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Title: |
Credit Agreement |
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Entities: |
American Biltrite Inc.; Fleet National Bank; Bank of New York; Skadden, Arps, Slate, Meagher & Flom LLP |
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Date: |
2003 |
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Size: |
Preview shows 21KB of 246KB total |
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Price: |
$99 |
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ID: |
#401598 |
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AMERICAN BILTRITE INC.
K&M ASSOCIATES L.P.
CREDIT AGREEMENT
Dated as of October 14, 2003
FLEET NATIONAL BANK, Administrative Agent
{PAGE}
{TABLE}
{CAPTION}
TABLE OF CONTENTS
Page
{S} {C}
1. Definitions..............................................................................................1
2. The Credits.............................................................................................21
2.1. Revolving Credit...............................................................................21
2.2. Letters of Credit..............................................................................22
2.3. Application of Proceeds........................................................................24
3. Interest; Pricing Options; Fees.........................................................................24
3.1. Interest.......................................................................................24
3.2. LIBOR Pricing Options..........................................................................25
3.3. Fixed Rate Pricing Options.....................................................................27
3.4. Unused Line Fees...............................................................................27
3.5. Letter of Credit Fees..........................................................................28
3.6. Computations of Interest and Fees..............................................................29
3.7. Maximum Lawful Interest Rate...................................................................29
4. Payment.................................................................................................29
4.1. Payment at Maturity............................................................................29
4.2. Voluntary Prepayments..........................................................................29
4.3. Letters of Credit..............................................................................30
4.4. Reborrowing; Application of Payments, etc......................................................30
5. Conditions to Extending Credit..........................................................................30
5.1. Conditions on Initial Closing Date.............................................................30
5.2. Conditions to Each Extension of Credit.........................................................32
6. General Covenants.......................................................................................32
6.1. Taxes and Other Charges; Accounts Payable......................................................32
6.2. Conduct of Business, etc.......................................................................33
6.3. Insurance......................................................................................34
6.4. Financial Statements and Reports...............................................................34
6.5. Certain Financial Tests........................................................................37
6.6. Indebtedness...................................................................................38
6.7. Liens..........................................................................................39
6.8. Investments and Acquisitions...................................................................40
6.9. Distributions..................................................................................42
6.10. Issuance of Equity by Subsidiaries; Subsidiary Distributions...................................42
6.11. Voluntary Prepayments of Other Indebtedness....................................................42
6.12. Negative Pledge Clauses........................................................................43
6.13. ERISA, etc.....................................................................................43
6.14. Transactions with Affiliates...................................................................43
6.15. Environmental Laws.............................................................................43
7. Representations and Warranties..........................................................................43
7.1. Organization and Business......................................................................43
{PAGE}
7.2. Financial Statements and Other Information; Material Agreements................................44
7.3. Agreements Relating to Financing Debt, Investments, etc........................................45
7.4. Changes in Condition...........................................................................45
7.5. Title to Assets................................................................................45
7.6. Operations in Conformity With Law, etc.........................................................45
7.7. Litigation.....................................................................................45
7.8. Authorization and Enforceability...............................................................46
7.9. No Legal Obstacle to Agreements................................................................46
7.10. Defaults.......................................................................................47
7.11. Licenses, etc..................................................................................47
7.12. Pension Plans..................................................................................47
7.13. Environmental Regulations......................................................................47
7.14. Government Regulation; Margin Stock............................................................47
7.15. Disclosure.....................................................................................48
8. Defaults................................................................................................48
8.1. Events of Default..............................................................................48
8.2. Certain Actions Following an Event of Default..................................................51
8.3. Annulment of Defaults..........................................................................52
8.4. Waivers........................................................................................52
9. Expenses; Indemnity.....................................................................................53
9.1. Expenses.......................................................................................53
9.2. General Indemnity..............................................................................53
9.3. Indemnity With Respect to Letters of Credit....................................................54
10. Operations; Agent.......................................................................................54
10.1. Interests in Credits...........................................................................54
10.2. Agent's Authority to Act, etc..................................................................54
10.3. Lender Operations for Advances, Letters of Credit, etc.........................................55
10.4. Sharing of Payments, etc.......................................................................56
10.5. Agent's Resignation............................................................................57
10.6. Concerning the Agent...........................................................................57
10.7. Rights as a Lender.............................................................................58
10.8. Independent Credit Decision....................................................................58
10.9. Indemnification................................................................................59
11. Successors and Assigns; Lender Assignments and Participations...........................................59
11.1. Assignments by Lenders.........................................................................59
11.2. Credit Participants............................................................................62
11.3. Special Purpose Funding Vehicles...............................................................63
12. Confidentiality.........................................................................................63
13. Notices.................................................................................................64
14. Amendments, Consents, Waivers, etc......................................................................64
14.1. Lender Consents for Amendments.................................................................64
14.2. Course of Dealing; No Implied Waivers..........................................................66
15. General Provisions......................................................................................66
15.1. Defeasance.....................................................................................66
15.2. No Strict Construction.........................................................................66
15.3. Venue; Service of Process; Certain Waivers.....................................................66
{PAGE}
15.4. WAIVER OF JURY TRIAL...........................................................................67
15.5. Interpretation; Governing Law; etc.............................................................67
{/TABLE}
{PAGE}
CREDIT AGREEMENT
This Agreement, dated as of October 14, 2003, is among American
Biltrite Inc., a Delaware corporation ("American Biltrite"), K&M Associates
L.P., a Rhode Island limited partnership ("K & M"; American Biltrite and K&M
being, collectively but jointly and severally, the "Borrower"), the Lenders
from time to time party hereto and Fleet National Bank, both in its capacity as
a Lender and in its capacity as administrative agent for the Lenders. The
parties agree as follows:
Recitals: Pursuant to this Agreement, the Lenders are extending to the
Borrower a $25,000,000 secured revolving credit facility, including a
$5,000,000 sub-allotment for Letters of Credit. All the credit facilities
mature on March 1, 2004. The proceeds of these credit facilities may be used
for general corporate purposes as provided herein.
1. Definitions. Certain capitalized terms are used in this Agreement and in the
other Credit Documents with the specific meanings defined below in this Section
1.
"Affiliate" means, with respect to the Company (or any other specified
Person), any other Person directly or indirectly controlling, controlled by or
under direct or indirect common control with the Company (or such specified
Person), and shall include (a) any officer or director or general partner of
the Company (or such specified Person), (b) any Person of which the Company (or
such specified Person) or any Affiliate (as defined in clause (a) above) of the
Company (or such specified Person) shall, directly or indirectly, beneficially
own either (i) at least 10% of the outstanding equity securities having the
general power to vote or (ii) at least 10% of all equity interests and (c) any
Person directly or indirectly controlling the Company (or such specified
Person) through a management agreement, voting agreement or other contract.
"Agent" means Fleet in its capacity as administrative agent for the
Lenders hereunder, as well as its successors and assigns in such capacity
pursuant to Section 10.5.
"Agreement" means this Credit Agreement as from time to time amended,
modified and in effect.
"American Biltrite" is defined in the preamble.
"Applicable Margin" means the amount in the table below set opposite
the Reference Leverage Ratio for such date:
------------------------------------ -------------------------
Reference Leverage Ratio Applicable Margin
------------------------------------ -------------------------
} 300% 250 b.p.
-
------------------------------------ -------------------------
} 250% { 300% 200 b.p.
-
------------------------------------ -------------------------
} 201% { 250% 150 b.p.
-
------------------------------------ -------------------------
} 101% { 200% 125 b.p.
-
------------------------------------ -------------------------
{ 100% 100 b.p.
-
------------------------------------ -------------------------
{PAGE}
Changes in the Applicable Margin shall occur on the third Banking Day after
quarterly financial statements have been furnished to the Agent in accordance
with Sections 6.4.1 or 6.4.2 from time to time. In the event that the financial
statements required to be delivered pursuant to Section 6.4.1 or 6.4.2, as
applicable, are not delivered when due, then during the period from the third
Banking Day following the date such financial statements were due until the
third Banking Day following the date on which they are actually delivered, the
Applicable Margin shall be the maximum amount set forth in the table above.
"Applicable Rate" means, at any date, the sum of:
(a) (i) with respect to each portion of the Loan subject to a LIBOR Pricing
Option, the sum of the Applicable Margin (which may change during the LIBOR
Interest Period for such LIBOR Pricing Option in accordance with the definition
of "Applicable Margin") plus the LIBOR Rate with respect to such LIBOR Pricing
Option;
(ii) with respect to each portion of the Loan subject to a Fixed Rate
Pricing Option, the sum of the Applicable Margin plus the Fixed Rate with
respect to such Fixed Rate Pricing Option;
(iii) with respect to each other portion of the Loan, the Base Rate;
plus (b) an additional 4% per annum effective on the day written notice from
the Agent has been delivered to the Borrower that the interest rates hereunder
are increasing as a result of the occurrence and continuance of an Event of
Default until the earlier of such time as (i) such Event of Default is no
longer continuing or (ii) such Event of Default is deemed no longer to exist,
in each case pursuant to Section 8.3.
"Assignee" is defined in Section 11.1.1.
"Assignment and Acceptance" is defined in Section 11.1.1.
"Banking Day" means any day other than Saturday, Sunday or a day on
which banks in Boston, Massachusetts are authorized or required by law or other
governmental action to close.
"Bankruptcy Code" means Title 11 of the United States Code.
"Bankruptcy Default" means an Event of Default referred to in Section
8.1.10.
"Base Rate" means, on any date, the greater of (a) the rate of
interest announced by Fleet at the Boston Office as its prime rate or (b) the
sum of 1/2% plus the Federal Funds Rate. The Base Rate is a reference rate and
does not necessarily represent the lowest or best rate being charged to any
customer. Changes in the rate of interest resulting from changes in the Base
Rate shall take place immediately without notice or demand of any kind.
"Borrower" is defined in the preamble.
-2-
{PAGE}
"Borrowing Base" means, on any date, the sum of the following, but
only with respect to the Company, the Tape Subsidiaries and K&M:
(a) 70% of Eligible Accounts Receivable,
plus (b) 35% of Eligible Inventory,
plus (c) 20% of Eligible Fixed Assets,
minus (d) Indebtedness owed to the Noteholders;
provided, however, that the Borrowing Base shall be reduced to $1.00
during any period when the Company has failed to furnish the computation of the
Borrowing Base required by Section 6.4.3, commencing seven days following
notice to the Borrower of its failure to furnish the computation.
"Boston Office" means the principal banking office of Fleet in Boston,
Massachusetts.
"By-laws" means all written by-laws, rules, regulations and all other
documents relating to the management, governance or internal regulation of any
Person other than an individual, all as from time to time in effect.
"Capital Expenditures" means, for any period, amounts added or
required to be added to the property, plant and equipment or other fixed assets
account on the Consolidated balance sheet of the Company and its Subsidiaries,
prepared in accordance with GAAP.
"Capitalized Lease" means any lease which is required to be
capitalized on the balance sheet of the lessee in accordance with GAAP,
including Statement Nos. 13 and 98 of the Financial Accounting Standards Board.
"Capitalized Lease Obligations" means the amount of the liability
reflecting the aggregate discounted amount of future payments under all
Capitalized Leases calculated in accordance with GAAP, including Statement Nos.
13 and 98 of the Financial Accounting Standards Board.
"Cash Equivalents" means:
(a) negotiable certificates of deposit, time deposits (including sweep
accounts), demand deposits and bankers' acceptances having a maturity of nine
months or less and issued by any United States financial institution having
capital and surplus and undivided profits aggregating at least $100,000,000 and
rated at least Prime-1 by Moody's or A-1 by S&P or issued by any Lender;
(b) corporate obligations having a maturity of nine months or less and
rated at least Prime-1 by Moody's or A-1 by S&P or issued by any Lender;
-3-
{PAGE}
(c) any direct obligation of the United States of America or any
agency or instrumentality thereof, or of any state or municipality thereof, (i)
which has a remaining maturity at the time of purchase of not more than one
year or which is subject to a fully collateralized repurchase agreement with
any Lender (or any other financial institution referred to in clause (a) above)
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