FIRST AMENDMENT
TO FINANCING AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO FINANCING AND SECURITY AGREEMENT (this "Amendment")
is made as of this 13th day of December, 1995, by and among CHARTER POWER
----
SYSTEMS, INC., a corporation organized and existing under the laws of the State
of Delaware ("Charter Power"), C&D CHARTER POWER SYSTEMS, INC., a corporation
organized and existing under the laws of the State of Delaware ("C&D Charter"),
CACTUS HOLDINGS, INC., a corporation organized and existing under the laws of
the State of Delaware ("Cactus"), INTERNATIONAL POWER SYSTEMS, INC., a
corporation organized and existing under the laws of the State of Arizona
("International"), RATELCO ELECTRONICS, INC., a corporation organized and
existing under the laws of the State of Delaware ("Ratelco"), C&D/CHARTER
HOLDINGS, INC., a corporation organized and existing under the laws of the State
of Delaware ("Charter Holdings"), and CHARTER POWER OF CALIFORNIA, a corporation
organized and existing under the laws of the State of California ("Charter
California") (Charter Power, C&D Charter, Cactus, International, Ratelco,
Charter Holdings and Charter California are herein collectively referred to as
the "Borrowers" and individually as a "Borrower"); and NATIONSBANK, N.A., a
national banking association, in its capacity as a lender ("NationsBank"),
NATWEST BANK, N.A., a national banking association being formerly known as
National Westminster Bank, NJ ("NatWest"), CORESTATES BANK, N.A., a national
banking association ("CoreStates") (NationsBank, CoreStates, and NatWest are
herein collectively referred to as the "Lenders" and individually, as a
"Lender"); and NATIONSBANK, N.A., a national banking association (the "Agent");
Witnesseth:
RECITALS
A. The Lenders, the Borrowers and the Agent are parties to that certain
Financing and Security Agreement dated September 26, 1994 (as amended, restated,
supplemented or otherwise modified, the "Credit Agreement"). Under and subject
to the provisions of the Credit Agreement, the Lenders agreed to establish
jointly and severally in favor of the Borrowers (i) a revolving credit facility
in a maximum principal amount not to exceed FORTY-FIVE MILLION DOLLARS
($45,000,000) (the "Total Revolving Credit Committed Amount"), (ii) a term loan
facility (collectively, the "Term Loans") in a maximum principal amount not to
exceed FIFTEEN MILLION DOLLARS ($15,000,000) (the "Total Term Loan Committed
Amount") and (iii) a letter of credit facility as part of the Revolving Credit
Facility (the "Letter of Credit Facility") in a maximum principal amount not to
exceed EIGHT MILLION DOLLARS ($8,000,000) (the "Letter of Credit Committed
Amount").
B. C&D Charter has requested that the Development Authority of Rockdale
County (the "Issuer") issue $6,500,000 in the aggregate principal amount of its
Industrial Development Revenue Bonds (C&D Charter Power Systems, Inc. Project),
Series 1995 (the "Bonds"), pursuant to the terms of that certain Trust Indenture
dated as of December 1, 1995 (the "Indenture"), by and between the Issuer and
Norwest Bank Minnesota, National Association, as trustee (the "Trustee"), for
the benefit of C&D Charter and for the purpose of acquiring and installing
equipment to be used by the C&D Charter in its manufacturing facility for
industrial batteries, chargers, rectifiers and power supplies located in
Conyers, Georgia (the "Equipment").
C. In order to fulfill the requirements of the Indenture, C&D Charter has
requested that the Agent, in its individual capacity, issue an irrevocable
direct-pay letter of credit for the benefit of the Trustee and for the account
of C&D Charter in the face amount of $6,574,794.52 (the "Rockdale Letter of
Credit") to secure payment of the principal amount of the Bonds, together with
interest thereon, as and when due and payable. The Agent, with the consent of
the Lenders, has agreed to issue the Rockdale Letter of Credit in accordance
with the provisions of that certain Letter of Credit and Reimbursement Agreement
dated the date hereof by and between the Borrower and the Agent (as amended,
restated, supplemented or otherwise modified, the "Rockdale Letter of Credit
Agreement").
D. As a condition to issuance of the Rockdale Letter of Credit, the Agent
has required that all of the obligations, liabilities and indebtedness of C&D
Charter under and in connection with the Rockdale Letter of Credit and/or the
Rockdale Letter of Credit Agreement (collectively, the "Rockdale Letter of
Credit Obligations") (i) be secured by a first priority lien on, and security
interest in, the Equipment, (ii) be secured by a second priority lien on, and
security interest in, all other assets of C&D Charter and all assets of each of
the other Borrowers, and (iii) be unconditionally and irrevocably guaranteed by
each of the other Borrowers.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrowers, the Lenders and the Agent hereby agree as follows:
1. The recitals set forth above are true and accurate in each and every
respect and are incorporated herein by reference. All capitalized terms used
herein but not specifically defined
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herein shall have the respective meanings given such terms in the Credit
Agreement, unless the context indicates or dictates a contrary meaning.
2. The Credit Agreement is hereby amended as follows:
a. The definition of "Permitted Liens" on pages 23 and 24 of the
Credit Agreement is hereby amended to include the Liens and security interests
granted to the Agent as collateral and security for the Rockdale Letter of
Credit Obligations. In particular, the Lenders hereby acknowledge and agree
that the Rockdale Letter of Credit Obligations may be (i) secured by a first
priority lien on, and security interest in, the Equipment, (ii) secured by a
second priority lien on, and security interest in, all other assets of C&D
Charter and all assets of each of the other Borrowers, and (iii) unconditionally
and irrevocably guaranteed by each of the other Borrowers; provided, that the
Agent, as issuer of the Rockdale Letter of Credit, agrees that if an event of
default occurs under the Rockdale Letter of Credit Obligations, it shall not
take any action with respect to the Collateral (other than the Equipment) for a
period of ninety (90) days following written Notice of such default to the
Lenders.
b. The definition of "Permitted Preferred Indebtedness" on pages 24
and 25 of the Credit Agreement is hereby amended to include the Rockdale Letter
of Credit Obligations.
c. Section 6.2.6 on pages 110 and 111 of the Credit Agreement is hereby
amended to permit any or all of the Borrowers to guaranty payment and
performance of the Rockdale Letter of Credit Obligations.
3. The terms "this Agreement" as used in the Credit Agreement and the
terms "Credit Agreement" as used in any of the Financing Documents shall mean
the Credit Agreement as modified by herein unless the context clearly indicates
or dictates a contrary meaning.
4. The Borrowers will execute such confirmatory instruments with respect
to the Credit Agreement and/or any of the Financing Documents as the Agent may
reasonably require.
5. The Borrowers ratify and confirm all of their respective liabilities
and obligations under the Credit Agreement and agree that, except as expressly
modified in this Amendment, the Credit Agreement continues in full force and
effect as if set forth specifically herein. The Borrowers, the Agent and the
Lenders
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agree that this Amendment shall not be construed as an agreement to extinguish
the original obligations under the Credit Agreement and shall not constitute a
novation as to any of the joint and several obligations of the Borrowers under
the Credit Agreement.
6. This Amendment may not be amended, changed, modified, altered or
terminated without in each instance the prior written consent of the Agent, the
Lenders and the Borrowers. This Amendment shall be construed in accordance
with, and governed by, the laws of the State of Maryland.
7. The Borrowers agree that neither the execution and delivery of this
Amendment nor any of the terms, provisions, covenants, or agreements contained
in this Amendment shall in any manner release, impair, lessen, waive, or
otherwise adversely affect the joint and several liability and obligations of
the Borrowers under the terms of the Credit Agreement.
8. This Agreement may be executed in any number of duplicate originals or
counterparts, each of such duplicate originals or counterparts shall be deemed
to be an original and all taken together shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the Borrowers, the Agent and the Lenders have caused
this Amendment to be executed under seal as of the date first above written.
ATTEST: CHARTER POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title:Treasury Mgr Title: V.P. - CFO
ATTEST: C&D CHARTER POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title:V.P. - CFO
ATTEST: CACTUS HOLDINGS, INC.
/s/ Robert Marley By: /s/ Kerry M. Kane (Seal)
- -------------------------- -----------------------------
Name: Name: K. Kane
Title: Vice President Title: President
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ATTEST: INTERNATIONAL POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title: V/P/ - CFO
ATTEST: RATELCO ELECTRONICS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title: V.P. - CFO
ATTEST: C&D/CHARTER HOLDINGS, INC.
/s/ Robert Marley By: /s/ Kerry M. Kane (Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Vice President Title: President
ATTEST: CHARTER POWER OF CALIFORNIA
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title: V.P. - CFO
WITNESS: NATIONSBANK, N.A.
in its capacity as Agent
/s/ Stephen J. Luongo By: /s/ Patrick M. Moore (Seal)
- -------------------------- ---------------------------
Name: Patrick M. Moore
Title: Vice President
WITNESS: NATIONSBANK, N.A.
in its capacity as a Lender
/s/ Stephen J. Luongo By: /s/ Patrick M. Moore (Seal)
- -------------------------- ----------------------------
Name: Patrick M. Moore
Title: Vice President
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WITNESS: CORESTATES BANK, N.A.
in its capacity as a Lender
/s/ B. Morgan, VP By: /s/ Karl F. Schultz (Seal)
- -------------------------- ----------------------------
Name: Karl F. Schultz
Title: Vice President
WITNESS: NATWEST BANK, N.A.
in its capacity as a Lender
/s/ Jonathan F. Cullinan By: /s/ Gail L. Powers (Seal)
- -------------------------- ----------------------------
Name: Gail L. Powers
Title: Vice President
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SECOND AMENDMENT
TO FINANCING AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO FINANCING AND SECURITY AGREEMENT (this
"Amendment") is made as of this 26th day of January, 1996, by and among CHARTER
----
POWER SYSTEMS, INC., a corporation organized and existing under the laws of the
State of Delaware ("Charter Power"), C&D CHARTER POWER SYSTEMS, INC., a
corporation organized and existing under the laws of the State of Delaware ("C&D
Charter"), CACTUS HOLDINGS, INC., a corporation organized and existing under the
laws of the State of Delaware ("Cactus"), INTERNATIONAL POWER SYSTEMS, INC., a
corporation organized and existing under the laws of the State of Arizona
("International"), RATELCO ELECTRONICS, INC., a corporation organized and
existing under the laws of the State of Delaware ("Ratelco"), C&D/CHARTER
HOLDINGS, INC., a corporation organized and existing under the laws of the State
of Delaware ("Charter Holdings"), and CHARTER POWER OF CALIFORNIA, a corporation
organized and existing under the laws of the State of California ("Charter
California") (Charter Power, C&D Charter, Cactus, International, Ratelco,
Charter Holdings and Charter California are herein collectively referred to as
the "Borrowers" and individually as a "Borrower"); and NATIONSBANK, N.A., a
national banking association, in its capacity as a lender ("NationsBank"),
NATWEST BANK, N.A., a national banking association being formerly known as
National Westminster Bank, NJ ("NatWest"), CORESTATES BANK, N.A., a national
banking association ("CoreStates") (NationsBank, CoreStates, and NatWest are
herein collectively referred to as the "Lenders" and individually, as a
"Lender"); and NATIONSBANK, N.A., a national banking association (the "Agent");
Witnesseth:
RECITALS
A. The Lenders, the Borrowers and the Agent are parties to that certain
Financing and Security Agreement dated September 26, 1994 (as amended, restated,
supplemented or otherwise modified, the "Credit Agreement"). Under and subject
to the provisions of the Credit Agreement, the Lenders agreed to establish
jointly and severally in favor of the Borrowers (i) a revolving credit facility
in a maximum principal amount not to exceed FORTY-FIVE MILLION DOLLARS
($45,000,000) (the "Total Revolving Credit Committed Amount"), (ii) a term loan
facility (collectively, the "Term Loans") in a maximum principal amount not to
exceed FIFTEEN MILLION DOLLARS ($15,000,000) (the "Total Term Loan Committed
Amount") and (iii) a letter of credit facility as part of the Revolving Credit
Facility (the "Letter of Credit Facility") in a maximum principal amount not to
exceed EIGHT MILLION DOLLARS ($8,000,000) (the "Letter of Credit Committed
Amount").
B. The Borrowers have requested that (i) the Lenders increase the Total
Revolving Credit Committed Amount to SIXTY-FIVE MILLION DOLLARS ($65,000,000)
and extend the term of the Revolving Credit Facility for an additional one year
period, (ii) the Lenders and the Agent consent and agree to the proposed
purchase by Charter Power of up to 600,000 shares of its common stock, and (iii)
the Lenders and the Agent amend certain other terms and conditions of the Credit
Agreement, and, subject to the provisions of this Amendment, the Lenders and the
Agent have so agreed provided that, among other things, (a) the Borrowers
execute and deliver this Amendment, (b) on or before the effective date of this
Amendment, the Borrowers pay to the Agent, for the ratable benefit of the
Lenders, a fee in the amount of Thirty-four Thousand Dollars ($34,000) (the
"Modification Fee"), (c) the Borrowers execute and deliver to each of the
Lenders amended and restated revolving credit notes substantially in the form of
the revolving credit note attached to the Credit Agreement as Exhibit A-1, with
appropriate insertions and in the aggregate principal amount of the Total
Revolving Credit Committed Amount as increased by this Amendment, and (d) the
Borrowers furnish to the Agent such information, items, certifications and other
documents as the Agent and/or any of the Lenders may reasonably request in
connection with the closing and consummation of the transactions contemplated by
this Amendment.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrowers, the Lenders and the Agent hereby agree as follows:
1. The recitals set forth above are true and accurate in each and every
respect and are incorporated herein by reference. All capitalized terms used
herein but not specifically defined herein shall have the respective meanings
given such terms in the Credit Agreement, unless the context indicates or
dictates a contrary meaning.
2. The Credit Agreement is hereby amended as follows:
a. The definition of "Fees" on page 10 of the Credit Agreement is
hereby amended to include the Modification Fee and the Stock Percentage Fees.
b. The definition of "Financing Documents" on page 10 of the Credit
Agreement is hereby amended to include the Rockdale Letter of Credit Documents
and each of the Converted Stock Notes.
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c. The definition of "Interest Rate" on page 15 of the Credit
Agreement is hereby amended to mean with respect to the Revolving Loan, as
applicable, the Prime Rate, plus the Stock Margin or the LIBOR Rate, plus the
Stock Margin.
d. The definitions of "Letter of Credit" and "Letters of Credit" on
page 16 of the Credit Agreement are hereby amended to include the Rockdale
Letter of Credit.
e. The definitions of "Letter of Credit Agreement" and "Letter of
Credit Agreements" on page 16 of the Credit Agreement are hereby amended to
include the Rockdale Letter of Credit Agreement.
f. The definition of "Letter of Credit Documents" on page 16 of the
Credit Agreement is hereby amended to include the Rockdale Letter of Credit
Documents.
g. The definition of "Letter of Credit Obligations" on page 17 of
the Credit Agreement is hereby amended to include the Rockdale Letter of Credit
Obligations.
h. The definitions of "Loan" and "Loans" on page 18 of the Credit
Agreement is hereby amended to include each Converted Stock Loan.
i. The definitions of "Note" and "Notes" on page 19 of the Credit
Agreement is hereby amended to include each Converted Stock Note.
j. The definition of "Permitted Uses" on page 25 of the Credit
Agreement is hereby amended to include (i) the purchase of Stock if and to the
extent such purchase is expressly permitted by the provisions of this Credit
Agreement and (ii) the issuance of the Rockdale Letter of Credit to secure
payment of principal of, and interest on, the $6,500,000 Development Authority
of Rockdale County Industrial Development Revenue Bonds (C&D Charter Power
Systems, Inc. Project), Series 1995.
k. The definition of "Permitted Preferred Indebtedness" on pages 24
and 25 of the Credit Agreement is hereby amended to include the Rockdale Letter
of Credit Obligations.
l. The definition of "Revolving Credit Expiration Date" on page 28
of the Credit Agreement is hereby amended to mean January 31, 1999, as may be
further extended in accordance with the provisions of Section 2.1.1. of the
Credit Agreement.
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m. Article 1 of the Credit Agreement is hereby amended to add the
following definitions:
"Converted Stock Loan" has the meaning set forth in Section
2.1.11 of the Credit Agreement, as added by this Amendment.
"Converted Stock Note" and "Converted Stock Notes" have the
meanings set forth in Section 2.1.11 of the Credit Agreement, as added by
this Amendment.
"Rockdale Letter of Credit" means that certain $6,574,794.52
direct-pay, irrevocable letter of credit issued by the Agent as security
for the principal of, and interest on, the $6,500,000 Development Authority
of Rockdale County Industrial Development Revenue Bonds (C&D Charter Power
Systems, Inc. Project), Series 1995, as the same may at any time and from
time to time be amended, restated, reissued, renewed, supplemented or
otherwise modified.
"Rockdale Letter of Credit Agreement" means that certain letter
of credit and reimbursement agreement dated as of December 1, 1995 by and
between the Agent and C&D Charter, as the same may at any time and from
time to time be amended, restated, supplemented or otherwise modified.
"Rockdale Letter of Credit Documents" means any and all
agreements, documents and/or instruments which now or at any time hereafter
evidence, secure, guaranty or otherwise relate to all or any portion of the
Rockdale Letter of Credit Obligations, including, without limitation, the
Rockdale Letter of Credit Agreement, all as the same may at any time and
from time to time be amended, restated, supplemented or otherwise modified.
"Rockdale Letter of Credit Obligations" means any and all primary
and contingent obligations of any or all of the Borrowers to the Agent
and/or any of the Lenders under or in connection with any of the Rockdale
Letter of Credit Documents.
"Stock" means the issued and outstanding common stock of Charter
Power.
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"Stock Margin" with respect to any advance of the Revolving Loan
has the meaning set forth in Section 2.4.1(d) of the Credit Agreement, as
added by this Amendment.
"Stock Percentage Fee" has the meaning set forth in Section 6.2.4
of the Credit Agreement, as amended by this Amendment.
"Stock Purchase Advance" has the meaning set forth in Section
2.1.11 of the Credit Agreement, as added by this Amendment.
n. The amount of the Revolving Credit Committed Amounts for each Lender
and the amount of the Total Revolving Credit Committed Amount as set forth in
Section 2.1.1 on pages 33 of the Credit Agreement are hereby increased and
restated as follows:
Revolving Credit Revolving Credit
---------------- ----------------
Lender Committed Amount Proportionate Share
- ------ ---------------- -------------------
NationsBank $27,183,000 41.82%
CoreStates $18,908,500 29.09%
NatWest $18,908,500 29.09%
Total Revolving
Credit Committed
Amount: $65,000,000 100%
o. Subparagraphs (i) and (ii) of Section 2.1.1 on page 34 of the Credit
Agreement are hereby deleted in their entirety and the following are substituted
in their place such that during the Revolving Credit Commitment Period, the
Borrowers may request advances under the Revolving Credit Facility in accordance
with the provisions of the Credit Agreement; provided that after giving effect
to the Borrowers' request:
(i) the outstanding principal balance of each Lender's
Proportionate Share of the Revolving Loan and of the Letter of Credit
Obligations (including, the PEDFA Obligations, but excluding the Rockdale
Letter of Credit Obligations) would not exceed such Lender's Revolving
Credit Committed Amount, and
(ii) the aggregate outstanding principal balance of the Revolving
Loan and all Letter of Credit Obligations (including, the PEDFA
Obligations, but excluding the Rockdale
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Letter of Credit Obligations) would not exceed the Total Revolving Credit
Committed Amount.
Neither the Rockdale Letter of Credit nor the Rockdale Letter of Credit
Obligations shall reduce the Borrowers' availability under the Revolving Credit
Facility or shall be counted against the Total Revolving Credit Committed Amount
or the Revolving Credit Committed Amount of any Lender.
p. Section 2.1.9 on pages 38 and 39 of the Credit Agreement is hereby
deleted in its entirety and the following is substituted in its place:
2.1.9 Renewal of Revolving Credit Facility. Upon the written
------------------------------------
request of the Borrowers and subject to the terms and conditions of this
Section , the Lenders may, in their sole and absolute discretion, extend
the Revolving Credit Facility for up to two (2) additional one (1) year
periods (each referred to herein as an "Extension" and collectively, as the
"Extensions"). The Borrowers' written request for the initial Extension
(the "Initial Extension") must be furnished to the Agent on or before June
30, 1997 (the "Initial Extension Request Date"), and the Borrowers' written
request for the second Extension (the "Final Extension") must be furnished
to the Agent on or before December 31, 1998 (the "Final Extension Request
Date") (the Initial Extension Request Date and the Final Extension Request
Date are herein collectively referred to as the "Request Dates" and
individually as a "Request Date"). The Agent agrees to furnish to the
Lenders copies of the Borrowers' written request for an Extension within
three (3) Business Days of the Agent's receipt of such request. The Agent
and/or any of the Lenders may agree to or decline either or both of the
Borrowers' Extension requests in their sole and absolute discretion. An
Extension shall only be effective if and to the extent the Agent and all of
the Lenders consent in writing to such Extension. The Borrowers' request
for an Extension shall be deemed rejected if the Agent and each of the
Lenders have not consented to such Extension in writing within thirty (30)
days after the Request Date for such Extension. None of the Lenders shall
have any obligation or duty to agree to any Extension and the Borrowers
acknowledge and agree that they will not take any action or omit to take
any action in reliance upon the Lenders' possible consent to any requested
Extension prior to the Borrowers' having received written confirmation from
the Agent that all of the Lenders have agreed in writing to any such
Extension. If the Agent and all
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of the Lenders agree to an Extension, the Revolving Credit Expiration Date
shall be deemed extended automatically to the then next succeeding
anniversary date of the Revolving Credit Expiration Date.
q. Article II of the Credit Agreement is hereby amended to add the
following Section 2.1.11:
2.1.11 Conversion of Revolving Loan Advances for Stock Purchases;
---------------------------------------------------------
Mandatory Reductions in Total Revolving Credit Facility. The Borrowers
-------------------------------------------------------
jointly and severally covenant and agree that if at any time the
aggregate principal amount of Revolving Loan advances used to purchase
Stock at any time and from time to time equals or exceeds Five Million
Dollars ($5,000,000) and such aggregate principal amount (each a
"Stock Purchase Advance") has not yet been converted to a Converted
Stock Loan in accordance with the provisions of this Section 2.1.11,
such Stock Purchase Advance shall be converted into a term loan having
a maturity date which is three (3) years after the effective date of
the conversion (each referred to herein as a "Converted Stock Loan");
provided that (i) all Stock purchased with the proceeds of such Stock
Purchase Advance shall have been purchased by Charter Power in
accordance with the provisions of Section 6.2.4 of this Agreement,
(ii) there shall not exist a Default or an Event of Default under this
Agreement as of the effective date of such conversion, and (iii) the
Borrowers shall have executed and delivered to the Agent a series of
promissory notes (as from time to time extended, amended, restated,
supplemented or otherwise modified, the "Converted Stock Notes" and
individually a "Converted Stock Note") substantially in the form of
Exhibit A-3 attached to and made a part of this Agreement, with
appropriate insertions and such other documents as the Agent and/or
any of the Lenders may reasonably require to confirm the validity of
the Obligations, as converted, and any Liens and security interests.
Each Lender's Converted Stock Note shall be dated as of the date the
Stock Purchase Advance, in part evidenced by such Converted Stock
Note, equals or exceeds Five Million Dollars ($5,000,000), shall be
payable to the order of such Lender at the times provided in the
Converted Stock Note, and shall be in the principal amount of such
Lender's Proportionate Share of the respective Stock Purchase Advance
evidenced, in part, by such Converted Stock Note. If as of the
effective date
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of any proposed conversion the Borrowers would not be entitled to
convert any Stock Purchase Advance to a Converted Stock Loan, such
Stock Purchase Advance, together with any unpaid and accrued interest
thereon, shall be payable jointly and severally by the Borrowers ON
DEMAND.
The unpaid principal balance of each Converted Stock Loan shall
bear interest at a floating and fluctuating rate of interest equal to
the Interest Rate or Interest Rates then available for the Converted
Term Loan, as selected by the Borrowers in accordance with the
provisions of Section 2.4, plus thirty-five (35) basis points. The
unpaid principal balance of each Converted Stock Loan, together with
unpaid and accrued interest thereon, shall be due and payable in
consecutive quarterly installments on the first day of each quarterly
period commencing with the first such date following the effective
date of the Converted Stock Loan; the principal amount of each such
quarterly installment shall be sufficient to fully amortize the
principal balance of the Converted Stock Loan in approximately equal
quarterly principal installments by the maturity date of such
Converted Stock Loan.
Subject to the terms of Section 2.4.5 of the Credit Agreement,
the Borrowers may, at their option, at any time and from time to time,
prepay, the Converted Stock Loans, in whole or in part, upon at least
five (5) Business Days prior written notice to the Agent, specifying
the date and amount of the proposed prepayment. Subject to the terms
of Section 2.4.5 of the Credit Agreement, each Converted Stock Note
may be prepaid, in whole or in part, without premium or penalty. The
amount to be prepaid, together with unpaid and accrued interest
thereon through the date of prepayment if the prepayment is intended
to prepay the Converted Stock Loans in whole, shall be paid by the
Borrowers to the Agent for the ratable benefit of the Lenders on the
date specified for such prepayment. Partial prepayments shall be in an
amount not less than Two Hundred Thousand Dollars ($200,000) and shall
be applied first to all unpaid and accrued late charges, second to any
unpaid and
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outstanding Enforcement Costs, third to any billed and unpaid interest
on the Converted Stock Loans, and then to principal against the
principal installments in the inverse order of their maturities.
The Total Revolving Credit Committed Amount shall be
automatically and permanently reduced by the principal amount of each
Converted Stock Loan as of the effective date of such Converted Stock
Loan. If, after giving effect to any such reduction in the Total
Revolving Credit Committed Amount, the then outstanding principal
amount of the Revolving Loan exceeds the Total Revolving Credit
Committed Amount as so reduced, the Borrowers jointly and severally
shall contemporaneously with such reduction (a) make a mandatory
prepayment of the Revolving Loan in the amount of such excess, and (b)
pay to the Agent for the ratable benefit of the Lenders an amount
equal to unpaid interest on the amount of such excess and the pro rata
portion of the Revolving Credit Unused Line Fee accrued to the date of
such mandatory prepayment. After each such reduction, the Revolving
Credit Unused Line Fee shall be calculated with respect to the Total
Revolving Credit Committed Amount as so reduced.
For purposes of this Agreement, all Stock purchases shall be
deemed to have been financed with the proceeds of the Revolving Loan,
regardless of the actual source of funds for the purchase.
r. Section 2.3 beginning on page 42 through, and including, page 54 of
the Credit Agreement is hereby amended to provide that if and to the extent
there is any express inconsistency between any of the provisions of Section 2.3
and the Rockdale Letter of Credit Agreement with respect to the Rockdale Letter
of Credit and/or the Rockdale Letter of Credit Obligations, the terms and
conditions of the Rockdale Letter of Credit Agreement shall control and govern
any such inconsistency.
s. Section 2.3.1 on pages 42 and 43 of the Credit Agreement is hereby
amended to provide that the Rockdale Letter of Credit shall not reduce at any
time the availability under the Revolving Credit Facility or the Letter of
Credit Facility; and, accordingly,
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neither the Rockdale Letter of Credit nor the Rockdale Letter of Credit
Obligations shall be counted against the Total Revolving Credit Committed
Amount, the Letter of Credit Committed Amount or the Revolving Credit Committed
Amount of any Lender. The Rockdale Letter of Credit and the Rockdale Letter of
Credit Obligations shall be in addition to the $65,000,000 Total Revolving
Credit Committed Amount and the $8,000,000 Letter of Credit Committed Amount.
t. Section 2.3.2 on page 43 of the Credit Agreement is hereby amended to
add the following subsection (d):
(d) with respect to the Rockdale Letter of Credit, a Letter of
Credit Fee in an amount equal to seventy-five (75) basis points of the
face amount of such Rockdale Letter of Credit. The Letter of Credit
Fee for the Rockdale Letter of Credit shall be paid upon the issuance
of the Rockdale Letter of Credit and on each anniversary date
thereafter.
u. Section 2.3.3 on pages 43 and 44 of the Credit Agreement is hereby
deleted in its entirety and the following is substituted in its place:
2.3.3. Terms of Letters of Credit. Unless otherwise agreed
--------------------------
by the Lenders in writing, each Letter of Credit (a) shall be opened
pursuant to a Letter of Credit Agreement, (b) shall expire on a date
not later than the Business Day preceding the Revolving Credit
Expiration Date and (c) shall be issued for a Permitted Use. Neither
the Agent nor any of the Lenders shall have any obligation or
commitment to consent to the renewal, extension or amendment to either
or both of the PEDFA Letters of Credit or the Rockdale Letter of
Credit.
v. Sections 2.3.8 and 2.3.9 on pages 50, 51 and 52 of the Credit
Agreement are hereby amended to provide that each of the Lenders hereby consent
and agree, subject to the provisions of Section 2.3.8 and 2.3.9 of the Credit
Agreement, to purchase an undivided interest and participation in and to the
Rockdale Letter of Credit (including, without limitation, any and all
obligations of the Borrowers under or with respect to the Rockdale Letter of
Credit and the related Rockdale Letter of Credit Obligations) in an
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amount equal to such Lender's Revolving Credit Proportionate Share of the face
amount of the Rockdale Letter of Credit. No further action shall be necessary
to evidence or obligation any Lender's purchase of such an undivided interest
and participation.
If at any time, however, any Lender fails to consent to any renewal or
extension of the Rockdale Letter of Credit, but one or more of the other Lenders
agree to such renewal or extension, each Lender's undivided interest and
participation in the Rockdale Letter of Credit (including the Rockdale Letter of
Credit Obligations) shall be contemporaneously and automatically adjusted as of
the commencement of such renewal or extension term so as to reflect each
Lender's revised proportionate share of the Rockdale Letter of Credit (which
proportionate shares shall be as agreed upon by the Lenders which have consented
to the renewal or extension; provided that the proportionate share of any Lender
which has failed to consent to the renewal or extension shall in all cases be
zero).
Each of the Lenders further acknowledge and agree that the Agent and the
Borrowers shall not be entitled to assume that such Lender has consented and
agreed to a renewal and extension of the Rockdale Letter of Credit for an
additional one (1) year period, unless such Lender has notified the Agent, in
writing, at least ninety (90) days prior to the then current expiration date of
the Rockdale Letter of Credit of such Lender's consent to any such renewal. If
any such Lender fails to so notify the Agent in writing of its consent to any
such renewal or extension as and when required by this paragraph, the Agent and
the Borrowers shall thereafter be permitted to assume that such Lender has
elected not to consent to any such renewal or extension and, neither the Agent
nor any Lender shall have any obligation at any time thereafter to sell, convey
or assign any undivided or participation interest in the Rockdale Letter of
Credit Obligations to any such Lender.
w. For purposes of calculating the Interest Rate under Section 2.4.1 and
the adjustments, if any, to the Interest Rate under Section 2.4.3, with respect
to each Converted Stock Loan, each such Converted Stock Loan shall be considered
a Converted Term Loan such that the Interest Rate on each Converted Stock Loan
shall be subject to adjustment as provided in Sections 2.4.1(b)(iii) and (iv)
and Section 2.4.3 in the same manner as the Term Loans, except
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that an additional thirty-five (35) basis points shall be added to the
Applicable Margin.
x. Section 2.4.1 on pages 55 and 56 of the Credit Agreement is hereby
amended to add the following subsection (d):
(d) In calculating the Applicable Margin to be added when
determining the actual and available Interest Rates for the Revolving
Loan (including then outstanding advances and future advances) as set
forth in subsection (c) above, an additional margin of twenty-five
----------
(25) basis points (the "Stock Margin") shall be added to the actual
and available Interest Rates for the Revolving Loan if the ratio of
Liabilities to Tangible Net Worth exceeds or at any time would exceed
2.0 to 1.0 as of the end of any fiscal quarter as the result, in whole
or in part, of Charter Power's actual purchase of Stock or commitment
to purchase Stock. Any such increase in the actual and available
Interest Rates shall be effective retroactively to the end of any such
fiscal quarter. If the ratio of Liabilities to Tangible Net Worth as
of the end of any fiscal quarter exceeds 2.0 to 1.0, but the Agent, in
its commercially reasonable discretion, determines that such ratio is
not due in whole or in part to the purchase of Stock, the Stock Margin
for that fiscal quarter shall be zero.
y. Section 2.4.2(b) on pages 57 and 58 of the Credit Agreement is hereby
amended to add the following subsection (xii):
(xii) with respect to each of the Converted Stock Loans, the
Borrowers shall not at any time select or change to an Interest Period
that extends beyond the maturity date of such Converted Stock Loan,
and no more than four (4) Interest Rates may be in effect from time to
time with respect to all of the Converted Stock Loans.
z. Section 6.1.1 on pages 89 and 90 of the Credit Agreement is hereby
amended to add the following subsections (h) and (i):
(h) Management Letter. The Borrowers shall furnish to the Agent
-----------------
and the Lenders as soon as available, but in no event more than one
hundred eighty (180) days after
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the close of Charter Power's fiscal year, a copy of a management
letter prepared by Charter Power's independent certified public
accountants to be acceptable to the Agent and the Lenders in all
respects .
(i) Stock Reports. The Borrowers shall furnish to the Agent and
-------------
the Lenders as soon as available, but in no event more than ten (10)
days after the end of each calendar month in which any shares of Stock
are purchased, a detailed monthly report with respect to all Stock
purchases made since July 14, 1995, which report shall state (1) the
cumulative number of shares of Stock purchased, (2) the price per
share of all such Stock purchased, (3) the total purchase price of all
Stock purchased, (4) the date of each Stock purchase, and (5) such
other information with respect to any Stock purchase as the Agent or
any of the Lenders may reasonably request.
aa. Section 6.1.23(c) on page 101 of the Credit Agreement is hereby
deleted in its entirety and the following is substituted in its place:
(c) not store any of their Inventory having an aggregate value of
$1,700,000 or more, with any one or more bailees, warehousemen or
similar Persons without the Agent's prior written consent, which
consent may be conditioned on, among other things, delivery by the
bailee, warehouseman or similar Person to the Agent of warehouse
receipts, in form acceptable to the Agent, in the name of the Agent
evidencing the storage of Inventory and the interests of the Agent and
the Lenders therein
bb. Section 6.2.4 on pages 106 and 107 of the Credit Agreement is hereby
amended to permit Charter Power to purchase Stock; provided that (i) the average
share price of the Stock purchased shall not at any time exceed Twenty-five
Dollars ($25.00), (ii) no Stock shall be purchased at any time on or after July
1, 1997, (iii) no Stock shall be purchased at any time two (2) days after the
date the Agent notifies Charter Power that no additional Stock may be purchased,
(iv) at the time of any actual or proposed Stock purchase there does not exist a
Default or an Event of Default, (v) the aggregate number of shares of Stock
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purchased by Charter Power shall at no time exceed 600,000 and (vi) the
Borrowers jointly and severally pay to the Agent for the ratable benefit of the
Lenders a fee on the outstanding balance of the Revolving Loan used to purchase
Stock (the "Stock Percentage Fees"), which Stock Percentage Fees shall be
payable quarterly in arrears on the first day of each quarterly period
commencing with the first such quarterly period after the "Commencement Date"
(as hereinafter defined) and shall be equal to one-sixth of one percent
(1/6th%). Notwithstanding the foregoing, the Borrowers shall not be required to
pay Stock Percentage Fees until such time as the aggregate Stock Percentage Fees
which would otherwise be payable to the Agent exceed Fifteen Thousand Dollars
($15,000) (the "Commencement Date").
cc. Section 6.2.5 on pages 107, 108 and 109 of the Credit Agreement is
hereby amended to increase the ceiling for the amount of Indebtedness for
Borrowed Money permitted under clauses (f), (g), (h) and (i) from Eight Million
Dollars ($8,000,000) to Fifteen Million Dollars ($15,000,000).
dd. Section 6.2.6 on pages 110 and 111 of the Credit Agreement is hereby
amended to permit any or all of the Borrowers to guaranty payment and
performance of the Rockdale Letter of Credit Obligations.
ee. Section 6.2.7 on page 111 of the Credit Agreement is hereby amended to
permit a one-time only increase in the Capital Expenditure Ceiling for each of
the fiscal years ending on January 31, 1996 and January 31, 1997, respectively,
from $8,000,000 to $12,000,000. Any unused portion of this permitted increase
shall not be added to or constitute a part of the Carry Forward Amount allowed
under Section 6.2.7. For all fiscal years ending after January 31, 1997, the
Capital Expenditure Ceiling shall remain equal to the amounts currently
permitted under Section 6.2.7.
ff. Article 7 on pages 113, 114, 115 and 116 of the Credit Agreement are
hereby amended to add the following Sections 7.1.12 and 7.1.13:
7.1.12 Termination or Refinancing of the Revolving Credit
--------------------------------------------------
Facility. If the Revolving Credit Facility shall be terminated by the
--------
Borrower or refinanced or replaced, in whole or in part, without the
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prior written consent of the Agent and each of the Lenders, which
termination, refinancing or replacement of the Revolving Credit
Facility, without further action or notice, shall be deemed an Event
of Default under this Agreement as of the day which is forty-five (45)
days after the effective date of such termination, refinancing or
replacement (the "Default Date"). Immediately effective as of the date
of any such termination, refinancing and/or replacement of the
Revolving Credit Facility, the Interest Rate on the Term Loans shall
be increased to the Base Rate, plus one percent (1%) per annum. This
Section 7.1.12 shall in no manner prejudice, lessen or otherwise
adversely affect any of the rights or remedies of the Agent and/or any
of the Lenders under any of the other provisions of this Agreement or
any of the other Financing Documents.
7.1.13 Rockdale Letter of Credit. If an Event of Default (as
-------------------------
defined therein) shall occur and be continuing under the Rockdale
Letter of Credit Agreement or, without cost or expense to the Agent or
any of the Lenders, if any of the Borrowers fail to grant a Lien on,
and security interest in, any assets or properties of any of the
Borrowers not currently provided by the Rockdale Letter of Credit
Documents as additional collateral and security for the Rockdale
Letter of Credit Obligations, which Liens and security interests shall
be junior and subordinate to the Liens or security interests securing
any of the other Obligations under this Agreement or if the Borrowers
fail to pay on demand all costs, expenses and fees (including
recordation taxes, filing fees and reasonable attorneys' fees)
incurred in connection with any such Liens and security interests.
3. The terms, conditions and provisions of this Amendment shall not be
effective until each of the following conditions precedent have been satisfied
fully to the extent and in manner required by the Agent and the Lenders: (a)
the Borrowers, the Agent and the Lenders execute and deliver this Amendment, (b)
the Borrowers pay to the Agent, for the ratable benefit of the Lenders, the
Modification Fee, (c) the Borrowers execute and deliver to the Lender for the
account of each of the Lenders amended and restated revolving credit notes
substantially in the form of the revolving
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credit note attached to the Credit Agreement as Exhibit A-1, with appropriate
insertions and in the aggregate principal amount of the Total Revolving Credit
Committed Amount as increased by this Amendment, (d) the Borrowers furnish to
the Agent and the Lenders such additional information, items, certifications,
confirmations, amendments and other documents as the Agent and/or any of the
Lenders may reasonably request in connection with the closing and consummation
of the transactions contemplated by this Amendment, and (e) the Borrowers shall
have reimbursed the Agent for any and all fees and expenses incurred by the
Agent in connection with the preparation, execution and delivery of this
Amendment and any and all other agreements, documents and/or instruments
contemplated by this Amendment, including, without limitation, reasonable
attorneys' fees and expenses.
4. The terms "this Agreement" as used in the Credit Agreement and the
terms "Credit Agreement" as used in any of the Financing Documents shall mean
the Credit Agreement as modified by herein unless the context clearly indicates
or dictates a contrary meaning.
5. The Borrowers will execute such confirmatory instruments with respect
to the Credit Agreement and/or any of the Financing Documents as the Agent may
reasonably require.
6. The Borrowers ratify and confirm all of their respective liabilities
and obligations under the Credit Agreement and agree that, except as expressly
modified in this Amendment, the Credit Agreement continues in full force and
effect as if set forth specifically herein. The Borrowers, the Agent and the
Lenders agree that this Amendment shall not be construed as an agreement to
extinguish the original obligations under the Credit Agreement and shall not
constitute a novation as to any of the joint and several obligations of the
Borrowers under the Credit Agreement.
7. This Amendment may not be amended, changed, modified, altered or
terminated without in each instance the prior written consent of the Agent, the
Lenders and the Borrowers. This Amendment shall be construed in accordance
with, and governed by, the laws of the State of Maryland.
8. The Borrowers agree that neither the execution and delivery of this
Amendment nor any of the terms, provisions,
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covenants, or agreements contained in this Amendment shall in any manner
release, impair, lessen, waive, or otherwise adversely affect the joint and
several liability and obligations of the Borrowers under the terms of the Credit
Agreement.
9. This Agreement may be executed in any number of duplicate originals or
counterparts, each of such duplicate originals or counterparts shall be deemed
to be an original and all taken together shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the Borrowers, the Agent and the Lenders have caused
this Amendment to be executed under seal as of the date first above written.
ATTEST: CHARTER POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasury Manager Title:
ATTEST: C&D CHARTER POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title:
ATTEST: CACTUS HOLDINGS, INC.
/s/ Robert Marley By: /s/ Kerry M. Kane (Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Vice President Title: President
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ATTEST: INTERNATIONAL POWER SYSTEMS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title:
ATTEST: RATELCO ELECTRONICS, INC.
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title:
ATTEST: C&D/CHARTER HOLDINGS, INC.
/s/ Robert Marley By: /s/ Kerry M. Kane (Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Vice President Title: President
ATTEST: CHARTER POWER OF CALIFORNIA
/s/ Robert Marley By: /s/ Stephen E. Markert, Jr.(Seal)
- -------------------------- ----------------------------
Name: Name:
Title: Treasurer Title:
WITNESS: NATIONSBANK, N.A.
in its capacity as Agent
/s/ Stephen J. Luongo By: /s/ Patrick M. Moore (Seal)
- ------------------------- ----------------------------
Name: Patrick M. Moore
Title: Vice President
WITNESS: NATIONSBANK, N.A.
in its capacity as a Lender
/s/ Stephen J. Luongo By: /s/ Patrick M. Moore (Seal)
- ------------------------- ----------------------------
Name: Patrick M. Moore
Title: Vice President
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WITNESS: CORESTATES BANK, N.A.
in its capacity as a Lender
/s/ Daniel J. Astolfi,VP By: /s/ Karl Schultz (Seal)
- -------------------------- ----------------------------
Name: Karl F. Schultz
Title: Vice President
WITNESS: NATWEST BANK, N.A.
in its capacity as a Lender
/s/ William K. Lacy By: /s/ Thomas L. Savage (Seal)
- -------------------------- ----------------------------
Name: Thomas L. Savage
Title: Vice President
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