<PAGE>
Exhibit 10.71
AMENDMENT NO. 3 AND WAIVER TO CREDIT AGREEMENT
THIS
AMENDMENT NO. 3 AND WAIVER TO CREDIT AGREEMENT (this "Amendment
Agreement") is made and entered into as of December 29, 2005, by
and among
LIBBEY GLASS INC., a Delaware corporation (the "US Borrower").
LIBBEY EUROPE
B.V., a company organized and existing under the laws of the
Netherlands (the
"Dutch Borrower", and together with the US Borrower, the
"Borrowers"), EACH
LENDER SIGNATORY HERETO, and BANK OF AMERICA, N.A., as the
administrative agent
for the Lenders (in such capacity, the "Administrative Agent"),
Swing Line
Lender and an L/C Issuer.
WITNESSETH:
WHEREAS, the
Administrative Agent, the lenders party thereto (collectively,
the "Lenders" and individually, a "Lender") and the Borrowers have
entered into
that certain Credit Agreement dated as of June 24, 2004 (as amended
by Amendment
No. 1 and Waiver to Credit Agreement dated as of December 21, 2004
and by
Amendment No. 2 and Waiver to Credit Agreement dated as of
September 30, 2005
("Amendment No. 2"), and as hereby and from time to time amended,
restated,
supplemented, modified or replaced, the "Credit Agreement";
capitalized terms
used herein but not otherwise defined herein shall have the
meanings assigned to
such terms in the Credit Agreement), pursuant to which the Lenders
have agreed
to make and have made available to the Borrowers a revolving credit
facility in
an aggregate principal amount of $250,000,000; and
WHEREAS, the US Borrower would have been in default of the
financial
covenant set forth in Section 7.14(a) of the Credit Agreement
commencing as of
September 30, 2005 which default was waived by Amendment No. 2;
and
WHEREAS, the Borrowers have requested that certain terms of the
Credit
Agreement be amended in the manner set forth herein, that the
Aggregate
Commitments be reduced to $195,000,000, and that the financial
covenant default
described above continue to be waived effective as of the date
hereof, and for a
period from the date hereof through and including January 2, 2007,
and the
Administrative Agent and the Lenders, subject to the terms and
conditions
contained herein, have agreed to such amendment and waiver, to be
effective as
of the date hereof; and
WHEREAS, the Borrowers, the Administrative Agent and the
Lenders
acknowledge that the terms of this Amendment Agreement constitute
an amendment
and modification of, and not a novation of, the Credit
Agreement;
NOW,
THEREFORE, in consideration of the mutual covenants and the
fulfillment of the conditions set forth herein, the parties hereby
agree as
follows:
1.
Definitions. The term "Credit Agreement" or "Agreement" (as the
case may
be) as used herein, in the Credit Agreement and in the other Loan
Documents
shall mean the Credit
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Agreement as hereby amended and modified, and as further amended,
restated,
modified, replaced or supplemented from time to time as permitted
thereby.
2.
Amendments to, Additions of, and Restatements of Terms of the
Credit
Agreement. Subject to the conditions hereof and upon satisfaction
of the terms
set forth in Section 7, the Credit Agreement is hereby amended,
effective as of
the date hereof, as follows:
(A) SECTION 1.01 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY
ADDING
THE
FOLLOWING DEFINITIONS, IN ALPHABETICAL ORDER, TO READ AS
FOLLOWS:
"Cash Management Obligations" means, with respect to any
Lender,
any obligations owed to such Lender by the US Borrower or any of
its
Subsidiaries which arise as a direct result of the deposit,
collection
and other cash management, treasury or deposit services provided
by
such Lender to the US Borrower or any such Subsidiary,
including
without limitation all of the obligations of the US Borrower or any
of
its Subsidiaries to such Lender for overdrafts, for returned
checks
and other returned items and for credit extended under, or as a
result
of, cash management, treasury and deposit agreements.
"Collateral" has the meaning specified in Section 6.16 of this
Agreement.
"Collateral Agent" means Bank of America, in its capacity as
collateral agent for the Secured Parties, or any permitted
successor
collateral agent.
"Equity Interests" means, with respect to any Person, all of
the
shares of capital stock of (or other ownership or profit interests
in)
such Person, all of the warrants, options or other rights for
the
purchase or acquisition from such Person of shares of capital stock
of
(or other ownership or profit interests in) such Person, all of
the
securities convertible into or exchangeable for shares of
capital
stock of (or other ownership or profit interests in) such Person
or
warrants, rights or options for the purchase or acquisition from
such
Person of such shares (or such other interests), and all of the
other
ownership or profit interests in such Person (including
partnership,
member or trust interests therein), whether voting or nonvoting,
and
whether or
not such shares, warrants, options, rights or other
interests are outstanding on any date of determination.
"Intercreditor Agreement" means that certain Intercreditor and
Collateral Agency Agreement to be executed among the
Administrative
Agent, the Lenders party hereto, the Collateral Agent, the
Noteholders, and the Victrocrisa Lenders and consented and agreed
by
each Borrower and the other Loan Parties, as the same may be
amended,
modified, restated, supplemented or replaced from time to time.
"Mortgage" means any mortgage, deed of trust, deed to secure,
or
similar instrument under which a Lien may be granted against
real
property, duly executed by Holdings, the US Borrower or one of
the
Guarantors covering the Real Property, appropriately conformed to
the
particular requirements of each
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<PAGE>
applicable jurisdiction where such Real Property is located and
in
form and substance reasonably satisfactory to the
Administrative
Agent.
"Note Purchase Agreement" means that certain Note Purchase
Agreement dated as of March 31, 2003, by and among the US Borrower
and
the Noteholders, pursuant to which the Noteholders purchased
the
Senior Secured Notes, as may be amended, restated,
supplemented,
modified, or replaced from time to time.
"Noteholders" means, collectively, each of the purchasers party
to the Note Purchase Agreement, including their permitted
successors
and assigns.
"Pledged Foreign Subsidiary" means each, and "Pledged Foreign
Subsidiaries" means all, Subsidiaries of the US Borrower that
are
owned directly by the US Borrower or a Guarantor which are
organized
under the laws of a jurisdiction other than the United States
of
America or any state or commonwealth thereof.
"Real Property" means the real property located in the United
States and owned by Holdings, the US Borrower or the Guarantors,
as
described on Schedule 1.01 (a).
"Secured Obligations" means all advances to, and debts,
liabilities, obligations, covenants and duties of, any Loan
Party
arising under any Loan Document or otherwise with respect to (a)
the
Obligations, (b) any Revolving Loan or Letter of Credit, (c) any
Swap
Contract of the US Borrower or any Subsidiary to which a Lender or
an
Affiliate of a Lender is a party, provided such Lender was a party
to
this Agreement at the time such Swap Contract was entered into or
(d)
Cash Management Obligations, in each case whether direct or
indirect
(including those acquired by assumption), absolute or contingent,
due
or to become due, now existing or hereafter arising and
including
interest and fees that accrue with respect to the foregoing after
the
commencement by or against any Loan Party or any Affiliate thereof
of
any proceeding under any Debtor Relief Laws naming such Person as
the
debtor in such proceeding, regardless of whether such interest
and
fees are allowed claims in such proceeding; provided, however,
that
the maximum amount of the Swap Contracts under clause (c) and
Cash
Management Obligations under clause (d) that are considered
"Secured
Obligations" shall be governed by the Intercreditor Agreement.
"Secured Party" means each of, and "Secured Parties" means all
of, (a) the Collateral Agent, (b) the Administrative Agent, (c)
the
Lenders, (d) any Affiliate of a Lender that has Cash Management
Obligations or that is a party to a Swap Contract with the US
Borrower
or any Subsidiary, provided such Lender was a party to this
Agreement
at the time such Cash Management Obligations were incurred or
such
Swap Contract was entered into, (e) the Swing Line Lender, (f)
the
Noteholders, (g) the Victrocrisa Lenders, and (h) each
financial
institution or other entity that hereafter becomes a "Secured
Party"
for purposes of the Intercreditor Agreement; provided that each
party
shall be a Secured Party only to
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the extent set forth in and subject to the limitations set forth
in
the Intercreditor Agreement.
"Security Agreement" means the Security Agreement to be
executed
by Holdings, the US Borrower and the Guarantors in favor of
Collateral
Agent for the benefit of the Secured Parties, in form and
substance
reasonably acceptable to the Administrative Agent, as the same may
be
amended, supplemented, restated, replaced, or modified from time
to
time.
"Security Documents" means, collectively, any security
agreement,
including without limitation the Security Agreement, any pledge
agreement, any mortgage or deed of trust including without
limitation
the Mortgages, any assignment and endorsement of insurance, or
any
other agreement, joinder, ratification, or document, together with
all
related financing statements and stock powers, executed and
delivered
in connection with this Agreement to create a Lien on any real
or
personal property in favor of Collateral Agent for the benefit of
the
Secured Parties, as the same may be amended, supplemented,
replaced,
modified and restated from time to time.
"Senior Secured Notes" means, collectively, (a) $25,000,000 in
3.69% Senior Notes, Series 2003A-1, due on March 31, 2008, (b)
$55,000,000 in 5.08% Senior Notes, Series 2003A-2, due on March
31,
2013, and (c) $20,000,000 Floating Rate Senior Notes, Series
2003B,
due on March 31, 2010.
"Victrocrisa Credit Agreement" means that certain Credit
Agreement dated as of April 2, 2004, by and among Victrocrisa
Comercial, S. de R.L. de C.V., a corporation organized and
existing
under the laws of Mexico, Victrocrisa, S. de R.L. de C.V., a
corporation organized and existing under the laws of Mexico,
the
lenders and agents party thereto, as may be amended, restated,
supplemented, modified or replaced from time to time.
"Victrocrisa Lenders" means, collectively, each of the Tranche
B
Lenders (as defined on the Victrocrisa Credit Agreement) party to
the
Victrocrisa Credit Agreement, including their permitted successors
and
assigns.
(B) SECTION 1.01 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO
RESTATE
EACH
OF THE FOLLOWING IN THEIR ENTIRETY TO READ AS FOLLOWS:
"Applicable Rate" means the following basis points per annum,
based upon the Leverage Ratio as set forth in the most recent
Compliance Certificate received by the Administrative Agent
pursuant
to Section 6.02(b):
Applicable Rate
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<TABLE>
<CAPTION>
APPLICABLE RATE FOR
EURODOLLAR RATE LOANS, APPLICABLE APPLICABLE
OFFSHORE CURRENCY RATE FOR
RATE
FOR
PRICING LEVERAGE
FACILITY
RATE LOANS AND LETTER BASE RATE SWINGLINE
LEVEL
RATIO
FEE
OF CREDIT FEE
LOANS LOANS IN
EURO
-------
-------------
--------
---------------------- ---------- -------------
<S>
<C>
<C>
<C>
<C>
<C>
1 Less than
or 15.0
60.0
-40.0
110.0
equal to 1.75
to 1.00
2 Less than
or 20.0
80.0
-20.0
130.0
equal to 2.25
to 1.00 but
greater than
1.75 to 1.00
3 Less than
or 25.0
100.0
0.0
150.0
equal to 2.75
to 1.00 but
greater than
2.25 to 1.00
4 Less than
or 30.0
120.0
20.0
170.0
equal to 3.25
to 1.00 but
greater than
2.75
to 1.00
5 Less than
or 40.0
135.0
35.0
185.0
equal to 3.75
to 1.00 but
greater than
3.25 to 1.00
6 Less than
or 50.0
175.0
75.0
225.0
equal to 4.25
to 1.00 but
greater than
3.75 to 1.00
7 Greater
than 50.0
225.0
125.0
275.0
4.25 to 1.00
</TABLE>
Any increase or decrease in the Applicable Rate resulting from
a
change in the Leverage Ratio shall become effective as of the
fifth
Business Day immediately following the date a Compliance
Certificate
is delivered pursuant to Section 6.02(b); provided, however, that
if
no Compliance Certificate is delivered with respect to a fiscal
quarter on or prior to the date when due in accordance with
such
Section, then, until such time as the applicable Compliance
Certificate is delivered, with respect to the Facility Fee,
Revolving
Loans and Offshore Currency Loans, Pricing Level 7 as set forth in
the
table above shall apply as of the fifth Business Day after the
Administrative Agent gives the US Borrower
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notice that it has not received such certificate by the due
date.
Until adjusted as provided above, the Applicable Rate shall be at
the
Pricing Level 6.
"Available Amount" means an amount equal to the lesser of (a)
$195,000,000 and (b) the Aggregate Commitments.
"Loan Documents" means this Agreement, the Security Documents
(once entered into), the Intercreditor Agreement (once entered
into),
each Note, the Fee Letter, each Request for Credit Extension,
each
Compliance Certificate and the Guaranties, including all
amendments,
restatements, replacements, modifications, increases,
extensions,
ratifications, joinders, and supplements to the foregoing.
"Maximum Non-Loan Party Investment Amount" means an aggregate
amount not to exceed (a) $40,000,000 or (b) $125,000,000 if at
the
time of such Investment or Disposition, the Leverage Ratio is
less
than 2.25 to 1.00 (it being understood that Investments permitted
by
this clause (b) shall not cease to be allowed by virtue of changes
in
the Leverage Ratio subsequent to the time of such Investment or
Disposition), plus, in the case of either clause (a) or (b), an
amount
(the "Incremental Amount") equal to any cash dividends, other
cash
returns and the fair market value of other distributions
received
after the date hereof with respect to the Investment described
in
Section 7.02(n) (such Incremental Amount not to exceed the
initial
amount of such Investment).
(C) SECTION 2.10(C) IS HEREBY ADDED TO THE CREDIT AGREEMENT TO READ
AS
FOLLOWS:
(c) Additional Fee. To the extent the Obligations shall not
have
been paid in full on or prior to May 31, 2006, on June 1, 2006, the
US
Borrower shall pay to each Lender an amount equal to 25 basis
points
on the amount of the Aggregate Commitments held by such Lender on
such
date.
(D) SECTIONS 6.16 THROUGH 6.20 ARE HEREBY ADDED TO THE CREDIT
AGREEMENT TO READ AS FOLLOWS:
6.16 Collateral. To secure full and complete payment and
performance of the Secured Obligations, execute and deliver or
cause
to be executed and delivered the documents described below
covering
the property and collateral described in this Section 6.16
(which,
together with any other property and collateral which may now
or
hereafter secure the Secured Obligations or any part thereof,
is
sometimes herein called the "Collateral") as follows:
(a) On or before January 31, 2006, the US Borrower will, and
will cause each of the Guarantors to, grant to Collateral
Agent,
for the benefit of the Secured Parties, a first priority
security
interest
in substantially all of its personal property, including
but not limited to, accounts, chattel paper, instruments,
documents, books, records, inventory, machinery, equipment,
trademarks, patents, copyrights, other
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<PAGE>
intellectual property, payment intangibles, other general
intangibles, commercial tort claims, Equity Interests in its
Subsidiaries (provided that not more than 65% of the Equity
Interests of any Pledged Foreign Subsidiary shall be required
to
be subject to such security interest except as otherwise
provided
in the Security Agreement), other investment property and other
personal property described in the Security Agreement, whether
now owned or hereafter acquired, and all products and cash and
noncash proceeds thereof, pursuant to the Security Agreement
and
the Security Documents, which shall be in form and substance
reasonably satisfactory to the Administrative Agent.
(b) On or before January 31, 2006, the US Borrower will, and
will cause each Guarantor to deliver to the Administrative
Agent
certificates of insurance and endorsements to insurance
policies
naming the Collateral Agent as loss payee/mortgagee and/or
additional insured, as applicable, with respect to all
Collateral
or if otherwise available, and as may be required by Section
6.07
and the Security Documents.
(c) On or before January 31, 2006, the US Borrower will, and
will cause each Guarantor, to deliver to the Administrative
Agent
counterparts of a fully executed Intercreditor Agreement.
(d) On or before March 31, 2006, the US Borrower will, and
will cause each Guarantor to, grant to Collateral Agent, for
the
benefit of the Secured Parties, a first priority security
interest in all of its Real Property pursuant to the Mortgages
and other Security Documents related to the Mortgages and the
Real Property, to include, without limitation, loan or
mortgagee
title commitments, flood certificates, and tax affidavits,
together with payment of all related taxes and fees, all of
which
shall be in form and substance reasonably satisfactory to the
Administrative Agent.
(e) To the extent that the real property located at Dane,
Wisconsin, owned in connection with Traex Company has not been
sold on or before June 30, 2006, the US Borrower will, and will
cause any applicable Guarantor, to grant a lien in such real
property in the manner contemplated by Section 6.16(d) on or
prior to July 15, 2006.
(f) On or before January 31, 2006, certificates of
resolutions or other action, incumbency certificates and/or
other
certificates of Responsible Officers of each Loan Party, all in
form and substance reasonably satisfactory to the
Administrative
Agent, which establish the identity and verify the authority
and
capacity of each Responsible Officer thereof authorized to act
as
a Responsible Officer in connection with this Amendment
Agreement
and the other Loan Documents to which such Loan Party is a
party.
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<PAGE>
(g) On January 31, 2006, the US Borrower shall cause special
counsel to the US Borrower to deliver to the Administrative
Agent
an opinion of counsel (which shall be in customary form) with
respect to the Security Documents executed and delivered on or
prior to January 31, 2006, together with such board
resolutions,
officer's certificates, corporate and other documents and
opinions of counsel relative to such Security Documents as the
Administrative Agent shall reasonably request. Upon the earlier
of (x) May 31, 2006 or (y) as soon as practicable (but in no
event more than thirty days) after the occurrence of an Event
of
Default, the US Borrower shall deliver to the Administrative
Agent an opinion of counsel in the applicable foreign
jurisdiction (which shall be in customary form) with respect to
the Security Documents executed and delivered on or prior to
such
date which pertain to the Pledged Foreign Subsidiaries.
(h) The US Borrower will, and will cause each of the
Guarantors to execute and deliver and cause to be executed and
delivered such further documents and instruments as
Administrative Agent reasonably deems necessary or desirable to
evidence and perfect its Liens in the Collateral as set forth
in
the Security Agreement.
6.17 Additional Subsidiaries.
(a) At any time following January 31, 2006, within ten days
after the time that any Person becomes a Domestic Subsidiary as
a
result of the creation of such Subsidiary, an Acquisition
permitted by Article VII or otherwise, (i) if such Domestic
Subsidiary is a Restricted Material Subsidiary, it shall become
a
party to the Security Agreement to secure the Secured
Obligations, pursuant to joinder agreements in form and
substance
satisfactory to the Administrative Agent, (ii) 100% of such
Subsidiary's Equity Interests shall be pledged to secure the
Secured Obligations, and (iii) the Lenders shall receive such
board resolutions, officer's certificates, corporate and other
documents and opinions of counsel as the Administrative Agent
shall reasonably request in connection with the actions
described
in clauses (i) and (ii) above.
(b) Within thirty days after the time that any Person
becomes a Pledged Foreign Subsidiary as a result of the
creation
of such Subsidiary, an Acquisition permitted by Article VII or
otherwise, (i) 65% of such Subsidiary's Equity Interests shall
be
pledged to secure the Secured Obligations. Subject to the
limitations set forth in Section 6.16(g), the opinions and
certificates required by Section 6.16(g) shall also be
furnished
to the Administrative Agent concurrently with such pledge.
6.18 Cash Flow Forecasts. After May 31, 2006, the US Borrower
shall deliver to the Administrative Agent on the second Business
Day
of each week a 13-week rolling cash flow forecast in form
reasonably
acceptable to the Administrative Agent.
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<PAGE>
6.19 Status of Refinancing. During the last week of each month
(beginning January, 2006) the US Borrower will hold a conference
call
during normal business hours with the Lenders to discuss the status
of
the US Borrower's efforts to refinance the Obligations.
6.20 Financial Advisor. In the event that the Obligations have
not been paid in full on or prior to May 31, 2006, counsel to
the
Administrative Agent shall engage a financial advisor selected by
the
Administrative Agent to perform a detailed review of the US
Borrower's
business plan, financial statements, projections and strategies,
with
such review to commence no later than June 9, 2006. No later
than
August 9,
2006, such financial advisor shall provide to the Lenders a
written report setting forth the results of such review. Such
financial advisor shall also provide such other financial
advisory
services relating to the business and financial condition of the
Loan
Parties and their Subsidiaries as shall be requested by the
Administrative Agent and agreed between the Administrative Agent
and
such financial advisor. During the engagement of such financial
advisor, the US Borrower shall provide the financial advisor with
such
financial and other information (to the extent that such
information
is reasonably available or can be reasonably obtained by the
Loan
Parties)
regarding the US Borrower, its Subsidiaries and other Loan
Parties, and investments as shall be reasonably requested by
the
financial advisor, including reasonable access to the books and
records of the US Borrower, its Subsidiaries and the Loan
Parties
during normal business hours; provided that (i) in the case of
commercially sensitive information (e.g. customer lists and channel
of
distribution information), no such information shall be furnished
to
the financial advisor unless the financial advisor shall have
first
agreed in writing with the US Borrower that only summaries created
in
consultation with the US Borrower of such information shall be
distributed to
the Lenders, (ii) no such financial and other
information or access to books and records shall be furnished
for
stockholders of Holdings and (iii) such financial information
and
access to the books and records of other affiliates and
investments
shall be furnished only to the extent permitted by any such
affiliate
or the terms of any instrument pursuant to which any such
investment
has been made; provided further, that in the case of this clause
(iii)
the US Borrower shall use commercially reasonable efforts to
ensure
that such information can be furnished to the financial
advisor.
During the engagement of such financial advisor, which shall
continue
for so long as the Administrative Agent shall deem appropriate,
the
Administrative Agent shall re
