocket expenses of
counsel, independent public accountants and other outside experts retained by
Administrative Agent in connection with the administration of this Amendment.
SECTION 6. Reaffirmation of Guaranties. Each Subsidiary Guarantor as a
-----------------------------
guarantor of the Obligations under the Subsidiary Guaranty and the other Loan
Documents, hereby reaffirms its continuing obligations and liabilities
thereunder, and agrees that such Subsidiary Guaranty and the other Loan
Documents shall remain in full force and effect and cover and extend to all
Obligations under the Credit Agreement (as amended hereby).
SECTION 7. Execution in Counterparts. This Amendment may be executed in
---------------------------
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same instrument. Delivery of an executed counterpart of a signature page to
this Amendment by facsimile transmission shall be effective as delivery of a
manually executed counterpart of this Amendment.
SECTION 8. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
-------------
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
[signature pages follow]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.
MacDERMID, INCORPORATED
By: John Cordani
-------------
Title: Secretary
MacDERMID TOWER, INC.
MacDERMID TARTAN, INC.
MacDERMID ACUMEN, INC.
MacDERMID EQUIPMENT, INC.
MacDERMID SOUTH ATLANTIC, INC.
MacDERMID OVERSEAS ASIA,
LIMITED
MacDERMID EUROPE, INC.
MacDERMID DELAWARE, INC.
MacDERMID INVESTMENTS
CORPORATION
MacDERMID SOUTH AMERICA, INC.
SPECIALTY POLYMERS, INC.
ECHO INTERNATIONAL, INC.
MCD ACQUISITION CORP.
W. CANNING, INC.
W. CANNING USA, LLC
DYNACIRCUITS, LLC
CANNING GUM, LLC
MacDERMID GRAPHIC ARTS, INC.
MacDERMID-PTI, INC.
SUPRATECH SYSTEMS INC.
NAPP SYSTEMS INC.
By: John Cordani
-------------
Title: Secretary
BANK OF AMERICA, N.A.,
as Administrative Agent and Individually as a Lender, the Swing Line Lender and
as the Issuing Bank
By: Wendy J. Gorman
-----------------
Title: Principal
MacDERMID COLORSPAN INCORPORATED
AXCYL INCORPORATED
By: John Cordani
-------------
Title: Secretary
FLEET NATIONAL BANK, as Syndication Agent and as a Lender
By: Janet G. O'Donnell
--------------------
Title: Managing Director
THE BANK OF NEW YORK, as Co-Agent and as a Lender
By: Melinda White
--------------
Title: VP
FIRST UNION NATIONAL BANK, as Co-Agent and as a Lender
By: Robert Brown
-------------
Title: Vice President
LLOYDS TSB BANK PLC as Co-Agent and as a Lender
By: Ian Dimmock
------------
Title: Vice President Acquisition Finance
By:
Title:
THE CHASE MANHATTAN BANK
By: Stacey Haimes
--------------
Title: VP
COMERICA BANK
By: John M. Costa
---------------
Title: First Vice President
BANK ONE, N.A. (f/k/a/ THE FIRST NATIONAL BANK OF CHICAGO)
By:
Title:
ABN AMRO BANK N.V.
Title:
By: George Dugan
-------------
Title: Vice President
BANK OF MONTREAL
By: Brian Hunter
-------------
Title: Director
BANK OF TOYKO-MITSUBISHI TRUST
COMPANY
By: Pamela Donnelly
----------------
Title: Vice President
DG BANK DEUTSCHE
GENOSSENSCHAFTSBANK AG, CAYMAN
ISLAND BRANCH
By: Ya-Roo Yang
------------
Title: Assistant Vice President
By: Bernd Henrik Franke
---------------------
Title: Vice President
THE ROYAL BANK OF SCOTLAND plc
By:
Title:
UNICREDITO ITALIANO S.p.A., New York Branch
By:
Title:
By:
Title:
HSBC BANK USA
By: Alan Vitulich
--------------
Title: Vice President
FORTIS (USA) FINANCE LLC
By: E. Matthews
------------
Title:
WACHOVIA BANK, N.A.
By: Robert Wilson
--------------
Title: Vice President
CREDIT SUISSE FIRST BOSTON
By: James P. Moran
----------------
Title: Director
SCHEDULE I TO
SIXTH AMENDMENT TO CREDIT AGREEMENT
MACDERMID INCORPORATED
WORLDWIDE LINES OF CREDIT
USD CONVERSIONS
FACILITY/OPERATION BANK AMOUNT- USD
- ------------------------- ------------------ -----------
MacDermid Inc Bank of America 215,000,000
Eurocir Group Various 30,000,000
MacDermid Canning UK Barclays 15,000,000
MacDermid US Operations Fleet 7,000,000
MacDermid Benelux Fortis 5,000,000
MacDermid Taiwan HSBC 2,500,000
MacDermid Asia Chase 2,100,000
MacDermid Hong Kong Chase 2,100,000
MacDermid Hong Kong HSBC 2,000,000
MacDermid Singapore HSBC 1,800,000
MacDermid Japan BTM 2,000,000
MacDermid Japan Dai-Ichi Kangyo 900,000
MacDermid Italiana Banco San Paolo 850,000
MacDermid Sweden Handelsbanken 625,000
MacDermid France Banque Populaire 600,000
MacDermid Italiana Banco Pop Dimilano 450,000
MacDermid Italiana Banco Ambrovenelo 375,000
MacDermid Italiana Banco Cariplo 328,000
MacDermid Canada Commerce Bank 325,000
MacDermid Italiana Banco Pop Veneta 280,000
MacDermid Italiana Banc Sella Spa 250,000
MacDermid France Soc Lyonnaise 200,000
MacDermid Australia Chase 200,000
MacDermid France Banque Worms 200,000
MacDermid Germany Spar Kasse 50,000
-----------
290,133,000