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TECUMSEH PRODUCTS COMPANY
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AMENDMENT AND WAIVER NO. 1
TO NOTE PURCHASE AGREEMENT
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DATED AS OF JUNE 30, 2005
$300,000,000 4.66% SENIOR GUARANTEED NOTES DUE MARCH 5, 2011
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TECUMSEH PRODUCTS COMPANY
$300,000,000
4.66% SENIOR GUARANTEED NOTES DUE MARCH 5, 2011
AMENDMENT AND WAIVER NO. 1 TO NOTE PURCHASE AGREEMENT
As of June 30, 2005
TO EACH OF THE CURRENT NOTEHOLDERS
NAMED IN ANNEX 1 HERETO:
Ladies and Gentlemen:
TECUMSEH
PRODUCTS COMPANY, a Michigan corporation (together with any
successors and assigns, the "COMPANY"),
hereby agrees with each of you as
follows:
1. PRIOR ISSUANCE OF
NOTES, ETC.
The
Company issued and sold three hundred million dollars
($300,000,000)
in aggregate principal amount of its 4.66%
Senior Guaranteed Notes due March 5,
2011 (the "NOTES", such term to include any
such notes issued in substitution
therefor pursuant to Section 13 of the Note
Purchase Agreement) pursuant to the
Note Purchase Agreement dated as of March
5, 2003 between the Company and the
purchasers named in Schedule A thereto (the
"EXISTING NOTE PURCHASE AGREEMENT"
and, as may be amended pursuant to this
Agreement and as may be further amended,
restated or otherwise modified from time to
time, the "NOTE PURCHASE
AGREEMENT"). The Company represents and
warrants to each of you that the
register kept by the Company for the
registration and transfer of the Notes
indicates that each of the Persons named in
Annex 1 hereto (collectively, the
"CURRENT NOTEHOLDERS") is currently a
holder of the aggregate principal amount
of the Notes indicated in such Annex.
2. REQUEST FOR CONSENT TO
AMENDMENTS
The
Company requests that each of the Current Noteholders agree to
the
amendments (the "AMENDMENTS") to, and
waiver of certain rights (the "WAIVER")
under, the Existing Note Purchase Agreement
provided for by this Agreement.
3. WARRANTIES AND
REPRESENTATIONS
To induce
the Current Noteholders to enter into this Agreement and to
agree to the Amendments and the Waiver, the
Company warrants and represents to
you as follows (it being agreed, however,
that nothing in this Section 3 shall
affect any of the warranties and
representations previously made by the Company
in or pursuant to the Existing Note
Purchase Agreement, and that all of such
other warranties and representations, as
well as the warranties and
representations in this Section 3, shall
survive the effectiveness of the
Amendments and the Waiver).
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3.1
NO MATERIAL
ADVERSE CHANGE.
Since the
date of the financial statements of the Company filed with the
Securities and Exchange Commission with the
Company's Quarterly Report on Form
10-Q for the period ended March 31, 2005,
and except as reflected in or
contemplated by the financial forecasts
provided to the Current Noteholders on
June 16, 2005 (the "PROJECTIONS"), and
except for the Default or Event of
Default waived in Section 4.2 of this
Agreement, there has been no change in the
business operations, profits, financial
condition, properties or business
prospects of the Company except changes
that, in the aggregate, could not
reasonably be expected to have a Material
Adverse Effect.
3.2
FULL
DISCLOSURE.
Neither
the financial statements and other certificates previously
provided to the Current Noteholders
pursuant to the provisions of the Existing
Note Purchase Agreement nor the statements
made in this Agreement nor the
Projections furnished by or on behalf of
the Company to the Current Noteholders
in connection with the proposal and
negotiation of the Amendments, taken as a
whole, contain any untrue statement of a
material fact or omit a material fact
necessary to make the statements contained
therein and herein, taken as a whole,
not misleading. There is no fact relating
to any event or circumstance that has
occurred or arisen since June 16, 2005 that
the Company has not disclosed to the
Current Noteholders in writing that has had
or, so far as the Company can now
reasonably foresee, could reasonably be
expected to have, a Material Adverse
Effect.
3.3
INTENT.
Neither
the Company nor any Subsidiary is entering into the transaction
contemplated by this Agreement with any
intent to hinder, delay or defraud
either current creditors or future
creditors of the Company.
3.4
NO DEFAULTS.
No event
has occurred and no condition exists that, upon the execution
and
delivery of this Agreement and the
effectiveness of the Amendments and the
Waiver, would constitute a Default or an
Event of Default.
3.5
TRANSACTION IS
LEGAL AND AUTHORIZED; OBLIGATIONS ARE ENFORCEABLE.
(a) The execution and delivery of this Agreement by the Company
and
compliance
by the Company with all of its respective obligations
hereunder:
(i) is within the corporate powers of the Company;
(ii) is legal and does not conflict with, result in any breach
in any of the provisions of, constitute a default under, or
result
in the creation of any Lien upon any Property of the Company or
any
Subsidiary under the provisions of, any agreement, charter
instrument, bylaw or other instrument to which it is a party or
by
which it or any of its Property may be bound; and
(iii) does not give rise to a right or option of any other
Person under any agreement or other instrument, which right or
option could reasonably be expected to have a Material Adverse
Effect.
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(b) This Agreement has been duly authorized by all necessary
action
on the
part of the Company and has been executed and delivered by one
or
more duly
authorized officers of the Company, and each constitutes a
legal,
valid and binding obligation of the Company, enforceable in
accordance
with its terms, except that such enforceability may be:
(i) limited by applicable bankruptcy, reorganization,
arrangement, insolvency, moratorium or other similar laws
affecting
the enforceability of creditors' rights generally; and
(ii) subject to the availability of equitable remedies.
3.6
CERTAIN
LAWS.
The
execution and delivery of this Agreement by the Company and the
consummation of the transaction
contemplated hereby:
(a) is not subject to regulation under the Investment Company Act
of
1940, as
amended, the Public Utility Holding Company Act of 1935, as
amended,
the Transportation Acts, as amended, or the Federal Power Act,
as
amended,
and
(b) does not violate any provision of any statute or other rule
or
regulation
of any Governmental Authority applicable to the Company or any
Subsidiary.
3.7
GOVERNMENTAL
CONSENT.
Neither
the Company or any Subsidiary thereof, nor the nature of any of
its or their respective businesses or
Properties, is such so as to require a
consent, approval or authorization of, or
filing, registration or qualification
with, any governmental authority on the
part of the Company as a condition to
the execution and delivery of this
Agreement.
3.8
FEES.
Neither
the Company nor any Subsidiary thereof has paid (or promised to
pay) any amendment fee or any other direct
or indirect compensation to any party
to the Credit Agreement or to any other
creditor of the Company or any
Subsidiary in connection with the
transactions contemplated hereby.
3.9
AMENDMENT TO
CREDIT AGREEMENT.
The
Company has delivered to each of the Current Noteholders a true
and
correct copy of the Credit Agreement and
any and all amendments, modifications
and waivers in respect thereof.
4. AMENDMENTS; WAIVER
4.1
AMENDMENTS TO
EXISTING NOTE PURCHASE AGREEMENT.
Subject to
Section 4.3, the Existing Note Purchase Agreement is hereby
amended in the manner specified in Exhibit
A to this Agreement.
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4.2
WAIVER.
Subject to
Section 4.3 from the period through and including August 8,
2005, the Current Noteholders hereby waive
compliance by the Company with the
provisions of Section 10.3 of the Existing
Note Purchase Agreement as at the end
of the fiscal quarter ended June 30, 2005.
Notwithstanding the foregoing in no
event will the Company incur, or permit any
Subsidiary to incur, during the
Temporary Waiver Period any Indebtedness
(other than Indebtedness under existing
working capital credit facilities in
accordance with the terms thereof on June
30, 2005, including the maximum amounts to
be borrowed thereunder), if after
giving effect thereto, the Company would
not be in compliance with the
provisions of Section 10.3 of the Existing
Note Purchase Agreement without
giving effect to the Waiver contemplated
hereby.
4.3
EFFECTIVENESS OF AMENDMENTS AND WAIVER.
The
Amendments contemplated by Section 4.1 and Exhibit A and the
Waiver
contemplated by Section 4.2 shall, in
accordance with Section 17.1 of the
Existing Note Purchase Agreement, become
effective (the date of such
effectiveness is herein referred to as the
"EFFECTIVE DATE"), if at all, at such
time as the Company and the Required
Holders shall have indicated their written
consent to such Amendments and such Waiver
by executing and delivering the
applicable counterparts of this Agreement.
It is understood that any Current
Noteholder may withhold its consent for any
reason or for no reason, and that,
without limitation of the foregoing, any
Current Noteholder hereby makes the
granting of its consent contingent upon
satisfaction of each of the following
conditions:
(a) the Company shall have (i) paid all unpaid fees and
disbursements of Chapman & Cutler reflected in invoices
presented on or
before the
date hereof and (ii) established a retainer for legal fees with
Bingham
McCutchen LLP, special counsel to the Current Noteholders, in
the
aggregate
amount of $100,000 and pursuant to documentation satisfactory
to
such
special counsel; and
(b) the Company shall have paid $200,000 to Conway, Del Genio,
Gries
& Co.
LLC ("CONWAY"), financial advisor to the Current Noteholders,
pursuant
to a retainer arrangement satisfactory to the Company, the
Required
Holders and Conway.
(c) the Company shall have delivered to each of the Current
Noteholders a true and correct copy of any amendment or waiver to
the
Credit
Agreement entered into on or prior to the date hereof.
Any such amendment or waiver entered into
in connection with the transaction
contemplated hereby shall be in form and
substance satisfactory to the Required
Holders provided execution and delivery of
this Agreement by the Required
Holders shall be deemed to be an
affirmation that such amendment or waiver is so
satisfactory.
4.4
NO OTHER
AMENDMENTS; CONFIRMATION.
Except as
expressly provided herein, (a) no terms or provisions of any
agreement are modified or changed by this
Agreement, (b) the terms of this
Agreement shall not operate as a waiver by
any Current Noteholder of, or
otherwise prejudice any Current
Noteholder's rights, remedies or powers under,
the Existing Note Purchase Agreement or any
other Financing Document or under
any applicable law, and (c)
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the terms and provisions of the Existing
Note Purchase Agreement and each other
Financing Document shall continue in full
force and effect.
5. DEFINED TERMS
Capitalized terms used herein and not otherwise defined herein
shall have
the meanings ascribed to them in the
Existing Note Purchase Agreement.
6. EXPENSES
Whether or
not any of the Amendments or the Waiver becomes effective, the
Company will promptly (and in any event
within thirty (30) days of receiving any
statement or invoice therefor) pay all
fees, expenses and costs relating to this
Agreement, including, but not limited to,
(a) the reasonable cost of reproducing
this Agreement and the other documents
delivered in connection herewith and (b)
the reasonable fees and disbursements of
the Current Noteholders' special
counsel, Bingham McCutchen LLP, incurred in
connection with the preparation,
negotiation and delivery of this Agreement.
The fees of Conway will be paid by
the Company pursuant to the retainer
arrangement referenced to in Section
4.3(b). This Section 6 shall not be
construed to limit the Company's obligations
under Section 15.1 of the Note Purchase
Agreement.
7. MISCELLANEOUS
7.1
PART OF NOTE
PURCHASE AGREEMENT, FUTURE REFERENCES, ETC.
(a) This
Agreement shall be construed in connection with and as a part
of
the Existing Note Purchase Agreement and,
except as expressly amended by this
Agreement, all terms, conditions and
covenants contained in the Existing Note
Purchase Agreement and the other Financing
Documents are hereby ratified and
shall be and remain in full force and
effect. Any and all notices, requests,
certificates and other instruments executed
and delivered after the execution
and delivery of this Agreement may refer to
the Note Purchase Agreement without
making specific reference to this
Agreement, but nevertheless all such
references shall include this Agreement
unless the context otherwise requires.
7.2
GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF
MICHIGAN, UNITED STATES OF AMERICA,
EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE
LAW OF SUCH STATE THAT WOULD REQUIRE
THE APPLICATION OF THE LAWS OF A
JURISDICTION OTHER THAN SUCH STATE.
7.3
DUPLICATE
