EXHIBIT 10.16
WAIVER EXTENSION AND SECOND AMENDMENT, dated as of November 9, 2001 (this
"Waiver Extension"), among Formica Corporation, a Delaware corporation (the
"Company"), Formica Limited, a company incorporated under the laws of England
and Wales (the "U.K. Revolver Borrower"), Formica Holdco (UK) Limited, a
company incorporated under the laws of England and Wales (the "U.K. Term
Borrower"), Formica Canada, Inc., a corporation organized and existing under
the laws of Canada (the "Canadian Borrower"), Formica S.A., a societe anonyme
organized and existing under the laws of the French Republic (the "French
Revolver Borrower"), Formica Espanola S.A., a sociedad anonima organized and
existing under the laws of the Kingdom of Spain (the "Spanish Revolver
Borrower"; and collectively with the Company, the U.K. Revolver Borrower, the
U.K. Term Borrower, the Canadian Borrower, the French Revolver Borrower and the
Spanish Revolver Borrower, the "Borrowers"), the various financial institutions
as are or may become parties hereto (collectively, the "Lenders") and Bankers
Trust Company ("BTCo"), as administrative agent (the "Administrative Agent")
for the Lenders.
The Borrowers and the Lenders are parties to the Second Amended and
Restated Credit Agreement, dated as of May 26, 2000 (as amended by the Initial
Waiver (as defined below), the "Original Credit Agreement"; and following the
Effective Date (as hereinafter defined), as amended by this Waiver Extension,
and as it may be further amended, modified or supplemented from time to time
thereafter, the "Credit Agreement") pursuant to which the Lenders have advanced
Loans and the Issuers have issued Letters of Credit (as such terms are defined
in the Original Credit Agreement) to the Borrowers upon the terms and
conditions set forth therein.
The Borrowers and Lenders are parties to the Waiver and First Amendment,
dated as of August 13, 2001 ("Initial Waiver"), pursuant to which, among other
matters, the Lenders waived certain financial covenant Defaults under the
Credit Agreement for the period from August 13, 2001 until November 9, 2001
(the "Initial Waiver Period") and amended certain other terms and conditions of
the Original Credit Agreement.
The Borrowers have requested that the Lenders extend the waivers set forth
in the Initial Waiver and First Amendment beyond the Initial Waiver Period
until February 9, 2002 (such period, "the "Waiver Extension Period", and
combined with the Initial Waiver Period, the "Waiver Period") and amend certain
other terms and conditions of the Original Credit Agreement, as set forth
below.
Accordingly, for good and valuable consideration, the receipt and adequacy
of which hereby are acknowledged, and subject to the fulfillment of the
conditions set forth below, the parties hereto hereby agrees as follows:
1. Defined Terms. Unless otherwise specifically defined herein, all
capitalized terms used herein shall have the respective meanings set forth in
the Credit Agreement.
2. Waiver. (a) The Required Lenders hereby continue to waive compliance by
the Company during the Waiver Period (as extended through the Waiver Extension
Period) with the financial covenants set forth in Section 7.2.4 of the Original
Credit Agreement; provided, however, that the effectiveness of this waiver
shall not permit an Authorized Officer of the Company to deliver
to the Administrative Agent (and the Company agrees that, during the Waiver
Period, it shall not deliver) a compliance certificate in the manner
contemplated under Section 7.2.6(c)(iii) of the Credit Agreement. The waiver
contained in this Section 2 is expressly limited to the covenants and time
period set forth herein.
(b) The Required lenders hereby waive permanently the requirement for the
delivery of an opinion of counsel as set forth in Section 5(b) of the Initial
Waiver.
3. Amendments. Effective as of the Effective Date, the Original Credit
Agreement is hereby amended as follows:
(a) Section 1.1 of the Original Credit Agreement is hereby amended by
adding the following new defined terms and placing them in their respective
appropriate alphabetical locations:
"'Extension Period' means the period from November 9, 2001 until and
including February 9, 2002."
"'Initial Waiver Period' means the period from August 13, 2001 until
November 8, 2001."
"'Special Margin' means, with respect to the outstanding principal
amount of any Loan or Stated Amount of Letters of Credit, an additional
interest charge (in the case of Loans) or an additional fee (in the case
of Letters of Credit) of (i) 1.00% per annum payable in cash, plus (ii)
(x) during the Initial Waiver Period 3.00% per annum, and (y) during the
Extension Period 5.50% per annum (each of (x) and (y), the "PIK Principal
Amount"), which, in the case of Loans, shall be added to the principal
amount of the applicable Loans on the date upon which other interest is
payable on such Loan and, in the case of Letters of Credit, shall
constitute Revolving Loans which shall be added to the principal amount of
Revolving Loans outstanding on each date upon which other fees in respect
of Letters of Credit are payable for the account of the Lenders entitled
to such fees pursuant to Section 3.3.3; provided, that PIK Principal
Amount shall not be considered as part of the outstanding principal of any
Loans when calculating whether the Loans exceed any applicable Commitment
Amount hereunder."
"'Waiver Period' means the period from August 13, 2001 until 5:00 pm
(New York City time) on February 9, 2002."
(b) Section 3.3.3 of the Original Credit Agreement is hereby amended by
adding the phrase "plus, during the Extension Period, the Special Margin"
following the expression "1.25%" appearing on the eighth line thereof.
4. Additional Agreements and Documents. (a) The Company and each other
Borrower hereby agree to negotiate in good faith and execute as promptly as
possible and in any
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event by no later than November 16, 2001, at their sole cost and expense, such
additional documents and agreements as may be necessary or desirable, in the
reasonable judgment of counsel to the Lenders, to create and perfect security
interests or rights of setoff in favor of the Lenders in (x) the cash of the
Subsidiaries of the Company located outside of the United States (other than
those Subsidiaries located in the People's Republic of China, Taiwan,
Singapore, Thailand and Brazil), to the extent that the aggregate amount of
such cash exceeds $5,500,000, and (y) other personal property of the Foreign
Borrowers (other than the U.K. Term Borrower) (to the extent that granting and
perfecting such security interests is reasonably practicable without undue
expense), in each case, to secure the Obligations of the Foreign Borrowers
(other than the U.K. Term Borrower).
(b) The Company agrees to execute and deliver leasehold mortgages prepared
by counsel to the Lenders that may be necessary or desirable in the reasonable
judgment of counsel to the Lenders to create and perfect security interest in
certain leasehold interests of the Company, if any, as to which the
Administrative Agent shall have requested such leasehold mortgages; provided,
that the effectiveness of such leasehold mortgages shall be subject to
obtaining landlord consent, to the extent required under the applicable lease
or leases, which the Borrower agrees to use its commercially reasonable efforts
to obtain as promptly as practicable.
(c) The Company acknowledges and agrees that the failure of the Company or
any other Obligor to perform or observe the terms of this Section 4 shall
constitute an Event of Default under to Section 8.1.4 of the Credit Agreement.
5. Representations and Warranties. The Company and each other Borrower
represents and warrants to each Lender, as of the Effective Date, that:
(a) The Company and each Borrower has full power and authority and
holds all requisite governmental licenses, permits and other approvals to
enter into this Waiver Extension;
(b) The execution and delivery by the Company and each Borrower of
this Waiver Extension and the performance by each of them of this Waiver
Extension and the Credit Agreement, as amended by this Waiver Extension,
are within the Company's and each such Obligor's company powers, have been
duly authorized by all necessary company action, and do not contravene the
Company's or any such Obligor's Charter Documents, contravene any
contractual restriction, law or governmental regulation or court decree or
order binding on or affecting the Company or any such Obligor, or result
in, or require the creation or imposition of, any Lien on any of the
Company's or any other Obligor's properties, except pursuant to the terms
of a Loan Document.
(c) This Waiver Extension and the Credit Agreement, as amended by
this Waiver Extension, constitute the legal, valid and binding obligations
of each Borrower, enforceable in accordance with their respective terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws
3
relating to or affecting creditors' rights generally and general equitable
principles (whether considered in a proceeding in equity or at law).
(d) As of the Effective Date, after giving effect to the waiver and
amendments contained in this Waiver Extension, (i) the Company and each
other Obligor is in full compliance with all of the various covenants and
agreements set forth in the Credit Agreement and each of the Loan
Documents; (ii) no event has occurred and is continuing that constitutes
or would constitute a Default or Event of Default, (iii) all
representations and warranties in the Credit Agreement and other Loan
Documents are true and correct in all material respects as of the date
hereof as though made as of the date hereof, and (iv) no default or event
of default exists under the Senior Subordinated Debt Documents.
6. Conditions to Effectiveness. The waivers and amendments contained
herein shall not become effective until the Administrative Agent shall
determine that each of the following conditions precedent shall have been
satisfied on or prior to such Business Day (the "Effective Date"):
(a) Counterparts of this Waiver Extension shall have been duly
executed and delivered on behalf of the Company, each of the other
Borrowers, the Administrative Agent, and the Required Lenders.
(b) The Company and any applicable Subsidiary shall have executed and
delivered, at its sole cost and expense, mortgages prepared by counsel to
the Lenders that may be necessary or desirable, in the reasonable judgment
of counsel to the Lenders, to create and perfect security interests in
favor of the Administrative Agent in certain real estate of the Company
and any applicable Subsidiary identified by counsel to the Lenders
(including mortgages on real property owned by the Company and located in
Anne Arundel County, Maryland and real property owned by Wildon
Industries, Inc. and located in Mt. Bethel, Pennsylvania).
(c) The Company shall have established a segregated account with the
Administrative Agent with an initial deposit in the amount of $8,372,859
and shall have executed and delivered, at its sole cost and expense,
documents prepared by counsel to the Lenders relating to such segregated
account.
7. Ratification of Effectiveness. The term "Agreement", "hereof", "herein"
and similar terms as used in the Original Credit Agreement, and references in
the other Loan Documents to the Original Credit Agreement shall mean and refer
to, from and after the Effective Date, the Original Credit Agreement as amended
by this Waiver Extension. The Company and each other Borrower hereby ratifies
and confirms that the Credit Agreement, as amended by this Waiver Extension,
remains in full force and effect in accordance with its terms.
8. Execution in Counterparts. This Waiver Extension may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
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9. Governing Law; Entire Agreement. THIS WAIVER EXTENSION SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK. This Waiver Extension, the Credit Agreement and the other Loan
Documents constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and supersede any prior agreements,
written or oral, with respect thereto.
5
IN WITNESS WHEREOF, the parties hereto have caused this Waiver Extension
to be executed by their respective authorized officers as of the date and year
first above written.
FORMICA CORPORATION
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
FORMICA LIMITED
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
FORMICA HOLDCO (UK) LIMITED
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
FORMICA CANADA, INC.
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
FORMICA S.A.
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
FORMICA ESPANOLA S.A.
By: /s/ David Schneider
---------------------------------
Name: David Schneider
Title:
BANKERS TRUST COMPANY,
as Administrative Agent and as a
Lender
By: /s/ Gregory Shefan
---------------------------------
Name: Gregory Shefan
Title: Director
ABN-AMRO BANK N.V.
By: /s/ Judith M. Bresnen
---------------------------------
Name: Judith M. Bresnen
Title: Group Vice President
/s/ John M. Pastore
---------------------------------
Assistant Vice President
AG CAPITAL FUNDING PARTNERS, L.P.
By: Angelo, Gordon & Co., L.P.
as Investment Adviser
By: /s/ John W. Fraser
---------------------------------
Name: John W. Fraser
Title: Managing Director
NORTHWOODS CAPITAL, LIMITED
By: Angelo, Gordon & Co., L.P.
as Collateral Manager
By: /s/ John W. Fraser
---------------------------------
Name: John W. Fraser
Title: Managing Director
NORTHWOODS CAPITAL II, LIMITED
By: Angelo, Gordon & Co., L.P.
as Investment Adviser
By: /s/ John W. Fraser
---------------------------------
Name: John W. Fraser
Title: Managing Director
AMSOUTH BANK
By: /s/ Kathleen F. Kerlinger
---------------------------------
Name: Kathleen F. Kerlinger
Title: Attorney-In-Fact
THE BANK OF NOVA SCOTIA
By: /s/ Daniel A. Costigan
---------------------------------
Name: Daniel A. Costigan
Title: Director
BAYERISCHE HYPO-UND VEREINSBANK AG
NEW YORK BRANCH
By: /s/ Michael D. Novellino
---------------------------------
Name: Michael D. Novellino
Title: Associate Director
By: /s/ Salvatore Esposito
---------------------------------
Name: Salvatore Esposito
Title: Director
BNP PARIBAS
By: /s/ Duane P. Helkowski
---------------------------------
Name: Duane P. Helkowski
Title: Director
By: /s/ Kathryn Quinn
---------------------------------
Kathryn Quinn
Vice President
BOEING CAPITAL CORPORATION
By: /s/ James C. Hammersmith
---------------------------------
Name: James C. Hammersmith
Title: Senior Documentation
Center
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ Renee M. Singer
---------------------------------
Name: Renee M. Singer
Title: Vice President
COMERICA BANK
By: /s/ Jennifer M. Pugliano
---------------------------------
Name: Jennifer M. Pugliano
Title: Account Officer
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Richard Teitelbaum
---------------------------------
Name: Richard Teitelbaum
Title: V.P.
CREDIT SUISSE FIRST BOSTON
By: /s/ Cassandra Droogan
---------------------------------
Name: Cassandra Droogan
Title: Associate
/s/ Jeffrey Bernstein
---------------------------------
Jeffrey Bernstein
Vice President
GRAYSON & CO
By: Boston Management and Research,
as Investment Advisor
By: /s/ Payson F. Swaffied
---------------------------------
Name: Payson F. Swaffied
Title: Vice President
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By: /s/ Payson F. Swaffield
---------------------------------
Name: Payson F. Swaffield
Title: Vice President
EATON VANCE SENIOR INCOME TRUST
By: Eaton Vance Management,
as Investment Advisor
By: /s/ Payson F. Swaffield
---------------------------------
Name: Payson F. Swaffield
Title: Vice President
EATON VANCE INSTITUTIONAL SENIOR
LOAN FUND
By: Eaton Vance Management,
as Investment Advisor
By: /s/ Payson F. Swaffield
---------------------------------
Name: Payson F. Swaffield
Title: Vice President
OXFORD STRATEGIC INCOME FUND
By: Eaton Vance Management,
as Investment Advisor
By: /s/ Payson F. Swaffield
---------------------------------
Name: Payson F. Swaffield
Title: Vice President
ELC (CAYMAN) LTD. 1999-II
By: /s/ Amos Beason
---------------------------------
Name: Amos Beason
Title: Director
ELC (CAYMAN) LTD. 1999-III
By: /s/ Amos Beason
---------------------------------
Name: Amos Beason
Title: Director
ELC (CAYMAN) LTD. 2000-I
By: /s/ Amos Beason
---------------------------------
Name: Amos Beason
Title: Director
ELC (CAYMAN) LTD. CDO SERIES 1999-I
By: /s/ Amos Beason
---------------------------------
Name: Amos Beason
Title: Director
FIRSTAR BANK, N.A.
By: /s/ Thomas W. Cherry
---------------------------------
Name: Thomas W. Cherry
Title: Vice President
FLEET NATIONAL BANK, Successor in
interest to Summit Bank
By: /s/ Richard F. Napierkowski
---------------------------------
Name: Richard F. Napierkowski
Title: Vice President
FOOTHILL INCOME TRUST II L.P.
By: FIT II GP, LLC, its general
partner
By: /s/ Edward Stearns
---------------------------------
Name: Edward Stearns
Title: Managing Member
GALAXY CLO 1999-1, LTD.
By: SAI Investment Advisor, Inc.,
Its Collateral Manager
By:
---------------------------------
Name:
Title:
KZH SOLEIL, LLC
By: /s/ Susan Lee
---------------------------------
Name: Susan Lee
Title:
KZH SOLEIL-2, LLC
By: /s/ Susan Lee
---------------------------------
Name: Susan Lee
Title:
HSBC BANK USA
By: /s/ John Northington
---------------------------------
Name: John Northington
Title: VP
LIBERTY-STEIN ROE ADVISOR
FLOATING RATE ADVANTAGE FUND
By: Stein Roe & Farnham
Incorporated, As Advisor
By: /s/ James R. Fellows
---------------------------------
Name: James R. Fellows
Title: Sr. Vice President &
Portfolio Manager
STEIN ROE FLOATING RATE LIMITED
LIABILITY COMPANY
By: /s/ James R. Fellows
---------------------------------
Name: James R. Fellows
Title: Sr. Vice President
Stein Roe & Farmharm
Incorporated, as Advisor
to the Stein Roe
Floating Rate Limited
Liability Company
MORGAN STANLEY PRIME INCOME TRUST
By: /s/ Peter Gewirtz
---------------------------------
Name: Peter Gewirtz
Title: Vice President
NATIONAL CITY BANK
By: /s/ Peter W. Richer
---------------------------------
Name: Peter W. Richer
Title: Vice President
PB CAPITAL CORPORATION
By: /s/ Christopher J. Ruzzi
---------------------------------
Name: Christopher J. Ruzzi
Title: Vice President
By: /s/ Lisa Moraglia
---------------------------------
Name: Lisa Moraglia
Title: Associate
TRANSAMERICA BUSINESS CAPITAL
CORPORATION
By: /s/ Stephen K. Goetschius
---------------------------------
Name: Stephen K. Goetschius
Title: Senior Vice President
VAN KAMPEN PRIME RATE INCOME TRUST
By: Van Kampen Investment Advisory
Corp.
By: /s/ Darvin D. Pierce
---------------------------------
Name: Darvin D. Pierce
Title: Executive Director
VAN KAMPEN SENIOR INCOME TRUST
By: Van Kampen Investment Advisory
Corp.
By: /s/ Darvin D. Pierce
---------------------------------
Name: Darvin D. Pierce
Title: Executive Director
VAN KAMPEN SENIOR FLOATING RATE FUND
By: Van Kampen Investment Advisory
Corp.
By: /s/ Darvin D. Pierce
---------------------------------
Name: Darvin D. Pierce
Title: Executive Director
VAN KAMPEN CLO I, LIMITED
By: Van Kampen Management Inc., as
Collateral Manager
By: /s/ Darvin D. Pierce
---------------------------------
Name: Darvin D. Pierce
Title: Executive Director
VAN KAMPEN CLO II, LIMITED
By: Van Kampen Management Inc., as
Collateral Manager
By: /s/ Darvin D. Pierce
---------------------------------
Name: Darvin D. Pierce
Title: Executive Director