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EXHIBIT 4.b
AMENDMENT TO AMENDED AND RESTATED
CREDIT AGREEMENT
AMENDMENT dated as of March 30, 1998 to the Amended and Restated Credit
Agreement dated as of November 14, 1996 (as heretofore amended, the "Credit
Agreement") among MASCO CORPORATION (the "Borrower"), the BANKS party thereto
(the "Banks") and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the
"Agent").
WITNESSETH:
WHEREAS, the parties hereto desire to amend the Credit Agreement to:
(i) change the minimum tangible net worth covenant to a minimum net
worth covenant and update the minimum amount specified therein,
(ii) reduce the maximum permitted ratio of (x) Consolidated Debt to (y)
the sum of Consolidated Debt and Consolidated Adjusted Net Worth from 57% to 53%
and
(iii) replace the defined term "Shareholders' Equity" with the term
"Consolidated Net Worth";
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Defined Terms; References. Unless otherwise specifically defined
herein, each term used herein which is defined in the Credit Agreement has the
meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.
SECTION 2. Definitions. (a) The definitions of "Consolidated Tangible Net
Worth" and "Shareholders' Equity" in Section 1.01 of the Credit Agreement are
deleted.
(b) The following new definition is added to Section 1.01 of the Credit
Agreement in the appropriate alphabetical order:
"Consolidated Net Worth" means at any date the consolidated
shareholders' equity of the Borrower and its Consolidated
Subsidiaries determined as of such date.
(c) The definitions of "Consolidated Adjusted Net Worth" and
"Consolidated Total Liabilities" in Section 1.01 of the Credit Agreement are
amended by changing the words "Shareholders' Equity" to "Consolidated Net
Worth".
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SECTION 3. Minimum Consolidated Net Worth. Section 5.02 of the Credit
Agreement is amended to read in full as follows:
Section 5.02. Minimum Consolidated Net Worth. At no time will
Consolidated Net Worth be less than Minimum Consolidated Net Worth.
"Minimum Consolidated Net Worth" means $1,700,000,000; provided that such
amount shall be adjusted at the end of each Fiscal Quarter ending after
December 31, 1997, as follows:
(i) increased by 50% of Consolidated Net Income for such
Fiscal Quarter; provided that, if Consolidated Net Income for such
Fiscal Quarter is a negative number (a "Consolidated Net Loss"), an
amount up to 50% of such Consolidated Net Loss shall be applied first
to reduce Minimum Consolidated Net Worth to the extent of offsetting
prior increases (if any) in Minimum Consolidated Net Worth Made
pursuant to this clause (i) during the same Fiscal Year and second to
reduce (but not below zero) any future increase in Minimum
Consolidated Net Worth that would otherwise be made pursuant to this
clause (i) during the same Fiscal Year; and
(ii) increased by an amount equal to 50% of all increases
in Consolidated Net Worth during such Fiscal Quarter attributable to
sales or issuances of the Borrower's Equity Securities; provided that
an amount up to 50% of all decreases in Consolidated New Worth during
such Fiscal Quarter attributable to purchases or other retirements of
the Borrower's Equity Securities shall be applied first to offset any
increase in Minimum Consolidated Net Worth that would otherwise be
made pursuant to this clause (ii) at the end of such Fiscal Quarter,
second to reduce Minimum Consolidated Net Worth to the extent of
offsetting prior increases (if any) in Minimum Consolidated Net Worth
made pursuant to this clause (ii) and third to reduce (but not below
zero) any future increase in Minimum Consolidated Net Worth that would
otherwise be made pursuant to this clause (ii).
SECTION 4. Limitations on Debt. (a) Section 5.03(a) of the Credit Agreement
is amended to read in full as follows:
(a) The Borrower will not at any time, and will not suffer or
permit any Consolidated Subsidiary at any time to, create, incur, issue,
guarantee or assume any Debt if, immediately after giving effect thereto,
the ratio of (i) Consolidated Debt to (ii) the sum of Consolidated Debt and
Consolidated Adjusted Net Worth would exceed 53%.
(b) Subsections (b) and (d) of Section 5.03 of the Credit Agreement
are amended by changing the words "Shareholders' Equity" to "Consolidated
Net Worth".
SECTION 5. Negative Pledge. Clause (i) of Section 5.04 of the Credit
Agreement is amended by changing "5% of Consolidated Tangible Net Worth" to "3%
of "Consolidated Net Worth".
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SECTION 6. Financial Information. Section 4.04 of the Credit Agreement is
amended to read as follows:
SECTION 4.04. Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of December 31, 1997 and the related
consolidated statements of income and cash flows for the Fiscal Year then
ended, reported on by Coopers & Lybrand L.L.P. and set forth in the
Borrower's 1997 Form 10-K, a copy of which has been delivered to each of
the Banks, fairly present, in conformity with generally accepted accounting
principles, the consolidated financial position of the Borrower and its
Consolidated Subsidiaries as of such date and the consolidated results of
their operations and their cash flows for such Fiscal Year.
(b) There has been no material adverse change since December 31,
1997 in the business or financial position of the Borrower and its
Consolidated Subsidiaries, considered as a whole, as reflected in the
financial statements referred to in subsection (a) of this Section.
SECTION 7. Conforming Change in Conditions to Borrowing. Clause (d) of
Section 3.02 is amended by changing the reference therein to Section "4.04(c)"
to refer to Section "4.04(b)".
SECTION 8. Representations of Borrower. The Borrower represents and
warrants that (i) the representations and warranties of the Borrower set forth
in Article 4 of the Credit Agreement will be true on and as of the Amendment
Effective Date and (ii) no Default will have occurred and be continuing on such
date.
SECTION 9. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 10. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
SECTION 11. Effectiveness. This Amendment shall become effective on the
date (the "AMENDMENT EFFECTIVE DATE") when the Agent shall have received from
each of the Borrower and the Required Banks a counterpart hereof signed by such
party or facsimile or other written confirmation (in form satisfactory to the
Agent) that such party has signed a counterpart hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.
MASCO CORPORATION
By: /s/Robert B. Rosowski
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Title: Vice President - Controller and
Treasurer
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By: /s/John M. Mikolay
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Title: Vice President
NBD BANK
By: /s/William J. Maxbauer
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Title: Vice President
BANK OF AMERICA ILLINOIS
By: /s/Andrew J. Sutherland
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Title: Vice President
COMERICA BANK
By: /s/Arden J. Anderson
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Title: First Vice President
NATIONSBANK, N.A.
By: /s/Wallace Harris, Jr.
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Title: Vice President
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PNC BANK, NATIONAL ASSOCIATION
By: /s/Peter F. Stack
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Title: Assistant Vice President
THE BANK OF NEW YORK
By: /s/Edward J. Doughery III
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Title: Vice President
U.S. Commercial Banking
THE CHASE MANHATTAN BANK
By: /s/Andris G. Kalnins
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Title: Vice President
COMMERZBANK AKTIENGESELLSCHAFT
CHICAGO BRANCH
By: /s/J. Timothy Shortly
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Title: Senior Vice President
By: /s/William Binder
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Title: Vice President
ROYAL BANK OF CANADA
By: /s/Gordon MacArthur
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Title: Manager
WACHOVIA BANK OF GEORGIA, N.A.
By: /s/Debra L. Coheley
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Title: Senior Vice President
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THE BANK OF NOVA SCOTIA
By: /s/F.C.H. Ashby
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Title: Senior Manager Loan Operations
THE BANK OF TOKYO-MITSUBISHI LTD.,
CHICAGO BRANCH
By: /s/Hajime Watannabe
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Title: Deputy General Manager
THE DAI-ICHI KANGYO BANK, LTD.,
CHICAGO BRANCH
By: /s/Sunao Hirata
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Title: Vice President
DRESDNER BANK AG NEW YORK AND
GRAND CAYMAN BRANCHES
By: /s/B. Craig Erickson
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Title: Vice President
By: /s/Kam Pasha
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Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/Thomas A. Crandell
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Title: Vice President
ISTITUTO BANCARIOSAN PAOLO
DI TORINO SPA
By: /s/Carlo Persico
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Title: Deputy General Manager
By: /s/William J. DeAngelo
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Title: First Vice President
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THE SANWA BANK LTD.
CHICAGO BRANCH
By: /s/Richard H. Ault
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Title: VP Corporate Banking
TH SUMITOMO BANK, LTD.
By: /s/Kenichiro Kobayashi
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Title: Joint General Manager
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