Exhibit 10.1
CALGON CARBON
CORPORATION,
as Borrower
THE LENDING INSTITUTIONS NAMED
HEREIN,
as Lenders
NATIONAL CITY BANK OF
PENNSYLVANIA
as a Lender, the Swing Line
Lender and
as Administrative
Agent
WAIVER AGREEMENT
dated as of
November 4, 2005
to
CREDIT AGREEMENT
dated as of
February 18,
2004
EXECUTION
VERSION
WAIVER
AGREEMENT
THIS WAIVER AGREEMENT
, dated as of November 4, 2005 (this
“ Agreement ”), is made by and among the
following:
(i) CALGON CARBON CORPORATION
, a Delaware corporation (herein, together with its successors and
assigns, “ Borrower ”);
(ii) the lending institutions
signatory hereto (herein, together with its or their successors and
assigns, each a “ Lender ” and
collectively, the “ Lenders ”);
and
(iii) NATIONAL CITY BANK OF
PENNSYLVANIA , a national banking association, as a Lender, the
Swing Line Lender, the lead arranger, book manager and the
Administrative Agent (in such capacity, the “
Administrative Agent ”).
PRELIMINARY STATEMENTS:
A. Borrower, the Lenders, the Swing
Lender and the Administrative Agent entered into the Credit
Agreement, dated as of February 18, 2004, as amended by
Amendment No. 1, dated as of March 31, 2005, and
Amendment No. 2 and Waiver, dated as of August 8, 2005
(as the same may from time to time be further amended, restated,
amended and restated or otherwise modified, the “
Credit Agreement ,” with the terms defined
therein, or the definitions of which are incorporated therein,
being used herein as so defined).
B. Borrower has requested that the
Administrative Agent and the Required Lenders: (i) waive the
Event of Default that has occurred as a result of Borrower’s
failure to comply with Section 10.8 of the Credit Agreement as
of September 30, 2005, and the Administrative Agent and the
Required Lenders have agreed to waive such Event of Default upon
the terms and conditions described herein, as more fully set forth
below; and (ii) forbear from exercising their rights under the
Credit Agreement and the other Credit Documents with respect to
(x) Borrower’s possible failure to comply with
Section 10.8 of the Credit Agreement from October 1, 2005
through January 31, 2006, and (y) Borrower’s
possible failure to comply with Section 10.9 of the Credit
Agreement for the Testing Period ending December 31, 2005, and
the Administrative Agent and the Required Lenders have agreed to
forbear from exercising such rights upon the terms and conditions
described herein, as more fully set forth below.
NOW, THEREFORE, the parties hereby
agree as follows:
1. WAIVER.
1.1 Borrower has notified the
Administrative Agent that Borrower has failed to comply with the
covenant set forth in Section 10.8 of the Credit Agreement as
of September 30, 2005 (the “ Waived
Default ”). Borrower has requested that the
Administrative Agent and the Required Lenders permanently waive the
Waived Default. The Administrative Agent and the Required Lenders
have agreed to waive and, effective as of the Effective Date (as
defined in Section 7 of this Agreement), hereby waive, the
Waived Default upon the terms and conditions contained
herein.
2
2. FORBEARANCE.
2.1 Forbearance Defaults .
Borrower anticipates that it may fail to comply with
(a) Section 10.8 of the Credit Agreement from
October 1, 2005 through January 31, 2006, and
(b) Section 10.9 of the Credit Agreement for the Testing
Period ending December 31, 2005 (collectively, the “
Forbearance Defaults ”), which Forbearance
Defaults constitute or will constitute Events of Default under the
Credit Agreement.
2.2 Forbearance . During the
Forbearance Period (as defined below), subject to the terms and
conditions set forth herein, the Administrative Agent and the
Lenders (a) will not exercise any of their rights or remedies
under the Credit Agreement, the other Credit Documents or
applicable law with respect to the Forbearance Defaults and
(b) will make Loans and issue Letters of Credit under the
Credit Agreement in accordance with the provisions hereof. For
purposes of this Agreement: (i) the “ Forbearance
Period ” means the period commencing on the Effective
Date (as defined below) and ending on the Termination Date (as
defined below); and (ii) the “ Termination
Date ” means the earlier of (x) January 31,
2006, and (y) the date the Forbearance Period is terminated
upon the occurrence of any of the events described in
Section 2.3 below. Nothing in this Agreement shall constitute
a waiver by the Administrative Agent or the Lenders of any Default
or Event of Default under the Credit Agreement (including the
Forbearance Defaults), other than the Waived Default, whether now
existing or hereafter arising.
2.3 Termination of
Forbearance . Upon the occurrence of any Termination Event (as
defined below) and at any time after such occurrence, the
Administrative Agent, or the Administrative Agent at the direction
of the Required Lenders, is entitled to, without prior notice to
Borrower, immediately terminate the Forbearance Period, unless such
Termination Event is an Event of Default described in
Section 11.1(h) of the Credit Agreement, in which case the
Forbearance Period will automatically terminate without demand or
notice of any kind. For purposes of this Agreement, “
Termination Event ” means:
(a) Borrower’s ratio of
(a) its Consolidated Total Debt at September 30, 2005 to
(b) its Consolidated EBITDA for the Testing Period ended
September 30, 2005 exceeds 3.75 to 1.00;
(b) the occurrence of a Default or
Event of Default under the Credit Agreement (other than the
Forbearance Defaults);
(c) failure by Borrower to comply
with any of its other agreements described in Section 3
hereof; or
(d) any representation or warranty
made by Borrower under this Agreement or by any Credit Party under
any agreement, instrument or other document executed or delivered
by any Credit Party in connection with this Agreement is untrue or
incorrect in any material respect when made or any schedule,
certificate, statement, report, financial data, notice or writing
furnished at any time by any Credit Party to the Administrative
Agent or the Lenders is untrue or incorrect in any material respect
on the date as of which the facts set forth therein are stated or
certified.
2.4 Effect at End of Forbearance
Period . When the Forbearance Period ends, all Obligations may
be declared immediately due and payable as provided in the Credit
Agreement, without notice or demand, and without regard to any
matters transpiring during the Forbearance Period or the financial
condition or prospects of any Credit Party as of such date, and the
Administrative Agent and the Lenders will be fully entitled to
exercise any rights and remedies they may have under the Credit
Agreement, the other Credit Documents or applicable law.
3
2.5 No Waiver .
(a) The Administrative Agent and the
Lenders have not waived, are not by this Agreement waiving, and
have no present intention of waiving, any Events of Default that
may be continuing on the date hereof or any Events of Default that
may occur after the date hereof (whether the same or similar to the
Forbearance Defaults or otherwise), other than the Waived Default,
and the Administrative Agent and the Required Lenders have not
agreed to forbear with respect to any of their rights or remedies
concerning any Events of Default (other than, during the
Forbearance Period, the Forbearance Defaults), that may have
occurred or are continuing as of the date hereof or that may occur
after the date hereof.
(b) Subject to Section 2.2
above (solely with respect to the Forbearance Defaults), the
Administrative Agent and the Lenders reserve the right to exercise
any or all of their rights and remedies under the Credit Agreement,
the other Credit Documents and applicable law as a result of any
Events of Default that may exist and be continuing on the date
hereof or any Event of Default that may occur after the date
hereof, and the Administrative Agent and the Lenders have not
waived any of such rights or remedies, and nothing in this
Agreement, and no delay on its part in exercising any such rights
or remedies, should be construed as a waiver of any such rights or
remedies.
(c) Without limiting the generality
of the foregoing, Credit Parties will not claim that any prior
action or course of conduct by the Administrative Agent or the
Lenders constitutes an agreement or obligation to continue such
action or course of conduct in the future. Credit Parties
acknowledge that the Administrative Agent and the Lenders have made
no commitment as to how or whether the Forbearance Defaults will be
resolved upon or following the Termination Date.
3. AGREEMENTS OF BORROWERS AND THE
LENDERS. From the Effective Date through and including the
Termination Date, notwithstanding anything contained in the Credit
Agreement to the contrary, the following provisions shall
apply:
3.1 Loans to Borrower shall be made:
(a) only as Swing Line Revolving Loans incurred as Eurodollar
Market Index Rate Loans, or as General Revolving Loans incurred as
Eurodollar Loans with an Interest Period of one month; and
(b) in the case of General Revolving Loans, only if at the
time of such request, and immediately after giving effect to such
Borrowing, Adjusted Consolidated Total Debt does not and will not
exceed $105,000,000. “ Adjusted Consolidated Total
Debt ” means the sum of Consolidated Total Debt (as
defined below) plus an amount equal to the Unutilized
Swing Line Revolving Commitment. “ Consolidated Total
Debt ” means the sum (without duplication) of the
principal amount (or Capitalized Lease Obligation, in the case of a
Capital Lease, or present value, based on the implicit interest
rate, in the case of any Synthetic Lease, or the higher of
liquidation value or stated value, in the case of Redeemable Stock)
of all Indebtedness of Borrower and each of its Subsidiaries, all
as determined on a consolidated basis, minus
Consolidated Cash. The terms “ Capitalized Lease
Obligation ,” “ Capital Lease
,” “ Synthetic Lease ,” “
Redeemable Stock ,” “
Indebtedness ” and “ Consolidated
Cash ” have the meanings given to such terms in the
Credit Agreement.
3.2 Notwithstanding anything
contained in the Credit Agreement to the contrary, including, but
not limited to, Section 10.2(d) thereof, the Borrower or any
of its Subsidiaries may sell as an entirety the German retail
charcoal business and/or the solvent recovery business
(collectively, the “ Businesses ”) so
long as (a) the consideration for such transaction represents
fair value (as determined by management
4
of Borrower and as reasonably acceptable to the
Administrative Agent) and at least 90% of such consideration
consists of cash, and (b) at least five Business Days prior to
the date of completion of such transaction Borrower shall have
delivered to the Administrative Agent an officer’s
certificate executed on behalf of Borrower by an Authorized
Officer, which certificate shall contain: (1) a description of
the proposed transaction, the date such transaction is scheduled to
be consummated, and the estimated purchase price or other
consideration for such transaction; (2) a description of the
contemplated use of the Cash Proceeds from such Asset Sale,
together with a certification that such Cash Proceeds will be used
as described; (3) a certification of the effect of such
transaction, on a pro forma basis, on the financial
covenants contained in sections 10.7, 10.8, 10.9 and 10.10 of the
Credit Agreement, such pro forma ratios being
determined as if such transaction had been completed at the
beginning of the most recent period of four consecutive fiscal
quarters of Borrower; (4) a certification that no Default or
Event of Default has occurred and is continuing, or would result
from consummation of such transaction (other than the Waived
Default or the Forbearance Defaults); and (5) if requested by
the Administrative Agent, a certified copy of the draft or
definitive documentation pertaining thereto. Any other
(a) Asset Sale, (b) Permitted Disposition, (c) sale
of any property, land or building (including any related
receivables or other intangible assets) to any person that is not a
Subsidiary of Borrower, (d) sale of the entire capital stock
(or other equity interests) and Indebtedness of any Subsidiary of
Borrower, and (e) the merger or consolidation of any
Subsidiary that is not an Affiliate of Borrower, must be approved
in writing by the Required Lenders and shall be subject to such
conditions as the Required Lenders may require, including permanent
reductions in the General Revolving Commitment. Notwithstanding the
foregoing, sales or other dispositions of obsolete, worn out or
surplus equipment or fixtures may be effected at any time in the
ordinary course of business.
3.3 If after the Effective Date
Borrower or any of its Subsidiaries receives Net Cash Proceeds from
any Asset Sale relating to the Businesses, within 3 days of the
receipt thereof, Borrower shall apply an amount equal to 100% of
the Net Cash Proceeds so received from any Asset Sale to the
prepayment of first , Swing Line Revolving Loans
an
