EXHIBIT 4.5 (iii)
BARNES GROUP INC.
AMENDMENT NO. 2 TO NOTE AGREEMENT
As of February 5, 2003
To each of the Current Noteholders
Named in Annex 1 hereto
Ladies and Gentlemen:
Barnes Group Inc., a Delaware corporation (hereinafter, the "Company"),
together with its successors and assigns, agrees with you as follows:
1. PRELIMINARY STATEMENTS.
1.1 NOTE ISSUANCE, ETC.
The Company issued and sold $60,000,000 aggregate principal amount of
its 8.59% Senior Notes due November 21, 2008 (as may be amended, restated or
otherwise modified from time to time, the "Notes") pursuant to a Note Agreement,
as amended by Amendment No. 1 to Note Agreement (the "Existing Note Agreement"
and, as amended by this Amendment No. 2 to Note Agreement (this "Amendment
Agreement"), the "Note Agreement"), dated as of November 21, 2000, and entered
into by and among the Company and each of the Purchasers listed in Exhibit A
attached thereto. The register for the registration and transfer of the Notes
indicates that the Persons named in Annex 1 hereto (collectively, the "Current
Noteholders") are currently the holders of the entire outstanding principal
amount of the Notes.
2. DEFINED TERMS.
Capitalized terms used herein and not otherwise defined herein have the
meanings ascribed to them in the Note Agreement.
3. AMENDMENT.
Subject to Section 5, the Existing Note Agreement is amended as provided
for by this Amendment Agreement in the manner specified in Exhibit A (the
"Amendment").
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4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
To induce you to enter into this Amendment Agreement and to consent to
the Amendment, the Company represents and warrants as follows:
4.1. ORGANIZATION, POWER AND AUTHORITY, ETC.
The Company is a corporation duly incorporated and validly existing in
good standing under the laws of Delaware and has all requisite corporate power
and authority to enter into and perform its obligations under this Amendment
Agreement.
4.2. LEGAL VALIDITY.
The execution and delivery of this Amendment Agreement by the Company
and compliance by the Company with its obligations hereunder: (a) are within the
corporate powers of the Company; and (b) are legal and do not conflict with,
result in any breach of, constitute a default under, or result in the creation
of any Lien upon any Property of the Company under the provisions of: (i) any
charter instrument or bylaw to which the Company is a party or by which the
Company or any of its Property may be bound; (ii) any order, judgment, decree or
ruling of any court, arbitrator or governmental authority applicable to either
the Company or its Property; or (iii) any agreement or instrument to which the
Company is a party or by which the Company or any of its Property may be bound
or any statute or other rule or regulation of any governmental authority
applicable to the Company or its Property.
This Amendment Agreement has been duly authorized by all necessary
action on the part of the Company, has been executed and delivered by a duly
authorized officer of the Company, and constitutes a legal, valid and binding
obligation of the Company, enforceable in accordance with its terms, except that
enforceability may be limited by applicable bankruptcy, reorganization,
arrangement, insolvency, moratorium, or other similar laws affecting the
enforceability of creditors' rights generally and subject to the availability of
equitable remedies.
4.3. NO DEFAULTS.
No event has occurred and no condition exists that, upon the execution
and delivery of this Amendment Agreement, would constitute a Default or an Event
of Default.
5. EFFECTIVENESS OF AMENDMENT.
The Amendment shall become effective as of the first date written above
(the "Effective Date") upon:
(a) execution and delivery of a counterpart of this Amendment
Agreement by the Company and the holders of 66-2/3% of the aggregate outstanding
principal amount of the Notes;
(b) delivery by the Company of a fully executed copy of the Kar
Guaranty (as defined below) dated as of February 5, 2003 from Kar Products, LLC,
a Delaware limited liability
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company, in favor of (i) Fleet National Bank, a national banking association, as
administrative agent (in such capacity, the "Administrative Agent") for itself
and the other lending institutions (collectively, the "Bank Lenders") which are
or may become parties to a Revolving Credit Agreement dated as of June 14, 2002
by and among the Company, the Bank Lenders, the Administrative Agent and the
Documentation Agents (as such term is defined in the Credit Agreement) (the
"Credit Agreement"), (ii) each of the Bank Lenders, (iii) each of the holders of
the Notes and (iv) each of the other financial institutions named therein,
guarantying the payment and other obligations of the Company under the Credit
Agreement, the Note Agreement and the other agreements listed therein (including
(x) the Note Purchase Agreement dated as of December 1, 1995, by and among the
Company and each of the purchasers listed on Schedule A attached thereto (the
"1995 Note Agreement") and (y) the separate Note Agreements, each dated as of
November 12, 1999, by and among 3031786 Nova Scotia Company, a Nova Scotia
company, the Company as guarantor and each of the purchasers listed on Schedule
A attached thereto (collectively, the "Nova Scotia Agreement")) (the "Kar
Guaranty");
(c) delivery by the Company of a fully executed copy of (i) an
amendment to the 1995 Note Agreement, dated the date hereof, and (ii) an
amendment to the Nova Scotia Agreement; and
(d) delivery by the Company of a fully executed copy of an amendment
to the Credit Agreement, dated the date hereof.
6. EXPENSES.
Whether or not the Amendment becomes effective, the Company will
promptly (and in any event within thirty days of receiving any statement or
invoice therefor) pay all fees, expenses and costs relating to this Amendment
Agreement, including, but not limited to, the reasonable fees of your special
counsel, Bingham McCutchen LLP, incurred in connection with the preparation,
negotiation and delivery of this Amendment Agreement and any other documents
related thereto. Nothing in this Section shall limit the Company's obligations
pursuant to Section 1.5 of the Existing Note Agreement.
7. MISCELLANEOUS.
7.1. PART OF EXISTING NOTE AGREEMENT; FUTURE REFERENCES, ETC.
This Amendment Agreement shall be construed in connection with and as a
part of the Existing Note Agreement and, except as expressly amended by this
Amendment Agreement, all terms, conditions and covenants contained in the
Existing Note Agreement are hereby ratified and shall be and remain in full
force and effect. Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of this
Amendment Agreement may refer to the Existing Note Agreement without making
specific reference to this Amendment Agreement, but nevertheless all such
references shall include this Amendment Agreement unless the context otherwise
requires.
7.2. COUNTERPARTS; EFFECTIVENESS.
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This Amendment Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which together shall constitute
one instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
Delivery of an executed signature page by facsimile transmission shall be
effective as delivery of a manually signed counterpart of this Amendment
Agreement.
7.3. GOVERNING LAW.
THIS AMENDMENT AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE
OF CONNECTICUT EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT
WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN
CONNECTICUT.
[Remainder of page intentionally left blank; next page is signature page.]
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If you are in agreement with the foregoing, please so indicate by
signing the acceptance below on the accompanying counterpart of this Amendment
Agreement and returning it to the Company, whereupon it will become a binding
agreement among each of you and the Company.
BARNES GROUP INC.
By: /s/ William C. Denninger
Name: William C. Denninger
Title: Senior Vice President-Finance
and Chief Financial Officer
By: /s/ Lawrence W. O'Brien
Name: Lawrence W. O'Brien
Title: Vice President and Treasurer
The foregoing Amendment Agreement is hereby accepted as of the date
first above written.
THE PRUDENTIAL INSURANCE COMPANY OF
AMERICA
By: /s/ Kevin Kraska
Name: Kevin Kraska
Title: Vice President
ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Jerry D. Zinkula
Name: Jerry D. Zinkula
Title:
By: /s/ Robert B. Bodett
Name: Robert B. Bodett
Title:
Authorized Signatories
AMERICAN HERITAGE LIFE INSURANCE
COMPANY
By: /s/ Jerry D. Zinkula
Name: Jerry D. Zinkula
Title:
By: /s/ Robert B. Bodett
Name: Robert B. Bodett
Title:
Authorized Signatories
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NATIONWIDE LIFE INSURANCE COMPANY
By: /s/ Joseph P. Young
Name: Joseph P. Young
Title: Credit Officer
Fixed Income Securities
NATIONWIDE LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Joseph P. Young
Name: Joseph P. Young
Title: Credit Officer
Fixed Income Securities
NATIONWIDE INDEMNITY COMPANY
By: /s/ Joseph P. Young
Name: Joseph P. Young
Title: Credit Officer
Fixed Income Securities
ANNEX 1
CURRENT NOTEHOLDERS AND
CURRENT OUTSTANDING PRINCIPAL AMOUNT
Current Noteholders Outstanding Principal Amount of Notes
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The Prudential Insurance Company $ 35,000,000
of America
Allstate Life Insurance Company $ 10,000,000
American Heritage Life Insurance $ 5,000,000
Company
Nationwide Life Insurance Company $ 4,000,000
Nationwide Life and Annuity Insurance $ 2,000,000
Company
Nationwide Indemnity Company $ 4,000,000
TOTAL $ 60,000,000
EXHIBIT A
AMENDMENT
1. Section 7.7 (Indebtedness) of the Existing Note Agreement is hereby
amended and restated in its entirety to read as follows:
"Section 7.7 Indebtedness. (a) The Company will not permit any of its
Subsidiaries to, directly or indirectly, incur, create, assume or permit to
exist any Indebtedness (other than the Kar Guaranty) unless (i) all
Indebtedness, plus the aggregate liquidation preference or redemption value of
all Preferred Stock, of Subsidiaries (other than Indebtedness owing to, or
Preferred Stock held by, the Company or other Subsidiaries, and other than the
Nova Scotia Notes), plus (ii) all Indebtedness of the Company secured by Liens
permitted to exist by Section 7.6(a)(vii), shall not at any time exceed 15% of
Consolidated Tangible Assets determined as of the end of the then most recently
completed fiscal year of the Company.
(b) The Company shall not, and shall not permit any Subsidiary to, make any
Investment in, or otherwise transfer any Property to or guaranty or otherwise
assume or be liable for any Indebtedness or other obligations of, 3031786 Nova
Scotia Company so long as the Nova Scotia Notes shall be outstanding, provided,
however, that this Section 7.7(b) shall not (i) prohibit the Kar Guaranty, (ii)
prohibit the Company from guarantying the payment and obligations of 3031786
Nova Scotia Company under the Nova Scotia Notes, (iii) prevent or restrict
3031786 Nova Scotia Company from continuing to operate as a special purpose
financing vehicle company in compliance with the laws and regulations of Canada
and the United States of America or (iv) prevent or restrict the Company or any
Subsidiary from transferring funds to 3031786 Nova Scotia Company in an amount
equal to, but not more than, the amount necessary (x) to pay interest on and
fees in respect of, or repay the principal of, the Nova Scotia Notes in
accordance with the terms thereof, and (y) to pay fees and expenses of 3031786
Nova Scotia Company so long as it operates solely as a special purpose financing
vehicle company in compliance with the laws and regulations of Canada and the
United States of America. The amount necessary to make any such payment, or to
pay any such fees or expenses, may not be so transferred more than five Business
Days before the due date thereof, except that up to $500,000 of any such amount
may be so transferred more than five Business Days before such due date."
2. Clause (d) of Section 7.16 (Restricted Payments and Restricted
Investments) of the Existing Note Agreement shall be amended and restated in its
entirety to read as follows:
"(d) loans or advances made by the Company to any of its Subsidiaries and
loans or advances made by any Subsidiary of the Company to the Company or
another such Subsidiary, or an investment made by the Company in a Person
pursuant to which, immediately after giving effect to such investment, such
Person becomes a Subsidiary of the Company,"
3. Clause (e) of Section 7.16 (Restricted Payments and Restricted
Investments) of the Existing Note Agreement shall be amended and restated in its
entirety to read as follows:
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"(e) in addition to those investments permitted by Section 7.16(d) hereof,
purchases of stock or other Securities of any corporations, associations or
other business entities; provided, however, that the aggregate cost to, or Fair
Market Value of the consideration paid by, the Company and its Subsidiaries for
such stock or Securities of all such corporations, associations or other
business entities shall not exceed the sum of (A) $25,000,000, plus (B) 50% of
Consolidated Net Income for the period commencing on December 31, 1999 and
ending on the date of such stock or Securities purchase (or minus 100% of
Consolidated Net Income for such period if Consolidated Net Income for such
period is a loss), or"
4. The definition of "Kar Guaranty" shall be added to Section 10.1 (Terms
Defined) of the Existing Note Agreement in the appropriate alphabetical order
thereof to read as follows:
""Kar Guaranty" means that certain Guaranty dated as of February 5, 2003 from
Kar Products, LLC, a Delaware limited liability company, in favor of (i) Fleet
National Bank, a national banking association, as administrative agent (in such
capacity, the "Administrative Agent") for itself and the other lending
institutions (collectively, the "Bank Lenders") which are or may become parties
to a Revolving Credit Agreement dated as of June 14, 2002 by and among the
Company, the Bank Lenders, the Administrative Agent and the Documentation Agents
(as such term is defined in the Credit Agreement) (the "Credit Agreement"), (ii)
each of the Bank Lenders, (iii) each of the holders of the Notes and (iv) each
of the other financial institutions named therein, guarantying the payment and
other obligations of the Company under the Credit Agreement, the Note Agreement
and the other agreements listed therein (including (x) the Note Purchase
Agreement dated as of December 1, 1995, by and among the Company and each of the
purchasers listed on Schedule A attached thereto (the "1995 Note Agreement") and
(y) the separate Note Agreements, each dated as of November 12, 1999, by and
among 3031786 Nova Scotia Company, a Nova Scotia company, the Company as
guarantor and each of the purchasers listed on Schedule A attached thereto
(collectively, the "Nova Scotia Agreement"))."