Exhibit 10.3
Amended RBS and National Westminster Credit Facility Agreement
THIS AMENDMENT AGREEMENT is made the 27 September 2001
BETWEEN
(1) APW ELECTRONICS GROUP PLC (formerly Vero Group PLC)
(2) APW ELECTRONICS OVERSEAS INVESTMENTS LIMITED (formerly Vero Electronics
Overseas Investments Limited)
(3) APW ELECTRONICS LIMITED (formerly Vero Electronics Limited)
(4) APW ENCLOSURES AB (formerly Vero Enclosures AB)
(5) APW ELECTRONICS GmbH (formerly Vero Electronics GmbH)
(6) VERO ELECTRONICS Inc.
(7) APW ENCLOSURES S.A. (formerly Vero Electronics S.A.) and
(8) APW ELECTRONICS S.r. L (formerly Vero Electronics S.r.L.) (each a "RBS
Borrower" and together the "RBS Borrowers");
(9) THE ROYAL BANK OF SCOTLAND plc ("RBS")
(10) APW ENCLOSURES PRODUCTS & SYSTEMS LIMITED and each of its subsidiaries set
out in Schedule 1 (each a "Natwest Borrower" and together the "Natwest
Borrowers"); and
(11) NATIONAL WESTMINSTER BANK PLC ("Natwest").
WHEREAS
(A) RBS and the RBS Borrowers entered into a (Pounds)27,500,000 revolving
credit facility dated 24 October 1995 (as subsequently amended by two
amendment agreements dated 15 May 1998 and 22 May 1998 respectively) (the
"RBS Facility Agreement"). The RBS Facility Agreement was subsequently
amended and restated under an amendment agreement dated 15 May 2001.
(B) NatWest and the Second Borrower entered into a (Pounds)27,000,000 multi-
line facility dated 20 April 2000 (the "Natwest Facility Agreement"). The
Natwest Facility Agreement was subsequently amended and restated under an
amendment agreement dated 15 May 2001.
(C) On 31 July 2000, APW Ltd, APW North America, Inc., APW Holdings (Denmark)
APS, certain financial institutions, Bank One, N.A., as syndication agent,
The Chase Manhattan Bank as documentation agent and Bank of America,
National Association as administrative agent ("the "US Agent") entered
into a multicurrency agreement (as subsequently amended and restated on
and with effect from 15 May 2001) (the "Multicurrency Agreement").
(D) RBS, Natwest, the US Agent and others entered into an intercreditor
agreement dated 15/th/ May 2001 regulating, inter alia, the application of
recoveries under the RBS Facility Agreement, the Natwest Facility
Agreement and the Multicurrency Agreement (the "Intercreditor Agreement").
(E) Under a first amendment to the Multicurrency Agreement dated of even date
herewith (the "First Amendment Agreement"), the parties to the
Multicurrency Agreement agreed to amend the Multicurrency Agreement in
certain respects. RBS and Natwest have agreed to make equivalent
amendments to the RBS Facility Agreement and the Natwest Facility
Agreement.
-1-
(F) The parties wish to enter into this Agreement to record the basis on which
the RBS Facility Agreement and the Natwest Facility Agreement are being
amended.
IT IS AGREED as follows:-
1 DEFINITIONS AND INTERPRETATION
In this Agreement, except where the context otherwise requires, words and
expressions defined and references construed in the RBS Facility Agreement
or the NatWest Facility Agreement (but not defined or construed in this
Agreement) shall have the same meaning herein.
2 AMENDMENT OF FACILITY AGREEMENTS
2.1 With effect from the date hereof, subject only to Clause 3.1, it is agreed
that, insofar as they are inconsistent with those provisions contained in
the First Amendment Agreement specified in Clauses 2.1.1 to 2.1.14 below
(but only as such provisions are in force as at the date of this
Agreement), the terms of the RBS Facility Agreement and the Natwest
Facility Agreement shall each be deemed to be amended, to the extent
necessary to make them consistent with the following provisions:-
2.1.1 Section 1.1 - definition of "Consolidated Net Income";
2.1.2 Section 1.2 - definition of EBITDARR;
2.1.3 Section 1.4 - Unscheduled Mandatory Reductions;
2.1.4 Section 1.5 - Required Guaranties;
2.1.5 Section 1.6 Action with Non-Guarantors;
2.1.6 Section 1.7 - Transfer of Assets;
2.1.7 Section 1.8 - Reports;
2.1.8 Section 1.9 - Quarterly Financial Covenants;
2.1.9 Section 1.10 - Monthly Financial Covenant;
2.1.10 Section 1.11- Section 7.6(b);
2.1.11 Section 1.12 - Sales of Assets;
2.1.12 Section 1.13 Investments;
2.1.13 Section 1.14 - Limitation on Debt and Subsidiary Debt;
2.1.14 Section 1.15 - Business Plan
2.2 Section 1.3 of the First Amendment Agreement (New Definition) shall be
deemed to be incorporated mutatis mutandis into each of the RBS Facility
Agreement and the NatWest Facility Agreement.
2.3 The parties agree to be bound by the RBS Facility Agreement and the Natwest
Facility Agreement, each as amended.
-2-
3 CONDITIONS PRECEDENT AND SUBSEQUENT TO THIS AMENDMENT AND RESTATEMENT
AGREEMENT
3.1 This Agreement shall become effective once RBS, for itself and on behalf of
Natwest, has received the First Amendment Agreement duly executed, dated
the date hereof, in form and substance satisfactory to RBS, such First
Amendment Agreement being conditional at that stage only on receipt of this
Agreement by the Administrative Agent (as defined therein).
3.2 It shall be a condition subsequent to this Agreement that RBS shall have
received in a form and substance satisfactory to it within 15 days of the
date of this Agreement, a copy, certified as true and up to date copy by the
Secretary of each UK Obligor, of a resolution of the board of directors of
such UK Obligor approving the execution and delivery of this Agreement and
the performance of its obligations hereunder and authorising a person or
persons (specified by name) on behalf of each UK Obligor to sign and deliver
this Agreement and any other documents to be delivered by it pursuant
thereto.
4 GENERAL
4.1 The Borrowers hereby undertake that the Representations and Warranties set
out in Clause 12 of the RBS Facility Agreement are true and accurate as of
the date of this Agreement and represent and warrant to each of RBS and
Natwest in the same terms as the representations and warranties contained in
Clause 4 of the First Amendment Agreement.
4.2 RBS and Natwest shall each be paid an amendment fee of 10 basis points on
their Commitment under the Multicurrency Agreement and their commitments
under the RBS Facility Agreement and the Natwest Facility Agreement.
4.3 All other terms and conditions of the Facility Agreement remain unchanged,
save that the creation of the security evidenced by the Collateral Documents
and all other security created in favour of the Security Trustee and the
Bank is expressly permitted.
4.4 A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Act 1999 to enforce or enjoy the benefit
of any term of this Agreement.
4.5 The Borrowers shall on demand reimburse RBS and Natwest all reasonable costs
including fees, costs and expenses (including legal fees and expenses)
incurred in or in connection with the negotiation and execution of the
Agreement shall pay all stamp, registration and other taxes to which any
such document is, or at any time may be, subject and shall indemnify RBS and
Natwest against any liabilities, expenses, costs or claims resulting from
any failure to pay, or any delay in paying, such tax.
4.6 This Agreement shall be governed by and construed in accordance with the
laws of England and the parties hereto submit to the jurisdiction of the
English courts.
-3-
Schedule
Company Registered Number Registered Office
APW Enclosure Products & Systems Limited 3618668 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Enclosure Systems (UK) Limited 962534 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Investments UK Limited 2873016 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Holdings (UK) Limited 2894364 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
Rubicon Finance Limited 2868702 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Holdings (Europe) Limited 2868712 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Electronics Group PLC 02889677 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Electronics Overseas Investments Limited 02889679 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Electronics Limited 00701364 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Power Supplies Limited 02037578 Unit 10, Centre One, Lysander Way, Old Sarum,
Salisbury, Wilts. SP4 6BU
Applied Power Limited 03528602 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Enclosure Systems (Holdings) Limited 03618666 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Enclosure Systems PLC 98900 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
APW Galway Limited 67768 Ballybrit Business Park, Ballybrit, Galway,
Republic of Ireland
APW New Forest Limited 1357306 Electron Way, Chandlers Ford, Eastleigh,
Hampshire, SO53 4ZR
-4-
SIGNED FOR AND ON BEHALF OF:-
THE ROYAL BANK OF SCOTLAND plc
By: /s/ T. J. Smith
Senior Manager SLS
SIGNED FOR AND ON BEHALF OF:-
NATIONAL WESTMINSTER BANK PLC
By: /s/ T. J. Smith
Senior Manager SLS
THE RBS BORROWERS
APW ELECTRONICS GROUP PLC
By:
APW ELECTRONICS OVERSEAS INVESTMENTS LIMITED
By:
APW ELECTRONICS LIMITED
By:
APW ENCLOSURES AB
By:
APW ENCLOSURES GmbH
By:
-5-
SIGNED FOR AND ON BEHALF OF:-
THE ROYAL BANK OF SCOTLAND plc
By:
SIGNED FOR AND ON BEHALF OF:-
NATIONAL WESTMINSTER BANK PLC
By:
THE RBS BORROWERS
APW ELECTRONICS GROUP PLC
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS OVERSEAS INVESTMENTS LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ENCLOSURES AB
By: /s/ Richard D. Carroll
Vice President
APW ENCLOSURES GmbH
By: /s/ Richard D. Carroll
Vice President
VERO ELECTRONICS INC.
By: /s/ Richard D. Carroll
Vice President
APW ENCLOSURES S.A.
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS S.r. L
By: /s/ Richard D. Carroll
Vice President
THE NATWEST BORROWERS
APW ENCLOSURE PRODUCTS & SYSTEMS LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ENCLOSURE SYSTEMS (UK) LIMITED
By: /s/ Richard D. Carroll
Vice President
APW INVESTMENTS UK LIMITED
By: /s/ Richard D. Carroll
Vice President
APW HOLDINGS (UK) LIMITED
By: /s/ Richard D. Carroll
Vice President
RUBICON FINANCE LIMITED
By: /s/ Richard D. Carroll
Vice President
APW HOLDINGS (EUROPE) LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS GROUP PLC
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS OVERSEAS INVESTMENTS LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ELECTRONICS LIMITED
By: /s/ Richard D. Carroll
Vice President
APW POWER SUPPLIES LIMITED
By: /s/ Richard D. Carroll
Vice President
APPLIED POWER LIMITED
By: /s/ Richard D. Carroll
Vice President
APW ENCLOSURE SYSTEMS (HOLDINGS) LIMITED
By: /s/ Richard D. Carroll
Vice President
APW GALWAY LIMITED
By: /s/ Richard D. Carroll
Vice President
APW NEW FOREST LIMITED
By: /s/ Richard D. Carroll
Vice President
Schedule 7.6(a)(i)
------------------
---------------------------------------------------------------------------------------------------------------
EBITDARR: Q102 Q202 Q302 Q402
---- ---- ---- ----
---------------------------------------------------------------------------------------------------------------
EBITDA (per Income Statement) 32,721 14,697 29,581 36,756
- Adjusted for "Other Expenses" - 45 44 44
EBITDA (adjusted for "Other Expenses") 32,721 14,652 29,537 36,712
- Less Gain on Asset Sale (24,000) - - -
EBITDA, less Gain on Asset Sale 8,721 14,652 29,537 36,712
+ GAAP Restructuring Expense 8,925 2,503 - -
+ Non-GAAP Restructuring Expense 2,802 3,437 2 -
=================================================================
EBITDARR, less Gain on Asset Sale 20,448 20,592 29,539 36,712
1Q Rolling 2Q Rolling 3Q Rolling 4Q Rolling
---------- ---------- ---------- ----------
Rolling EBITDARR 20,448 41,040 70,579 107,290
Total not Less Than 13,948 31,040 60,579 97,290
Schedule 7.6(a)(ii)
-------------------
--------------------------------------------------------------------------------------------------------------
Non - GAAP Restructuring expenses: Q1 02E Q2 02E Q3 02E Q4 02E
------ ------ ------ ------
--------------------------------------------------------------------------------------------------------------
Non - GAAP Restructuring 2,802 3,437 2 0
Write-off of Assets 2,173 1,780 1,430 0
Total Non - GAAP Restructuring 4,975 5,217 1,432 0
Non - GAAP Restructuring (cumulative) 4,975 10,192 11,624 11,624
Non - GAAP Restructuring Covenant -not to exceed 7,500 11,000 12,500 12,500
Schedule 7.6(a)(iii)
--------------------
-------------------------------------------------------------------------------------------------------------------
GAAP Restructuring expenses: Q1 02E Q2 02E Q3 02E Q4 02E
------ ------ ------ ------
-------------------------------------------------------------------------------------------------------------------
GAAP Restructuring 8,925 2,503 0 0
GAAP Restructuring (cumulative) 8,925 11,428 11,428 11,428
GAAP Restructuring Covenant -not to exceed 12,500 12,500 12,500 12,500
Schedule 7.6(a)(iv)
-------------------
---------------------------------------------------------------------------------------------------------------
Free Cash Flow: Q1 02E Q2 02E Q3 02E Q4 02E
------ ------ ------ ------
---------------------------------------------------------------------------------------------------------------
Cash Flow (608) (9,677) (5,289) 13,448
Cash Flow (Cumulative) (608) (10,285) (15,574) (2,126)
Cumulative Cash Flow Covenant Minimum (7,108) (18,785) (25,574) (12,126)
Schedule 7.6(b)
---------------
----------------------------------------------------------------------------------------------------------------
Rolling 3-month Revenue Test Q4 01E Q1 02E Q2 02E Q3 02E Q4 02E
------ ------ ------ ------ ------
----------------------------------------------------------------------------------------------------------------
Revenue Projections 290,200 285,000 280,000 310,000 335,000
Month 1 30% 87,060 85,500 84,000 93,000 100,500
Month 2 60% 174,120 171,000 168,000 186,000 201,000
Month 3 90% 261,180 256,500 252,000 279,000 301,500
Monthly Sales Covenant 256,500 252,000 279,000 301,500
(3 month rolling)
September 2001 259,620
October 2001 258,060
November 2001 256,500
December 2001 255,000
January 2002 253,500
February 2002 252,000
March 2002 261,000
April 2002 270,000
May 2002 279,000
June 2002 286,500
July 2002 294,000
August 2002 301,500