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Title: |
Credit Agreement |
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Entities: |
Citibank, NA; Citicorp USA, Inc.; Ferro Corp.; National City Bank; OM Group, Inc.; Bank of New York; Keybank NA; Mayer, Brown, Rowe & Maw; Squire, Sanders & Dempsey; Credit Suisse First Boston |
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Date: |
2001 |
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Size: |
Preview shows 28KB of 432KB total |
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Price: |
$78 |
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ID: |
#228500 |
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EXECUTION COPY
================================================================================
CREDIT AGREEMENT
DATED AS OF
AUGUST 31, 2001
AMONG
FERRO CORPORATION
AS BORROWER
VARIOUS FINANCIAL INSTITUTIONS
AS LENDERS
CREDIT SUISSE FIRST BOSTON
AS THE SYNDICATION AGENT AND
A JOINT LEAD ARRANGER
NATIONAL CITY BANK
AS THE ADMINISTRATIVE AGENT, THE SWING LINE LENDER,
THE LETTER OF CREDIT ISSUER AND A JOINT LEAD ARRANGER
CITICORP USA, INC.
KEYBANK NATIONAL ASSOCIATION
AS THE CO-DOCUMENTATION AGENTS
-----------------------------
CREDIT SUISSE FIRST BOSTON
AS SOLE BOOK RUNNING MANAGER
================================================================================
{PAGE}
TABLE OF CONTENTS
{TABLE}
{CAPTION}
PAGE
----
{S} {C}
SECTION 1. DEFINITIONS AND TERMS......................................................................1
1.1 Certain Defined Terms..........................................................................1
1.2 Computation of Time Periods...................................................................27
1.3 Accounting Terms..............................................................................27
1.4 Terms Generally...............................................................................27
1.5 Currency Equivalents..........................................................................27
SECTION 2. AMOUNT AND TERMS OF LOANS.................................................................28
2.1 Commitments for Loans.........................................................................28
2.2 Procedures for Borrowing and Disbursement of Funds............................................29
2.3 Competitive Bid Loans.........................................................................32
2.4 Notes; Loan Accounts..........................................................................36
2.5 Conversions of General Revolving Loans and Term Loans.........................................38
2.6 Refunding of, or Participation in, Swing Line Revolving Loans.................................39
2.7 Interest......................................................................................41
2.8 Selection and Continuation of Interest Periods................................................44
2.9 Increased Costs, Illegality, etc..............................................................45
2.10 Compensation..................................................................................47
2.11 Change of Lending Office; Replacement of Lenders..............................................48
SECTION 3. LETTERS OF CREDIT.........................................................................49
3.1 Letters of Credit.............................................................................49
3.2 Letter of Credit Requests: Notices of Issuance................................................50
3.3 Agreement to Repay Letter of Credit Drawings..................................................51
3.4 Letter of Credit Participations...............................................................51
3.5 Increased Costs...............................................................................54
3.6 Guaranty of Letter of Credit Obligations of Other Letter of Credit Obligors..................54
SECTION 4. FEES; COMMITMENTS.........................................................................56
4.1 Fees..........................................................................................56
4.2 Voluntary Termination/Reduction of Commitments................................................58
4.3 Mandatory Adjustments of Commitments, etc.....................................................59
4.4 Extension of Term Maturity Date...............................................................59
SECTION 5. PAYMENTS..................................................................................60
5.1 Voluntary Prepayments of Loans................................................................60
5.2 Mandatory Prepayments.........................................................................61
5.3 Repayment of Loans............................................................................64
5.4 Method and Place of Payment...................................................................64
5.5 Net Payments..................................................................................64
SECTION 6. CONDITIONS PRECEDENT......................................................................66
{/TABLE}
i
{PAGE}
TABLE OF CONTENTS
(continued)
{TABLE}
{CAPTION}
PAGE
----
{S} {C}
6.1 Conditions Precedent at Closing Date..........................................................66
6.2 Conditions Precedent to All Credit Events (Other than any Competitive Bid Borrowing)..........68
6.3 Conditions Precedent to Each Competitive Bid Borrowing........................................69
SECTION 7. REPRESENTATIONS AND WARRANTIES............................................................69
7.1 Corporate Status, etc.........................................................................69
7.2 Subsidiaries..................................................................................70
7.3 Corporate Power and Authority, etc............................................................70
7.4 No Violation..................................................................................70
7.5 Governmental Approvals........................................................................70
7.6 Litigation....................................................................................70
7.7 Use of Proceeds; Margin Regulations...........................................................71
7.8 Financial Statements, etc.....................................................................71
7.9 No Material Adverse Change....................................................................72
7.10 Tax Returns and Payments......................................................................72
7.11 Title to Properties, etc......................................................................72
7.12 Lawful Operations, etc........................................................................72
7.13 Environmental Matters.........................................................................73
7.14 Compliance with ERISA.........................................................................73
7.15 Intellectual Property, etc....................................................................74
7.16 Investment Company Act, etc...................................................................74
7.17 Burdensome Contracts; Labor Relations.........................................................74
7.18 Existing Indebtedness.........................................................................74
7.19 True and Complete Disclosure..................................................................75
SECTION 8. AFFIRMATIVE COVENANTS.....................................................................75
8.1 Reporting Requirements........................................................................75
8.2 Books, Records and Inspections................................................................78
8.3 Insurance.....................................................................................78
8.4 Payment of Taxes and Claims...................................................................78
8.5 Corporate Franchises..........................................................................79
8.6 Good Repair...................................................................................79
8.7 Compliance with Statutes, etc.................................................................79
8.8 Compliance with Environmental Laws............................................................79
8.9 Fiscal Years, Fiscal Quarters.................................................................79
8.10 Hedge Agreements, etc.........................................................................80
8.11 Certain Subsidiaries to Join in Subsidiary Guaranty...........................................80
8.12 Most Favored Covenant Status..................................................................81
8.13 Senior Debt...................................................................................81
8.14 Debt Rating Downgrade.........................................................................81
SECTION 9. NEGATIVE COVENANTS........................................................................82
9.1 Changes in Business...........................................................................82
{/TABLE}
ii
{PAGE}
{Table}
{Caption}
TABLE OF CONTENTS
(continued)
PAGE
----
{S} {C}
9.2 Consolidation, Merger, Asset Sales, etc.......................................................82
9.3 Restrictions on Acquisitions..................................................................84
9.4 Limitation on Sales and Leasebacks............................................................84
9.5 Indebtedness..................................................................................85
9.6 Leverage Ratio................................................................................86
9.7 Fixed Charge Coverage Ratio...................................................................87
9.8 No Stock Repurchases While Index Debt Rating is Not Investment Grade, etc.....................87
9.9 Transactions with Affiliates..................................................................87
9.10 Plan Terminations, Minimum Funding, etc.......................................................88
9.11 Restricted Payments...........................................................................88
9.12 Restrictive Agreements........................................................................88
SECTION 10. EVENTS OF DEFAULT.........................................................................89
10.1 Events of Default.............................................................................89
10.2 Acceleration, etc.............................................................................91
10.3 Application of Liquidation Proceeds...........................................................92
SECTION 11. THE ADMINISTRATIVE AGENT..................................................................93
11.1 Appointment...................................................................................93
11.2 Delegation of Duties..........................................................................93
11.3 Exculpatory Provisions........................................................................93
11.4 Reliance by Administrative Agent..............................................................94
11.5 Notice of Default.............................................................................94
11.6 Non-Reliance..................................................................................94
11.7 Indemnification...............................................................................95
11.8 The Agents in Individual Capacity.............................................................95
11.9 Successor Administrative Agent................................................................96
11.10 Other Agents..................................................................................96
SECTION 12. MISCELLANEOUS.............................................................................96
12.1 Payment of Expenses etc.......................................................................96
12.2 Right of Setoff...............................................................................98
12.3 Notices.......................................................................................98
12.4 Benefit of Agreement..........................................................................98
12.5 No Waiver; Remedies Cumulative...............................................................103
12.6 Payments Pro Rata; Sharing of Setoffs, etc...................................................104
12.7 Calculations; Computations...................................................................105
12.8 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.......................105
12.9 Counterparts.................................................................................106
12.10 Effectiveness; Integration...................................................................106
12.11 Headings Descriptive.........................................................................106
12.12 Amendment or Waiver..........................................................................107
12.13 Survival of Indemnities......................................................................108
{/TABLE}
iii
{PAGE}
TABLE OF CONTENTS
(continued)
{TABLE}
{CAPTION}
PAGE
----
{S} {C}
12.14 Domicile of Loans............................................................................108
12.15 Confidentiality..............................................................................108
12.16 Lender Register..............................................................................109
12.17 Limitations on Liability of the Letter of Credit Issuers.....................................110
12.18 General Limitation of Liability..............................................................110
12.19 No Duty......................................................................................110
12.20 Lenders and Agent Not Fiduciary to Borrower, etc.............................................111
12.21 Survival of Representations and Warranties...................................................111
12.22 Severability.................................................................................111
12.23 Independence of Covenants....................................................................111
12.24 No Reliance on Margin Stock..................................................................111
12.25 Interest Rate Limitation.....................................................................112
{/TABLE}
Annex I - Information as to Lenders
Annex II - Information as to Subsidiaries
Annex III - Information as to ERISA
Annex IV - Description of Existing Indebtedness
and Letters of Credit
Exhibit A-1 - Form of General Revolving Note
Exhibit A-2 - Form of Swing Line Revolving Note
Exhibit A-3 - Form of Term Note
Exhibit A-4 - Form of Competitive Bid Note
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of Notice of Competitive Bid Borrowing
Exhibit B-3 - Form of Notice of Conversion
Exhibit B-4 - Form of Letter of Credit Request
Exhibit C - Form of Subsidiary Guaranty
Exhibit D - Form of Assignment Agreement
Exhibit E - Form of Designation Agreement
Exhibit F - Form of Lender Tax Certificate
iv
{PAGE}
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of August 31, 2001 (this "AGREEMENT"),
is among FERRO CORPORATION, an Ohio corporation (the "BORROWER"), the various
financial institutions and other Persons from time to time parties hereto (the
"LENDERS"), CREDIT SUISSE FIRST BOSTON ("CSFB"), as syndication agent (in such
capacity, the "SYNDICATION AGENT") for the Lenders, NATIONAL CITY BANK ("NCB"),
as administrative agent (in such capacity, the "ADMINISTRATIVE AGENT", and
together with the Syndication Agent, the "AGENTS") for the Lenders, and CSFB and
NCB, as joint lead arrangers (the "JOINT LEAD ARRANGERS").
WHEREAS, pursuant to the Heads of Agreement, dated as of April 23, 2001
(the "PURCHASE AGREEMENT"), by and between the Borrower and OM Group, Inc., a
Delaware corporation ("OMG"), the Borrower will purchase the electronic
materials, performance pigments and colors, glass systems and cerdec ceramics
divisions (collectively, the "FERRO DIVISIONS") of dmc(2) Degussa Metals
Catalysts Cerdec A.G. ("DMC(2)") from OMG (the "DMC(2) ACQUISITION");
WHEREAS, in order to (a) finance the DMC(2) Acquisition, (b) refinance
existing indebtedness (the "REFINANCING") under the Borrower's existing credit
facility (the "EXISTING CREDIT FACILITY"), (c) pay related fees and expenses
(the "EXPENSE PAYMENTS", and together with the DMC(2) Acquisition and the
Refinancing, the "TRANSACTION") and (d) provide for post-closing working capital
and general corporate purposes of the Borrower and its Subsidiaries following
the consummation of the Acquisition, the Borrower has requested that the Lenders
make the Commitments available to the Borrower; and
WHEREAS, the Lenders and the Letter of Credit Issuer are willing, on the terms
and subject to the conditions hereinafter set forth, to extend the Commitments
and make Loans to the Borrower and issue (or participate in) Letters of Credit;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND TERMS.
1.1 CERTAIN DEFINED TERMS. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires:
"ACQUISITION" shall mean and include (i) any acquisition on a going
concern basis (whether by purchase, lease or otherwise) of any assets,
facilities and/or businesses operated by any person who is not a Subsidiary of
the Borrower, and (ii) acquisitions of a majority of the outstanding equity or
other similar interests in any such person (whether by merger, stock purchase or
otherwise).
"ADDITIONAL SECURED OBLIGATIONS" shall mean the Borrower's obligations
in respect of (a) the issued and outstanding letters of credit set forth on
Annex IV, (b) the Borrower's senior notes issued pursuant to its existing and
future indentures and (c) the trust notes and trust certificates issued in
connection with the Amended and Restated Participation Agreement, dated as of
October 31, 1995 (as amended and restated as of November 30, 2000 and as further
amended from time to time), by and among the Borrower, State Street Bank and
Trust Company, not in its
{PAGE}
individual capacity except as expressly stated therein, the financial
institutions named as purchasers thereto and Citibank, N.A., as agent (the
"TRUST INSTRUMENTS"), that will, in each case, share on a PARI PASSU basis with
the Obligations with respect to any collateral required to be provided pursuant
to section 8.14; PROVIDED that, with respect to the Borrower's senior notes and
the Trust Instruments, only the Borrower's and its Subsidiaries' Principal
Domestic Manufacturing Properties and the Capital Stock of the Borrower's
Domestic Subsidiaries will be required to be shared.
"ADJUSTED LIBO RATE" shall mean with respect to each Interest Period
for a LIBOR Loan, (i) the rate per annum appearing on page 3750 of the Telerate
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to Dollar deposits, or the
Alternative Currency, as the case may be, in the London interbank market), at
approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period, as the rate for Dollar deposits, or the
Alternative Currency, as the case may be, with a maturity comparable to such
Interest Period, divided (and rounded to the nearest ten thousandth of 1%) by
(ii) a percentage equal to 100% minus the then stated maximum rate of all
reserve requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves and without benefit of credits for
proration, exceptions or offsets which may be available from time to time)
applicable to any member bank of the Federal Reserve System in respect of
Eurocurrency liabilities as defined in Regulation D (or any successor category
of liabilities under Regulation D); PROVIDED, HOWEVER, that in the event that
the rate referred to in clause (i) above is not available at any such time for
any reason, then the rate referred to in clause (i) shall instead be the average
(rounded to the nearest ten thousandth of 1%) of the rates at which Dollar
deposits of $5,000,000, or the Alternative Currency, as the case may be, are
offered to the Reference Banks in the London interbank market at approximately
11:00 a.m. (London time), two Business Days prior to the commencement of such
Interest Period, for contracts which would be entered into at the commencement
of such Interest Period.
"ADMINISTRATIVE AGENT" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to section 11.9.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"AFFILIATE" shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 20% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
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