EXHIBIT 10.69
SEVENTH AMENDMENT TO FOURTH
AMENDED AND RESTATED
REVOLVING CREDIT, TERM LOAN
AND SECURITY AGREEMENT
T HIS S EVENTH A MENDMENT T O
F OURTH A MENDED AND R ESTATED R EVOLVING C REDIT ,
T ERM L OAN AND S ECURITY A GREEMENT (the “Amendment”) is made this
12 th day of March, 2004, by and among
WinCup Holdings, Inc. (“WinCup”), Radnor Chemical
Corporation, StyroChem U.S., Ltd. (“StyroChem US”),
Radnor Holdings Corporation, Radnor Delaware II, Inc., StyroChem
Delaware, Inc., WinCup Texas, Ltd. (“WinCup Texas”),
StyroChem GP, L.L.C., StyroChem LP, L.L.C., WinCup GP, L.L.C., and
WinCup LP, L.L.C. (each individually a “Borrower” and
collectively, “Borrowers”), and PNC Bank, National
Association (“PNC”), as Lead Arranger and
Administrative Agent (defined below), Fleet Capital Corporation
(“Fleet”), as Documentation Agent (defined below) and
Lenders (defined below).
BACKGROUND
A. On December 26, 2001, Borrowers,
the financial institutions which are now or which hereafter become
a party hereto (individually, a “Lender” and
collectively, the “Lenders”), and PNC, as agent for
Lenders (PNC in such capacity, the “Agent”) entered
into a certain Fourth Amended and Restated Revolving Credit and
Security Agreement (as amended, modified, renewed, extended,
replaced or substituted from time to time, the “Loan
Agreement”) to reflect certain financing arrangements between
the parties thereto. The Loan Agreement and all other documents
executed in connection therewith are collectively referred to as
the “Existing Financing Agreements.” All capitalized
terms not otherwise defined herein shall have the meaning ascribed
thereto in the Loan Agreement. In the case of a direct conflict
between the provisions of the Loan Agreement and the provisions of
this Amendment, the provisions hereof shall prevail.
B. Borrowers, Agent and Lenders
modified certain definitions, terms and conditions contained in the
Loan Agreement pursuant to that (i) certain First Amendment to
Revolving Credit and Security Agreement dated February 4, 2002 to
facilitate the execution of a Commitment Transfer Supplement by and
between Lenders and Fleet Capital Corporation, (ii) certain Letter
Agreement, dated as of March 21, 2002, among Borrowers, Agent and
Lenders, (iii) certain Second Amendment to Revolving Credit, Term
Loan and Security Agreement dated March 5, 2003, (iv) certain Third
Amendment to Revolving Credit, Term Loan and Security Agreement
dated August 1, 2003, (v) certain Fourth Amendment to Revolving
Credit, Term Loan and Security Agreement dated September 12, 2003,
(vi) certain Fifth Amendment to Revolving Credit, Term Loan and
Security Agreement dated October 27, 2003 and (vii) certain Sixth
Amendment to Revolving Credit, Term Loan and Security Agreement
dated November 17, 2003.
C. The Borrowers have requested and
the Agent has agreed to modify certain definitions, terms and
conditions in the Loan Agreement.
D. The parties have agreed, subject
to the terms and conditions of this Amendment, to modify and amend
the Existing Financing Agreements.
NOW THEREFORE, with the foregoing
background hereinafter deemed incorporated by reference herein and
made part hereof, the parties hereto, intending to be legally
bound, promise and agree as follows:
1. Section I of the Loan Agreement
shall be amended as follows:
(a) There shall be added to Section
I of the Loan Agreement the following definitions:
“ Mandatory Prepayment
Event ” shall mean the occurrence of any of the
following: (i) a sale of non-core assets as agreed by the Borrowers
and the Agent; (ii) a completion of a Qualified IPO; or (iii) any
other transaction in which Borrowers raise equity capital or reduce
outstanding shareholder loans.
“ Supplemental
Mortgages ” shall mean each of those certain mortgages or
deeds of trust executed by the applicable Borrower granting to
Agent for the benefit of Lenders a first priority Lien on each of
the Supplemental Mortgaged Properties.
“ Supplemental Mortgaged
Properties ” shall mean, collectively each of the parcels
of real property generally known as: (a) 7501 East Trammel Drive,
Shreveport, LA 71108, owned by WinCup; (b) 150 Fourth Avenue, Mt.
Sterling, OH 43143, owned by WinCup; (c) 313 East Fifteenth Street,
Higginsville, MO 64037, owned by WinCup; (d) 1102 Blue Creek Road,
El Campo, TX 77437, owned by WinCup Texas; (e) 11591 Business Hwy.
287 North, Fort Worth, TX 76179, owned by StyroChem US; (f) 400
East Minton Road, Saginaw, TX 76131, owned by WinCup Texas; and (g)
3607 North Sylvania Avenue, Fort Worth, TX 76111, owned by
StyroChem US.
“ Supplemental Mortgaged
Property Availability ” shall mean an amount equal to the
lesser of: (a) Six Million Dollars ($6,000,000); or (b) seventy
percent (70%) of the fair market value of the Supplemental
Mortgaged Properties; provided that, the Supplemental Mortgaged
Property Availability shall be reduced to Zero Dollars upon the
earlier of (x) a Mandatory Prepayment Event(s) in which Agent
receives net proceeds aggregating not less than Twenty Million
Dollars ($20,000,000) or (y) July 31, 2004.
(b) The following definitions shall
be deleted in their entirety and replaced as follows:
“ Fixed Charge Coverage
Ratio ” for any period shall mean with respect to any
fiscal period the ratio of (a) EBITDA minus unfinanced
capital expenditures and all distributions and dividends made
during such period to (b) all Debt Payments (excluding principal
repayments on account of
2
the First Supplemental Term Loan)
made during such period. For purposes of this calculation, amounts
received by Lenders from a Mandatory Prepayment Event(s) and
applied to reduce Revolving Advances not to exceed the amount of
such unfinanced capital expenditures shall reduce the amount of
unfinanced capital expenditures subtracted from EBITDA.
2. Section II of the Loan Agreement
shall be amended as follows:
(a) Section 2.1(a) shall be deleted
in its entirety and replaced as follows:
2.1 Revolving Advances
.
(a) Subject to the terms and
conditions set forth in this Agreement, including, without
limitation, Section 2.1(b), each Lender, severally and not jointly,
agrees to make Revolving Advances to Borrowers in accordance with
the procedures provided for herein in an aggregate amount
outstanding at any time not greater than such Lender’s
Commitment Percentage of the Borrowing Base (as defined below)
minus the undrawn or unreimbursed amount of outstanding
Letters of Credit unless Borrowers have deposited with Agent cash
collateral in such amounts and in accordance with Section 3.2. For
purposes hereof, “Borrowing Base” shall mean the lesser
of (x) the Maximum Revolving Advance Amount or (y) the sum
of:
(i) up to 85%, subject to the
provisions of Section 2.1(b) hereof (“Receivables Advance
Rate”), of Eligible Receivables, plus
(ii) the lesser of (x)
$1,000,000 or (y) up to 85%, subject to the provisions of
2.1(b) hereof (“Canadian Receivables Advance Rate”), of
Eligible Canadian Receivables, plus
(iii) the lesser of (x)
$30,000,000 or (y) up to 60%, subject to the provisions of
Section 2.1(b) hereof (“Inventory Advance Rate”), of
Eligible Inventory of Borrowers (the Receivables Advance Rate, the
Canadian Receivables Advance Rate and the Inventory Advance Rate
shall be referred to, collectively, as the “Advance
Rates”), plus
(iv) the Supplemental Mortgaged
Property Availability, minus
(v) such reserves as Agent may, in a
commercially reasonable manner, reasonably deem proper and
necessary.
The amount derived from the sum of
Sections 2.1(a)(y)(i), (ii), (iii) and (iv) minus (v) at any
time and from time to time shall be referred to as the
“Formula Amount”. The Revolving Advances shall be
evidenced by one or more secured promissory notes (collectively,
the “Revolving Credit Note”) substantially in the form
attached hereto as Exhibit 2.1(a) .
3
(b) Section 2.14(c) shall be deleted
in its entirety and replaced as follows:
2.14(c) (i) Subject to 2.14(c)(iii),
upon completion of a Qualified IPO, Borrowers shall make a
prepayment equal to eighty four percent (84%) of the Gross
Proceeds. The first $18,000,000 of such Gross Proceeds being
applied to the Term Loans and the remainder of such Gross Proceeds
to the outstanding balance of the Revolving Advances. (ii) Subject
to 2.14(c)(iii), upon the occurrence of a Mandatory Prepayment
Event(s) other than a Qualified IPO, Borrowers shall make a
prepayment equal to the net proceeds received on account of
Mandatory Prepayment Event(s) to be applied as follows: (A) upon
receipt of net proceeds aggregating Ten Million Dollars
($10,000,000), Borrowers shall make a prepayment of Two Million
Dollars ($2,000,000) to be applied to the Term Loans and the
remainder to the outstanding balance of Revolving Advances; (B)
upon receipt of net proceeds aggregating Twenty Mil
