Exhibit 10.1
Execution Copy
SECOND AMENDMENT TO CREDIT
AGREEMENT
THIS SECOND AMENDMENT TO CREDIT
AGREEMENT, dated as of September 15, 2009 (this
“Amendment”), is among Modine Manufacturing Company, a
Wisconsin corporation, any Foreign Subsidiary Borrowers, the
Lenders party hereto and JPMorgan Chase Bank, N.A., a national
banking association, as Swing Line Lender, as LC Issuer and as
Agent.
RECITAL
The Borrower, the Lenders party
thereto and the Agent are parties to an Amended and Restated Credit
Agreement dated as of July 18, 2008 (as amended or modified
from time to time, the “Credit Agreement”). The
Borrower desires to amend the Credit Agreement and the Agent and
the Lenders are willing to do so in accordance with the terms
hereof.
TERMS
In consideration of the premises and
of the mutual agreements herein contained, the parties agree as
follows:
ARTICLE 1.
AMENDMENTS
The Credit Agreement shall be
amended as follows:
1.1 The following definitions are
added to Article I of the Credit Agreement in appropriate
alphabetical order:
“Dutch Holdco” means a
Dutch holding company organized under the laws of the Netherlands
that is acquired by the Borrower in compliance with the terms of
this Agreement and is a Wholly-Owned Subsidiary of the Borrower and
owned directly by the Borrower.
“Modine Austria” means
Modine Austria Holding GmbH, a company organized under the laws of
Austria.
“UK Dollar” means Modine
UK Dollar, Limited, a Wholly-Owned Subsidiary of the
Borrower.
1.2 The definition of “Stock
Purchase Restricted Payment” in Article I of the Credit
Agreement is deleted and the following definitions in Article I of
the Credit Agreement are restated as follows.
“Modine Holding Consolidated
Group” means Modine Holding GmbH and its Subsidiaries
existing as of the First Amendment Effective Date, and Modine
Austria when its Capital Stock is transferred to Modine Holding
GmbH as permitted by the terms of this Agreement.
“Modine Holding GmbH”
means Modine Holding GmbH, a Wholly-Owned Subsidiary of the
Borrower.
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“Restricted Payment”
means, with respect to any Person, any dividend or other
distribution (whether in cash, securities or other property) with
respect to any Capital Stock of such Person, or any payment
(whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase,
redemption, retirement, acquisition, cancellation or termination of
any such Capital Stock of such Person or any option, warrant or
other right to acquire any such Capital Stock of such
Person.
1.3 Each reference in
Section 2.3 of the Credit Agreement to “Section 4.2(b)
of the Intercreditor Agreement” shall be replaced with
“Section 4.1(b) of the Intercreditor Agreement” and the
second paragraph of Section 2.3(b) of the Credit Agreement is
restated as follows:
As used herein, “Asset Sale
Net Proceeds” means 100% of all of the Net Cash Proceeds from
any sale, Event of Loss, license, lease or other disposition or
transfer of any assets (including without limitation any Sale and
Leaseback Transaction and any sale permitted under
Section 6.17(b) or (c), but excluding the Excluded Sales
described below) in excess of $25,000,000 in aggregate amount after
the First Amendment Effective Date, each payable and effective upon
receipt of such Net Cash Proceeds. As used herein, “Excluded
Sales” means (i) the sale of inventory in the ordinary
course of business, (ii) the sale of obsolete or worn-out
property in the ordinary course of business not to exceed
$1,000,000 in the aggregate after the First Amendment Effective
Date, (iii) sales of notes receivable or accounts receivable
to the extent permitted under Section 6.17; (iv) revenues
from licenses in existence on the First Amendment Effective Date,
including all renewals, extensions and modifications thereof and
substitutions therefor, (v) the sale or other transfer of any
assets solely among the Borrower and the Subsidiaries which is
permitted by the terms of this Agreement, and (vi) if the
Borrower shall deliver to the Agent a certificate of a Authorized
Officer to the effect that the Borrower or its applicable
Subsidiary receiving the Net Cash Proceeds from an Event of Loss
intends to apply the Net Proceeds from such event (or a portion
thereof specified in such certificate), within 180 days after
receipt of such Net Proceeds, to acquire (or replace or rebuild)
real property or equipment to be used in the business of the
Borrower or its Subsidiaries, and certifying that no Default has
occurred and is continuing, then such Net Cash Proceeds specified
in such certificate shall be excluded from the prepayment
determination required under the first sentence of this
Section 2.3(b), provided that to the extent of any such Net
Cash Proceeds therefrom that have not been so applied by the end of
such 180 day period, such Net Cash Proceeds will not be so
excluded, and will be included in the calculation contained in the
first sentence of this Section 2.3(b) in determining whether a
prepayment shall then be required.
1.4 The last sentence of
Section 2.27(iv) of the Credit Agreement is restated as
follows: “Each Borrower shall execute and deliver, and cause
each Guarantor to execute and deliver, promptly upon the reasonable
request of the Agent, such agreements and instruments evidencing
any intercompany loans or other advances among the Borrower and its
Subsidiaries, or any of them, and all such intercompany loans or
other advances owing by any of the Borrowers or a Guarantor shall
be, and are hereby made, subordinate and junior to the Secured
Obligations and no payments may be made on such intercompany loans
or other advances upon and during the continuance of a Default
unless otherwise agreed to by the Required
Lenders.”
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1.5 The Borrower has disclosed and
represented to the Lenders that on or about March 31, 2009 it
committed to increase the equity capital of Modine Thermal Systems
(Changzhou) Co. Ld. (“Modine China”) in the aggregate
amount of $1,500,000, which commitment was funded in the amount of
approximately $400,000 in April of 2009; and in the amount of
approximately $1,100,000 in June of 2009. The proceeds of such
increased capital are intended to be used by Modine China primarily
to pay an intercompany receivable owing to the Borrower, subject to
the receipt of required regulatory approvals (such increases,
collectively, the “Modine China Investments”), and the
Borrower agrees to cause Modine China to use such proceeds
primarily to pay an intercompany receivable owing to the Borrower
promptly after receipt of such required regulatory
approvals.
The Borrower has requested that the
Lenders waive any Default caused by the making of the Modine China
Investments effective as of March 31, 2009 immediately prior
to time the Modine China Investments were made, and the Lenders
hereby agree to such waiver. The Borrower and the Lenders further
agree that the Modine China Investments shall not reduce the amount
of Investments permitted under Section 6.5(b), but shall
reduce the amount of loans and advances under Section 6.4(h)
(in the form after giving effect to this Amendment). The Borrower
and Guarantors acknowledge and agree that the waiver contained
herein and in Section 6.4(h) as revised is a limited,
specific, and one-time waiver as described above and shall not
entitle the Borrower or the Guarantors (or any of them) to a
waiver, amendment, modification or other change to, of or in
respect of any provision of any of the Loan Documents in the future
in similar or dissimilar circumstances. Sections 6.4 and 6.5 of the
Credit Agreement are restated as follows:
Section 6.4 Loans or
Advances . Neither the Borrower nor any of its Subsidiaries
shall make loans or advances to any Person except:
(a) deposits required by government
agencies or public utilities;
(b) existing loans or advances
between the Borrower and its Subsidiaries and between Subsidiaries
described under the heading of “Intercompany Loan
Balances” on Schedule 6.16 hereto, but no increase in the
amount thereof (except to the extent increased amounts are
permitted under another clause of this Section 6.4), provided
that: (i) this covenant shall not restrict the assignment of
any such “Intercompany Loan Balances” by the holder to
the Borrower or a Guarantor, and (ii) in the event of the sale
of Modine Korea as permitted by Section 6.9(b)(ii) to a Person
that is not an Affiliate of the Borrower, the amount of loans owed
by Modine Korea to the Borrower on the date of such sale may
continue to be outstanding after such date, to be repaid on such
terms as the Borrower and such Person may agree;
(c) loans or advances from any
Foreign Subsidiaries to the Borrower or any Guarantor, provided
that such loans and advances are evidenced by documents
satisfactory to the Agent and are subordinated to all Secured
Obligations on terms and by agreements satisfactory to the
Agent;
(d) loans and advances between the
Borrower and the Guarantors, provided that such loans and advances
are evidenced by documents satisfactory to the Agent and are
subordinated to all Secured Obligations on terms and by agreements
satisfactory to the Agent;
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(e) loans and advances between
Foreign Subsidiaries, provided that such loans and advances are (i)
evidenced by documents satisfactory to the Agent and (ii) if
such loans and advances are owing by a Foreign Subsidiary Borrower
or any Foreign Subsidiary guaranteeing the Obligations of such
Foreign Subsidiary Borrower, subordinated to all Obligations and
Rate Management Obligations owing by such Foreign Subsidiary
Borrower on terms and by agreements satisfactory to the
Agent;
(f) a loan by the Borrower to Dutch
Holdco consisting solely of the deferred payment portion of the
sale of UK Dollar to Dutch Holdco permitted under
Section 6.9(b)(iii);
(g) a loan by the Borrower to Modine
Holding GmbH consisting solely of the deferred payment portion of
the sale of Modine Austria GmbH to Modine Holding GmbH permitted
under Section 6.9(b)(iv), provided that the Borrower will take
or cause its Subsidiaries to take all action to ensure that all
obligations under such loan do and will rank at least pari passu in
right of payment with all of the present and future unsubordinated
Indebtedness of Modine Holding GmbH, except to the extent:
(i) otherwise required under German law, or (ii) such
Indebtedness is secured by Permitted Encumbrances or other Liens
permitted under Section 6.6; and
(h) other loans and advances made in
the ordinary course of business not exceeding (i) $10,000,000
in the aggregate at any time outstanding, minus
(ii) (A) $1,500,000, which is the aggregate amount of the
increase in the registered capital of Modine Thermal Systems
(Changzhou) Co. Ld., a Wholly-Owned Subsidiary of the Borrower,
made in April and June of 2009, less (B) the amount by which
such increase in registered capital of Modine Thermal Systems
(Changzhou) Co. Ld is decreased after the date of the Second
Amendment to this Agreement and returned to the Borrower in
cash.
provided that after giving effect to
the making of any loans, advances or deposits permitted by clause
(a), (b), (c), (d), (e), (f), (g) or (h) of this Section,
no Default or Unmatured Default shall have occurred and be
continuing.
Notwithstanding anything herein to
the contrary, the Borrower will not, nor will it permit any
Subsidiary to, make any loans and advances to Modine Korea, any
member of the Modine Holding Consolidated Group or any Domestic
Subsidiary that is not a Guarantor at any time on or after the
First Amendment Effective Date other than as permitted under clause
(g) above, provided that this Section 6.4 shall not
restrict loans and advances between members of the Modine Holding
Consolidated Group.
Section 6.5 Investments and
Acquisitions .
(a) The Borrower will not, nor will
it permit any Subsidiary to, make or suffer to exist any
Investments (including without limitation, loans and advances to,
and other Investments in, Subsidiaries), or commitments therefor,
or to create any Subsidiary or to become or remain a partner in any
partnership or joint venture, or to make any Acquisition of any
Person, except:
(i) Cash Equivalent
Investments.
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(ii) (x) Existing Investments in
Subsidiaries as of the First Amendment Effective Date, but no
increase in the amount thereof other than an increase in the
registered capital of Modine Thermal Systems (Changzhou) Co. Ld. in
the amount of $1,500,000, and (y) other Investments described
in Schedule 6.5, but no increase in the amount thereof, as reduced
from time to time.
(iii) Investments comprised of
capital contributions (whether in the form of cash, a note, or
other assets) to a Subsidiary or other special-purpose entity
created solely to engage in a Qualified Receivables
Transaction.
(iv) Rate Management Transactions
permitted by Section 6.20 and guaranties by the Borrower and
its Subsidiaries of such Rate Management Obligations.
(v) Loans and advances permitted by
Section 6.4.
(vi) The acquisition of Dutch Holdco
and the following Investments in Dutch Holdco: (x) a cash
capital contribution or purchase price of up to €35,000, and
(y) the contribution of the beneficial interest in the Capital
Stock of Modine Korea (and for the avoidance of doubt, such
contribution will not include any transfer of the intercompany
loans owed by Modine Korea to the Borrower).
(vii) The Acquisition by Dutch
Holdco of UK Dollar in compliance with the terms of this
Agreement.
(viii) The Acquisition by Modine
Holding GmbH of Modine Austria in compliance with the terms of this
Agreement.
(b) The Borrower and its
Subsidiaries may make and have outstanding other Investments,
provided that no Default or Unmatured Default exists at the time
such Investment is made or would be caused thereby and at no time
shall the aggregate outstanding amount of all such other
Investments existing and permitted under this Section 6.5(b)
exceed $1,000,000.
Notwithstanding anything herein to
the contrary, the Borrower will not, nor will it permit any
Subsidiary to, make any Investments (including without limitation,
loans and advances to, and other Investments) to Modine Korea, any
member of the Modine Holding Consolidated Group or any Domestic
Subsidiary that is not a Guarantor at any time on or after the
First Amendment Effective Date other than the loan to Modine
Holding GmbH permitted under Section 6.4(g), provided that
this Section 6.5 shall not restrict Investments between
members of the Modine Holding Consolidated Group.
1.6 Section 6.9 of the Credit
Agreement is restated as follows:
Section 6.9 Consolidations,
Mergers and Sales of Assets . The Borrower will not, nor will
it permit any Subsidiary to, consolidate or merge with or into, or
sell, lease or otherwise transfer all or any substantial part of
its assets to, any other Person, or discontinue or eliminate any
business line or segment, provided that :
(a) Subsidiaries of the Borrower may
merge into the Borrower or a Wholly-Owned Subsidiary,
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(b) the foregoing limitation on the
sale, lease or other transfer of assets and on the discontinuation
or elimination of a business line or segment shall not
prohibit:
(i) sales of inventory in the
ordinary course of business;
(ii) sale or other disposition of
Modine Korea, whether by sale or other disposition of Capital Stock
or assets, and other assets owned by Foreign Subsidiaries related
to the Korean-based vehicular HVAC business;
(iii) if no Default or Unmatured
Default shall have occurred and be continuing or would be caused
thereby, the sale of the Capital Stock of UK Dollar owned by the
Borrower to Dutch Holdco for a pur
