Exhibit 10.4
EXECUTION COPY
FOURTH AMENDMENT AND CANADIAN
FORBEARANCE AGREEMENT
FOURTH AMENDMENT AND CANADIAN
FORBEARANCE AGREEMENT, dated as of October 8, 2009 (together
with all schedules hereto, this “ Agreement ”),
among ACCURIDE CORPORATION, a Delaware corporation (the “
U.S. Borrower ”), ACCURIDE CANADA INC., a corporation
organized and existing under the law of the Province of Ontario
(the “ Canadian Borrower ”, and, together with
the U.S. Borrower, the “ Borrowers ”), the
Subsidiary Guarantors (defined below, and together with the
Borrowers, the “ Loan Parties ”) and the
Specified Senior Lenders (as defined below) relating to the Senior
Prepetition Credit Agreement (as defined below). Capitalized
terms used but not otherwise defined herein shall have the
respective meanings ascribed to such terms in the Prepetition Loan
Documents (defined below).
W I T N E S
S E T H :
(A)
WHEREAS, the U.S. Borrower, the Canadian Borrower and the
Subsidiary Guarantors party thereto (the “ Subsidiary
Guarantors ”), the banks, financial institutions and
other institutional lenders party from time to time thereto
(collectively, the “ Lenders ”) and DEUTSCHE
BANK TRUST COMPANY AMERICAS, as administrative agent for the
Lenders (in such capacity, the “ Administrative Agent
”) have entered into (i) that certain Fourth Amended and
Restated Credit Agreement dated as of January 31, 2005 (as
heretofore amended, supplemented or otherwise modified, the “
Senior Prepetition Credit Agreement ”) and
(ii) each other “Loan Document” (as defined in the
Senior Prepetition Credit Agreement), (collectively with the Senior
Prepetition Credit Agreement, the “ Prepetition Loan
Documents ”)
(B)
WHEREAS, pursuant to the Senior Prepetition Credit Agreement, the
Lenders have made certain loans to the Borrowers;
(C)
WHEREAS, as a result of the then likely occurrence of certain
Events of Default under the Senior Prepetition Credit Agreement,
Citicorp USA, Inc., as Administrative Agent at such time, and
the Lenders entered into that certain Temporary Waiver Agreement
(the “ First Temporary Waiver Agreement ”),
dated as of July 1, 2009, whereby the Lenders agreed to
temporarily waive the Scheduled Defaults until the Temporary Waiver
Termination Date as so defined therein (hereinafter defined as the
“ First Temporary Waiver Termination Date
”);
(D)
WHEREAS, as a result of the occurrence and/or continuation of
certain Events of Default after the First Temporary Waiver
Termination Date under the Senior Prepetition Credit Agreement, the
Administrative Agent and the Lenders entered into that certain
Second Temporary Waiver Agreement (the “ Second
Temporary Wavier Agreement ”), dated as of
August 14, 2009, whereby the Lenders agreed to extend the
temporary waiver of the Scheduled Defaults and temporarily waive
the Additional Default until the Second Temporary Waiver
Termination Date as so defined therein (hereinafter defined as the
“ Second Temporary Waiver Termination Date
”);
(E)
WHEREAS, as a result of the occurrence and/or continuation of
certain Events of Default after the Second Temporary Waiver
Termination Date under the Senior Prepetition Credit Agreement, the
Administrative Agent and the Lenders entered into that
certain
Third Temporary Waiver
Agreement (the “ Third Temporary Wavier
Agreement ”), dated as of September 15, 2009,
whereby the Lenders agreed to extend the temporary waiver of the
Scheduled Defaults and the Additional Default and temporarily waive
the Technical Default until the Third Temporary Waiver Termination
Date as so defined therein (hereinafter defined as the “
Third Temporary Waiver Termination Date
”);
(F)
WHEREAS, as a result of the occurrence and/or continuation of
certain Events of Default after the Third Temporary Waiver
Termination Date under the Senior Prepetition Credit Agreement, the
Administrative Agent and the Lenders entered into that certain
Fourth Temporary Waiver Agreement (the “ Fourth
Temporary Wavier Agreement ”), dated as of
September 30, 2009, whereby the Lenders agreed to extend the
temporary waiver of the Scheduled Defaults, the Additional Default
and the Technical Default until October 5, 2009 (the “
Fourth Temporary Waiver Termination Date
”);
(G)
WHEREAS, as a result of the occurrence and/or continuation of
certain Events of Default after the Fourth Temporary Waiver
Termination Date under the Senior Prepetition Credit Agreement, the
Administrative Agent and the Lenders entered into that certain
Fifth Temporary Waiver Agreement (the “ Fifth
Temporary Wavier Agreement ”), dated as of
October 5, 2009, whereby the Lenders agreed to extend the
temporary waiver of the Scheduled Defaults, the Additional Default
and the Technical Default until 9:00 a.m. (eastern standard
time) on October 8, 2009 (the “ Fifth Temporary
Waiver Termination Date ”);
(H)
WHEREAS, the Administrative Agent and the Lenders will, if the
Scheduled Defaults, the Additional Default or the Technical Default
occur(s) and remain(s) continuing as a result of the
Fifth Temporary Waiver Termination Date occurring, be entitled to
exercise all of their rights and remedies under the Senior
Prepetition Credit Agreement, the other Prepetition Loan Documents,
applicable law and in equity (such rights, remedies and actions,
collectively, “ Enforcement Actions ”),
including without limitation, to declare to be immediately due and
payable the outstanding principal of the Advances, all accrued
interest thereon and all fees and other obligations owing to the
Administrative Agent and the Lenders under the Senior Prepetition
Credit Agreement and the other Prepetition Loan
Documents;
(I)
WHEREAS, each of the Loan Parties (other than the Canadian
Borrower) and certain of their respective subsidiaries and
affiliates expect to file as debtors-in-possession (in such
capacity, the “ Debtors ”) under Chapter 11 of
the United States Bankruptcy Code (collectively the “
Bankruptcy Filings ”) in the United States Bankruptcy
Court for the District of Delaware (the “ Bankruptcy
Court ”);
(J)
WHEREAS, the Loan Parties have notified the Specified Senior
Lenders that unless a forbearance is provided (and without
prejudice to the rights and remedies of the Administrative Agent
and the Lenders under the Senior Prepetition Credit Agreement, the
other Prepetition Loan Documents, applicable law and in equity),
the Canadian Borrower would be required to commence with the
applicable Canadian court, voluntary proceedings (in such capacity,
an “ Additional Debtor ”) under the
Companies’ Creditor Arrangement Act (Canada) in an applicable
court of competent jurisdiction in Canada due to Events of Default
under the Prepetition Loan Documents resulting from the Bankruptcy
Filings;
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(K)
WHEREAS, the Canadian Borrower does not intend to become an
Additional Debtor and is not and shall not be a
debtor-in-possession in the Bankruptcy Filings;
(L)
WHEREAS, that certain Senior Secured Superpriority
Debtor-In-Possession Credit Agreement is expected to be entered
into in connection with the Bankruptcy Filings (as amended,
supplemented or otherwise modified from time to time, including any
substitution, replacement, refinancing, renewal or extension
thereof, the “ DIP Credit Agreement ”) by the
U.S. Borrower as borrower and the Subsidiary Guarantors as
guarantors, Deutsche Bank Trust Company Americas, as DIP
administrative agent and DIP collateral agent, Deutsche Bank Trust
Company Americas, as DIP issuing bank and DIP swingline bank,
Deutsche Bank Securities Inc. as lead arranger, General Electric
Capital Corporation as syndication agent, and the DIP lenders from
time to time party thereto;
(M)
WHEREAS, the Loan Parties have notified the Lenders that the
Specified Events of Defaults have occurred and are existing on the
date hereof;
(N)
WHEREAS, notwithstanding the Specified Events of Default, the Loan
Parties have requested, and those certain Senior Lenders under the
Senior Prepetition Credit Agreement party to this Agreement,
including by way of joinder hereto (collectively, together with
their respective successors and assigns, the “ Specified
Senior Lenders ”) are willing, through the Forbearance
Termination Date (as defined below) with respect to each Specified
Senior Lender, to forbear in the enforcement of their remedies set
forth in the Prepetition Loan Documents available to it at law or
in equity, such forbearance to occur to the extent, and strictly on
the terms and conditions, set forth herein.
NOW, THEREFORE, in consideration of
the premises, the mutual covenants contained herein and for other
valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Loan Parties and the Specified Senior
Lenders hereby agree as follows:
ARTICLE
I
Definitions;
Acknowledgments
Section 1.1.
Definitions . As used in this Agreement, the following
terms shall have the meanings set forth below:
“ Canadian Borrower
Forbearance Condition ” means, on any date, a condition
that will be satisfied if the Canadian Borrower has complied with
each of the following covenants set forth in the Senior Prepetition
Credit Agreement (as modified below), with such provisions to be
interpreted as if the Canadian Borrower is the only
“Borrower” and the only “Restricted
Subsidiary” thereunder:
(a)
Liens, Etc . The covenants set forth in 5.02(a);
provided no Liens in excess of $500,000 may be created,
incurred, assumed or suffered to exist after the Effective Date
under Section 5.2(a)(x).
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(b)
Debt – The covenants set forth in
Section 5.02(b); provided that (x) no other
Subordinated Debt may be incurred after the Effective Date under
Section 5.02(b)(i)(A), (y) no Debt other than unsecured
Debt may be incurred after the Effective Date under
Section 5.02(b)(iii)(I) and (z) the following U.S.
Dollar values shall be adjusted with respect to any Debt to be
incurred after the Effective Date:
i.
in Section 5.02(b)(iii)(B), $25,000,000 shall be reduced to
$500,000;
ii.
in Section 5.02(b)(iii)(D), $50,000,000 shall be reduced to
$0; and
iii.
in Section 5.02(b)(iii)(I), $125,000,000 shall be reduced to
$500,000.
(c) Asset
Sales – The covenants set forth in Section 5.02(d);
provided that no asset sales may be made after the Effective
Date other than pursuant to Section 5.02(d)(i).
(d)
Investments – The covenants set forth in
Section 5.02(e); provided that (x) no
investment(s) shall be made pursuant to
Section 5.02(e)(ii) in the aggregate in excess of
$250,000 after the Effective Date, (y) no investment shall be
made after the Effective Date pursuant to
Section 5.02(e)(viii) and (z) no
investment(s) shall be made pursuant to
Section 5.02(e)(xiii) in the aggregate in excess of $500,000
after the Effective Date.
(e)
Prepayments, Etc., of Debt – The covenants set forth
in Section 5.02(g); provided that no payment,
redemption, purchase, defeasance or other satisfaction of any
Subordinated Debt may be made after the Effective Date pursuant to
Section 5.02(g)(i).
(f)
Capital Expenditures – The covenants set forth in
Section 5.02(j); provided that in Section 5.02(j),
the U.S. Dollar value $50,000,000 shall be reduced to $2,500,000
for the period commencing from and after the Effective
Date.
“ Default Interest
” means interest accruing pursuant to, and in accordance
with, Section 2.07(b) of the Senior Prepetition Credit
Agreement.
“ Forbearance Period
” means the period from the Effective Date to, but excluding,
the Forbearance Termination Date.
“ Milestone Termination
Date ” means (a) at any time while the DIP Credit
Agreement is in effect and the definition of “Milestone
Termination Date” is set forth therein, the definition of
“Milestone Termination Date” set forth in the DIP
Credit Agreement and (b) at any time while the DIP Credit
Agreement is not in effect or the definition of “Milestone
Termination Date” is not set forth therein, Wednesday,
October 14, 2009.
“Perfected
Account ” means
collectively: (a) the accounts set forth in that certain
letter agreement dated as of August 14, 2009 (as amended
or modified from time to time) among Canadian Borrower,
Administrative Agent and Fifth Third Bank; and (b) all other
“Account Collateral” (as defined in that certain
Security Agreement dated as of July 27, 2001 (as amended,
modified and supplemented from time to time) between Canadian
Borrower and Administrative Agent (as successor agent to Citicorp
USA, Inc.), herein the “ Canadian Security
Agreement ”)
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pursuant to which Administrative Agent has a
perfected lien in accordance with the terms of the Canadian
Security Agreement.
“ Petition Filing Date
” means the date upon which the U.S. Borrower’s
Bankruptcy Filing is made by the filing of a voluntary petition or
the voluntary conversion of an involuntary bankruptcy
petition.
“ Senior
Subordinated Notes Forbearance ” means that certain
Second Forbearance Agreement, dated as of September 30, 2009,
among certain holders of the Senior Subordinated Notes, the U.S.
Borrower, certain guarantors of the Senior Subordinated Notes and
The Bank of New York Mellon Trust Company (f/k/a The Bank of New
York Trust Company, N.A.), as trustee.
“
Specified Events of Default ” means, collectively, the
Scheduled Defaults, the Additional Default, the Technical Default
and the Defaults and Events of Default under the Specified Sections
(as defined below) of the Senior Prepetition Credit Agreement,
which have occurred or may in the future occur as a result
of:
(i)
the Bankruptcy Filings (including failure to pay principal,
interest and other obligations existing as of the date of the
Bankruptcy Filing as a result of the the acceleration of such
obligations under Section 7.01 of the Senior Prepetition
Credit Agreement),
(ii)
the execution, delivery, filing, performance (including utilization
of the cash management system and granting liens required
thereunder) and compliance with terms of the DIP Credit Agreement
and each “Loan Document” (as defined in the DIP Credit
Agreement) and the various instruments, documents and agreements
entered into or to be entered into in connection therewith
(together, the “ DIP Loan Documents ”) and the
Orders (as defined in the DIP Credit Agreement, (the “
Orders ”) and together with the DIP Loan Documents,
the “ DIP Documents ”) by the Debtors,
and
(iii)
any cross-default under Section 7.01(e) of the Senior
Prepetition Credit Agreement as a result of a default under any
Debt.
“ Specified Sections
” means for any Event of Default or Default arising in
connection with clauses (i) and (ii) under the definition
of “Specified Events of Default”,
(A)
With respect to any action or inaction of the Canadian
Borrower:
(i)
Section 7.01(a),
(ii)
7.01(c) (arising under Section 5.03(a) for failure
to give notice of any Specified Event of Default or
Section 5.04), and
(iii)
7.01(f); and
(B)
With respect to any action or inaction of any other Loan Party,
other than the Canadian Borrower:
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(i)
Section 7.01(a),
(ii)
7.01(c) (arising under Section 5.02(a), (b) or (k),
Section 5.03(a) for failure to give notice of any
Specified Event of Default or Section 5.04),
(iii)
Section 7.01(d) (arising under Sections 5.01(b),
Section 5.01(l), 5.03(c), 5.03(d), 5.03(e), any of the
provisions of the Guarantee and Collateral Agreement and any other
provisions of the other Loan Documents executed by the Debtors,
which are superseded by or otherwise contravene, violate or cannot
be complied with as a result of clauses (i) and (ii) in
the definition of Specified Events of Default),
(iv)
Section 7.01(e),
(v)
Section 7.01(f),
(vi)
Section 7.01(i) and
(vii)
Section 7.01(k).
Section 1.2.
Outstanding Indebtedness . Each Loan Party under the
Prepetition Loan Documents, acknowledges and agrees that
(a) as of 5:00 pm New York time on the date hereof, the
Obligations include, without limitation, the amounts set forth on
Schedule 1(1) attached hereto on account of the outstanding
unpaid amount of principal of, accrued and unpaid interest on, and
fees and commissions related to, the Advances and on account of the
aggregate face amount of the Letters of Credit issued by the
Issuing Bank and for fees and expenses (including any
attorneys’, accountants’, appraisers’ and
financial advisors’ fees that are chargeable or reimbursable
under the Prepetition Loan Documents), charges and other
obligations incurred in connection therewith as provided in the
Prepetition Loan Documents (collectively, the “
Outstanding Indebtedness ”) and (b) such Loan
Party is truly and justly indebted to the Lenders and the
Administrative Agent for, or (except in the case of the Canadian
Borrower) has provided a guaranty for the benefit of the Lenders
and the Administrative Agent with respect to, such Outstanding
Indebtedness without defense, counterclaim or offset of any kind,
and such Loan Party ratifies and reaffirms the validity,
enforceability and binding nature of the Obligations and such
Outstanding Indebtedness. The foregoing amounts do not
include other fees, expenses and other amounts which are chargeable
or otherwise reimbursable under the Prepetition Loan
Documents. None of the Loan Parties has any rights of offset,
defenses, claims or counterclaims with respect to any of the
Obligations and each of the Loan Parties (other than the Canadian
Borrower) are jointly and severally obligated with respect thereto,
in each case in accordance with the terms of the applicable
Prepetition Loan Documents. Each Loan Party (including the
Canadian Borrower) agrees and acknowledges that Default Interest
shall accrue at all times while the Specified Events of Default are
continuing, including while this Agreement is in effect.
Section 1.3.
Collateral . Each Loan Party ratifies and reaffirms
the validity and enforceability (without defense, counterclaim or
offset of any kind) of the Liens granted to secure any of the
Obligations and Outstanding Indebtedness by such Loan Party to
the
(1) SCHEDULE TO BE DISTRIBUTED BY DEUTSCHE
BANK.
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Administrative Agent, for the benefit of the
Lenders, pursuant to the Collateral Documents to which such Loan
Party is a party. Each Loan Party acknowledges and agrees
that all such Liens granted by such Loan Party shall continue to
secure the Obligations and the Outstanding Indebtedness from and
after the date of this Agreement. Each Loan Party hereby
represents and warrants to the Administrative Agent and the Lenders
that, pursuant to the Collateral Documents to which such Loan Party
is a party, the Obligations and the Outstanding Indebtedness are
secured by Liens on all of such Loan Party’s assets to the
extent required by the Collateral Documents.
Section 1.4.
Termination of Commitments . Each Loan Party
acknowledges and agrees that the Specified Events of Default have
occurred, certain are continuing and certain may occur in the
future. As a consequence, the Specified Senior Lenders have
instructed the Administrative Agent to terminate the Commitments of
the Lenders in their entirety, effective as of the Petition Filing
Date.
Section 1.5. Payments
Assumed To Be Due . Notwithstanding that the Lenders have
not previously exercised their rights to accelerate obligations,
for purposes of determining the rights and claims of the Lenders in
the cases commenced by the Bankruptcy Filings, the obligations of
the Debtors under the Prepetition Loan Documents, whether fixed or
contingent, shall be deemed, without the necessity of any further
action or notice, due and payable in full.
Section 1.6. Events of
Default . Each Loan Party (a) acknowledges and
agrees that the Scheduled Defaults, the Additional Default and the
Technical Default have occurred and are continuing and are in full
force and effect, (ii) acknowledges and agrees that the
Specified Events of Default have occurred (it being understood that
the Technical Default has been cured) and may or will occur from
and after the Petition Filing Date and (iii) represents and
warrants to the Administrative Agent and the Lenders that no
Default or Event of Default (other than the Specified Events of
Default) has occurred and continues to exist as of the Effective
Date (as defined below) and (b) absent the agreement of the
Lenders to enter into the forbearances as provided in this
Agreement, the Administrative Agent and the Lenders would be
entitled, during the continuance of such Specified Events of
Default, at any time to take any and all Enforcement
Actions.
ARTICLE
II
Forbearance;
Reservation of Rights
Section 2.1.
Forbearance . Subject to the terms and conditions set
forth herein, including, without limitation, Sections 1.4, 1.5
and 1.6, each of the Specified Senior Lenders hereby agrees on its
behalf and on behalf of its successors and assigns that, prior to
the Forbearance Termination Date with respect to such Specified
Senior Lender, it shall not exercise or instruct the exercise of,
and hereby instructs the Administrative Agent not to exercise, any
of the following remedies:
(a)
Exercise of foreclosure or similar remedies (including, without
limitation, any rights of a secured creditor under the PPSA, BIA or
UCC) in respect of collateral of
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the Canadian Borrower, to the extent
securing obligations of the Canadian Borrower under the Prepetition
Loan Documents; and/or
(b)
Exercise of any other remedy under the Prepetition Loan Documents
against the Canadian Borrower occurring solely by reason of the
occurrence of a Specified Event of Default,
provided , however , that none of the foregoing
shall restrict any Specified Senior Lender party to a Bank Hedge
Agreement with any Debtor from designating an Early Termination
Date (as defined in such Bank Hedge Agreement) as a result of any
of the Specified Events of Default.
Section 2.2.
Reservation of Rights . Subject to the terms and
conditions set forth herein and except as specifically contemplated
by Section 2.1, each of the Specified Senior Lenders hereby
reserves all of its rights, remedies, powers and privileges under
the Senior Prepetition Credit Agreement, the other Prepetition Loan
Documents, any applicable law and equity and does not waive, or
agree to forbear from exercising any remedies with respect
to, any Default or Event of Default which may currently or
hereafter exist that is not a Specified Event of Default.
This Section 2.2 shall survive the Forbearance Termination
Date with respect to each Specified Senior Lender until the
termination of the Prepetition Loan Documents and the indefeasible
payment in full
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