AMENDMENT NO. 3 TO FORBEARANCE AGREEMENTDefault Notice Forbearance Agreement |
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Avenue Capital Partners IV, LLC | Avenue Capital Partners V, LLC | Avenue Global Opportunities Fund GenPar, LLC | Avenue International Master GenPar, Ltd | Avenue Partners, LLC | BURLINGTON RESINS, INC | DISTRIBUTORS RECYCLING, INC | GCM Little Arbor Master Fund, Ltd | GL Partners IV, LLC | GL Partners V, LLC | GLENVIEW CAPITAL MANAGEMENT, LLC | INVESTMENTS, INC | MORGAN STANLEY & CO, INC | NATVAR HOLDINGS, INC | Oaktree Value Opportunities Fund GP, Ltd | OCM Opportunities Fund IV GP, Ltd | OCM Opportunities Fund VII GP, Ltd | PLASTIC SPECIALTIES AND TECHNOLOGIES, INC | PURETEC CORPORATION | Tekni-Plex, Inc | TP/ELM ACQUISITION SUBSIDIARY, INC | TPI ACQUISITION SUBSIDIARY, INC | TRI-SEAL HOLDINGS, INC. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Exhibit 10.1
AMENDMENT NO. 3 TO FORBEARANCE AGREEMENT
AMENDMENT
NO. 3 (the “
Amendment ”), dated as of March 27, 2008, to the
Forbearance Agreement (as amended, the “
Agreement ”)
1 dated as of January 16, 2008 by and among Tekni-Plex,
Inc. (the “
Company ”), each of the Company’s subsidiaries
identified on the signature pages thereof (the “
Subsidiaries ”), the Holders of the Company’s 12
3/4% Senior Subordinated Notes due 2010 (the “
Notes ”) that were issued pursuant to that certain
Indenture, dated as of June 21, 2000 (as supplemented on May 6,
2002, August 22, 2002, and April 25, 2005, the “
Indenture ”), that are signatories thereto (each a
“
Noteholder ,” and collectively, the “
Noteholders ,” and together with the Company, the
“
Parties ”) and
U.S. Bank National Association, as successor indenture
trustee (the “
Indenture Trustee ”) under the Indenture.
RECITALS
WHEREAS,
the parties hereto are desirous of extending the Agreement on
the terms set forth herein;
WHEREAS,
the Noteholders continue to collectively hold not less than
$286,650,000 in aggregate principal amount of the Notes,
representing not less than 91% of the aggregate principal
amount of the Notes that are outstanding, and not less than
$178,275,000 in aggregate principal amount of the Second Lien
Notes, representing not less than 64% of the aggregate
principal amount of the Second Lien Notes that are
outstanding.
NOW
THEREFORE, in consideration of the premises and the respective
covenants and agreements set forth in this Agreement, the
Parties, each intending to be legally bound, agree as
follows:
1.
Forbearance . Section 1(c) of the Agreement is
hereby amended and restated in its entirety as
follows:
“(c) As
used herein, the term “
Forbearance Period ” shall mean the period beginning
on January 17, 2008 and ending upon the occurrence of a Termination
Event. As used herein, “
Termination Event ” shall mean the earliest to occur
of (i) 11:59 p.m. EST on May 13, 2008, (ii) 11:59 p.m. EST on April
1, 2008, unless by such time Paul, Weiss (as defined below)
delivers to the Company a written notice stating that either (A) a
term sheet (the “
Restructuring Term Sheet ”) memorializing the
restructuring transaction agreed to in principle between holders of
a majority in principal amount of the Notes and the Required
Preferred Stockholders (as defined in the Company’s
Certificate of Incorporation) on March 27, 2008, has been agreed to
among the Company, holders of a majority in principal amount of the
Notes, the Required Preferred Stockholders and the two holders of
the Company’s common stock or (B) holders of a majority in
principal amount of the Notes have agreed to extend the date set
forth in this clause (ii) to a date specified in such written
notice, (iii) 11:59 p.m. EST on April 15, 2008 if any required
tender offer for the Notes shall not have been launched by such
time, unless Paul, Weiss delivers to the Company a written notice
stating that holders of a majority in principal amount of the Notes
have agreed to extend the date set forth in this clause (iii) to a
date specified in such written notice or waive compliance with
this
clause
(iii), and (iv) four Business Days after the delivery by Paul,
Weiss, as counsel to the Noteholder Group, to the Company and
the Indenture Trustee of a written notice terminating the
Forbearance Period (the “
Termination Notice ”), which notice may be delivered
at any time but only upon or after the occurrence of any
Forbearance Default (as defined below);
provided ,
however , that notwithstanding the foregoing, this Agreement
shall immediately terminate upon the occurrence of a Forbearance
Default under subsection (H) below, without the need for delivery
of the Termination Notice or any other notice. As used
herein, the term “
Forbearance Default ” shall mean: (A) the valid
acceleration of obligations arising under (i) the 8 3/4% Senior
Secured Notes due 2013 (the “
Second Lien Notes ”) issued pursuant to that certain
indenture dated as of November 21, 2003 (the “
Second Lien Indenture ”); (ii) the 10 7/8 % Senior
Secured Notes due 2012 (the “
First Lien Notes ”) issued pursuant to that certain
indenture dated as of June 10, 2005 (the “
First Lien Indenture ”); or (iii) the Credit Agreement
dated as of June 10, 2005, between the Company, as borrower,
Citicorp USA, Inc. as administrative agent, General Electric
Capital Corporation as syndication agent, and the lenders and
issuers party thereto (as amended, restated, supplemented or
otherwise modified from time to time, the “
Credit Agreement ”); (B) the Company’s payment
of or entry into an agreement to pay the fees or expenses of any
ad-hoc group of holders of First Lien Notes or Second Lien Notes
(other than the Noteholder Group); (C) the failure of the Company
and the Required Preferred Stockholders, after four business
days’ written notice from Paul, Weiss, Rifkind, Wharton &
Garrison LLP (“
Paul Weiss ”, together with Houlihan, Lokey, Howard
& Zukin Capital, Inc. (“
Houlihan Lokey ”), the “
Advisors ”) as counsel to the Noteholder Group
alleging such a failure, to engage in good faith efforts
to
negotiate,
document and consummate the transactions contemplated by the
Restructuring Term Sheet, which determination shall be made by
the holders of a majority in principal amount of the Notes in
good faith and their reasonable discretion; (D) the failure of
the Company, after four business days’ written notice
from Paul Weiss alleging such a failure, to engage in good
faith efforts to produce documentation and due diligence
materials reasonably requested by the Advisors, which
determination shall be made by the holders of a majority in
principal amount of the Notes in good faith and their
reasonable discretion; (E) the occurrence of any Event of
Default other than the Interest Default; (F) the failure of
the Company to comply with any material term, condition,
covenant or agreement set forth in this Agreement; (G) the
failure of any representation or warranty made by the Company
under this Agreement to be true and correct in all material
respects as of the date when made; (H) the commencement by or
against the Company or any Subsidiary that is a Significant
Subsidiary as defined in the Indenture of a case under title
11 of the United States Code; (I) the Company engages in any
material asset sales (other than the disposition of
inventory), material sale-leaseback, or material financing
transaction (including any increase in commitment under the
Credit Agreement) without the consent of a majority in
principal amount of the Notes held by the Noteholder Group;
(J) the Company pays any management, sponsor or consulting
fees to its preferred stockholders or their affiliates; or (K)
from and after February 14, 2008, the Company enters
int
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