Exhibit 10.34
FIFTH AMENDMENT TO, AND CONSENT AND WAIVER UNDER,
CREDIT AGREEMENT AND JOINDER TO LOAN DOCUMENTS
THIS FIFTH AMENDMENT TO, AND CONSENT AND WAIVER UNDER, CREDIT AGREEMENT AND
JOINDER TO LOAN DOCUMENTS (this "Fifth Amendment") is made and entered into as
of April 5, 2007, by and among Altra Industrial Motion, Inc., a Delaware
corporation, as Administrative Borrower ("Administrative Borrower") for the
Borrowers (as defined below), each of the New Loan Parties (as defined below)
listed on the signatory pages hereof, the lenders listed on the signatory pages
hereof (the "Lenders"), and Wells Fargo Foothill, Inc., a California
corporation, in its capacity as the arranger and administrative agent for the
Lenders ("Agent").
WITNESSETH:
WHEREAS, each of Administrative Borrower, Warner Electric LLC, a Delaware
limited liability company, Kilian Manufacturing Corporation, a Delaware
corporation, Warner Electric Technology LLC, a Delaware limited liability
company, Formsprag LLC, a Delaware limited liability company, Boston Gear LLC, a
Delaware limited liability company, Nuttall Gear L L C, a Delaware limited
liability company, and Ameridrives International L.P., a Delaware limited
partnership (each, a "Borrower" and, collectively, the "Borrowers"), have
entered into a Credit Agreement dated as of November 30, 2004 (as amended as of
December 30, 2004, January 14, 2005, January 31, 2005, and February 16, 2007,
and as may be further amended, restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"), with the Lenders and Agent;
WHEREAS, on February 17, 2007, Holdings, and its wholly owned subsidiary
Forest Acquisition Corporation ("FAC"), entered into an Agreement and Plan of
Merger (the "Merger Agreement") with TB Wood's Corporation ("TB Wood's"),
pursuant to which FAC agreed to purchase shares of common stock of TB Wood's for
$24.80 per share;
WHEREAS, in the Merger Agreement, FAC agreed to make a cash tender offer of
$24.80 per share for all outstanding shares of TB Wood's common stock;
WHEREAS, FAC commenced the tender offer (the "Tender Offer") on March 5,
2007;
WHEREAS, FAC acquired greater than 90% of the outstanding shares of TB
Wood's common stock in the Tender Offer, and FAC and TB Wood's will
substantially simultaneously herewith effect a statutory "short-form" merger
pursuant to which FAC will be merged with and into TB Wood's (the "Merger") and
TB Wood's will become a wholly-owned subsidiary of Administrative Borrower;
WHEREAS, upon consummation of the Merger and TB Wood's becoming a
wholly-owned subsidiary of Administrative Borrower (the "Joinder Effective
Time"), TB Wood's and each of its domestic subsidiaries (collectively, the "New
Loan Parties") will become Guarantors under the Loan Documents;
WHEREAS, Administrative Borrower intends to issue $105,000,000 aggregate
principal amount of 9% Senior Secured Notes due 2011 (the "Additional Notes")
under a supplement (the "Indenture Supplement") to the Indenture, pursuant to
which Administrative Borrower has previously issued $165,000,000 aggregate
principal amount of senior secured notes;
WHEREAS, the Notes (including the Additional Notes) will be guaranteed by
the New Loan Parties and secured by the assets of the New Loan Parties, subject
to the Intercreditor Agreement;
WHEREAS, Holdings and Administrative Borrower intend to fund the purchase
price of the acquisition of the common stock of TB Wood's through the net
proceeds of the issuance of the Additional Notes, together with cash on hand and
borrowings under the Credit Agreement;
WHEREAS, absent a consent and waiver from the Lenders and Agent, the
issuance of the Additional Notes would violate Section 6.1 of the Credit
Agreement and the consummation of the acquisition of TB Wood's contemplated by
the Merger Agreement would violate Section 6.3 and Section 6.12 of the Credit
Agreement;
WHEREAS, Borrowers have requested that the Lenders and Agent consent to the
issuance of the Additional Notes and the consummation of the acquisition of TB
Wood's contemplated by the Merger Agreement; and
WHEREAS, Borrowers, the Lenders and Agent wish to amend the Credit
Agreement, as provided herein;
NOW, THEREFORE, in consideration of the agreements and provisions herein
contained, the parties hereto do hereby agree as follows:
SECTION 1. DEFINITIONS. Any capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to such terms in the Credit Agreement.
SECTION 2. CONSENTS AND WAIVERS. Subject to the satisfaction of the conditions
set forth in Section 6 herein, the Lenders and Agent hereby (a) consent to, and
waive the application of Section 6.1 of the Credit Agreement solely with respect
to, the issuance of the Additional Notes in an aggregate principal amount not to
exceed $105,000,000, (b) consent to, and waive the application of Section 6.3
and Section 6.12 of the Credit Agreement solely with respect to, the
consummation of the acquisition of TB Wood's contemplated by the Merger
Agreement, (c) consent to, and waive the application of Section 6.14 of the
Credit Agreement solely with respect to, the use of proceeds of Borrowings under
the Credit Agreement to partially finance the Merger, (d) subject to compliance
with Section 7.03 hereof, waive the application of Section 5.15 of the Credit
Agreement solely with respect to the Securities Accounts and Deposit Accounts of
the New Loan Parties, and (e) waive the application of Section 5.16 of the
Credit Agreement solely with respect to the pledge by TB Wood's Incorporated of
the Stock of TB Wood's (India) Private Ltd..
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SECTION 3. AMENDMENTS TO CREDIT AGREEMENT. Subject to the satisfaction of the
conditions set forth in Section 6 herein, the Credit Agreement is hereby
amended, effective as of the Effective Date (as defined below), as follows:
3.01 AMENDMENT TO SECTION 2.6(B). Section 2.6(b) of the Credit Agreement is
hereby amended by deleting the words "2.00% per annum" therein and inserting
"1.50% per annum" in lieu thereof.
3.02 AMENDMENT TO SECTION 3.3. Section 3.3 of the Credit Agreement is
hereby amended by deleting the words "the fifth anniversary of the date hereof"
therein and inserting "the sixth anniversary of the date hereof" in lieu
thereof.
3.03 AMENDMENTS TO SECTION 6.1. Section 6.1 of the Credit Agreement is
hereby amended as follows:
(a) Section 6.1(g) of the Credit Agreement is hereby amended by
deleting it in its entirety and inserting the following in lieu thereof:
"(g) Indebtedness represented by any notes issued pursuant to the
Indenture, including any Senior Notes (or any other evidence of
indebtedness for borrowed money under the Senior Notes or the
Indenture) in an aggregate principal amount not to exceed $275,000,000
at any one time outstanding and any Refinancing Indebtedness in
respect thereof (whether in whole or in part);"
(b) The word "and" at the end of clause (p) is hereby deleted.
(c) Clause (q) is hereby re-titled clause (t).
(d) The following new clauses (q), (r) and (s) are hereby added as
follows:
"(q) Indebtedness under the TB Wood's Refinanced Standalone Facility
and any Refinancing Indebtedness in respect thereof (whether in whole
or in part);
(r) Indebtedness represented by any notes issued pursuant to the
Unsecured Indenture, including any Unsecured Notes (or any other
evidence of indebtedness for borrowed money under the Unsecured Notes
or the Unsecured Indenture) in an aggregate principal amount not to
exceed L21,450,000 at any one time outstanding and any Refinancing
Indebtedness in respect thereof (whether in whole or in part);
(s) Indebtedness represented by the IRB Bonds in an aggregate
principal amount not to exceed $5,300,000 and any Refinancing
Indebtedness in respect thereof (whether in whole or in part); and"
3.04 AMENDMENTS TO SECTION 6.7. Section 6.7(a) of the Credit Agreement is
hereby amended by (a) re-titling clause (iv) as clause (v) and (b) adding the
following new clause (iv): "(iv) Borrowers and their Restricted Subsidiaries may
pay and prepay the Indebtedness under the
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TB Wood's Refinanced Standalone Facility in accordance with the terms of the TB
Wood's Refinanced Standalone Facility,".
3.05 AMENDMENT TO SECTION 6.16. Section 6.16 of the Credit Agreement is
hereby amended by deleting it in its entirety and inserting the following in
lieu thereof:
"6.16 FINANCIAL COVENANTS.
(A) FIXED CHARGE COVERAGE RATIO. Fail to maintain or achieve a Fixed
Charge Coverage Ratio, measured on a fiscal quarter-end basis, of at least the
required amount set forth in the following table for the "Applicable Period" set
forth opposite thereto; provided, however, that, with respect to any "Applicable
Period", if daily average Excess Availability was at least $12,500,000 during
the 30 day period immediately preceding the applicable date of determination and
on the applicable date of determination, then the foregoing covenant shall not
apply for such applicable period:
Applicable Ratio Applicable Period
- ---------------- -----------------
1.20:1.00 For the 4 quarter period
ending March 31, 2007
1.20:1.00 For the 4 quarter period
ending each fiscal quarter thereafter
(B) CAPITAL EXPENDITURES. Make Capital Expenditures in any fiscal year
in excess of the amount set forth in the following table for the applicable
period:
Applicable Amount Applicable Period
- ----------------- -----------------
$25,750,000 fiscal year 2007
$20,000,000 fiscal year 2008
$21,250,000 fiscal year 2009
$22,500,000 fiscal year 2010 and each fiscal year thereafter
provided, however, that up to 75% of the difference between the amount of
Capital Expenditure that may be made in any fiscal year and the amount of
Capital Expenditures actually made in such fiscal year, may be made in the
immediately succeeding fiscal year; provided further, however, that with
respect to any Permitted Acquisitions, the "Applicable Amount" for the
"Applicable Period" in which such Permitted Acquisition is consummated
shall be increased by an amount equal to the product of (a) 1.25 times (b)
the average amount per year of Capital Expenditures made by such acquired
Person during the immediately preceding three (3) year period."
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3.06 AMENDMENT TO SECTION 11. Section 11 of the Credit Agreement is hereby
amended by replacing the words "Morrison & Foerster LLP, 1290 Avenue of the
Americas, 40th Floor, New York, NY 10104-0050, Attn: Mark B. Joachim, Esq., Fax
No.: (212) 468-7900" with the following: "Moses & Singer, The Chrysler Building,
405 Lexington Avenue, New York, NY 10174-1299, Attn.: Howard L. Siegel, Esq.,
Fax No.: (212) 554-7700."
3.07 AMENDMENTS TO SCHEDULE 1.1. Schedule 1.1 of the Credit Agreement is
hereby amended as follows:
(a) The words "1.25 percentage points" in the definition of "Base Rate
Margin" contained therein are hereby deleted and the words "0.25 percentage
points" are hereby inserted in lieu thereof.
(b) The definition of "Borrowing Base" is hereby amended by deleting
the words "Eligible Real Property and Equipment Book Value" and inserting
"Eligible Equipment Book Value" in lieu thereof.
(c) The definition of "Eligible Real Property" is hereby deleted in
its entirety.
(d) The definition of "Eligible Real Property and Equipment Book
Value" is hereby deleted in its entirety and the following definition shall be
inserted in lieu thereof:
"Eligible Equipment Book Value" means the net book value of the
Eligible Equipment, such value to be as determined from time to time
by a qualified appraisal company selected by Agent, net of all related
costs and expenses.
(e) The words "2.50 percentage points" in the definition of "LIBOR
Rate Margin" contained therein are hereby deleted and the words "1.75 percentage
points" are hereby inserted in lieu thereof.
(f) The definition of "Permitted Liens" is hereby amended by (i)
deleting "and" at the end of clause (r) thereof, (ii) re-titling clause (s) as
clause (t) and replacing the words "under clause (a) through (r) of this
definition" in such re-titled clause (t) with the words "under clause (a)
through (s) of this definition", and (iii) inserting the following new clause
(s): "(s) Liens securing the TB Wood's Refinanced Standalone Credit Facility."
(g) The following new definitions are hereby added in proper
alphabetical order:
"IRB Bonds" means those certain variable rate demand revenue bonds
issued by TB Wood's Incorporated under the authority of the industrial
development corporations of the City of San Marcos, Texas and the City
of Chattanooga, Tennessee in an aggregate principal amount of
$5,300,000, as the same may be amended, restated, supplemented or
modified from time to time.
"TB Wood's Refinanced Standalone Credit Facility" means that certain
Credit Agreement dated as of April 5, 2007 among TB Wood's
Corporation, the subsidiaries of TB Wood's Corporation party thereto,
Wells Fargo Foothill, Inc., as agent thereunder and the lenders party
thereto, as the same may be amended,
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restated, supplemented or modified from time to time, together with
the related "Loan Documents" (as defined thereunder).
"Unsecured Indenture" means the Indenture dated as of February 8,
2006, by and among Parent, the domestic subsidiaries of Parent party
thereto and The Bank of New York, as trustee, pursuant to which Parent
has issued the Unsecured Notes.
"Unsecured Notes" means the 11-1/4% Senior Notes due 2013 issued by
Parent under the Unsecured Indenture.
SECTION 4. JOINDERS. Subject to the satisfaction of the conditions set forth in
Section 6 herein, the parties agree that, as of the Joinder Effective Time, each
New Loan Party shall become a party to the following documents (the "Joined Loan
Documents") as follows:
4.01 SECURITY AGREEMENT
A. By execution of this Fifth Amendment and a Supplement to the Security
Agreement in the form of Annex 1 thereto, each New Loan Party will, as of the
Joinder Effective Time immediately and without any further action, become a
party to the Security Agreement (as amended by this Fifth Amendment), and each
New Loan Party will be deemed to be a "Grantor" for all purposes under the
Security Agreement as of the Joinder Effective Time.
B. As of the Joinder Effective Time, each New Loan Party shall assume all
the rights and obligations of a Grantor under and as defined in the Security
Agreement in the same manner as if such New Loan Party were an original
signatory to the Security Agreement.
C. As a Grantor, as of the Joinder Effective Time, each New Loan Party
shall be bound by the provisions of the Security Agreement and shall perform in
accordance with its terms all the obligations which by the terms of the Security
Agreement are required to be performed by it as a Grantor to the same extent as
if originally a party thereto.
4.02 GUARANTY
A. By execution of this Fifth Amendment, each New Loan Party will, as of
the Joinder Effective Time immediately and without any further action, become a
party to the Guaranty as a "Guarantor" for all purposes thereunder.
B. As of the Joinder Effective Time, each New Loan Party shall assume all
the rights and obligations of a Guarantor under the Guaranty in the same manner
as if such New Loan Party were an original signatory to the Guaranty.
C. As a party to the Guaranty, as of the Joinder Effective Time, each New
Loan Party shall be bound by the provisions of the Guaranty and shall perform in
accordance with its terms all the obligations which by the terms of the Guaranty
are required to be performed by it as a Guarantor to the same extent as if
originally a party thereto.
4.03 INTERCOMPANY SUBORDINATION AGREEMENT
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A. By execution of this Fifth Amendment, each New Loan Party will, as of
the Joinder Effective Time immediately and without any further action, become a
party to the Intercompany Subordination Agreement, and each New Loan Party will
be deemed to be a "Subordinating Creditor" for all purposes under the
Intercompany Subordination Agreement as of the Joinder Effective Time.
B. As of the Joinder Effective Time, each New Loan Party shall assume all
the rights and obligations of a Subordinating Creditor under and as defined in
the Intercompany Subordination Agreement and shall perform in accordance with
its terms all the obligations which by the terms of the Intercompany
Subordination Agreement are required to be performed by it as a Subordinating
Creditor to the same extent as if originally a party thereto.
C. As a Subordinating Creditor, as of the Joinder Effective Time, each New
Loan Party shall be bound by the provisions of the Intercompany Subordination
Agreement and shall perform in accordance with its terms all the obligations
which by the terms of the Intercompany Subordination Agreement are required to
be performed by it as a Subordinating Creditor to the same extent as if
originally a party thereto.
SECTION 5. REPRESENTATIONS AND WARRANTIES. In order to induce Agent and the
Lenders to enter into this Fifth Amendment, Administrative Borrower, for itself
and on behalf of all of the other Borrowers, and, as applicable, each New Loan
Party, hereby represents and warrants that:
5.01 NO DEFAULT. At and as of the date of this Fifth Amendment, after
giving effect to this Fifth Amendment, no Default or Event of Default has
occurred and is continuing.
5.02 REPRESENTATIONS AND WARRANTIES TRUE AND CORRECT. At and as of the
date of this Fifth Amendment, each of the representations and warranties
contained in the Credit Agreement and the other Loan Documents is true and
correct in all material respects (except to the extent that such representations
and warranties relate solely to an earlier date).
5.03 CORPORATE POWER, ETC. Administrative Borrower (a) has all
requisite corporate power and authority to execute and deliver this Fifth
Amendment and to consummate the transactions contemplated hereby for itself and
on behalf of all of the other Borrowers and (b) has taken all action, corporate
or otherwise, necessary to authorize the execution and delivery of this Fifth
Amendment and the consummation of the transactions contemplated hereby for
itself and on behalf of all of the other Borrowers. Administrative Borrower is
entering into this Fifth Amendment on behalf of all of the other Borrowers in
accordance with Sections 14.1 and 16.9 of the Credit Agreement. Each New Loan
Party (a) has all requisite corporate power and authority to execute and deliver
this Fifth Amendment and to consummate the transactions contemplated hereby and
(b) has taken all action, corporate or otherwise, necessary to authorize the
execution and delivery of this Fifth Amendment and the consummation of the
transactions contemplated hereby.
5.04 NO CONFLICT. The execution, delivery and performance by
Administrative Borrower and the New Loan Parties of this Fifth Amendment will
not (a) violate any provision of federal, state, or local law or regulation
applicable to any Borrower or any New Loan Party, the Governing Documents of any
Borrower or any New Loan Party, or any order, judgment, or
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decree of any court or other Governmental Authority binding on any Borrower or
any New Loan Party, (b) conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under any material
contractual obligation of any Borrower or any New Loan Party, (c) result in or
require the creation or imposition of any Lien of any nature whatsoever upon any
properties or assets of any Borrower or any New Loan Party, other than Permitted
Liens, or (d) require any unobtained approval or consent of any Person under any
material contractual obligation of any Borrower or any New Loan Party.
5.05 BINDING EFFECT. This Fifth Amendment has been duly executed and
delivered by Administrative Borrower (on behalf of itself and all of the other
Borrowers) and the New Loan Parties and constitutes the legal, valid and binding
obligation of Administrative Borrower (on behalf of itself and all of the other
Borrowers) and the New Loan Parties, enforceable against Administrative Borrower
(on behalf of itself and all of the other Borrowers) and the New Loan Parties in
accordance with its terms, except as such enforceability may be limited by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws, now or hereafter in effect, relating to or affecting the enforcement of
creditors' rights generally, and (b) the application of general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).
SECTION 6. CONDITIONS. This Fifth Amendment shall be effective as of April 5,
2007 (the "Effective Date") upon the fulfillment of all of the following
conditions precedent set forth in this Section 6:
6.01 EXECUTION OF THE FIFTH AMENDMENT. Each of the parties hereto shall
have executed a counterpart of this Fifth Amendment and shall have delivered
(including by way of telefacsimile or electronic mail) the same to Agent.
6.02 EXECUTION OF SUPPLEMENT TO SECURITY AGREEMENT. Each New Loan Party and
Agent shall have executed an original counterpart of a Supplement to the
Security Agreement in the form of Annex 1 to the Security Agreement, pursuant to
which each New Loan Party shall, effective as of the Joinder Effective Time
immediately and without any further action, grant, assign and pledge to Agent,
for the benefit of the Lender Group and the Bank Product Providers, a continuing
security interest in all of such New Loan Party's assets, and shall have
delivered (including by way of telefacsimile or electronic mail) the same to
Agent.
6.03 EXECUTION OF PLEDGED INTERESTS ADDENDUM TO SECURITY AGREEMENT. (a)
Administrative Borrower shall have executed a Pledged Interests Addendum in the
form of Exhibit C to the Security Agreement, pursuant to which 100% of the Stock
of each New Loan Party owned by Administrative Borrower shall become part of the
Pledged Interests (as defined in the Security Agreement), and shall have
delivered (including by way of telefacsimile or electronic mail) the same to
Agent, and (b) TB Wood's Corporation and TB Wood's Incorporated shall have
executed a Pledged Interests Addendum in the form of Exhibit C to the Security
Agreement, pursuant to which 100% of the Stock of each New Loan Party owned by
TB Wood's Corporation and TB Wood's Incorporated shall become part of the
Pledged Interests (as defined in the Security Agreement), and shall have
delivered (including by way of telefacsimile or electronic mail) the same to
Agent.
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6.04 GOVERNING DOCUMENTS. Agent shall have received copies of each New Loan
Party's Governing Documents, as amended, modified, or supplemented to the
Closing Date, in the case of the charter documents, certified by the Secretary
of State of the applicable state of organization, and in the case of the
by-laws, certified by the Secretary of such New Loan Party.
6.05 SCHEDULES. Administrative Borrower shall have delivered to Agent
updates, as applicable, to (a) any and all Schedules to the Credit Agreement
(including Schedules 4.5, 4.7(a), 4.7(b), 4.7(c), 4.7(d), 4.8(b) and 4.8(c)),
and (b) any and all Schedules to the Security Agreement (including Schedules 1,
2, 3, 4, 5, 6, 7 and 8), each in form and substance satisfactory to Agent.
6.06 INCUMBENCY CERTIFICATE. Agent shall have received a certificate of an
officer of each New Loan Party as to (a) the incumbency and signatures of the
officers of such New Loan Party authorized to execute any document in connection
with the transactions contemplated by this Fifth Amendment; and (b) the executed
resolutions of the Board of Directors evidencing the adoption and subsistence of
resolutions (i) approving the terms of, and the transactions contemplated by,
the Loan Documents to which it is a party and resolving that it execute the Loan
Documents to which it is a party, (ii) authorizing a specified person or persons
to execute the Loan Documents to which it is a party on its behalf, and (iii)
authorizing a specified person or persons, on its behalf, to sign and/or
dispatch all documents and notices (including any document, notice or other
agreement to be delivered thereunder or in connection therewith) to be signed
and/or dispatched by it under or in connection with the Loan Documents to which
it is a party. Such certificates shall state that the statements set forth
therein have not been amended, modified, revoked or rescinded as of the date of
such certificate.
6.07 GOOD STANDING CERTIFICATES. Agent shall have received a certificate of
status with respect to each New Loan Party, each dated within 10 days of the
Effective Date, such certificate to be issued by the appropriate officer of the
jurisdiction of organization of such New Loan Party, which certificate shall
indicate that such New Loan Party is in good standing in such jurisdiction
(together with a bringdown certificate dated within 1 day of the Effective
Date). Agent shall have received a certificate of status with respect to each
New Loan Party, each dated within 10 days of the Effective Date, such
certificate to be issued by the appropriate officer of the jurisdictions (other
than the jurisdiction of organization of such New Loan Party) in which its
failure to be duly qualified or licensed would constitute a Material Adverse
Change, which certificate shall indicate that such New Loan Party is in good
standing in such jurisdictions.
6.08 OPINIONS OF COUNSEL. Agent shall have received opinions of counsel to
Borrowers and each New Loan Party, each in form and substance satisfactory to
Agent.
6.09 INTELLECTUAL PROPERTY SECURITY AGREEMENTS. Each New Loan Party and
Agent shall have executed an original counterpart of a Patent Security Agreement
and Trademark Security Agreement (as each term is defined in the Security
Agreement) in the form of Exhibit B and Exhibit D, respectively, to the Security
Agreement, and shall have delivered (including by way of telefacsimile or
electronic mail) the same to Agent (such Patent Security Agreement and Trademark
Security Agreement to be effective as of the Joinder Effective Time immediately
and without any further action).
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6.10 AUTHORIZATIONS. Agent shall have received a copy of any other
authorization, consent, approval or other document, opinion or assurance which
is necessary in connection with the entry into and performance of the
transactions contemplated by any Loan Document or for the validity and
enforceability of any Loan Document.
6.11 CONSUMMATION OF TENDER OFFER. Agent shall have received satisfactory
evidence that FAC has acquired at least 66.6% of the outstanding shares of TB
Wood's pursuant to the Tender Offer and such shares have been validly tendered
and not withdrawn.
6.12 INDENTURE AND MERGER DOCUMENTS. Agent shall have received fully
executed copies of (a) the Indenture Supplement, the Merger Agreement and all
amendments, exhibits and schedules thereto, (b) any and all security documents
in favor of the Collateral Agent (as defined in the Intercreditor Agreement)
with respect to the assets of the New Loan Parties, and (c) all other material
agreements, documents, and instruments (including evidence of the consummation
of the Merger) related to the documents delivered pursuant to clauses (a) and
(b) above, in each case to the extent that such agreements, documents and
instruments have been executed as of the date hereof (the agreements, documents
and instruments required to be delivered pursuant to clauses (a), (b) and (c),
collectively, the "Transaction Documents").
6.13 TB WOOD'S STANDALONE CREDIT FACILITY. Agent shall have received
satisfactory evidence that the Loan and Security Agreement dated as of January
7, 2005 by and among Manufacturers and Traders Trust Company, as collateral
agent and funding agent, PNC Bank, National Association, as Administrative
Agent, TB Wood's Incorporated, Plant Engineering Consultants, LLC and TB Wood's
Enterprises, Inc., as Borrowers, and TB Wood's Corporation and T.B. Wood's
Canada Ltd., as guarantors, shall have been refinanced such that all obligations
and commitments thereunder shall have been terminated or otherwise provided for
in a manner reasonably satisfactory to Agent and Wells Fargo Foothill, Inc., as
agent and sole lender, shall have entered into a Credit Agreement dated as of
the date hereof (the "Refinanced TB Wood's Standalone Credit Facility") with TB
Wood's Incorporated, Plant Engineering Consultants, LLC and TB Wood's
Enterprises, Inc., and TB Wood's Corporation., as borrowers.
6.14 AMENDED AND RESTATED INTERCREDITOR AGREEMENT. Collateral Agent (as
defined in the Intercreditor Agreement), Agent, Wells Fargo Foothill, Inc., in
its capacity as agent under the Refinanced TB Wood's Standalone Credit Facility,
and each of the Loan Parties shall have executed an Amended and Restated
Intercreditor Agreement in form and substance satisfactory to Agent and shall
have delivered (including by way of telefacsimile or electronic mail) the same
to Agent.
6.15 AMENDED AND RESTATED FEE LETTER. Borrowers and Agent shall have
executed a counterpart of the Amended and Restated Fee Letter dated as of the
date hereof in form and substance satisfactory to Agent and shall have delivered
(including by way of telefacsimile or electronic mail) the same to Agent;
Borrowers shall have paid all fees required to be paid by Borrowers on the date
hereof pursuant to such Amended and Restated Fee Letter.
6.16 REPRESENTATIONS AND WARRANTIES. As of the Effective Date, the
representations and warranties set forth in Section 5 hereof shall be true and
correct.
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6.17 COMPLIANCE WITH TERMS. Borrowers shall have complied in all respects
with the terms hereof and of any other agreement, document, instrument or other
writing to be delivered by Borrowers in connection herewith.
SECTION 7. COVENANTS.
7.01 LOAN DOCUMENT OBLIGATIONS. Each New Loan Party covenants that it will
perform all covenants required to be performed by it as party to each of the
Joined Loan Documents.
7.02 TRANSACTION DOCUMENTS. Administrative Borrower shall deliver to Agent
promptly after execution thereof all other Transaction Documents not previously
delivered to Agent pursuant to Section 6.1.
7.03 CONTROL AGREEMENTS. Administrative Borrower shall deliver to Agent on
or prior to June 5, 2007, Control Agreements with respect to each Securities
Account and Deposit Account of the New Loan Parties, each in form and substance
reasonably satisfactory to Agent (it being understood and agreed that Wells
Fargo Foothill, Inc., in its capacity as agent under the TB Wood's Refinanced
Standalone Credit Facility, will have a first priority security interest in such
collateral, Agent, on behalf of itself, the Lenders and the Bank Product
Providers, will have a second priority security interest in such collateral and
Collateral Agent (as defined in the Intercreditor Agreement), on behalf of
itself, the Trustee and the Noteholders (as defined in the Intercreditor
Agreement), will have a third priority security interest in such collateral).
7.04 MORTGAGES. Administrative Borrower shall deliver to Agent the
documents, instruments and agreements required by, and in accordance with,
Section 5.17 of the Credit Agreement with respect to the following Real Property
Collateral owned by the New Loan Parties (it being understood and agreed that
Wells Fargo Foothill, Inc., in its capacity as agent under the TB Wood's
Refinanced Standalone Credit Facility, will have a first priority security
interest in such collateral, Agent, on behalf of itself, the Lenders and the
Bank Product Providers, will have a second priority security interest in such
collateral and Collateral Agent (as defined in the Intercreditor Agreement), on
behalf of itself, the Trustee and the Noteholders (as defined in the
Intercreditor Agreement), will have a third priority security interest in such
collateral): Chambersburg, Pennsylvania; Mt. Pleasant, Michigan; Scotland,
Pennsylvania; Chattanooga, Tennessee; and San Marcos, Texas.
7.05 INSURANCE CERTIFICATES. Administrative Borrower shall deliver to Agent
on or prior to April 15, 2007, updated insurance certificates required pursuant
to Section 5.8 of the Credit Agreement covering the New Loan Parties, each in
form and substance reasonably satisfactory to Agent.
7.06 FURTHER ASSURANCES. Each New Loan Party and the other Loan Parties
shall execute and deliver, or cause to be executed and delivered, to Agent such
documents and agreements, and shall take or cause to be taken such actions, as
Agent may, from time to time, reasonably request to carry out the terms and
conditions of this Fifth Amendment and the transactions contemplated hereby.
Each New Loan Party and the other Loan Parties hereby
11
authorize Agent to file, as agent for the Lenders, Uniform Commercial Code
financing statements that Agent deems necessary to reflect the terms of this
Fifth Amendment.
SECTION 8. MISCELLANEOUS.
8.01 CONTINUING EFFECT. Except as specifically provided herein, the Credit
Agreement and the other Loan Documents shall remain in full force and effect in
accordance with their respective terms and are hereby ratified and confirmed in
all respects.
8.02 NO WAIVER. This Fifth Amendment is limited as specified and the
execution, delivery and effectiveness of this Fifth Amendment shall not operate
as a modification, acceptance or waiver of any provision of the Credit Agreement
or any other Loan Document, except as specifically set forth herein.
8.03 REFERENCES.
(a) From and after the Effective Date, the Credit Agreement, the other
Loan Documents and all agreements, instruments and documents executed and
delivered in connection with any of the foregoing shall each be deemed amended
hereby to the extent necessary, if any, to give effect to the provisions of this
Fifth Amendment.
(b) From and after the Effective Date, (i) all references in the
Credit Agreement to "this Agreement", "hereto", "hereof", "hereunder" or words
of like import referring to the Credit Agreement shall mean the Credit Agreement
as amended hereby and (ii) all references in the Credit Agreement, the other
Loan Documents or any other agreement, instrument or document executed and
delivered in connection therewith to "Credit Agreement", "thereto", "thereof",
"thereunder" or words of like import referring to the Credit Agreement shall
mean the Credit Agreement as amended hereby.
8.04 GOVERNING LAW. THIS FIFTH AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
8.05 SEVERABILITY. The provisions of this Fifth Amendment are severable,
and if any clause or provision shall be held invalid or unenforceable in whole
or in part in any jurisdiction, then such invalidity or unenforceability shall
affect only such clause or provision, or part thereof, in such jurisdiction and
shall not in any manner affect such clause or provision in any other
jurisdiction, or any other clause or provision in this Fifth Amendment in any
jurisdiction.
8.06 COUNTERPARTS. This Fifth Amendment may be executed in any number of
counterparts, each of which counterparts when executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument. Delivery of an executed counterpart of this Fifth Amendment by
telefacsimile or electronic mail shall be equally effective as delivery of a
manually executed counterpart. A complete set of counterparts shall be lodged
with Administrative Borrower and Agent.
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8.07 HEADINGS. Section headings in this Fifth Amendment are included
herein for convenience of reference only and shall not constitute a part of this
Fifth Amendment for any other purpose.
8.08 BINDING EFFECT; ASSIGNMENT. This Fifth Amendment shall be binding
upon and inure to the benefit of the Loan Parties (including the New Loan
Parties), the Lenders and Agent and their respective successors and assigns;
provided, however, that the rights and obligations of Loan Parties (including
the New Loan Parties) under this Fifth Amendment shall not be assigned or
delegated without the prior written consent of Agent.
8.09 EXPENSES. Borrowers agree to pay Agent for all reasonable
expenses, including reasonable fees of attorneys and paralegals for Agent,
incurred by Agent in connection with the preparation, negotiation and execution
of this Fifth Amendment and any document required to be furnished herewith
pursuant to the terms of the Credit Agreement and the Fee Letter.
[Signature pages to follow]
13
IN WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
ALTRA INDUSTRIAL MOTION, INC.,
a Delaware corporation, as
Administrative Borrower on behalf of
itself and all other Borrowers
By: /s/ Michael L. Hurt
------------------------------------
Name: Michael L. Hurt
----------------------------------
Title: Chief Executive Officer
---------------------------------
[SIGNATURE PAGE OF FIFTH AMENDMENT]
TB WOOD'S INCORPORATED,
a Pennsylvania corporation, as a New
Loan Party
By: /s/ Joseph C. Horvath
------------------------------------
Name: Joseph C. Horvath
----------------------------------
Title: VP, CFO and Corporate Secretary
---------------------------------
PLANT ENGINEERING CONSULTANTS, LLC,
a Tennessee limited liability company,
as a New Loan Party
By: /s/ Joseph C. Horvath
------------------------------------
Name: Joseph C. Horvath
----------------------------------
Title: Treasurer and Secretary
---------------------------------
TB WOOD'S ENTERPRISES, INC.,
a Delaware corporation, as a New
Loan Party
By: /s/ Joseph C. Horvath
------------------------------------
Name: Joseph C. Horvath
----------------------------------
Title: President and Treasurer
---------------------------------
TB WOOD'S CORPORATION,
a Delaware corporation, as a New Loan
Party
By: /s/ Joseph C. Horvath
------------------------------------
Name: Joseph C. Horvath
----------------------------------
Title: VP, CFO and Corporate Secretary
---------------------------------
[SIGNATURE PAGE OF FIFTH AMENDMENT]
WELLS FARGO FOOTHILL, INC.,
a California corporation, as Agent and
Lender
By: /s/ Vincent J. Egan, Jr.
------------------------------------
Name: Vincent J. Egan, Jr.
----------------------------------
Title: VP
---------------------------------
[SIGNATURE PAGE OF FIFTH AMENDMENT]