Exhibit 10.9
AMENDMENT NO. 2 TO CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO CREDIT AGREEMENT (this "Amendment"), dated July
___, 2002, is made and entered into on the terms and conditions hereinafter set
forth, by and among NN, INC., a Delaware corporation (the "Borrower"), the
subsidiaries of the Borrower who are parties to the Credit Agreement, as
hereinafter defined (the "Guarantors"), the several lenders who are now or
hereafter become parties to the Credit Agreement (the "Lenders"), AMSOUTH BANK,
an Alabama state bank, individually and as administrative agent for the Lenders
(in such capacity, the "Administrative Agent"), and BANK ONE, KENTUCKY, NA,
individually and as co-agent for the Lenders (in such capacity, the "Co-Agent").
RECITALS:
1. Pursuant to a Credit Agreement dated as of July 20, 2001, among the
Borrower, the Guarantors, the Administrative Agent, the Lenders and the
Co-Agent, as amended by that certain Amendment No. 1 to Credit Agreement dated
October 4, 2001, (as the same heretofore may have been and/or hereafter may be
amended, restated, supplemented, extended, renewed, replaced or otherwise
modified from time to time, the "Credit Agreement"), the Lenders have agreed to
make Loans, all as more specifically described in the Credit Agreement.
Capitalized terms used but not otherwise defined in this Agreement have the same
meanings as in the Credit Agreement.
2. The parties hereto desire to amend the Credit Agreement in certain
respects, as more particularly hereinafter set forth.
AGREEMENTS:
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Defined Terms. Subsection 1.1 of the Agreement is hereby amended by
amending the definition of "Term Loan Commitments" to provide as follows:
"Term Loan Commitments" shall mean, at any time, the commitment of all
the Lenders, collectively, to make Term Loans to the Borrower from time to
time, pursuant to the provisions of Section 2.2.2, and the "Term Loan
Commitment" of any Lender at any time shall mean an amount equal to such
Lender's Percentage multiplied by the then effective aggregate Term Loan
Commitments. The Term Loan Commitments are in the aggregate amount set
forth in Section 2.1.
2. Term Loan Commitments. Subsection 2.1.1(c) of the Agreement is hereby
amended to provide as follows:
(c) The aggregate amount of the Term Loan Commitments shall be
$27,378,000, which amount shall reduce by $1,750,000 on October 1,
2002, and on each January 1, April 1, July 1 and October 1 thereafter.
3. Voluntary Reductions of Revolving Credit Commitments and Term Loan
Commitments. Subsection 2.1.2 of the Agreement is hereby amended to provide as
follows:
2.1.2. Voluntary Reductions of Revolving Credit Commitments and Term
Loan Commitments. The Borrower shall have the right, at any time and from
time to time, to terminate in whole or permanently reduce in part, without
premium or penalty, the Revolving Credit Commitments and Term Loan
Commitments in an amount up to the amount by which the Revolving Credit
Commitments or the Term Loan Commitments, as applicable, exceed the
aggregate amount of the then outstanding Revolving Loans or the Term Loans.
The Borrower shall give not less than ten (10) Business Days' prior written
notice to the Administrative Agent designating the date (which shall be a
Business Day) of such termination or reduction and the amount of any
reduction. Promptly after receipt of a notice of such termination or
reduction, the Administrative Agent shall notify each Lender of the
proposed termination or reduction. Such termination or reduction of the
Revolving Credit Commitments or the Term Loan Commitments, as the case may
be, shall be effective on the date specified in the Borrower's notice and
shall reduce the Revolving Credit Commitments or the Term Loan Commitments,
as applicable, of each Lender in proportion to its Percentage of the
Revolving Credit Commitments or the Term Loan Commitments, as applicable.
Any such reduction of the Revolving Credit Commitments or the Term Loan
Commitments shall be in a minimum amount of $1,000,000 and in integral
multiples of $500,000.
4. Commitment to Make Term Loans. Subsection 2.2.2 of the Agreement is
hereby amended to provide as follows:
2.2.2. Commitment to Make Term Loans. Subject to all of the terms and
conditions of this Agreement (including the conditions set forth in
Sections 6.1 and 6.2) in reliance upon the representations and warranties
of the Borrower herein set forth, each Lender hereby severally agrees to
make Term Loans to the Borrower from time to time prior to the Term Loan
Maturity Date and for the purposes identified in Section 2.7.; provided,
however, in no event shall (a) the aggregate principal amount of the Term
Loans made by any Lender outstanding at any time exceed such Lender's Term
Loan Commitment, or (b) the aggregate principal amount of the Term Loans
outstanding at any time exceed the Term Loan Commitments. All Term Loans
shall be paid in full no later than the Term Loan Maturity Date.
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5. Revolving Credit; Minimum Borrowings. Subsection 2.2.4 is hereby
amended to provide as follows:
2.2.4. Revolving Credit; Minimum Borrowings. Amounts borrowed by the
Borrower under the Revolving Credit Commitments may be prepaid and
reborrowed from time to time during the Revolving Commitment Period.
Amounts borrowed by the Borrower under the Term Loan Commitments may be
prepaid and reborrowed from time to time prior to the Term Loan Maturity
Date. The aggregate amount of Revolving Loans or Term Loans made on any
Funding Date shall be in integral multiples of $100,000.
6. Notice of Borrowing. Exhibit 2.2.5 [Form of Notice of Borrowing] to
the Agreement is hereby deleted and Exhibit 2.2.5 hereto is substituted in lieu
thereof. Subsection 2.2.5 of the Agreement is hereby amended to provide as
follows:
2.2.5. Notice of Borrowing.
(a) Delivery of Notice. Whenever the Borrower desires to borrow
under Section 2.2.1 or Section 2.2.2, it shall deliver to the
Administrative Agent a Notice of Borrowing no later than 11:00 a.m.
(Central time) at least one (1) Business Day in advance of the proposed
Funding Date (in the case of Base Rate Loans) or three (3) Business Days in
advance of the proposed Funding Date (in the case of LIBOR Loans). The
Notice of Borrowing shall specify (i) the proposed Funding Date (which
shall be a Business Day), (ii) the amount of the proposed Borrowing, (iii)
whether the proposed Borrowing shall be a Revolving Loan or a Term Loan,
(iv) whether the proposed Borrowing shall be in the form of Base Rate Loans
or LIBOR Loans, and (v) in the case of LIBOR Loans, the requested Interest
Period. In lieu of delivering a Notice of Borrowing, the Borrower may give
the Administrative Agent telephonic notice by the required time of notice
of any proposed Borrowing under this Section 2.2.5; provided, however, that
such notice shall be promptly confirmed in writing by delivery of a Notice
of Borrowing to the Administrative Agent on or prior to the Funding Date of
the requested Revolving Loans or Term Loans. The execution and delivery of
each Notice of Borrowing shall be deemed a representation and warranty by
the Borrower that the requested Revolving Loans or Term Loans may be made
in accordance with, and will not violate the requirements of, this
Agreement, including those set forth in Section 2.2.1 or Section 2.2.2.
(b) No Liability for Telephonic Notices. Neither the Administrative
Agent nor any Lender shall incur any liability to the Borrower in acting
upon any telephonic notice given pursuant to this Section 2.2.5 that the
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of the
Borrower or for otherwise acting in good faith under this Section 2.2.5
and, upon the funding of Revolving Loans or Term Loans by the Lenders in
accordance with this Agreement pursuant to any telephonic notice, the
Borrower shall have effected a Borrowing of Revolving Loans or Term Loans,
as the case may be, hereunder.
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(c) Notice Irrevocable. A Notice of Borrowing for LIBOR Loans (or a
telephonic notice in lieu thereof) shall be irrevocable on and after the
related Interest Rate Determination Date, and the Borrower shall be bound
to make a Borrowing in accordance therewith.
7. Commitment Fees. Subsection 2.8.3 of the Agreement is hereby amended
to provide as follows:
2.8.3. Commitment Fees. The Borrower agrees to pay to the
Administrative Agent, for distribution to the Lenders in proportion to
their respective Percentages, (a) annual commitment fees for the period
commencing on the date hereof to but excluding the Revolving Commitment
Period Expiration Date equal to the average of the daily unused portion of
the Revolving Credit Commitments (i.e., the aggregate amount of the
Revolving Credit Commitments less the aggregate amount of Revolving Loans
outstanding) multiplied by the Applicable Commitment Fee Percentage, and
(b) annual commitment fees for the period commencing on the date hereof to
but excluding the Term Loan Maturity Date equal to the average of the daily
unused portion of the Term Loan Commitments (i.e., the aggregate amount of
the Term Loan Commitments less the aggregate amount of Term Loans
outstanding) multiplied by the Applicable Commitment Fee Percentage
(collectively, the "Commitment Fees"). Commitment Fees shall be payable in
quarter-annual installments, in arrears, on January 1, April 1, July 1, and
October 1 of each year, commencing October 1, 2001, and on the Revolving
Commitment Expiration Date (with respect to the Revolving Credit
Commitments) and commencing October 1, 2002, and on the Term Loan Maturity
Date (with respect to the Term Loan Commitments).
8. Disbursement of Funds. Subsection 2.2.6 of the Agreement is hereby
amended to provide as follows:
2.2.6. Disbursement of Funds. Promptly after receipt of a Notice of
Borrowing (or telephonic notice in lieu thereof), the Administrative Agent
shall notify each Lender of the proposed Borrowing in writing, or by
telephone promptly confirmed in writing. Each Lender shall make the amount
of its Revolving Loan or Term Loan, as the case may be, available to the
Administrative Agent, in immediately available funds, at the Lending Office
of the Administrative Agent, not later than 11:00 a.m. (Central time) on
the Funding Date. The Administrative Agent shall make the proceeds of such
Revolving Loans or Term Loans available to the Borrower on such Funding
Date by causing an amount of immediately available funds equal to the
proceeds of all such Revolving Loans or Term Loans, as the case may be,
received by the Administrative Agent to be credited to the account of the
Borrower at such office of the Administrative Agent.
9. Term Loan Principal Payments. Subsection 3.1.2 of the Agreement is
hereby amended to provide as follows:
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3.1.2. Term Loan Principal Payments. Principal of the Term Loans
shall be repaid in an amount necessary to reduce the outstanding principal
of the Term Loans to an amount that is not greater than the amount of the
Term Loan Commitments, as such amount reduces from time to time in
accordance with Subsection 2.1.1(c) of this Agreement; provided, however,
that in connection with any payment of principal of the Term Loans
consisting of LIBOR Loans, the Borrower shall pay to the Administrative
Agent, for distribution to the Lenders, the accrued interest on such Loan
required to be paid pursuant to Section 3.1.1 and any amounts required to
be paid pursuant to Section 3.3.3.
10. Optional Prepayments. Subsection 3.1.3(a)(2) is hereby amended by
deleting from the last two (2) lines the clause "and provided further that any
prepayments of the Term Loans, shall be applied to scheduled Term Loan principal
payments in the inverse order of their maturity."
11. Mandatory Prepayment. The first sentence of Subsection 3.1.3(b)(1) of
the Agreement is hereby amended by deleting from the first sentence the language
"and provided further that any prepayments of the Term Loan shall be applied to
scheduled Term Loan principal payments in the inverse order of their maturity."
The penultimate sentence of Subsection 3.1.3(b)(1) of the Agreement is hereby
amended to provide as follows:
Any prepayment pursuant to this paragraph (1) shall be applied first to the
outstanding principal balance of the Term Loans, and then to outstanding
Revolving Loans, in each case applied first to Base Rate Loans until the
same have been fully repaid, and then to LIBOR Loans.
12. Secondary Offering. The proceeds received by the Borrower from the
Borrower's anticipated secondary offering of its stock less any underwriters'
discounts and commissions shall be applied to the outstanding Term Loans in
accordance with the provisions of Subsection 3.1.3(b) of the Agreement;
provided, however, notwithstanding the provisions of Section 3.1.3(b) of the
Agreement so long as such proceeds are received by the Borrower not later than
September 30, 2002, the amount of the Term Loan Commitments shall not be reduced
by the amount of such prepayment.
13. Restricted Payments. Clause (c) of Section 9.5 is hereby amended to
provide as follows:
(c) the Borrower may declare and pay dividends and make distributions
payable to its shareholders in any Fiscal Year in an aggregate amount not
in excess of (i) $5,500,000 or (ii) in the event Borrower received proceeds
from its anticipated secondary offering on or before September 30, 2002,
$6,500,000.
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14. Restructuring Fee. Upon execution of this Amendment, the Borrower
shall pay to the Administrative Agent, for distribution to the Lenders in
proportions to their respective Percentages, a restructuring fee in the amount
of $54,756.
15. Effectiveness. This Amendment shall be effective only upon execution
and delivery by the Borrower, the Guarantors, the Administrative Agent and the
Lenders.
16. Representations and Warranties of the Borrower and the Guarantors. As
an inducement to the Administrative Agent, the Co-Agent and the Lenders to enter
into this Amendment, the Borrower and the Guarantors hereby represent and
warrant to the Administrative Agent, the Co-Agent and the Lenders that, on and
as of the date hereof:
(a) the representations and warranties contained in the Credit
Agreement and the other Loan Documents are true and correct, except for (1)
representations and warranties that expressly relate to an earlier date,
which remain true and correct as of said earlier date, and (2)
representations and warranties that have become untrue or incorrect solely
because of changes permitted by the terms of the Credit Agreement and the
other Loan Documents, and
(b) no Default or Event of Default has occurred and is continuing.
17. Effect of Amendment; Continuing Effectiveness of Credit Agreement and
Loan Documents.
(a) Neither this Amendment nor any other indulgences that may have
been granted to the Borrower or any of the Guarantors by the Administrative
Agent, the Co-Agent or any Lender shall constitute a course of dealing or
otherwise obligate the Administrative Agent, the Co-Agent or any Lender to
modify, expand or extend the agreements contained herein, to agree to any
other amendments to the Credit Agreement or to grant any consent to, waiver
of or indulgence with respect to any other noncompliance with any provision
of the Loan Documents.
(b) This Amendment shall constitute a Loan Document for all purposes
of the Credit Agreement and the other Loan Documents. Any noncompliance by
the Borrower or any Guarantor with any of the covenants, terms, conditions
or provisions of this Amendment that shall continue for more than twenty
(20) days after the earlier of (a) written notice from the Administrative
Agent to the Borrower or such Guarantor, as applicable, of the existence of
such Default or (b) the date any Responsible Officer of the Borrower or
such Guarantor, as applicable, first obtains knowledge of such failure,
shall constitute an Event of Default. Except to the extent amended hereby,
the Credit Agreement, the other Loan Documents and all terms, conditions
and provisions thereof shall continue in full force and effect in all
respects.
18. Counterparts. This Amendment may be executed in multiple counterparts
or copies, each of which shall be deemed an original hereof for all purposes.
One or more counterparts or copies of this Amendment may be executed by one or
more of the parties hereto,
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and some different counterparts or copies executed by one or more of the
other parties. Each counterpart or copy hereof executed by any party hereto
shall be binding upon the party executing same even though other parties may
execute one or more different counterparts or copies, and all counterparts or
copies hereof so executed shall constitute but one and the same agreement. Each
party hereto, by execution of one or more counterparts or copies hereof,
expressly authorizes and directs any other party hereto to detach the signature
pages and any corresponding acknowledgment, attestation, witness or similar
pages relating thereto from any such counterpart or copy hereof executed by the
authorizing party and affix same to one or more other identical counterparts or
copies hereof so that upon execution of multiple counterparts or copies hereof
by all parties hereto, there shall be one or more counterparts or copies hereof
to which is(are) attached signature pages containing signatures of all parties
hereto and any corresponding acknowledgment, attestation, witness or similar
pages relating thereto.
19. Miscellaneous.
(a) This Amendment shall be governed by, construed and enforced in
accordance with the laws of the State of Tennessee, without reference to
the conflicts or choice of law principles thereof.
(b) The headings in this Amendment and the usage herein of defined
terms are for convenience of reference only, and shall not be construed as
amplifying, limiting or otherwise affecting the substantive provisions
hereof.
(c) Any reference herein to any instrument, document or agreement, by
whatever terminology used, shall be deemed to include any and all
amendments, modifications, supplements, extensions, renewals, substitutions
and/or replacements thereof as the context may require.
(d) When used herein, (1) the singular shall include the plural, and
vice versa, and the use of the masculine, feminine or neuter gender shall
include all other genders, as appropriate, (2) "include", "includes" and
"including" shall be deemed to be followed by "without limitation"
regardless of whether such words or words of like import in fact follow
same, and (3) unless the context clearly indicates otherwise, the
disjunctive "or" shall include the conjunctive "and".
[Signatures Begin Next Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered as of the date first written above.
BORROWER:
NN, INC.,
a Delaware corporation
By: /s/ William C. Kelly, Jr.
------------------------------------------------
Name: William C. Kelly, Jr.
-------------------------------------------
Title: Treasurer
------------------------------------------
GUARANTORS:
INDUSTRIAL MOLDING GP, LLC,
a Delaware limited liability company
By: /s/ David L. Dyckman
------------------------------------------------
Name: David L. Dyckman
-------------------------------------------
Title: Manager
------------------------------------------
INDUSTRIAL MOLDING LP, LLC,
a Tennessee limited liability company
By: /s/ William C. Kelly, Jr.
------------------------------------------------
Name: William C. Kelly, Jr.
-------------------------------------------
Title: Manager
------------------------------------------
[Signatures Continued Next Page]
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INDUSTRIAL MOLDING GROUP, L.P.,
a Tennessee limited partnership
By: Industrial Molding GP, LLC, a Delaware limited
liability company, its general partner
By: /s/ David L. Dyckman
-------------------------------------------
Name: David L. Dyckman
--------------------------------------
Title: GP, Manager
-------------------------------------
DELTA RUBBER COMPANY,
a Connecticut corporation
By: /s/ David L. Dyckman
------------------------------------------------
Name: David L. Dyckman
-------------------------------------------
Title: Vice President
------------------------------------------
LENDERS:
AMSOUTH BANK, as a Lender and as
Administrative Agent
By: /s/ Sarah Dawkins
------------------------------------------------
Name: Sarah Dawkins
-------------------------------------------
Title: Officer
------------------------------------------
BANK ONE, KENTUCKY, NA, as a Lender and as
Co-Agent
By: /s/ Thelma B. Ferguson
------------------------------------------------
Name: Thelma B. Ferguson
-------------------------------------------
Title: First Vice President
------------------------------------------
[Signatures Continued Next Page]
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FIRSTAR BANK, N.A., as a Lender
By: /s/ Russell S. Rogers
-----------------------------------------------
Name: Russell S. Rogers
-----------------------------------------
Title: Vice President
----------------------------------------
SUNTRUST BANK, as a Lender
By: /s/ William E. Edwards, III
-----------------------------------------------
Name: William E. Edwards, III
-----------------------------------------
Title: Group Vice President Corporate Banking
----------------------------------------
FIRST TENNESSEE BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ Vincent Hickam
-----------------------------------------------
Name: Vincent Hickam
-----------------------------------------
Title: Executive Vice President
----------------------------------------
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EXHIBIT 2.2.5
[FORM OF NOTICE OF BORROWING]
[Date]
AmSouth Bank
AmSouth Center
315 Deaderick Street
Nashville, TN 37237
Attn: Corporate Finance
Ladies and Gentlemen:
Pursuant to that certain Credit Agreement dated as of July 20, 2001, among
NN, Inc., a Delaware corporation (the "Borrower"), the Subsidiaries of the
Borrower now or hereafter becoming parties thereto, the several lenders who are
or become parties thereto (the "Lenders"), AmSouth Bank, as administrative agent
for the Lenders (the "Administrative Agent"), and Bank One Kentucky, NA, as
co-agent (the "Co-Agent") (as the same heretofore may have been and/or hereafter
may be amended, restated, supplemented, extended, renewed, replaced or otherwise
modified from time to time, the "Credit Agreement"; capitalized terms used but
not defined herein shall have the meanings assigned thereto in the Credit
Agreement), [notice is hereby given of the Borrower's] [the Borrower hereby
confirms its prior telephonic] request to borrow on __________________ __, 200_
from the Lenders on a pro rata basis $____________ as [Base Rate] [LIBOR]
[Revolving] [Term] Loans. [The initial Interest Period for such LIBOR Loans is
requested to be a _____________ month period.] The proceeds of such [Revolving
Loans] [Term Loans] are to be deposited in the Borrower's account
#__________________ maintained with the Administrative Agent.
The undersigned officer of the Borrower hereby certifies that (1) the
foregoing [Revolving Loans] [Term Loans] are permitted by, comply with all
requirements of and will not violate any provisions of the Credit Agreement,
including those set forth in Section 2.2.1 or Section 2.2.2 thereof, and (2) all
of the conditions of the Credit Agreement to the making of the foregoing
[Revolving Loans] [Term Loans], including those set forth in Section 6.2
thereof, have been satisfied.
NN, INC.
By:
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Title:
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