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CONFORMED COPY
EXHIBIT 10
AMENDMENT NO. 2 dated as of March 23, 2001
(this "Amendment"), to the Credit Agreement dated as
of April 30, 1997, as amended and restated as of
September 12, 1997, as of April 3, 1998, and as of
September 8, 1998, as amended (the "Credit
Agreement"), among NEENAH FOUNDRY COMPANY, a
Wisconsin corporation (the "Borrower"), NFC CASTINGS,
INC., a Delaware corporation ("Holdings"), the
Lenders from time to time party thereto (the
"Lenders"), and THE CHASE MANHATTAN BANK, a New York
banking corporation, as issuing bank, as
administrative agent (in such capacity, the
"Administrative Agent") and as collateral agent (in
such capacity, the "Collateral Agent") for the
Lenders.
A. Pursuant to the Credit Agreement, the Lenders have extended
and have agreed to extend credit to the Borrower on the terms and subject to the
conditions set forth therein.
B. The Borrower and Holdings have requested that certain
provisions of the Credit Agreement be amended as set forth herein.
C. The Required Lenders are willing to amend the Credit
Agreement pursuant to the terms and subject to the conditions set forth herein.
D. Capitalized terms used and not otherwise defined herein
shall have the meanings assigned to them in the Credit Agreement.
Accordingly, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency and receipt
of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Amendments. (a) The definition of the term "Senior
Debt Leverage Ratio" in Section 1.01 of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:
"Senior Debt Leverage Ratio" shall mean, as of any date of
determination, the ratio of (a) Senior Debt as of such date to (b)
Consolidated EBITDA for the period of four consecutive fiscal quarters
of the Borrower ended on such date (including the Consolidated EBITDA
for such four fiscal quarters of any Subsidiary acquired during such
four fiscal quarters constituting a Permitted Acquisition pursuant to
Section 6.04(g)).
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(b) The definition of the term "Applicable Percentage" in
Section 1.01 of the Credit Agreement is hereby amended by restating the table
set forth therein in its entirety as follows:
Eurodollar Eurodollar ABR Spread B
Spread B ABR Spread B Spread B Tranche B
Tranche A Term Tranche A Term Tranche B Term Loans
Loans, Loans, Term Loans and and
Revolving Loans Revolving Loans Additional Additional
Consolidated Leverage and Acquisition and Acquisition Tranche B Tranche B Fee
Ratio Loans Loans Term Loans Term Loans Percentage
----- ----- ----- ----- ----- ----------
Category 1 3.50% 2.50% 3.75% 2.75% .50%
- ----------
Equal to or greater
than 4.50 to 1.00
Category 2 3.25% 2.25% 3.50% 2.50% .50%
- ----------
Equal to or greater
than 4.00 to 1.00, but
less than 4.50 to 1.00
Category 3 3.00% 2.00% 3.25% 2.25% .50%
- ----------
Equal to or greater
than 3.50 to 1.00, but
less than 4.00 to 1.00
Category 4 2.75% 1.75% 3.00% 2.00% .50%
- ----------
Equal to or greater
than 3.00 to 1.00, but
less than 3.50 to 1.00
Category 5 2.50% 1.50% 3.00% 2.00% .50%
- ----------
Less than 3.00 to 1.00
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(c) The definition of the term "Senior Debt" in Section 1.01
of the Credit Agreement is hereby amended and restated in its entirety to read
as follows:
"Senior Debt" shall mean, at any date and without duplication,
(a) the aggregate amount of all Indebtedness of the Borrower and the
Subsidiaries on a consolidated basis at such date (other than any
Indebtedness described in clause (i) or (j) of the definition of such
term) minus (b) to the extent included therein, the sum of (i) the
aggregate amount of all Indebtedness pursuant to the Senior
Subordinated Notes at such date and (ii) the aggregate amount of all
Indebtedness pursuant to Qualified Subordinated Debt at such date.
(d) Section 2.13(c) of the Credit Agreement is hereby amended
by replacing the percentage of "50%" in clause (ii) therein with the percentage
of "75%".
(e) Section 5.04 of the Credit Agreement is hereby amended by
deleting the word "and" at the end of paragraphs (d) and (e) thereof and
replacing the punctuation at the end of paragraph (f) thereof with the word ";
and". Section 5.04 of the Credit Agreement is further amended by adding at the
end thereof the following:
(g) within 30 days after the end of each month through and
including December 31, 2001, its consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows showing
the financial condition of the Borrower and its consolidated
Subsidiaries as of the end of and for such month and the results of its
operations and the operations of such Subsidiaries as of the end of and
for such month, all certified by one of its Financial Officers as
fairly presenting in all material respects the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied,
subject to normal year-end audit adjustments;
(f) Section 6.04(g) of the Credit Agreement is hereby amended
by adding at the end thereof the following proviso:
provided, further that none of Holdings, the Borrower or any of the
Subsidiaries may consummate any Permitted Acquisition during the period
from and including March 23, 2001, to and including December 31, 2001;
(g) Section 6.10 of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
SECTION 6.10. Capital Expenditures. Permit the aggregate
amount of Consolidated Capital Expenditures (other than Consolidated
Capital Expenditures for patterns and Permitted Acquisitions permitted
by Section 6.04(g)) made by the Borrower and the Subsidiaries, taken as
a whole, (a) during the fiscal year of the Borrower ending on September
30, 2001, to exceed $22,000,000, (b) during the fiscal quarter of the
Borrower ending on December 31, 2001, to exceed $5,500,000, and (c) in
any fiscal year of the Borrower commencing on or after
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October 1, 2001, to exceed the sum of (i) $40,000,000, (ii) the net
cash proceeds of any issuance of equity securities by, without
duplication, Holdings, ACP Holdings or ACP Products made during such
fiscal year and substantially concurrently used to fund Consolidated
Capital Expenditures, and (iii) 100% of Excess Cash Flow for the
preceding fiscal year that was not required to be used to make
prepayments of the outstanding Term Loans pursuant to Section 2.13;
provided, however, that the amount of Consolidated Capital Expenditures
in any fiscal year of the Borrower commencing on or after October 1,
2002 permitted to be incurred pursuant to clause (c) above shall be
increased by an amount equal to the amount of unused Consolidated
Capital Expenditures permitted to be incurred pursuant to clause (c)
above for the immediately preceding fiscal year of the Borrower
(without giving effect to this proviso).
(h) Section 6.11 of the Credit Agreement is hereby amended by
restating the table set forth therein in its entirety as follows:
Period Ratio
------ -----
January 1, 1998 through September 30, 1999 6.00 to 1.00
October 1, 1999 through September 30, 2000 5.75 to 1.00
October 1, 2000 through December 31, 2000 5.50 to 1.00
January 1, 2001 through December 31, 2001 6.75 to 1.00
Thereafter 5.50 to 1.00
(i) Section 6.13 of the Credit Agreement is hereby amended by
replacing the punctuation at the end thereof with the following proviso:
; provided that notwithstanding the foregoing the Consolidated Interest
Coverage Ratio as of the end of the second, third and fourth quarters
of the fiscal year of the Borrower ended September 30, 2001 and the
first quarter of the fiscal year of the Borrower ended September 30,
2002, in each case, shall not be less than 1.35 to 1:00.
(j) A new Section 6.15 shall be inserted after Section 6.14 of
the Credit Agreement and shall read as follows:
SECTION 6.15. Senior Debt Leverage Ratio. Permit the Senior
Debt Leverage Ratio as of the end of any fiscal quarter of the Borrower
to be in excess of 2.75 to 1.00.
SECTION 2. Representations and Warranties. To induce the other
parties hereto to enter into this Amendment, each of Holdings and the Borrower
represents and warrants to each other party hereto that after giving effect to
this Amendment, (i) the representations and warranties set forth in Article III
of the Credit Agreement are true and correct in all material respects on and as
of the date hereof, except to the extent such representations and warranties
expressly relate to an earlier date, and (ii) no Default or Event of Default has
occurred and is continuing.
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SECTION 3. Amendment Fee. Subject to the following proviso,
the Borrower agrees to pay to each Lender that executes and delivers a copy of
this Amendment to the Administrative Agent (or its counsel) on or prior to 5:00
pm New York City time, on March 21, 2001, through the Administrative Agent, a
non-refundable amendment fee (the "Amendment Fee") in an amount equal to 0.25%
of the sum of the aggregate principal amount outstanding of such Lender's Loans,
L/C Exposure and unused Commitments as of such date; provided that the Borrower
shall have no liability for any such amendment fee if this Amendment does not
become effective in accordance with Section 4 below. Such amendment fee shall be
payable in immediately available funds on, and subject to the occurrence of, the
Amendment Effective Date (as defined below).
SECTION 4. Conditions to Effectiveness. This Amendment shall
become effective at such time (the "Amendment Effective Date") as (a) the
Administrative Agent (or its counsel) shall have received counterparts hereof
which, when taken together, bear the signatures of the Borrower, Holdings and
the Required Lenders, (b) the Administrative Agent shall have received the
Amendment Fee and (c) all out-of-pocket expenses incurred by the Administrative
Agent in connection with this Amendment or the transactions contemplated
thereby, for which invoices shall have been submitted to the Borrower on or
prior to the Amendment Effective Date, shall have been paid. Without limiting
the foregoing, the amendments set forth herein that affect the interest rates
under the Credit Agreement shall apply to all Loans outstanding on or after the
Amendment Effective Date from and including the Amendment Effective Date.
SECTION 5. Effect of Amendment. Except as expressly set forth
herein, this Amendment shall not by implication or otherwise limit, impair,
constitute a waiver of, or otherwise affect, the rights and remedies of the
Lenders or the Administrative Agent under the Credit Agreement or any other Loan
Document, and shall not alter, modify, amend or in any way affect any of the
terms, conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document, all of which are ratified and affirmed in
all respects and shall continue in full force and effect. Nothing herein shall
be deemed to entitle Holdings or the Borrower to a consent to, or a waiver,
amendment, modification or other change of, any of the terms, conditions,
obligations, covenants or agreements contained in the Credit Agreement or any
other Loan Document in similar or different circumstances. This Amendment shall
apply and be effective only with respect to the provisions of the Credit
Agreement specifically referred to herein. This Amendment shall constitute a
"Loan Document" for all purposes under the Credit Agreement and the other Loan
Documents.
SECTION 6. Expenses. The Borrower agrees to pay the reasonable
out-of-pocket costs and expenses incurred by the Administrative Agent in
connection with the preparation of this Amendment.
SECTION 7. Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each of which when so executed and delivered shall be deemed an original, but
all of which
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together shall constitute a single instrument. Delivery of an executed
counterpart of a signature page of this Amendment by facsimile transmission
shall be as effective as delivery of a manually executed counterpart hereof.
SECTION 8. Applicable Law. THIS AMENDMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 9. Headings. The headings of this Amendment are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their duly authorized officers, all as of the
date and year first above written.
NEENAH FOUNDRY COMPANY,
by
/s/ Gary LaChey
-------------------------------------
Name: Gary LaChey
Title: Corporate V.P. Finance
NFC CASTINGS, INC.,
by
/s/ Gary LaChey
-------------------------------------
Name: Gary LaChey
Title: Corporate V.P. Finance
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THE CHASE MANHATTAN BANK,
individually and as Administrative Agent
and Collateral Agent,
by
/s/ Peter S. Predun
-------------------------------------
Name: Peter S. Predun
Title: Vice President
AIM FLOATING RATE FUND,
By: INVESCO Senior Secured
Management, Inc. As Attorney in
fact,
by
/s/ Gregory Stoeckle
-------------------------------------
Name: Gregory Stoeckle
Title: Authorized Signatory
AVALON CAPITAL LTD.,
By: INVESCO Senior Secured
Management, Inc., as Portfolio
Advisor,
by
/s/ Gregory Stoeckle
-------------------------------------
Name: Gregory Stoeckle
Title: Authorized Signatory
BALANCED HIGH-YIELD FUND I, LTD.,
By: ING Capital Advisors LLC
acting as Asset Manager,
by
/s/ Michael D. Hatley
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Name: Michael D. Hatley
Title: Managing Director
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THE BANK OF NOVA SCOTIA,
by
/s/ F.C.H. Ashby
-------------------------------------
Name: F.C.H. Ashby
Title: Senior Manager Loan Operations
BANK ONE, WISCONSIN,
by
/s/ Fred J. Nehrling
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Name: Fred J. Nehrling
Title: Vice President
CAPTIVA II FINANCE, LTD.,
by
/s/ David Dyer
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Name: David Dyer
Title: Director
CERES FINANCE LTD.,
By: INVESCO Senior Secured
Management, Inc., as Sub-Managing
Agent,
by
/s/ Gregory Stoeckle
-------------------------------------
Name: Gregory Stoeckle
Title: Authorized Signatory
CIT GROUP/EQUIPMENT FINANCING,
INC.,
by
/s/ Undrae L. Mitchell
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Name: Undrae L. Mitchell
Title: Senior Credit Analyst
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CYPRESSTREE INVESTMENT FUND,
LLC,
By: CypressTree Investment
Management Company, Inc., its
Managing Member,
by
/s/ P. Jeffrey Huth
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Name: P. Jeffrey Huth
Title: Principal
CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC.,
As: Attorney-in-Fact and on behalf of
First Allmerica Financial Life
Insurance Company as Portfolio
Manager,
by
/s/ P. Jeffrey Huth
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Name: P. Jeffrey Huth
Title: Principal
CYPRESSTREE SENIOR FLOATING
RATE FUND,
By: CypressTree Investment
Management Company, Inc. as
Portfolio Manager,
by
/s/ P. Jeffrey Huth
-------------------------------------
Name: P. Jeffrey Huth
Title: Principal
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EATON VANCE SENIOR INCOME
TRUST,
By: Eaton Vance Management, as
Investment Advisor,
by
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Name:
Title:
FIRSTAR BANK, N.A.,
by
/s/ Mark A. Whitson
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Name: Mark A. Whitson
Title: Vice President
GENERAL ELECTRIC CAPITAL
CORPORATION,
by
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Name:
Title:
HELLER FINANCIAL INC.,
by
/s/ Scott Ziemke
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Name: Scott Ziemke
Title: Vice President
KZH CYPRESSTREE-1 LLC,
by
/s/ Kimberly Rowe
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Name: Kimberly Rowe
Title: Authorized Agent
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LASALLE BANK NATIONAL
ASSOCIATION,
by
/s/ Lou D. Banach
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Name: Lou D. Banach
Title: Vice President & Senior Lender
NATIONAL CITY BANK,
by
/s/ Lisa B. Lisi
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Name: Lisa B. Lisi
Title: Senior Vice President
NORTH AMERICAN SENIOR
FLOATING RATE FUND,
By: CypressTree Investment
Management Company, Inc. as
Portfolio Manager,
by
/s/ P. Jeffrey Huth
-------------------------------------
Name: P. Jeffrey Huth
Title: Principal
OXFORD STRATEGIC INCOME FUND,
By: Eaton Vance Management, as
Investment Advisor,
by
-------------------------------------
Name:
Title:
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PACIFICA PARTNERS I, L.P.,
By: Imperial Credit Asset Management
as its Investment Manager,
by
/s/ Tom Colwell
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Name: Tom Colwell
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
by
/s/ Louis K. McLinden, Jr.
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Name: Louis K. McLinden, Jr.
Title: Vice President
SENIOR DEBT PORTFOLIO,
By: Boston Management and Research,
as Investment Advisor,
by
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Name:
Title:
STANFIELD CLO, LTD.,
By: Stanfield Capital Partners LLC, as its
Collateral Manager,
by
/s/ Christopher A. Pucillo
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Name: Christopher A. Pucillo
Title: Managing Director
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STANFIELD/RMF TRANSLANTIC CDO,
LTD.,
By: Stanfield Capital Partners LLC, as its
Collateral Manager,
by
/s/ Christopher A. Pucillo
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Name: Christopher A. Pucillo
Title: Managing Director
VAN KAMPEN CLO I, LIMITED,
By: Van Kampen Management Inc., as
Collateral Manager,
by
/s/ Darvin D. Pierce
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Name: Darvin D. Pierce
Title: Principal
VAN KAMPEN CLO II, LIMITED,
By: Van Kampen Management Inc., as
Collateral Manager,
by
/s/ David D. Pierce
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Name: Darvin D. Pierce
Title: Principal
VAN KAMPEN PRIME RATE INCOME
TRUST,
By: Van Kampen Investment Advisory
Corp.,
by
/s/ Darvin D. Pierce
-------------------------------------
Name: Darvin D. Pierce
Title: Principal