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THIRD AMENDMENT TO CREDIT AGREEMENT

Loan Agreement

THIRD AMENDMENT TO CREDIT AGREEMENT | Document Parties: DARLING INTERNATIONAL INC | JPMORGAN CHASE BANK, NA You are currently viewing:
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DARLING INTERNATIONAL INC | JPMORGAN CHASE BANK, NA

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Title: THIRD AMENDMENT TO CREDIT AGREEMENT
Governing Law: Texas     Date: 10/2/2009
Industry: Food Processing     Sector: Consumer/Non-Cyclical

THIRD AMENDMENT TO CREDIT AGREEMENT, Parties: darling international inc , jpmorgan chase bank  na
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                                                     EXHIBIT 10.1

 

 

THIRD AMENDMENT TO CREDIT AGREEMENT

 

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this " Amendment "), dated as of September 30, 2009 is among DARLING INTERNATIONAL INC., a Delaware corporation (the " Borrower "), each of the lending institutions which is a party hereto, and JPMORGAN CHASE BANK, N.A., as administrative agent (the " Administrative Agent ").

 

RECITALS:

 

A.           The Borrower, the Administrative Agent and the lending institutions party thereto have entered into that certain Credit Agreement dated as of April 7, 2006 (as amended by that certain First Amendment to Credit Agreement dated as of May 9, 2006, that certain Letter Agreement dated as of February 9, 2007, and that certain Second Amendment to Credit Agreement dated October 8, 2008, the " Agreement ").  The Borrower, the Administrative Agent and the lenders party hereto now desire to amend the Agreement as herein set forth.

 

B.           Immediately prior to the effectiveness of this Amendment, Keybank National Association assigned all of its right, title and interest as a Lender under the Loan Documents to JPMorgan Chase Bank, N.A.

 

NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows effective as of the date hereof unless otherwise indicated:

 

 

ARTICLE 1.

 

Definitions

 

Section 1.1.   Definitions .  Capitalized terms used in this Amendment, to the extent not otherwise defined herein, shall have the same meanings as in the Agreement, as amended hereby.

 

 

ARTICLE 2.

 

Amendments

 

Section 2.1.   Amendment to Section 1.01 .  The following definitions contained in Section 1.01 of the Agreement are amended in their respective entireties to read as follows:

 

" Adjusted LIBO Rate " means, with respect to any Eurodollar Borrowing for any Interest Period or with respect to the determination of the Alternate Base Rate, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period or, with respect to the determination of the Alternative Base Rate, for a one month interest period multiplied by (b) the Statutory Reserve Rate.

 

" Alternate Base Rate " means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus ½ of 1% and (c) the Adjusted LIBO Rate for a one month interest period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%.  Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.


 

THIRD AMENDMENT TO CREDIT AGREEMENT, Page 1

 


 

 

" Applicable Percentage " means, with respect to any Revolving Lender, the percentage of the total Revolving Commitments represented by such Lender's Revolving Commitment; provided that in the case of Section 2.21 when a Defaulting Lender shall exist, "Applicable Percentage" shall mean the percentage of the total Revolving Commitments (disregarding any Defaulting Lender's Revolving Commitment) represented by such Lender's Revolving Commitment.  If the Revolving Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Revolving Commitments most recently in effect, giving effect to any assignments.

 

" Applicable Rate " means, for any day and with respect to any Loan and with respect to any letter of credit fee or any commitment fee payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption "ABR Spread", "Eurodollar Spread", "Commitment Fee Rate" or "Letter of Credit Fee" as the case may be, based upon the Pricing Ratio as of the most recent determination date; provided that until delivery of the Borrower's consolidated financial statements for the fiscal quarter ended September 30, 2009 as required by Section 5.01(b) , the "Applicable Rate" shall be the applicable rate per annum set forth below in Category 5:

 

Category

Pricing Ratio

ABR Spread

Eurodollar

Spread

Commitment

Fee Rate

Letter of

Credit Fee

1

Greater than or equal to  2.50 to 1.00

2.50%

3.50%

0.500%

3.75%

2

Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00

2.25%

3.25%

0.500%

3.50%

3

Less than 2.00 to 1.00 but greater than or equal to 1.50 to 1.00

2.00%

3.00%

0.45%

3.25%

4

Less than 1.50 to 1.00 but greater than or equal to 1.00 to 1.00

1.75%

2.75%

0.40%

3.00%

5

Less than 1.00 to 1.00

1.50%

2.50%

0.40%

2.75%

 

For purposes of the foregoing, (i) the Pricing Ratio shall be determined as of the end of each fiscal quarter of the Borrower's fiscal year based upon the Borrower's consolidated financial statements delivered pursuant to Section 5.01(a)  or (b)  and (ii) each change in the Applicable Rate resulting from a change in the Pricing Ratio shall be effective during the period commencing on and including the date of delivery to the Administrative Agent of such consolidated financial statements indicating such change and ending on the date immediately preceding the effective date of the next such change; provided that the Pricing Ratio shall be deemed to be in Category 1:  (A) at any time that an Event of Default has occurred and is continuing or (B) at the option of the Administrative Agent or at the request of the Required Lenders if the Borrower fails to deliver the consolidated financial statements required to be delivered by it pursuant to Section 5.01(a) or (b), during the period from the expiration of the time for delivery thereof until such consolidated financial statements are delivered.

 

" Change in Control " means any of the following: (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of Equity Interests representing more than 50% of either the aggregate ordinary voting power or the aggregate equity value represented by the issued and outstanding Equity Interests in the Borrower; (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of Borrower by Persons who were neither (i) nominated by the board of directors of Borrower nor (ii) appointed by directors so nominated; or (c) the occurrence of a "Change of Control" or any comparable event resulting in a requirement for the Borrower to make an offer to purchase any New Unsecured Debt, as the term "Change of Control" or those events are defined under any of the documentation evidencing and governing any of the New Unsecured Debt.

 

 

THIRD AMENDMENT TO CREDIT AGREEMENT, Page 2

 


 

 

" Eurodollar ", when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate but does not include any Loan or Borrowing bearing interest at a rate determined by reference to clause (c) of the definition of the term "Alternative Base Rate".

 

" Revolving Maturity Date " means April 7, 2013.

 

Section 2.2.   Addition to Section 1.01 .  The following definitions are added to Section 1.01 of the Agreement in proper alphabetical order and shall read in their respective entireties as follows:

 

" Defaulting Lender " means any Lender that has: (a) failed to fund any portion of its Loans or participations in Letters of Credit or Swingline Loans within two Business Days of the date required to be funded by it hereunder, (b) notified the Borrower, the Administrative Agent, the Issuing Bank, the Swingline Lender or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under other agreements in which it commits to extend credit, (c) failed, within two Business Days after request by the Administrative Agent, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans, (d) as determined by the Administrative Agent, otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date when due, unless the subject of a good faith dispute, or (e) as determined by the Administrative Agent, (i) become or is insolvent or has a parent company that has become or is insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment.

 

" New Unsecured Debt " means unsecured Indebtedness of the Borrower for borrowed money in an aggregate principal amount not to exceed $150,000,000 at any time outstanding which: (a) has a maturity date no earlier than the date that is six (6) months following the Revolving Maturity Date (provided that provisions satisfying the requirements of clause (b) of this definition will not violate the requirements of this clause (a)); (b) does not contain any mandatory prepayment, mandatory redemption or any provisions requiring the Borrower to offer to purchase such Indebtedness other than: (i) provisions requiring the Borrower to make offers to purchase such Indebtedness in the event of asset sales as long as, in connection with any such asset sales, the Net Proceeds thereof are required to be used to prepay the Term Loans and such Term Loans are prepaid in full prior to the time any proceeds therefrom are used to purchase any such Indebtedness and (ii) provisions requiring the Borrower to make offers to purchase such Indebtedness in the event of a change of control as long as a "Change of Control" will occur hereunder prior to or at the same time as a change of control offer is required to be made thereunder; (c) does not contain any positive, negative or financial covenant nor any event of default that is more restrictive than those provisions herein; and (d) has interest rate provisions that are customary in the market at the time of issuance.

 

 

THIRD AMENDMENT TO CREDIT AGREEMENT, Page 3

 


 

 

Section 2.3.   Amendment to Section 2.11 .   Clause (c) of Section 2.11 is amended in its entirety to read as follows:

 

(c)            Mandatory Prepayments from Net Proceeds of Prepayment Event .  In the event and on each occasion that any Net Proceeds are received by or on behalf the Borrower or any Subsidiary in respect of any Prepayment Event, the Borrower shall, within three Business Days after such Net Proceeds are received, prepay Term Borrowings in an aggregate amount equal to such Net Proceeds; provided that:

 

(i)           in the case of any event described in clauses (a) or (b) of the definition of the term Prepayment Event, if the Borrower shall deliver to the Administrative Agent a certificate of a Financial Officer to the effect that the Borrower and the Subsidiaries intend to apply the Net Proceeds from such event, within 18 months after receipt of such Net Proceeds, to acquire or repair assets to be used in the business of the Borrower and the Restricted Subsidiaries or to make an acquisition permitted by Section 6.04(l), to acquire a Route Swap permitted by Section 6.04(k) or to make an Investment permitted by Section 6.04(q) or (s), then no prepayment shall be required pursuant to this paragraph in respect of such event except (A) to the extent of any Net Proceeds therefrom that have not been so applied within 24 months after receipt of such Net Proceeds, at which time a prepayment shall be required in an amount equal to the Net Proceeds that have not been so applied; (B) if at the time of the proposed application of the Net Proceeds, an Event of Default exists, then at that time, a prepayment shall be required in an amount equal to such Net Proceeds; or (C) if the Borrower would be required to make an offer to purchase any New Unsecured Debt with such Net Proceeds, then prior to the time that the Borrower would be required to make such offer, the Borrower shall be required to make a prepayment under this clause (c) in an amount equal to such Net Proceeds; and

 

(ii)           Net Proceeds from a single Prepayment Event shall not be required to be used to prepay Term Borrowings under this clause (c) if the aggregate amount of Net Proceeds received from such Prepayment Event do not exceed $500,000 unless (A) such Net Proceeds, when added to the aggregate amount of Net Proceeds received from all Prepayment Events occurring in the same fiscal year which are not reinvested pursuant to this clause (c) exceed $1,000,000 (in which event the aggregate amount of such Net Proceeds from all such Prepayment Events in excess of $1,000,000, shall then be required to be used to prepay the Term Borrowing under this clause (c)) or (B) the Borrower would be required to make an offer to purchase any New Unsecured Debt with such Net Proceeds, then the Borrower shall be required to make a prepayment under this clause (c) in an amount equal to such Net Proceeds from a single Prepayment Event.

 

 

THIRD AMENDMENT TO CREDIT AGREEMENT, Page 4

 


 

 

Section 2.4.   Amendment to Section 2.19 .   Clause (b) of Section 2.19 is amended in its entirety to read as follows:

 

(b)            Replacement .  If  (i) a Lender requests compensation under Section 2.15, (ii) the Borrower is required to pay any additional amount to a Lender or any Governmental Authority for the account of a Lender pursuant to Section 2.17, (iii) a Lender defaults in its obligation to fund Loans hereunder, has become insolvent and its assets become subject to a receiver, liquidator, trustee, custodian or other officer having similar powers, or otherwise is a Defaulting Lender, or (iv) a Lender shall become a Non-consenting Lender (as defined below), then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 10.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent to the extent required by Section 10.04, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all


 
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