AMENDMENT, RELEASE AND WAIVER NO. 1
AMENDMENT, RELEASE AND WAIVER NO. 1 dated as of December 4,
1998 by and among BE Aerospace, Inc., a Delaware corporation (the "Company"),
In-Flight Entertainment, LLC, a Delaware limited liability company
("In-Flight"), the lenders party hereto (the "Lenders") and The Chase Manhattan
Bank, as administrative agent (the "Administrative Agent").
WHEREAS the Company, the Lenders and the Administrative Agent
are party to a Fifth Amended and Restated Credit Agreement dated as of October
29, 1993, amended and restated as of August 7, 1998 (as amended, supplemented
and otherwise modified and in effect to but excluding the date hereof, the
"Credit Agreement").
WHEREAS In-Flight and the Administrative Agent are parties to
an Amended and Restated Guarantee and Security Agreement (the "In-Flight
Guarantee and Security Agreement") providing, inter alia, for the guarantee by
In-Flight of the obligations of the Company under the Credit Agreement.
WHEREAS the Company and the Administrative Agent are parties
to an Amended and Restated Security Agreement (the "Security Agreement")
providing, inter alia, for the pledge by the Company, as collateral security for
the payment of the obligations of the Company under the Credit Agreement, of all
of the membership interests of In-Flight owned by the Company.
WHEREAS the Company has advised the Lenders and the
Administrative Agent that the Company wishes to (i) sell, at any time or from
time to time, all or any part of the membership interests it holds in In-Flight
(collectively, the "In-Flight Disposition"), (ii) transfer certain assets of
Puritan-Bennett Aero Systems Corp. ("Puritan-Bennett") associated with the
business of In-Flight in an amount not to exceed $2,000,000 to a special purpose
subsidiary of the Company ("Puritan-Bennett Subsidiary") after which the Company
shall then transfer all of the issued and outstanding stock of Puritan-Bennett
Subsidiary to In-Flight (the "Puritan-Bennett Transfer") and (iii) terminate the
In-Flight Guarantee and Security Agreement and release the remaining membership
interests of In-Flight owned by the Company from the Collateral under the
Security Agreement. Therefore, the Company has requested that the Lenders agree,
and the Lenders party hereto are willing, on the basis set forth herein, to
waive and amend various provisions contained in Sections 8.05, 8.08 and 8.17 of
the Credit Agreement and to consent to the termination of the In-Flight
Guarantee and Security Agreement and the release of the remaining membership
interests of In-Flight from the Collateral, all on the terms and conditions of
this Amendment, Release and Waiver No. 1. Capitalized terms used but not defined
herein shall have the respective meanings ascribed to such terms in the Credit
Agreement.
NOW THEREFORE in consideration of the premises and the mutual
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Section 1. WAIVER, TERMINATION AND RELEASE.
(a) Subject to the satisfaction of the conditions to
effectiveness specified in Section 5 hereof, but with effect on the date hereof,
each of the Lenders hereby agrees with the Company that:
(i) any violation of Section 8.05 of the Credit Agreement
shall be waived to the extent necessary to permit the In-Flight
Disposition;
(ii) any violation by the Company or Puritan-Bennett of
Section 8.08(d) of the Credit Agreement shall be waived to the extent
necessary to permit the Puritan-Bennett Transfer and any investment by
the Company or Puritan-Bennett in connection therewith shall not
constitute an Investment for the purpose of Section 8.08(d); and
(iii) Section 8.17 of the Credit Agreement, which requires
that the Company maintain its ownership interest in each of its
Subsidiaries and prohibits the sale, transfer, pledge or disposal of
such ownership interests, shall be waived to the extent necessary to
permit the In-Flight Disposition.
(b) Subject to the satisfaction of the conditions to
effectiveness specified in Section 5 hereof, but with effect on the date of the
initial In-Flight Disposition, each of the Lenders hereby further agrees with
the Company that In-Flight shall be released from its obligations under the
In-Flight Guarantee and Security Agreement.
(c) Subject to the satisfaction of the conditions to
effectiveness specified in Section 5 hereof, but with effect on the date of the
initial In-Flight Disposition, each of the Lenders hereby further agrees with
the Company that, all membership interests of In-Flight owned by the Company
shall be released from the Collateral under the Security Agreement.
Section 2. AMENDMENTS. Subject to the satisfaction of the
conditions precedent specified in Section 5 hereof, but with effect on the date
hereof, the Credit Agreement shall be amended as follows:
(a) Section 8.08(d) shall be amended to read in its entirety:
"(d) Investments by the Company in Subsidiaries of the Company
in the ordinary course of business; provided that (i) the aggregate
amount of the Investments by the Company or any of its Subsidiaries in
the Specified Subsidiaries shall not exceed $5,000,000 at any one time
outstanding and (ii) the aggregate amount of Customer Obligations (as
defined in paragraph (h) below) that are not fully secured (whether by
a perfected Lien on, or an indefeasible title retention to, the
products so sold or leased, or otherwise) plus the aggregate fair
market value of all Property (whether now owned or hereafter acquired)
of the Company or any of its Subsidiaries (as determined in good faith
by the chief financial officer of the Company) sold, assigned,
transferred or otherwise disposed of on or after December 2, 1998 to
any Minority-Owned Entities (as defined in paragraph (h) below) plus
the aggregate book value (at the time of its transfer) of all Property
(not including cash and not including any Property that is subject to a
Lien in favor of the Administrative Agent for the benefit of the
Lenders) transferred by the Company to any one or more Subsidiaries
since December 2, 1998 minus any cash dividends or other distributions
received by the Company from any Minority-Owned Entity (as defined in
paragraph (h) below) since December 2, 1998 shall not exceed in the
aggregate at any one time outstanding the greater of (x) $25,000,000
and (y) 5% of Adjusted Net Worth as of the most recent Fiscal Date for
which financial statements have been provided hereunder; provided
further, that any increase in the net worth of any Minority-Owned
Entity (determined in accordance with GAAP) shall not be considered in
determining the amounts under (x) and (y) above;"
(b) Section 8.08(h) shall be amended to read in its entirety:
"(h) Investments of the Company and its Subsidiaries (i) in
corporations, companies, limited liability companies, partnerships and
other entities in each case that are not, or do not thereby become,
Subsidiaries of the Company ("Minority-Owned Entities") or (ii)
representing obligations of customers owing to the Company and its
Subsidiaries in respect of the deferred purchase price of products or
services sold or the leasing of products to customers ("Customer
Obligations"), in each case in the ordinary course of business of the
Company and its Subsidiaries as provided for in Section 8.14 hereof and
on such terms as the management of the Company may determine in its
reasonable business judgment, provided that the aggregate amount of
such Customer Obligations that are not fully secured (whether by a
perfected Lien on, or an indefeasible title retention to, the products
so sold or leased, or otherwise) plus the aggregate fair market value
of all Property (whether now owned or hereafter acquired) of the
Company or any of its Subsidiaries (as determined in good faith by the
chief financial officer of the Company) sold, assigned, transferred or
otherwise disposed of on or after December 2, 1998 to any such
Minority-Owned Entities plus the aggregate book value (at the time of
its transfer) of all Property (not including cash and not including
Property that is subject to a Lien in favor of the Administrative Agent
for the benefit of the Lenders) transferred by the Company to any one
or more Subsidiaries since December 2, 1998 minus any cash dividends or
other distributions received by the Company from any Minority-Owned
Entity since December 2, 1998 shall not exceed in the aggregate at any
one time outstanding the greater of (x) $25,000,000 and (y) 5% of
Adjusted Net Worth as of the most recent Fiscal Date for which
financial statements have been provided hereunder; provided further,
that any increase in the net worth of any Minority-Owned Entity
(determined in accordance with GAAP) shall not be considered in
determining the amounts under (x) and (y) above."
Section 3. REPRESENTATIONS AND WARRANTIES. The Company hereby
represents and warrants to the Lenders and the Administrative Agent that this
Amendment, Release and Waiver No. 1 has been duly and validly executed and
delivered by the Company and constitutes the Company's legal and valid
obligation, enforceable in accordance with its terms. The Company further
represents and warrants to the Lenders and the Administrative Agent that both
before and after giving effect to this Amendment, Release and Waiver No. 1 (i)
no Default has occurred and is continuing and (ii) the representations and
warranties made by the Company in Section 7 of the Credit Agreement are true and
complete on and as of the date hereof with the same force and effect as if made
on and as of such date (or, if any such representation or warranty is expressly
stated to have been made as of a specific date, as of such specific date). It
shall be an Event of Default for all purposes of the Credit Agreement (as
amended hereby) if any representation, warranty or certification made by the
Company in this Amendment, Release and Waiver No. 1, or in any certificate or
other writing furnished to any Lender or the Administrative Agent pursuant to
this Amendment, Release and Waiver No. 1, shall prove to have been incorrect as
of the time made or furnished in any material respect.
Section 4. DOCUMENTS OTHERWISE UNCHANGED. The parties hereto
agree that, except as expressly provided herein, the Credit Agreement and the
Security Agreement shall remain unchanged and in full force and effect.
Section 5. CONDITIONS TO EFFECTIVENESS. The waivers set forth
in Section 1 hereof and the amendments to the Credit Agreement set forth in
Section 2 hereof shall be subject to the satisfaction of each of the following
conditions to effectiveness:
(a) the Administrative Agent shall have received one or more
counterparts of this Amendment, Release and Waiver No. 1 duly executed
by the Company, In-Flight, the Majority Lenders and the Administrative
Agent; and
(b) the Administrative Agent shall have received satisfactory
evidence from the chief financial officer of the Company as to the Net
Available Proceeds that the Company shall receive in connection with
the sale of the membership interests of In-Flight and the chief
financial officer shall have given the Administrative Agent irrevocable
notice that such Net Available Proceeds shall be applied to the
prepayment of the Series B Loans.
Section 6. COUNTERPARTS. This Amendment, Release and Waiver
No. 1 may be executed in any number of counterparts, each of which
shall be identical and all of which, when taken together, shall
constitute one and the same instrument, and any of the parties
hereto may execute this Amendment, Release and Waiver No. 1 by
signing any such counterpart.
Section 7. EXPENSES. Without limiting its obligations under
Section 11.03 of the Credit Agreement, the Company agrees to pay, on demand, all
reasonable out-of-pocket costs and expenses of the Administrative Agent
(including, without limitation, reasonable fees and expenses of Milbank, Tweed,
Hadley & McCloy, special counsel to the Administrative Agent) incurred in
connection with the negotiation, preparation, execution and delivery of this
Amendment, Release and Waiver No. 1.
Section 8. BINDING EFFECT. This Amendment, Release and Waiver
No. 1 shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns.
Section 9. GOVERNING LAW. This Amendment, Release and Waiver
No. 1 shall be governed by, and construed in accordance with, the law of the
State of New York.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment, Release and Waiver No. 1 to be duly executed as of the date first
above written.
BE AEROSPACE, INC.
By_______________________
Name:
Title:
Address for Notices:
BE Aerospace, Inc.
1400 Corporate Center Way
Wellington, Florida 33414
Attention: Jeffrey P. Holtzman,
Vice President and Treasurer
Telecopier No.: (561) 791-3966
Telephone No.: (561) 791-5000
with a copy to:
Ropes & Gray
One International Place
Boston, MA 02110
Attention: Winthrop G. Minot, Esq.
Telecopier No.: (617) 951-7050
Telephone No.: (617) 951-7000
IN-FLIGHT ENTERTAINMENT, LLC
By BE Aerospace, Inc., Member
By_______________________
Name:
Title:
Address for Notices:
In-Flight Entertainment, LLC
17481 Red Hill Avenue
Irvine, California 92614
Attention: Thomas P. McCaffrey
Telephone No.:
Telecopier No.:
LENDERS
THE CHASE MANHATTAN BANK
By_______________________
Name:
Title:
NATIONSBANK, N.A.
By_______________________
Name:
Title:
CREDIT LYONNAIS ATLANTA AGENCY
By_______________________
Name:
Title:
LASALLE BUSINESS CREDIT, INC.
By_______________________
Name:
Title:
THE LONG-TERM CREDIT BANK
OF JAPAN, LTD.
By_______________________
Name:
Title:
THE FUJI BANK AND TRUST COMPANY
By_______________________
Name:
Title:
WACHOVIA BANK, N.A.
By_______________________
Name:
Title:
AMSOUTH BANK
By_______________________
Name:
Title:
THE BANK OF NEW YORK
By_______________________
Name:
Title:
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK,
CAYMAN ISLAND BRANCH
By_______________________
Name:
Title:
By_______________________
Name:
Title:
FIRST UNION NATIONAL BANK
By_______________________
Name:
Title:
SUNTRUST BANK, SOUTH FLORIDA, N.A.
By_______________________
Name:
Title:
ABN AMRO BANK N.V.
By_______________________
Name:
Title:
By_______________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By_______________________
Name:
Title:
Address for Notices to
Chase as Administrative Agent:
The Chase Manhattan Bank
Loan and Agency Services Group
1 Chase Manhattan Plaza
New York, New York 10081