Amendment No. 4 to Credit Agreement among Caraustar Industries, Inc. and Lenders

Summary

This amendment updates the terms of a credit agreement originally made in 1997 between Caraustar Industries, Inc. and a group of lenders, including Bankers Trust Company, Bank of America, and others. The amendment revises financial definitions, adjusts leverage ratio requirements, and modifies how certain fees and interest rates are calculated. It also sets conditions for the amendment’s effectiveness and requires Caraustar to pay amendment fees and related expenses. All other terms of the original credit agreement remain in effect unless specifically changed by this amendment.

EX-10.18 3 g64758ex10-18.txt AMENDMENT NO. 4 TO CREDIT AGREEMENT 1 EXHIBIT 10.18 CARAUSTAR INDUSTRIES, INC. AMENDMENT NO. 4 TO CREDIT AGREEMENT AMENDMENT NO. 4, dated as of September 29, 2000 (the "Amendment"), to the CREDIT AGREEMENT, dated as of July 23, 1997, by and among CARAUSTAR INDUSTRIES, INC., a North Carolina corporation (the "Borrower"), BANKERS TRUST COMPANY, as Administrative Agent, NATIONSBANK, NA., as Syndication Agent, SUNTRUST BANK, ATLANTA, as Documentation Agent, FIRST UNION NATIONAL BANK, as Managing Agent, and the lenders party thereto (the "Lenders"). W I T N E S S E T H : WHEREAS, the Borrower, the Administrative Agent, the Syndication Agent, the Documentation Agent, the Managing Agent and the Lenders have entered into a Credit Agreement, dated as of July 23, 1997 (as amended, the "Credit Agreement"); WHEREAS, the Borrower has requested and the Lenders have agreed to amend the Credit Agreement as set forth herein; NOW, THEREFORE, upon the terms and conditions hereinafter set forth, the parties hereto hereby agree to amend the Credit Agreement as follows: ARTICLE I AMENDMENTS Section 1.01 Amendment to Section 1.1 of the Credit Agreement. The definition of Consolidated EBITDA in Section 1.1 of the Credit Agreement shall be amended by: (a) inserting the following new clause (C) after clause (B) thereto: "and (C) Consolidated EBITDA shall include any one-time, non-cash charge taken in connection with the write down of property, plant or equipment, determined in accordance with GAAP, during such EBITDA Measurement Period"; and 2 (b) inserting the following proviso at the end thereof: "and provided, further, that for purposes of the calculation of the Interest Coverage Ratio, Consolidated EBITDA shall include any one-time, non-cash charge taken in connection with the write down of property, plant or equipment, determined in accordance with GAAP, during such EBITDA Measurement Period." Section 1.02 Amendment to Section 4.1(c) of the Credit Agreement. Section 4.1(c) of the Credit Agreement shall be amended by: (a) inserting the following proviso at the end of the first sentence thereto: ";provided, however, that, notwithstanding the foregoing, the Borrower shall be required to use the Leverage Ratio Eurodollar Margin Election for the purposes of calculating the Eurodollar Margin for the period beginning on the date of Amendment No. 4 hereto through the date on which the Borrower delivers an Officer's Compliance Certificate setting forth a Leverage Ratio of 3.50 to 1.00 or less as of the most recent fiscal quarter end"; and (b) amending Section 4.1(c)(i) to (i) insert the words "but less than or equal to 3.50 to 1.00" at the end of the Leverage Ratio level titled "Greater than 3.00 to 1.00", (ii) insert a new Leverage Ratio level titled "Greater than 3.50 to 1.00" and (iii) insert a new Eurodollar Margin level of .475% next to such new Leverage Ratio level. Section 1.03 Amendment to Section 4.3 of the Credit Agreement. Section 4.3 of the Credit Agreement shall be amended by inserting the following proviso at the end of the second sentence thereto: ";provided, however, that, notwithstanding the foregoing, the Borrower shall be required to use the Leverage Ratio Facility Fee Rate Election for the purposes of calculating the Facility Fee Rate for the period beginning on the date of Amendment No. 4 hereto through the date on which the Borrower delivers an Officer's Compliance Certificate setting forth a Leverage Ratio of 3.50 to 1.00 or less as of the most recent fiscal quarter end." Section 1.04 Amendment to Section 9.1 of the Credit Agreement. Section 9.1 of the Credit Agreement shall be deleted and the following Section 9.1 shall be inserted in lieu thereof: Section 9.1 Leverage Ratio. Permit, (i) as of the fiscal quarters ended September 30, 2000 and December 31, 2000, the Leverage Ratio for each such fiscal quarter to exceed 4.00 to 1.00 and (ii) as of any other fiscal quarter, the Leverage Ratio for each such fiscal quarter to exceed 3.50 to 1.00". 2 3 ARTICLE II EFFECTIVENESS OF AMENDMENTS This Amendment shall become effective on the opening of business in New York on the Business Day on which the Administrative Agent has notified the Borrower and the Banks that the Administrative Agent has executed a counterpart signature page of this Amendment and has received executed counterpart signature pages of this Amendment from the Borrower and the Required Lenders. ARTICLE III MISCELLANEOUS 3.01 Fees and Expenses. The Borrower agrees to pay the following: (a) An amendment fee to each Lender that consents to this Amendment and returns an executed signature page evidencing the foregoing on or prior to September 29, 2000, equal to 0.10% of such Lender's Commitment, which fee shall be due and payable upon the effectiveness of this Amendment; and (b) All reasonable expenses incurred by the Administrative Agent and the Lenders in connection with the preparation, execution and delivery of this Amendment by the Administrative Agent and the Lenders, including, without limitation, reasonable fees and expenses of counsel to the Administrative Agent and the Lenders. 3.02 Reference to and Effect on the Credit Agreement and the Other Loan Documents. (a) This Amendment modifies the Credit Agreement to the extent set forth herein, is hereby incorporated by reference into the Credit Agreement and is made a part thereof. On and after the effective date, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment. (b) Except as specifically amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. (c) The execution, delivery and performance of this Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of the 3 4 Administrative Agent or any Lender under, the Credit Agreement or any of the other Loan Documents. 3.03 Headings. Section and subsection headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose or be given any substantive effect. 3.04 Applicable Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES. 3.05 Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute one and the same instrument. [Remainder of Page Intentionally Blank] 4 5 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of September 29, 2000. CARAUSTAR INDUSTRIES, INC., as Borrower By: /s/ H. Lee Thrash, III -------------------------------- Name: H. LEE THRASH, III Title: Vice President Planning & Development and Chief Financial Officer BANKERS TRUST COMPANY, as Administrative Agent, a Lender and Swingline Lender By: /s/ Robert R. Telesca -------------------------------- Name: ROBERT R. TELESCA Title: Assistant Vice President FIRST UNION NATIONAL BANK, as Managing Agent and a Lender By: ------------------------------ Name: Title: THE BANK OF TOKYO-MITSUBISHI, LTD., as Co-Agent and a Lender By: /s/ R. Glass ------------------------------ Name: R. GLASS Title: Vice President 5 6 BANK OF AMERICA, N.A. as Syndication Agent and a Lender By: /s/ KEVIN F. SULLIVAN ----------------------------- Name: Kevin F. Sullivan Title: Managing Director THE BANK OF NEW YORK, as Co-Agent and a Lender By: /s/ DAVID C. SIEGAL ----------------------------- Name: David C. Siegel Title: Vice President THE BANK OF NOVA SCOTIA, as Co-Agent and a Lender By: /s/ WILLIAM E. ZARRETT ----------------------------- Name: William E. Zarrett Title: Managing Director CREDIT LYONNAIS, NEW YORK BRANCH, as Co-Agent and a Lender By: /s/ R. HURST ----------------------------- Name: R. Hurst Title: Vice President SUNTRUST BANK, ATLANTA, as Documentation Agent and a Lender By: /s/ JUSTIN P. WILDE ------------------------ Name: Justin P. Wilde Title: Bank Officer 6 7 CHRISTIANA BANK, as a Lender By: /s/ Petter Svendsen/Peter M. Dodge ------------------------------------- Name: Petter Svendsen/Peter M. Dodge Title: Senior Vice President/Senior Vice President FLEET BANK, as a Lender By: ------------------------------------- Name: Title: THE FUJI BANK, LIMITED, as a Lender By: /s/ Raymond Ventura ------------------------------------- Name: Raymond Ventura Title: Vice President THE INDUSTRIAL BANK OF JAPAN, LIMITED, as a Lender By: /s/ Akihiko Mabuchi ------------------------------------- Name: Akihiko Mabuchi Title: Senior Vice President MELLON BANK, N.A., as a Lender By: /s/ Daniel J. Lenckos ------------------------------------- Name: Daniel J. Lenckos Title: Vice President 7 8 THE SANWA BANK LIMITED, as a Lender By: /s/ P. BARTLETT WU ---------------------------- Name: P. Bartlett WU Title: Vice President TORONTO DOMINION (TEXAS), INC., as a Lender By: /s/ CAROL BRANDT ---------------------------- Name: Carol Brandt Title: Vice President WACHOVIA BANK, as Co-Agent and a Lender By: /s/ THOMAS L. GLEASON ---------------------------- Name: Thomas L. Gleason Title: Senior Vice President 8