INTERCOMPANY LOAN
AGREEMENT
This Intercompany Loan Agreement (this “
Agreement ”) is made and entered into as of
June 16, 2009 (the “ Closing Date ”), by
and between Associated Materials, LLC (the “ Lender
”), a Delaware limited liability company and an indirect,
wholly-owned subsidiary of the Borrower, and AMH Holdings II, Inc.
(the “ Borrower ”), a Delaware
corporation.
WHEREAS, the Borrower wishes to borrow funds
from its indirect subsidiary, the Lender, from time to time, on and
subject to the terms and conditions contained in this Agreement;
and
WHEREAS, the Lender is willing to provide loans
to the Borrower from time to time, on and subject to the terms and
conditions contained in this Agreement.
NOW THEREFORE, in consideration of the mutual
promises, representations, warranties, covenants and conditions set
forth in this Agreement, the Lender and the Borrower hereby agree
as follows:
1.1. Certain Defined Terms . As used in
this Agreement, the following terms shall have the following
meanings (such meaning to be equally applicable to both the
singular and plural forms of the terms defined):
(a) “ Agreement ” means
this Intercompany Loan Agreement, as modified, supplemented,
amended, restated, extended, renewed or replaced from time to
time.
(b) “ Bankruptcy Code ”
means Title 11 of the United States Code (11 U.S.C.
Section 101 et seq.), as amended from time to time.
(c) “ Business Day ”
means a day of the year on which banks in the city of New York,
State of New York, are not required or authorized by law to
close.
(d) “ Holders ” means
the Persons in whose name the Securities issued under the Indenture
are registered at the office or agency maintained by the Borrower,
as issuer under the Indenture, where such securities may be
presented for registration of transfer or for exchange.
(e) “ Indenture ” means
that certain Indenture, to be dated on or about June 23, 2009,
by and between the Borrower, as issuer, and the Trustee.
(f) “ Interest Payment Date
” means each May 1 and December 1 following the Closing Date
while any Loan is outstanding.
(g) “ Interest Period ”
means, initially, the period beginning on the Closing Date and
ending on the first Interest Payment Date, and thereafter each
period beginning on an Interest Payment Date and ending on the
immediately succeeding Interest Payment Date or, if earlier, the
date of termination of this Agreement.
(h) “ Junior Debt ”
shall mean the Loan, along with accrued and unpaid interest thereon
and any fees, expenses or other amounts due under the Loan
Documents.
(i) “
Loan ” has the meaning specified in
Section 2.1.
(j) “ Loan Documents ”
means and includes this Agreement and the Note, and any other
documents and instruments required under or in connection
therewith.
(k) “
Loan Request ” has the meaning specified in
Section 2.3.
(l) “ Note ” means the
promissory note of the Borrower payable to the order of the Lender,
in substantially the form of Exhibit A hereto,
evidencing Loans.
(m) “
Maturity Date ” means May 1, 2015.
(n) “ Person ” means an
individual, partnership, venture, unincorporated association,
organization, syndicate, corporation, limited liability company or
other entity, trust and trustee, executor, administrator or other
legal or personal representative, or any government or any
political subdivision or agency thereof.
(o) “ Securities ” means
the Borrower’s 20% Senior Notes due 2014 issued under the
Indenture.
(p) “ Senior Creditors ”
means the Holders and any trustee or agent acting on their behalf
from time to time.
(q) “ Senior Debt ”
means any and all present and future obligations and liabilities of
the Borrower of every type or description to the Holders under the
Indenture and the Securities, whether for principal, premium,
interest or other reimbursement obligations, cash collateral cover,
fees, expenses, indemnities or other amounts (including
attorneys’ fees and expenses), in each case whether due or
not due, direct or indirect, joint and/or several, absolute or
contingent, voluntary or involuntary, liquidated or unliquidated,
determined or undetermined, now or hereafter existing, renewed or
restructured, whether or not from time to time decreased or
extinguished and later increased, created or incurred, whether or
not arising after the commencement of a proceeding under the
Bankruptcy Code (including post-petition interest) and whether or
not allowed or allowable as a claim in any such proceeding, and
whether or not recovery of any such obligation or liability may be
barred by a statute of limitations or such obligation or liability
may otherwise be unenforceable.
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(r) “ Tax ” means any
tax, levy, duty, impost or withholding, together with interest (and
any taxes payable upon the amounts paid or payable) thereon and
fines and penalties with respect thereto which may be imposed by
reason of any violation or default with respect to the law
regarding such tax.
(s) “ Trustee ” means
Deutsche Bank Trust Company Americas, as trustee under the
Indenture until a successor replaces it and, thereafter, means the
successor.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
2.1 The Loan . The Lender agrees, on the
terms and conditions set forth in this Agreement, to make, from
time to time, loans and advances (each a “Loan”) to the
Borrower, as follows:
(a) Amount of Loan . The Loans
shall not exceed at any one time an aggregate outstanding principal
amount of $33,000,000, plus accrued interest as provided in
Section 2.1(c).
(b) The Note . The Loans will be
evidenced by the Note, duly executed and delivered by the Borrower
to the Lender. Each Loan made to the Borrower under this Agreement
will be set forth on Attachment 1 to the Note with appropriate
insertions therein, for the principal amount so loaned. The Note
will be payable in accordance with its terms, which are hereby
incorporated by reference into this Agreement.
(c) Interest Rate . Interest
(“PIK Interest”) shall accrue on the Loan at the rate
of 3% per annum. Any PIK Interest shall be compounded with the Loan
on the last day of each Interest Period. Any PIK Interest shall,
after being so capitalized, be treated as part of the principal
amount of the Loan and be recorded as such on Attachment 1 to the
Note, shall bear interest in accordance with this
Section 2.1(c), shall be payable in accordance with
Section 2.4(a) hereof and shall be prepayable in accordance
with Section 2.4(b) hereof. Interest shall be calculated on
the basis of a 360-day year comprised of twelve 30-day months. All
interest accrued shall be payable upon payment or any prepayment in
full of the principal amount outstanding under the
Loans.
(d) Term . The Loans and all PIK
Interest accrued thereon shall mature, and become due and payable
in full in cash, on the Maturity Date.
2.2 Borrowing Procedures . The Borrower
may request a Loan by delivery to the Lender of a request (a
“ Loan Request ”) by an authorized officer of
the Borrower as follows:
(a) Each Loan Request shall set
forth:
(i) the amount of the proposed Loan (not to
exceed, together with all Loans previously made, the maximum amount
provided in Section 2.1(a) above); and
(ii) the
proposed date of such Loan, which must be a Business
Day.
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(b) Each such Loan Request shall be
delivered to the Lender by 10:00 a.m. (New York Time) on the
proposed date of the Loan.
If the making of any Loan shall subject the
Lender to any Tax to which it would not have been subject but for
the making of such Loan (other than Tax on the income of the Lender
resulting from the payment of interest to the Lender under any
Loan), including any increase in the payments required to be made
by the Lender under any tax sharing agreement and whether such Tax
is imposed because of any change in any U.S. or non-U.S. tax laws,
rules, regulations or judicial or administrative interpretations
thereof occurring following the date of this Agreement, the
Borrower shall indemnify and hold the Lender harmless from the
liability for any such Tax.
2.4
Payments; Prepayments .
(a) All payments in respect of a Loan shall
be made prior to 2:00 p.m. (New York Time) on a Business Day to an
account specified in writing by the Lender to the Borrower. Any
payments made after 2:00 p.m. on a Business Day shall be deemed for
the purpose of calculating interest hereunder to be made on the
following Business Day.
(b) The Borrower may, without penalty, upon
one (1) Business Day’s notice to the Lender stating the
proposed date and aggregate principal amount of the prepayment,
prepay, in whole or in part, the outstanding principal amount of
the Loans, accrued and unpaid interest to the date of such
prepayment on the principal amount prepaid and any fees, expenses
or other amounts payable under the Loan Documents.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the
Borrower . The Borrower hereby represents and warrants to the
Lender that:
(a) Corporate Existence . The
Borrower is a corporation duly organized and validly existing in
good standing under the laws of the state of its organization. The
Borrower is duly qualified and authorized to do business as a
corporation in each jurisdiction where the character of its assets
or the nature of its activities makes such qualification necessary,
except where such failure to qualify and be authorized to do
business will not have a material adverse impact on the
Borrower.
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(b) Due Authorization . Execution,
delivery and performance of this Agreement and any other documents
and instruments required under or in connection with this
Agreement, and incurring the Loan are within its corporate powers,
have been duly authorized, are not in contravention of law or the
terms of the Borrower’s certificate of incorporation or
bylaws, and, except as have been previously obtained, do not
require the consent or approval of any governmental body, agency or
authority, except where failure to obtain consent or approval would
not have a material adverse effect upon either the Lender or the
Borrower.
(c) Enforceability . This
Agreement, including without limitation, all other certificates,
agreements and documents executed and delivered by the Borrower
under or in connection herewith have each been duly executed and
delivered by duly authorized officers of the Borrower and
constitute the valid and binding obligations of the Borrower,
enforceable in accordance with their respective terms, except as
enforcement thereof may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or similar laws affecting
the enforcement of creditor’s rights generally and by general
principles of equity (whether enforcement is sought in a proceeding
in equity or at law).
3.2 Representations and Warranties of the
Lender . The Lender hereby represents and warrants to the
Borrower that:
(a) Corporate Existence . The
Lender is a limited liability company duly organized and validly
existing in good standing under the laws of its jurisdiction of
formation. The Lender is duly qualified and authorized to do
business in each jurisdiction where the character of its assets or
the nature of its activities makes such qualification necessary,
except where such failure to qualify and be authorized to do
business will not have a material adverse impact on the
Lender.
(b) Due Authorization . Execution,
delivery and performance the Loan Documents, and the Loan to the
Borrower are within its limited liability company powers, have been
duly authorized, are not in contravention of law or the terms of
the Lender ‘s certificate of formation or limited liability
company agreement, and, except as have been previously obtained, do
not require the consent or approval of any governmental body,
agency or authority, except where failure to obtain consent or
approval would not have a material adverse effect upon either the
Lender or the Borrower.
(c) Enforceability . This
Agreement, including without limitation, all other certificates,
agreements and documents executed and delivered by the Lender under
or in connection herewith have each been duly executed and
delivered by duly authorized officers of the Lender and constitute
the valid and binding obligations of the Lender, enforceable in
accordance with their respective terms, except as enfor
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