Third Forbearance Extension Agreement among Denali Incorporated, Guarantors, Canadian Imperial Bank of Commerce, ING (U.S.) Capital LLC, and Lenders

Summary

This agreement, dated November 6, 2000, is an extension of a prior forbearance arrangement between Denali Incorporated (the Borrower), its guarantors, Canadian Imperial Bank of Commerce (as administrative agent), ING (U.S.) Capital LLC (as documentation agent), and the lenders under an existing credit agreement. The parties agree to extend the period during which the lenders will refrain from exercising certain rights due to existing defaults, with the new termination date being the earliest of November 30, 2000, the closing of a specified transaction, or a new event of default. The agreement also defers certain lender rights and sets conditions for effectiveness.

EX-10.67 2 h82053ex10-67.txt THIRD FORBEARANCE EXTENSION AGREEMENT 1 EXHIBIT 10.67 THIRD FORBEARANCE EXTENSION AGREEMENT THIRD FORBEARANCE EXTENSION AGREEMENT, dated as of November 6, 2000 (this "Forbearance Extension"), among (i) DENALI INCORPORATED (the "Borrower"); (ii) each of the guarantors which are signatories hereto (each a "Guarantor", collectively, the "Guarantors"); (iii) CANADIAN IMPERIAL BANK OF COMMERCE (in its capacity as administrative agent for the Lenders referenced below, the "Administrative Agent"); (iv) ING (U.S.) CAPITAL LLC (in its capacity as documentation agent for the Lenders referenced below, the "Documentation Agent"); and (v) the lenders party to the Credit Agreement referenced below (the "Lenders"), in respect of the Credit Agreement referenced below. WITNESSETH: WHEREAS, the Borrower, the Lenders, the Administrative Agent and the Documentation Agent have entered into that certain Credit Agreement, dated as of January 12, 1999 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"); WHEREAS, the Guarantors are party to that certain Guarantee, dated as of January 12, 1999 (as amended, supplemented or otherwise modified from time to time, the "Guarantee"), in favor of the Administrative Agent for the benefit of the Lenders; WHEREAS, the Borrower, the Guarantors, the Lenders, the Administrative Agent and the Documentation Agent have entered into that certain Forbearance Agreement, dated as of June 30, 2000 (the "Forbearance Agreement"), as extended by that certain Forbearance Extension Agreement, dated as of July 31, 2000 (the "First Forbearance Extension"), as extended by that certain Second Forbearance Extension Agreement, dated as of September 30, 2000 (the "Second Forbearance Extension"); WHEREAS, the Specified Events of Default (as defined in the Forbearance Agreement) and the Additional Specified Events of Default (as defined in the Second Forbearance Extension) have occurred and are continuing; WHEREAS, the Forbearance Termination Date (as defined in the Forbearance Agreement and as extended by the Second Forbearance Extension) has expired; WHEREAS, the Borrower and the Guarantors have requested that the Lenders, the Administrative Agent and the Documentation Agent to revive the Forbearance Period and extend the Forbearance Termination Date and to provide for certain other amendments or modifications to the Credit Agreement and the Forbearance Agreement. NOW, THEREFORE, in consideration of the premises, the mutual covenants contained herein and for other valuable consideration, the receipt and adequacy of which are hereby 2 acknowledged, the Borrower, the Guarantors, the Administrative Agent, the Documentation Agent and the Lenders hereby agree as follows: 1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement, the Forbearance Agreement, the First Forbearance Extension or the Second Forbearance Extension, as applicable. 2. Forbearance Extension; Deferral of Principal; Other Modifications. (a) The Forbearance Period is hereby revived and the Forbearance Termination Date is hereby amended to be the earliest to occur of (i) November 30, 2000, (ii) the closing of the Blair Transaction and (iii) the occurrence of a Forbearance Event of Default. (b) During the Forbearance Period, no Eurodollar Loan shall be made or continued with an Interest Period that ends later than November 30, 2000. (c) Section 2(e) of the Second Forbearance Extension is hereby superceded by the following. Subject to the terms and conditions set forth herein, the Lenders shall defer their rights to exercise any warrants held by the Lenders relating to the Borrower that are exercisable on July 31, 2000, August 31, 2000, September 30, 2000 or October 31, 2000 until the Forbearance Termination Date. If the Blair Transaction is consummated on or prior to November 30, 2000, the Lenders shall surrender such warrants to the Borrower for cancellation. 3. Termination. The forbearance and deferral of principal payments set forth in Section 3 of the Forbearance Agreement, as modified by Section 2 of the First Forbearance Extension, Section 2 of the Second Forbearance Extension and Section 2 of this Forbearance Extension shall terminate on the Forbearance Termination Date. Upon such termination, the Administrative Agent, the Documentation Agent and the Lenders shall be entitled to exercise all rights and remedies granted to them pursuant to the Credit Agreement and the other Loan Documents or under applicable law. 4. Representations and Warranties. In order to induce the Administrative Agent, the Documentation Agent and the Lenders to enter into this Forbearance Extension, the Borrower and each Guarantor hereby represents and warrants to the Administrative Agent, the Documentation Agent and to each Lender that: (a) Other than as set forth in Section 4(b), each of the representations and warranties made by the Borrower and each of the Guarantors in each Loan Document to which it is a party is true and correct in all material respects as of the date hereof. (b) Other than the Specified Events of Default and the Additional Specified Events of Default, no Default or Event of Default has occurred and is continuing as of the date hereof. 5. Conditions Precedent to Effectiveness of Forbearance Extension. This Forbearance Extension shall not become effective unless and until: (a) the Administrative Agent has received this Forbearance Extension, executed and delivered by a duly authorized officer of the Borrower, each Guarantor, the Required Lenders, the Administrative Agent and the Documentation Agent; 3 (b) the Administrative Agent shall have received for the account of each Lender payment of all accrued interest, excluding any accrued default interest, through October 31, 2000; (c) payments due to the holders of the Permanent Subordinated Debt as of the date hereof shall have been deferred pursuant to a waiver agreement, dated as of the date hereof, among the Borrower and the holders of the Permanent Subordinated Debt and such waiver agreement shall have been duly executed by the Borrower and each such noteholder and shall be in form and substance satisfactory to the Administrative Agent; and (d) the Administrative Agent has received such other documents and information as the Administrative Agent may reasonably require, which documents and information shall be satisfactory to the Administrative Agent in its sole discretion. 6. Forbearance Events of Default. The Forbearance Period shall immediately terminate and the forbearance and deferral of principal payments set forth in Section 3 of the Forbearance Agreement, as modified by Section 2 of the First Forbearance Extension, Section 2 of the Second Forbearance Extension and Section 2 of this Forbearance Extension shall be of no further force and effect upon the occurrence of any of the following (each, a "Forbearance Event of Default"): (a) the occurrence of one or more Defaults or Events of Default under the Credit Agreement (other than a Specified Event of Default or an Additional Specified Event of Default); or (b) any representation or warranty made or deemed made by the Borrower or any Guarantor herein, in the Forbearance Agreement, the First Forbearance Extension or this Forbearance Extension or which is contained in any certificate, document or financial or other statement created and/or delivered at any time under or in connection with the Forbearance Agreement, the First Forbearance Extension, the Second Forbearance Extension or this Forbearance Extension or on or subsequent to the date hereof under or in connection with any other Loan Document shall prove to have been incorrect in any material respect on or as of the date made or deemed made; or (c) the Borrower or any Subsidiary shall default in the observance or performance of any agreement contained herein or in the Forbearance Agreement, the First Forbearance Extension, the Second Forbearance Extension or this Forbearance Extension (after giving effect to the provisions hereof); or (d) the Borrower shall make, or permit to be made by any Guarantor, any payment to any Person in respect of the Permanent Subordinated Debt so long as an Event of Default shall continue to exist under the Credit Agreement and such payment shall be waived by the holders of the Permanent Subordinated Debt or a payment blockage notice shall remain in effect, in each case without the prior written consent of the Administrative Agent, the Documentation Agent and the Lenders; or (e) the Administrative Agent shall determine in good faith that the Blair Transaction will not close on or prior to November 30, 2000; or (f) the lenders under the Dutch Credit Facility shall accelerate the payment of principal owing under the Dutch Credit Facility or shall take any action in furtherance of the exercise of remedies in respect of the Dutch Credit Facility. 4 7. Absence of Waiver. The parties hereto agree that the agreements set forth herein shall not be deemed to: (a) be a consent to cure, or waiver of, any Default or Event of Default; (b) except as expressly set forth herein, modify or limit any other term or condition of the Credit Agreement, the Forbearance Agreement, the First Forbearance Extension, the Second Forbearance Extension or any other Loan Document; (c) impose upon any Lender, the Administrative Agent or the Documentation Agent any commitment or obligation, express or implied, to consent to any amendment or further modification of the Credit Agreement, the Forbearance Agreement, the First Forbearance Extension or other Loan Documents; (d) impose upon any Lender, the Administrative Agent or any Documentation Agent any commitment or obligation, express or implied, to grant or extend any financial accommodations to the Borrower or the Guarantors (other than as expressly set forth herein) or to modify or extend the Forbearance Agreement, the First Forbearance Extension or this Forbearance Extension; or (e) prejudice any right or remedy that the Administrative Agent, the Documentation Agent or the Lenders may now have or may in the future have under the Credit Agreement or under or in connection with the other Loan Documents or any instrument or agreement referred to therein including, without limitation, any right or remedy resulting from any Default or Event of Default. 8. Release of Claims and Waiver. Each of the Borrower and each Guarantor hereby releases, remises, acquits and forever discharges each Lender, the Administrative Agent and the Documentation Agent and each of their employees, agents, representative, consultants, attorneys, officers, directors, partners, fiduciaries, predecessors, successors and assigns, subsidiary corporations, parent corporations and related corporate divisions (collectively, the "Released Parties"), from any and all actions, causes of action, judgments, executions, suits, debts, claims, demands, liabilities, obligations, damages and expenses of any and every character, known or unknown, direct or indirect, at law or in equity, of whatever nature or kind, whether heretofore or hereafter arising, for or because of any matter or things done, omitted or suffered to be done by any of the Released Parties prior to and including the date of execution hereof, and in any way directly or indirectly arising out of any or in any way connected to this Agreement or the Loan Documents (collectively, the "Released Matters"). Each of the Borrower and each Guarantor hereby acknowledges that the agreements in this Section 8 are intended to be in full satisfaction of all or any alleged injuries or damages arising in connection with the Released Matters. Each of the Borrower and each Guarantor hereby represents and warrants to the Administrative Agent, the Documentation Agent and each Lender that it has not purported to transfer, assign or otherwise convey any right, title or interest of the Borrower or any Guarantor in any Released Matter to any other Person and that the foregoing constitutes a full and complete release of all Released Matters. 9. Miscellaneous. (a) Section headings used in this Forbearance Extension are for convenience of reference only and shall not affect the construction of this Forbearance Extension. (b) This Forbearance Extension may be executed by one or more of the parties hereto by facsimile or in any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 5 (c) This Forbearance Extension and the rights and obligations of the parties under this Forbearance Extension shall be governed by, and construed and interpreted in accordance with, the law of the State of New York. (d) This Forbearance Extension shall be deemed a "Loan Document" for purposes of the Credit Agreement and the other Loan Documents. (e) This Forbearance Extension constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous oral or written agreements with respect to the subject matter hereof. (f) Time is of the essence in this Forbearance Extension. (g) No amendment or modification of this Forbearance Extension shall be effective unless made in writing and signed by all parties. Each of the Borrower and each of the Guarantors acknowledges and agrees that any and all future discussions with any Lender, the Administrative Agent or the Documentation Agent shall be without prejudice to any Lender, the Administrative Agent or the Documentation Agent and shall not be deemed to modify, waive, or amend any term or provision of this Forbearance Extension or the Loan Documents. IN WITNESS WHEREOF, the parties hereto have caused this Forbearance Extension to be duly executed and delivered as of the day and year first above written. DENALI INCORPORATED, as Borrower By /S/ RICHARD W. VOLK -------------------------------- Name: RICHARD W. VOLK Title: CHAIRMAN, PRESIDENT & CEO CANADIAN IMPERIAL BANK OF COMMERCE, as Administrative Agent By: GERALD GIRARDI Name: GERALD GIRARDI Title: EXECUTIVE DIRECTOR ING (U.S.) CAPITAL LLC, as Documentation Agent and as a Lender By: ROBERT L. FELLOWS Name: ROBERT L. FELLOWS Title: DIRECTOR CIBC INC., as a Lender By: GERALD GIRARDI Name: GERALD GIRARDI Title: EXECUTIVE DIRECTOR 6 KEY CORPORATE CAPITAL INC., as a Lender By: MICHAEL D. CARROLL Name: MICHAEL D. CARROLL Title: VICE PRESIDENT BANK OF OKLAHOMA N.A., as a Lender By: PAMELA J. BEEN Name: PAMELA J. BEEN Title: VICE PRESIDENT 7 SOUTHWEST BANK OF TEXAS, N.A., as a Lender By: PRESTON C. CLARE Name: PRESTON C. CLARE Title: SENIOR VICE PRESIDENT