EXECUTION COPY
FOURTEENTH AMENDMENT TO CREDIT AGREEMENT
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THIS FOURTEENTH AMENDMENT TO CREDIT AGREEMENT (this
"Amendment"), dated as of December 11, 1998, is by and between
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KAISER ALUMINUM & CHEMICAL CORPORATION, a Delaware corporation
(the "Company"), KAISER ALUMINUM CORPORATION, a Delaware
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corporation (the "Parent Guarantor"), the various financial
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institutions that are or may from time to time become parties to
the Credit Agreement referred to below (collectively, the
"Lenders" and, individually, a "Lender"), and BANKAMERICA
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BUSINESS CREDIT, INC., a Delaware corporation, as agent (in such
capacity, together with its successors and assigns in such
capacity, the "Agent") for the Lenders. Capitalized terms used,
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but not defined, herein shall have the meanings given to such
terms in the Credit Agreement, as amended hereby.
W I T N E S S E T H:
WHEREAS, the Company, the Parent Guarantor, the Lenders
and the Agent are parties to the Credit Agreement, dated as of
February 15, 1994, as amended by the First Amendment to Credit
Agreement, dated as of July 21, 1994, the Second Amendment to
Credit Agreement, dated as of March 10, 1995, the Third Amendment
to Credit Agreement and Acknowledgement, dated as of July 20,
1995, the Fourth Amendment to Credit Agreement, dated as of
October 17, 1995, the Fifth Amendment to Credit Agreement, dated
as of December 11, 1995, the Sixth Amendment to Credit Agreement,
dated as of October 1, 1996, the Seventh Amendment to Credit
Agreement, dated as of December 17, 1996, the Eighth Amendment to
Credit Agreement, dated as of February 24, 1997, the Ninth
Amendment to Credit Agreement and Acknowledgment, dated as of
April 21, 1997, the Tenth Amendment to Credit Agreement and
Assignment, dated as of June 25, 1997, the Eleventh Amendment to
Credit Agreement and Limited Waivers, dated as of October 20,
1997, the Twelfth Amendment to Credit Agreement, dated as of
January 13, 1998, and the Thirteenth Amendment to Credit
Agreement, dated as of July 20, 1998 (the "Credit Agreement");
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and
WHEREAS, the parties hereto have agreed to amend the
Credit Agreement as herein provided;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Amendments to Credit Agreement.
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1.1 Amendments to Article IX: Covenants.
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A. Section 9.2.4 of the Credit Agreement is hereby
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amended to read in its entirety as follows:
"SECTION 9.2.4. Financial Condition.
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(a) Net Worth. The Company shall not permit Net
Worth as of the end of any Fiscal Quarter set forth below to
be less than the correlative amount indicated:
Fiscal Quarter
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Net Worth
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First Fiscal Quarter of 1994
$450,000,000
Second Fiscal Quarter of 1994
$433,000,000
Third Fiscal Quarter of 1994
$416,000,000
Fourth Fiscal Quarter of 1994
$400,000,000
First Fiscal Quarter of 1995
$396,000,000
Second Fiscal Quarter of 1995
$392,000,000
Third Fiscal Quarter of 1995
$388,000,000
Fourth Fiscal Quarter of 1995
$385,000,000
First Fiscal Quarter of 1996
$391,000,000
Second Fiscal Quarter of 1996
$397,000,000
Third Fiscal Quarter of 1996
Minimum Net Worth
and each Fiscal Quarter
thereafter
; provided that for purposes of this Section 9.2.4(a), the
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calculation of Net Worth shall exclude the effect of any
non-cash charges, up to an aggregate amount of $50,000,000,
in respect of the Micromill project, including (without
limitation) any write-down of assets located at the Center
for Technology in Pleasanton, California, and at the
Micromill facility near Reno, Nevada.
(b) Interest Coverage Ratio. The Company shall
not permit the Interest Coverage Ratio (i) for the one
Fiscal Quarter period ending March 31, 1996 to be less than
1.1 to 1.0, (ii) for the two Fiscal Quarter period ending
June 30, 1996 to be less than 1.2 to 1.0, (iii) for the
three Fiscal Quarter period ending September 30, 1996 to be
less than 0.5 to 1.0, (iv) for the four Fiscal Quarter
period ending December 31, 1996 to be less than 0.3 to 1.0,
(v) for the one Fiscal Quarter period ending June 30, 1997
to be less than 0.2 to 1.0, (vi) for the two Fiscal Quarter
period ending September 30, 1997 to be less than 0.4 to 1.0,
(vii) for the three Fiscal Quarter period ending
December 31, 1997 to be less than 0.6 to 1.0 and (viii) for
the four Fiscal Quarter period ending on the last day of
each of the Fiscal Quarters set forth below to be less than
the correlative ratio indicated:
Date
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Ratio
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First Fiscal Quarter of 1998
0.80 to 1.0
Second Fiscal Quarter of 1998
1.20 to 1.0
Third Fiscal Quarter of 1998
1.60 to 1.0
Fourth Fiscal Quarter of 1998
1.10 to 1.0
First Fiscal Quarter of 1999
0.90 to 1.0
Second Fiscal Quarter of 1999
0.75 to 1.0
Third Fiscal Quarter of 1999
0.75 to 1.0
Fourth Fiscal Quarter of 1999
1.00 to 1.0
First Fiscal Quarter of 2000
1.00 to 1.0
Second Fiscal Quarter of 2000
1.25 to 1.0
Third Fiscal Quarter of 2000
1.25 to 1.0
Fourth Fiscal Quarter of 2000
1.50 to 1.0
First Fiscal Quarter of 2001
1.50 to 1.0
Second Fiscal Quarter of 2001
2.00 to 1.0
; provided that for purposes of calculating the Interest
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Coverage Ratio under this Section 9.2.4(b), EBITDA shall
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exclude the effect of any non-cash charges, up to an
aggregate amount of $50,000,000, in respect of the Micromill
project, including (without limitation) any write-down of
assets located at the Center for Technology in Pleasanton,
California, and at the Micromill facility near Reno,
Nevada."
B. Section 9.2.22 of the Credit Agreement is hereby
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amended by deleting the phrase "$300,000" contained therein and
substituting the phrase "$550,000" therefor.
Section 2. Conditions to Effectiveness.
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This Amendment shall become effective as of the date
hereof only when the following conditions shall have been
satisfied and notice thereof shall have been given by the Agent
to the Parent Guarantor, the Company and each Lender (the date of
satisfaction of such conditions and the giving of such notice
being referred to herein as the "Fourteenth Amendment Effective
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Date"):
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A. The Agent shall have received for each Lender
counterparts hereof duly executed on behalf of the Parent
Guarantor, the Company, the Agent and the Required Lenders (or
notice of the approval of this Amendment by the Required Lenders
satisfactory to the Agent shall have been received by the Agent).
B. The Agent shall have received:
(1) Resolutions of the Board of Directors or of
the Executive Committee of the Board of Directors of the Company
and the Parent Guarantor approving and authorizing the execution,
delivery and performance of this Amendment, certified by their
respective corporate secretaries or assistant secretaries as
being in full force and effect without modification or amendment
as of the date of execution hereof by the Company or the Parent
Guarantor, as the case may be;
(2) A signature and incumbency certificate of the
officers of the Company and the Parent Guarantor executing this
Amendment;
(3) For each Lender, an opinion, addressed to the
Agent and each Lender, from Kramer, Levin, Naftalis & Frankel, in
form and substance satisfactory to the Agent; and
(4) Such other information, approvals, opinions,
documents or instruments as the Agent may reasonably request.
Section 3. Company's Representations and Warranties.
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In order to induce the Lenders and the Agent to enter
into this Amendment and to amend the Credit Agreement in the
manner provided herein, the Parent Guarantor and the Company
represent and warrant to each Lender and the Agent that, as of
the Fourteenth Amendment Effective Date, after giving effect to
the effectiveness of this Amendment, the following statements are
true and correct in all material respects:
A. Authorization of Agreements. The execution and
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delivery of this Amendment by the Company and the Parent
Guarantor and the performance of the Credit Agreement as amended
by this Amendment (the "Amended Agreement") by the Company and
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the Parent Guarantor are within such Obligor's corporate powers
and have been duly authorized by all necessary corporate action
on the part of the Company and the Parent Guarantor, as the case
may be.
B. No Conflict. The execution and delivery by the
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Company and the Parent Guarantor of this Amendment and the
performance by the Company and the Parent Guarantor of the
Amended Agreement do not:
(1) contravene such Obligor's Organic Documents;
(2) contravene the Senior Indenture, the New
Senior Indenture, the Additional New Senior Indentures, or the
Subordinated Indenture or contravene any other contractual
restriction where such a contravention has a reasonable
possibility of having a Materially Adverse Effect or contravene
any law or governmental regulation or court decree or order
binding on or affecting such Obligor or any of its Subsidiaries;
or
(3) result in, or require the creation or
imposition of, any Lien on any of such Obligor's properties or
any of the properties of any Subsidiary of such Obligor, other
than pursuant to the Loan Documents.
C. Binding Obligation. This Amendment has been duly
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executed and delivered by the Company and the Parent Guarantor
and this Amendment and the Amended Agreement constitute the
legal, valid and binding obligations of the Company and the
Parent Guarantor, enforceable against the Company and the Parent
Guarantor in accordance with their respective terms, except as
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors'
rights generally and by general principles of equity.
D. Governmental Approval, Regulation, etc. No
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authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or any
other Person is required for the due execution, delivery or
performance of this Amendment by the Company or the Parent
Guarantor.
E. Incorporation of Representations and Warranties
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from Credit Agreement. Each of the statements set forth in
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Section 7.2.1 of the Credit Agreement is true and correct.
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Section 4. Acknowledgement and Consent.
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The Company is a party to the Company Collateral
Documents, in each case as amended through the date hereof,
pursuant to which the Company has created Liens in favor of the
Agent on certain Collateral to secure the Obligations. The
Parent Guarantor is a party to the Parent Collateral Documents,
in each case as amended through the date hereof, pursuant to
which the Parent Guarantor has created Liens in favor of the
Agent on certain Collateral and pledged certain Collateral to the
Agent to secure the Obligations of the Parent Guarantor. Certain
Subsidiaries of the Company are parties to the Subsidiary
Guaranty and/or one or more of the Subsidiary Collateral
Documents, in each case as amended through the date hereof,
pursuant to which such Subsidiaries have (i) guarantied the
Obligations and/or (ii) created Liens in favor of the Agent on
certain Collateral. The Company, the Parent Guarantor and such
Subsidiaries are collectively referred to herein as the "Credit
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Support Parties", and the Company Collateral Documents, the
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Parent Collateral Documents, the Subsidiary Guaranty and the
Subsidiary Collateral Documents are collectively referred to
herein as the "Credit Support Documents".
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Each Credit Support Party hereby acknowledges that it
has reviewed the terms and provisions of the Credit Agreement as
amended by this Amendment and consents to the amendment of the
Credit Agreement effected as of the date hereof pursuant to this
Amendment.
Each Credit Support Party acknowledges and agrees that
any of the Credit Support Documents to which it is a party or
otherwise bound shall continue in full force and effect. Each
Credit Support Party hereby confirms that each Credit Support
Document to which it is a party or otherwise bound and all
Collateral encumbered thereby will continue to guaranty or
secure, as the case may be, the payment and performance of all
obligations guaranteed or secured thereby, as the case may be.
Each Credit Support Party (other than the Company and
the Parent Guarantor) acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this
Amendment, such Credit Support Party is not required by the terms
of the Credit Agreement or any other Loan Document to consent to
the amendments to the Credit Agreement effected pursuant to this
Amendment and (ii) nothing in the Credit Agreement, this
Amendment or any other Loan Document shall be deemed to require
the consent of such Credit Support Party to any future amendments
to the Credit Agreement.
Section 5. Miscellaneous.
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A. Reference to and Effect on the Credit Agreement
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and the Other Loan Documents.
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(1) On and after the Fourteenth Amendment 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 Amended Agreement.
(2) 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.
B. Applicable Law. THIS AMENDMENT SHALL BE DEEMED TO
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BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO SUCH LAWS RELATING TO
CONFLICTS OF LAWS.
C. Headings. The various headings of this Amendment
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are inserted for convenience only and shall not affect the meaning
or interpretation of this Amendment or any provision hereof.
D. Counterparts. This Amendment may be executed by
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the parties hereto in several counterparts and by the different
parties on separate counterparts, each of which shall be deemed
to be an original and all of which shall constitute together but
one and the same instrument; signature pages may be detached from
multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached
to the same document.
E. Severability. Any provision of this Amendment
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which is prohibited or unenforceable in any jurisdiction shall,
as to such provision and such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Amendment or
affecting the validity or enforceability of such provisions in
any other jurisdiction.
IN WITNESS WHEREOF, this Amendment has been duly
executed and delivered as of the day and year first above
written.
KAISER ALUMINUM CORPORATION KAISER ALUMINUM &
CHEMICAL CORPORATION
By: /s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
BANKAMERICA BUSINESS CREDIT, BANKAMERICA BUSINESS
INC., as Agent CREDIT, INC.
By:/s/Michael J. Jasaitis By:/s/Michael J. Jasaitis
Name: Michael J. Jasaitis Name: Michael J. Jasaitis
Its: Vice President Its: Vice President
BANK OF AMERICA NATIONAL TRUST THE CIT GROUP/BUSINESS
AND SAVINGS ASSOCIATION CREDIT, INC.
By:/s/Michael Balok By:/s/Dan Hughes
Name Printed: Michael Balok Name Printed: Dan Hughes
Its: Managing Director Its: Vice President
CONGRESS FINANCIAL CORPORATION HELLER FINANCIAL, INC.
(WESTERN)
By:/s/Kristine Metchikian By:/s/T/ Bukowski
Name Printed: Kristine Metchikian Name Printed: T. Bukowski
Its: Vice President Its: Sr. Vice President
LA SALLE NATIONAL BANK TRANSAMERICA BUSINESS
CREDIT CORPORATION
By:/s/ Douglas C. Colletti By: /s/ R. L. Heinz
Name Printed: Douglas C. Colletti Name Printed: R. L. Heinz
Its: First Vice President Its:Senior Vice President
ABN AMRO BANK N.V.
San Francisco International Branch
By: ABN AMRO North America,
Inc., as agent
By:/s/Jeffrey A. French
Name Printed: Jeffrey A. French
Its: Group Vice President & Director
By:/s/ Michael M. Tolentino
Name Printed: Michael M. Tolentino
Its: Vice President
ACKNOWLEDGED AND AGREED TO:
AKRON HOLDING CORPORATION KAISER ALUMINUM &
CHEMICAL INVESTMENT,
INC.
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER ALUMINUM PROPERTIES, KAISER ALUMINUM TECHNICAL
INC. SERVICES, INC.
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
OXNARD FORGE DIE COMPANY, INC. KAISER ALUMINIUM
INTERNATIONAL, INC.
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER ALUMINA AUSTRALIA KAISER FINANCE
CORPORATION CORPORATION
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
ALPART JAMAICA INC. KAISER JAMAICA
CORPORATION
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER BAUXITE COMPANY KAISER EXPORT COMPANY
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER MICROMILL HOLDINGS, LLC KAISER SIERRA
MICROMILLS, LLC
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER TEXAS SIERRA MICROMILLS, KAISER TEXAS MICROMILL
LLC HOLDINGS, LLC
By:/s/Karen A. Twitchell By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell Name Printed: Karen A.
Twitchell
Its: Treasurer Its: Treasurer
KAISER BELLWOOD CORPORATION
By:/s/Karen A. Twitchell
Name Printed: Karen A. Twitchell
Its: Treasurer