<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD YEAR ENDED
SEPTEMBER 30, 1999 OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM ______________ TO ________________.
Commission file number 333-64675
GLOBE MANUFACTURING CORP.
(Exact name of registrant as specified in its charter)
Alabama 63-1101362
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
456 Bedford Street, Fall River, Massachusetts 02720
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 508/674-3585
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--------- ---------
As of September 30, 1999, the Registrant had 1,000 shares of Common Stock
outstanding.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I FINANCIAL INFORMATION PAGE
<S> <C> <C>
Item 1. Financial Statements
Condensed Consolidated Balance Sheets - September 30, 1999 (Unaudited)
and December 31, 1998................................................. 1
Condensed Consolidated Statements of Income (Unaudited) - Three Months
Ended September 30, 1999 and 1998; Nine Months Ended September 30,
1999 and 1998......................................................... 2
Condensed Consolidated Statements of Cash Flows (Unaudited) - Nine
Months Ended September 30, 1999 and 1998.............................. 3
Notes to Condensed Consolidated Financial Statements (Unaudited)
-September 30, 1999................................................... 4
Item 2. Management's Discussion and Analysis of Financial Conditions and
Results of Operations................................................. 6
Item 3. Quantitative and Qualitative Disclosure about Market Risk............. 8
PART II OTHER INFORMATION
Item 1. Legal Proceedings..................................................... 8
Item 2. Changes in Securities and Use of Proceeds............................. 9
Item 3. Defaults Upon Senior Securities....................................... 9
Item 4. Submission of Matters to a Vote of Security Holders .................. 9
Item 5. Other Information..................................................... 9
Item 6. Exhibits and Reports on Form 8-K...................................... 9
</TABLE>
<PAGE>
PART I
------
GLOBE MANUFACTURING CORP.
Condensed Consolidated Balance Sheets
(Dollars in thousands)
<TABLE>
<CAPTION>
(Unaudited)
September 30, (Note A)
1999 December 31, 1998
-------------- -----------------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 3,369 $ 1,439
Accounts receivable, net 39,518 22,510
Inventories 19,421 18,380
Prepaid taxes and other assets 7,939 8,840
--------- ---------
Total current assets 70,247 51,169
Property, plant and equipment 166,485 157,436
Less accumulated depreciation (81,407) (74,107)
--------- ---------
Net property, plant and equipment 85,078 83,329
Other assets 10,911 11,328
--------- ---------
Total assets $ 166,236 $ 145,826
========= =========
Liabilities and stockholders' equity (deficit)
Current liabilities:
Accounts payable $ 8,036 $ 6,012
Accrued interest expense 4,064 7,773
Other current liabilities 12,152 5,010
Note payable 29,600 11,300
--------- ---------
Total current liabilities 53,852 30,095
Other long-term liabilities 7,271 5,908
Long-term debt 109,450 115,000
Senior subordinated notes 150,000 150,000
Stockholders' equity (deficit)
Common stock, Class A, voting, $.01 par value 1 1
Other stockholders' equity (deficit) (154,338) (155,178)
--------- ---------
Total stockholders' equity (deficit) (154,337) (155,177)
--------- ---------
Total liabilities and stockholders' equity (deficit) $ 166,236 $ 145,826
========= =========
</TABLE>
See notes to condensed consolidated financial statements.
-1-
<PAGE>
GLOBE MANUFACTURING CORP.
Condensed Consolidated Statements of Income
(Dollars in thousands)
<TABLE>
<CAPTION>
Three months ended Nine months ended
----------------------------------- ------------------------------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
September 30, September 30, September 30, September 30,
1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Net Sales $43,102 $40,831 $131,060 $133,321
Cost and expenses:
Cost of sales 28,098 25,126 88,023 84,682
Selling, general & administrative expenses 6,264 7,255 17,999 19,265
Research & development expenses 812 1,031 3,147 3,144
Interest, net 7,215 4,355 21,153 6,143
Transaction compensation expense -- 5,778 -- 5,778
Transaction commitment fee expense -- 1,000 -- 1,000
Miscellaneous (356) 8 (573) (647)
------- ------- ------- -------
42,033 44,553 129,749 119,365
------- ------- ------- -------
Income before income taxes and
extraordinary income 1,069 (3,722) 1,311 13,956
Provision for income taxes 386 (1,209) 472 5,609
------- ------- ------- -------
Income/(loss) before extraordinary item 683 (2,513) 839 8,347
Loss from write-off of deferred financing
cost, net of income taxes -- 187 -- 187
------- ------- ------- -------
Net income/(loss) $ 683 $(2,700) $ 839 $ 8,160
======= ======= ======= =======
</TABLE>
See notes to condensed consolidated financial statements.
-2-
<PAGE>
GLOBE MANUFACTURING CORP.
Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
<TABLE>
<CAPTION>
Nine Months Ending
---------------------------------------
(Unaudited) (Unaudited)
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
Cash from (used in) operations ($9,901) $ 19,595
Investing Activities
Capital expenditures (6,080) (26,317)
Other (265) 173
------- --------
(6,345) (26,144)
------- --------
Financing Activities
Net change in note payable 18,300 3,325
Principal payments on long-term debt (3,750)
Net effect of recapitalization transaction -- 7,012
Other (124) (219)
------- --------
18,176 6,368
------- --------
Net increase (decrease) in cash and cash equivalents 1,930 (181)
Cash and cash equivalents at beginning of year 1,439 1,947
------- --------
Cash and cash equivalents at end of period $ 3,369 $ 1,766
======= ========
</TABLE>
See notes to condensed consolidated financial statements.
-3-
<PAGE>
GLOBE MANUFACTURING CORP.
Notes to Condensed Consolidated Financial Statements (Unaudited)
(Dollars in thousands)
September 30, 1999
Note A. Basis of presentation
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the nine month period ended September 30,
1999 are not necessarily indicative of the results that may be expected for the
year ended December 31, 1999.
The balance sheet at December 31, 1998 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements.
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Registrant Company and Subsidiaries' annual
report on Form 10-K for the year ended December 31, 1998.
Note B. Inventories
The components of inventory consist of the following:
<TABLE>
<CAPTION>
September 30 December 31,
------------ ------------
1999 1998
---- ----
<S> <C> <C>
Raw materials $ 3,418 $ 2,688
Finished goods 16,811 16,500
------- -------
$20,229 $19,118
Less LIFO reserve (808) (808)
------- -------
$19,421 $18,380
</TABLE>
-4-
<PAGE>
Note C. Debt
Long-term debt consists of the following:
<TABLE>
<CAPTION>
September 30 December 31
------------ -----------
1999 1998
-------- -----------
<S> <C> <C>
Term loan A, principal due in variable semi-annual $ 60,000 $ 60,000
installments through 2005; variable rate interest
55,000 55,000
Term loan B, principal due in variable semi-annual
installments through 2006; variable rate interest
150,000 150,000
Senior Subordinated Notes, due 2008; interest at 10% -------- --------
265,000 265,000
Less current maturities 5,550 -
-------- --------
$259,450 $265,000
</TABLE>
On March 23, 1999 the Company exchanged all of its outstanding 10% Senior
Subordinated Notes due 2008 for an equal amount of its Series B 10% Senior
Subordinated Notes due 2008.
On October 20, 1999, the Company amended its existing Senior Credit Facility.
The amendment revises covenant ratios, establishes a minimum EBITDA test,
determines the availability of the revolving loan based on a leverage ratio
test, subjects the Code Hennessy and Simmons management fee to a leverage ratio
test, and increases interest rate margins. The amendment was necessary because
the Company was not able to meet certain covenants under its Senior Credit
Facility.
Note D. Segment Information
Globe Manufacturing Corp. (the "Company") operates in one industry segment
encompassing the manufacture and sale of elastomeric fibers. These fibers, which
consist of spandex fibers and latex thread, are sold to customers in the textile
and apparel industries that are geographically diversified throughout the United
States and in various foreign countries. The Company's manufacturing facilities
are located in the United States. The following is a summary by geographic area
of revenues from customers. Revenues are attributed to each geographic location
based upon the location of the Company's customers.
<TABLE>
<CAPTION>
September 30 September 30
------------ ------------
1999 1998
------------ ------------
<S> <C> <C>
United States.............. $ 85,937 $ 90,351
Europe..................... 25,305 25,217
Asia....................... 8,458 4,740
Central and South America.. 3,515 2,865
Other...................... 7,845 10,148
-------- --------
Total Sales................ $131,060 $133,321
======== ========
</TABLE>
-5-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
Net sales of the Company were $43.1 million for the third quarter of 1999
and $131.1 million for the nine months ended September 30, 1999, representing an
increase of 5.6% and a decrease of 1.7%, respectively, over the corresponding
periods of 1998. The increase in the third quarter from the corresponding
periods of 1998, is directly related to the increase in sales volume of fine
denier spandex that were partially offset by marginal decreases in sales volumes
of heavy denier spandex and latex fiber. The slight decrease for the nine month
period compared to the corresponding period of 1998 is attributed to decreases
in selling prices of fine denier spandex and latex fibers.
Gross margin for the third quarter was $15.0 million and $43.0 million for
the nine months ended September 30, 1999, representing decreases of 4.5% and
11.5%, respectively, over the corresponding periods of 1998. The Company's gross
margin as a percentage of net sales was 34.8% for the third quarter and 32.8%
for the nine month period, compared to 38.4% and 36.5%, respectively, for the
corresponding periods in 1998. The decrease in gross margin was primarily due to
a decrease in pricing on fine denier spandex.
Selling, general and administrative expenses were $6.3 million for the
third quarter of 1999, and $18.0 million for the nine months ended September
30, 1999, representing decreases of 13.7% and 6.6%, respectively, over the
corresponding periods of 1998. As a percentage of net sales, selling, general
and administrative expenses were 14.5% for the third quarter and 13.7% for the
nine month period, compared to 17.8% and 14.4%, respectively, for the
corresponding periods in 1998.
Research and development expenses were $0.8 million for the third quarter
of 1999, and $3.1 million for the nine months ended September 30,1999, compared
to $1.0 million and $3.1 million, respectively, for the corresponding periods in
1998. Research and development expenses for the Company as a percentage of net
sales were 1.9% for the third quarter and 2.4% for the nine month period,
compared to 2.5% and 2.3% for the corresponding periods in 1998.
Net interest expense was $7.2 million for the third quarter and $21.2
million for the nine months ended September 30, 1999, compared to $4.4 million
and $6.1 million, respectively, for the corresponding periods in 1998. The
increase in interest expense was directly attributable to the recapitalization
of the Company.
-6-
<PAGE>
Liquidity and Capital Resources
Cash used by operating activities was $9.9 million for the nine months
ended September 30, 1999 as compared to cash provided by operating activities of
$19.6 million for the comparable prior year period. The reduction in cash
provided by operating activities for the nine months ended September 30, 1999
was due to increases in interest expense, accounts receivable, inventories,
prepaid taxes, and a decrease in accrued expenses. This reduction was partially
offset by an increase in accounts payable, accretion on discounted notes, and
depreciation and amortization.
The average days sales outstanding for accounts receivable was
approximately 72 days for the nine months ended September 30, 1999 compared to
56 days for the comparable prior year period. The increase in days sales
outstanding is due to increases in export sales, and export sales made with
extended terms. Export sales represented 34.3% and 31.6% of total sales for the
nine months ended September 30, 1999 and 1998, respectively. Inventory balances
increased $1.0 million from December 31, 1998, primarily due to an increase in
unit sales volume of fine denier spandex compared to the fourth quarter of 1998,
raising the level and value of inventory on hand. The note payable increased
$18.3 million primarily due to interest payments due on the senior subordinated
notes and working capital needs.
Capital expenditure, including capital leases, were $9.1 million for the
nine months ended September 30, 1999 compared to $26.3 million the comparable
prior year period. Capital expenditures for the nine months ended September 30,
1998 consisted primarily of expenditures for the expansion of the Tuscaloosa
facility.
As part of the recapitalization transaction, the Company entered into a
Senior Credit Facility consisting of a $115.0 million term loan facility, which
was fully drawn upon the consummation of the transaction and a $50.0 million
revolving loan facility. The revolving loan facility is available for general
corporate and working capital purposes.
On October 20, 1999, the Company amended its existing Senior Credit
Facility. The amendment revises covenant ratios, establishes a minimum EBITDA
test, determines the availability of the revolving loan based on a leverage
ratio test, subjects the Code Hennessy and Simmons management fee to a leverage
ratio test, and increases interest rate margins. The amendment was necessary
because the Company was not able to meet certain covenants under its Senior
Credit Facility.
Impact of the Year 2000 Issue
The year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Any of the Company's
computer programs that have date-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000.
If the Company, its significant customers or suppliers fail to make
necessary modifications and conversions on a timely basis, the year 2000 issue
could have a material adverse effect on Company operations. However, the impact
cannot be quantified at this time. The Company believes that its competitors
face similar risks.
The Company has established a corporate-wide project team to identify non-
compliant software and complete the corrections required for the year 2000
issue. The Company has successfully repaired existing manufacturing and the
majority of the ancillary systems in all locations. The Company has also
successfully implemented a new software system that is compliant with year 2000.
The new system encompasses the Company's financial, inventory costing, and
distribution systems. The Company also has made inquiry of its major customers
and suppliers to assess their compliance. There can be no assurance that there
will not be a material adverse effect on the Company if third party governmental
or business entities do not convert or replace their systems in a timely manner
and in a way that is compatible with the Company's systems.
Costs related to the year 2000 issue are funded through operating cash
flows. Through September 30, 1999, the Company expended approximately $350,000
in systems development and remediation efforts, and modifying the applicable
code of existing software. The Company
-7-
<PAGE>
estimates remaining costs to be immaterial. The Company presently believes that
the total cost of achieving year 2000 compliant systems will not be material to
the Company's financial condition, liquidity or results of operations.
Time and cost estimates are based on currently available information.
Developments that could affect estimates include, but are not limited to, the
availability and cost of trained personnel, the ability to locate and correct
all relevant computer code and systems and remediation success of the Company's
customers and suppliers.
Forward-Looking Information
This Quarterly Report on Form 10-Q contains certain forward-looking
statements, including, without limitation, statements concerning the Company's
future financial position, business strategy, budgets, projected costs and plans
and objectives of management for future operations. These forward-looking
statements are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 (which do not apply to initial public
offerings). Forward- looking statements generally can be identified by the use
of forward-looking terminology such as "may," "will," "expect," "intend,"
"estimate," "anticipate," "believe," "should," "plans," or "continue" or the
negative thereof or variations thereon or similar terminology. Although the
Company believes that the expectations reflected in such forward-looking
statements are reasonable, it can give no assurance that such expectations will
prove to have been correct. These forward-looking statements are subject to a
number of risks and uncertainties, including, without limitation, those related
to the Company's substantial leverage and debt service requirements, the
Company's dependence on significant customers and on certain suppliers, the
effects of competition on the Company, the risks related to environmental,
health and safety laws and regulations, the Company's exposure to foreign sales
risk and the cyclicality of the textile industry, risks related to the year 2000
issue, and the other factors discussed in the Company's filings with the
Securities and Exchange Commission. Actual results could differ materially from
these forward-looking statements.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
The Company's market risk disclosure set forth in the Company's Annual
Report on Form 10-K has not changed significantly through the nine months ended
September 30, 1999.
Part II Other Information
Item 1. Legal Proceedings
In April 1997 two domestic purchasers of extruded latex thread filed a
complaint against a number of foreign manufacturers and distributors of such
thread, including an Indonesian limited liability company in which Globe
Holdings then owned a 40% interest (the "Joint Venture"). The complaint alleged
an international conspiracy to restrain trade in, and fix prices of, the thread
in the U.S. The Company was not named as a defendant in the case. The Joint
Venture alleged in its motion to dismiss that not all parties to the conspiracy
had been joined. There can be no assurance that the Company will not be named in
the future. The Company is entitled to indemnification from, among other items,
any liabilities arising out of any criminal or civil antitrust claims or
investigations resulting from the above-described proceedings to the
-8-
<PAGE>
extent related to the Company's activities prior to the recapitalization
transaction in 1998. This indemnity expires on December 31, 2001.
The U.S. Department of Commerce has imposed anti-dumping duties on
Indonesian extruded latex producers. Additional duties of 28.29% have been
levied on extruded latex thread imported from Indonesia from May 1999 going
forward.
From time to time, the Company has been and is involved in various legal
proceedings, all of which management believes are routine in nature and
generally incidental to the conduct of its business. The ultimate legal and
financial liability of the Company with respect to such proceedings cannot be
estimated with certainty, but the Company believes, based on its examination of
such matters, that none of such proceedings, if determined adversely to the
Company, would have a material adverse effect on the Company's results of
operations, financial condition and its ability to meet its obligations under
the Company's existing debt.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.16 Second Amendment to the Credit Agreement, dated as of May 24, 1999.
10.17 Third Amendment and Waiver to the Credit Agreement, dated as of
October 20, 1999.
27.1 Financial Data Schedule
(b) Reports on Form 8-K
None.
-9-
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
GLOBE MANUFACTURING CORP.
Date: November 12, 1999 By: /s/ LAWRENCE R. WALSH
----------------------------------------------
Lawrence R. Walsh
Vice President, Finance and Administration
and duly authorized signatory on
behalf of the Registrant
<PAGE>
Exhibit 10.16
SECOND AMENDMENT
----------------
SECOND AMENDMENT (this "Amendment"), dated as of May 24, 1999, among
GLOBE HOLDINGS, INC., a Massachusetts corporation ("Holdings"), GLOBE
MANUFACTURING CORP., an Alabama corporation (the "Borrower"), the several
lenders from time to time party to the Credit Agreement referred to below (the
"Lenders"), MERRILL LYNCH, PIERCE, FENNER & SMITH, INC., as Syndication Agent
(the "Syndication Agent"), and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent (the "Administrative Agent"). All
capitalized terms used herein and not otherwise defined herein shall have the
respective meanings provided such terms in the Credit Agreement.
W I T N E S S E T H:
-------------------
WHEREAS, Holdings, the Borrower, the Lenders, the Syndication Agent
and the Administrative Agent are party to a Credit Agreement, dated as of July
31, 1998 (as amended, modified or supplemented through, but not including, the
date hereof, the "Credit Agreement"); and
WHEREAS, the Borrower has requested that the Lenders provide the
amendment provided for herein and the Lenders have agreed to provide such
amendment on the terms and conditions set forth herein;
NOW, THEREFORE, it is agreed:
1. Section 8.07 of the Credit Agreement is hereby amended by
inserting the following new clause (i) at the end thereof:
"(i) In addition to the foregoing, the Borrower may incur up to
$3,500,000 of Capital Lease Obligations for a new SAP computer
system so long as such obligations are incurred in its 1999
fiscal year."
2. In order to induce the Lenders to enter into this Amendment, each
of Holdings and the Borrower hereby represents and warrants that (i) no Default
or Event of Default exists as of the Second Amendment Effective Date (as defined
below), both before and after giving effect to this Amendment, and (ii) all
representations and warranties contained in the Credit Agreement and in the
other Loan Documents are true and correct in all material respects as of the
Second Amendment Effective Date, both before and after giving effect to this
Amendment.
3. This Amendment shall become effective on the date (the "Second
Amendment Effective Date") when the Administrative Agent, the Required Lenders,
Holdings and the Borrower shall have signed a counterpart hereof (whether the
same or different counterparts) and shall have delivered (including by way of
facsimile transmission) the same to the Administrative Agent as provided in
Section 12.02 of the Credit Agreement.
<PAGE>
4. This Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any other provision of the Credit
Agreement or any other Loan Document.
5. This Amendment may be executed in any number of counterparts and
by the different parties hereto on separate counterparts, each of which
counterparts when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A complete set of
counterparts shall be lodged with the Borrower and the Administrative Agent.
6. All references in the Credit Agreement and each of the Loan
Documents to the Credit Agreement shall be deemed to be references to the Credit
Agreement after giving effect to this Amendment.
7. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK.
* * *
-2-
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed and delivered as of the date
hereof.
GLOBE HOLDINGS, INC.
By: /s/ Lawrence R. Walsh
-----------------------
Name: LAWRENCE R. WALSH
Title: VICE PRESIDENT
GLOBE MANUFACTURING CORP.
By: /s/ Lawrence R. Walsh
-----------------------
Name: LAWRENCE R. WALSH
Title: VICE PRESIDENT
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Administrative Agent
By: /s/ Dietmar Scheil
---------------------
Name: DIETMAR SCHEIL
Title: VICE PRESIDENT
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Lender
By: /s/ Heidi-Anne Sandquist
--------------------------
Name: HEIDI-ANNE SANDQUIST
Title: VICE PRESIDENT
-3-
<PAGE>
MERRILL LYNCH CAPITAL CORPORATION
By: /s/ Carol J.E. Feeley
----------------------------
Name: CAROL J.E. Feeley
Title: VICE PRESIDENT/DIRECTOR
ALLIANCE INVESTMENT
OPPORTUNITIES FUND, L.L.C.
By: Alliance Investment Opportunities
Management L.L.C., as Managing Member
By: Alliance Capital Management L.P., as
Managing Member
By: Alliance Capital Management
Corporation, as General Partner
By: /s/ Nelson Jantzen
----------------------------
Name: NELSON JANTZEN
Title: SENIOR VICE PRESIDENT
ALLSTATE INSURANCE COMPANY
By:
----------------------------
Name:
Title:
ALLSTATE LIFE INSURANCE COMPANY
By:
----------------------------
Name:
Title:
-4-
<PAGE>
ARCHIMEDES FUNDING, L.L.C.
By: ING Capital Advisors, Inc., as Collateral
Manager
By: /s/ JANE M. NELSON
-------------------------------
Name: Jane M. Nelson
Title: Senior Vice President
BHF-BANK AKTIENGESELLSCHAFT
By: /s/ MICHAEL PELLERITO
-------------------------------
Name: Michael Pellerito
Title: Assistant Vice President
By: /s/ PERRY FORMAN
-------------------------------
Name: Perry Forman
Title: Vice President
CYPRESS TREE INSTITUTIONAL FUND, LLC
By: Cypress Tree Investment Management Company,
Inc., its Managing Manager
By: /s/ TIMOTHY M. BARNES
-------------------------------
Name: Timothy M. Barnes
Title: Managing Director
CYPRESS TREE INVESTMENT FUND, LLC
By: Cypress Tree Investment Management
Company, Inc., its Managing Manager
By: /s/ TIMOTHY M. BARNES
-------------------------------
Name: Timothy M. Barnes
Title: Managing Director
-5-
<PAGE>
CYPRESS TREE INVESTMENT MANAGEMENT COMPANY,
INC.
As: Attorney-in-Fact and on behalf of First
Allmerica Financial Life Insurance Company
as Portfolio Manager
By: /s/ TIMOTHY M. BARNES
-----------------------------------------
Name: Timothy M. Barnes
Title: Managing Director
EATON VANCE SENIOR INCOME TRUST
By: Eaton Vance Management, as Investment
Advisor
By: /s/ PAYSON F. SWAFFIELD
-----------------------------------------
Name: Payson F. Swaffield
Title: Vice President
FIRST SOURCE FINANCIAL LLP
By: First Source Financial Inc., its
Agent/Member
By: /s/ JEFFREY A. CERNY
-----------------------------------------
Name: Jeffrey A. Cerny
Title: Vice President
FLEET NATIONAL BANK
By: /s/ OLIVER BENNETT
-----------------------------------------
Name: Oliver Bennett
Title: Senior Vice President
-6-
<PAGE>
HELLER FINANCIAL, INC.
By: /s/ Sheila C. Weimer
-------------------------
Name: Sheila C. Weimer
Title: Vice President
ING HIGH INCOME PRINCIPAL
PRESERVATION FUND
HOLDINGS, LDC
By: ING Capital Advisors, Inc. as
Investment Advisor
By: /s/ Jane M. Nelson
--------------------------
Name: Jane M. Nelson
Title: Senior Vice President
KZH - CYPRESSTREE-1 CORPORATION
By: /s/ Peter Chin
--------------------------
Name: Peter Chin
Title: Authorized Agent
THE MITSUBISHI TRUST AND BANKING
CORPORATION
By:
--------------------------
Name:
Title:
-7-
<PAGE>
MORGAN STANLEY DEAN WITTER
PRIME INCOME TRUST
By: c/o Morgan Stanley Dean Witter
Advisors, Inc.
By:
-----------------------------
Name:
Title:
NATIONAL CITY BANK
By:
-----------------------------
Name:
Title:
OXFORD STRATEGIC INCOME FUND
By: Eaton Vance Management, as
Investment Advisor
By: /s/ Payson F. Swaffield
------------------------------
Name: Payson F. Swaffield
Title: Vice President
SENIOR DEBT PORTFOLIO
By: Boston Management and Research, as
Investment Advisor
By: /s/ Payson F. Swaffield
-------------------------------
Name: Payson F. Swaffield
Title: Vice President
-8-
<PAGE>
STATE STREET BANK AND TRUST CO.
By: /s/ Thomas M. O'Reilly
--------------------------
Name: Thomas M. O'Reilly
Title: Vice President
SUNTRUST BANK
By: /s/ David W. Penter
--------------------------
Name: David W. Penter
Title: Senior Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ David W. Kinkela
--------------------------
Name: David W. Kinkela
Title: Vice President
-9-
<PAGE>
Exhibit 10.17
THIRD AMENDMENT AND WAIVER
--------------------------
THIRD AMENDMENT AND WAIVER (this "Amendment"), dated as of October 20,
1999, among GLOBE HOLDINGS, INC., a Massachusetts corporation ("Holdings"),
GLOBE MANUFACTURING CORP., an Alabama corporation (the "Borrower"), the several
lenders from time to time party to the Credit Agreement referred to below (the
"Lenders"), and BANK OF AMERICA, N.A., as Administrative Agent (the
"Administrative Agent"). All capitalized terms used herein and not otherwise
defined herein shall have the respective meanings provided such terms in the
Credit Agreement.
W I T N E S S E T H:
-------------------
WHEREAS, Holdings, the Borrower, the Lenders, the Syndication Agent
and the Administrative Agent are party to a Credit Agreement, dated as of July
31, 1998 (as amended, modified or supplemented through, but not including, the
date hereof, the "Credit Agreement"); and
WHEREAS, the Borrower has requested that the Lenders provide the
amendments and waivers provided for herein and the Lenders have agreed to
provide such amendments and waivers on the terms and conditions set forth
herein;
NOW, THEREFORE, it is agreed:
1. The Lenders hereby waive any Default or Event of Default that has
occurred and is continuing under the Credit Agreement solely as a result of
Holdings' and the Borrower's failure to be in compliance with the provisions of
(x) Section 8.08 of the Credit Agreement (as in effect prior to giving effect to
this Amendment) for the Measurement Period ending on September 30, 1999 and (y)
Section 8.10(a) of the Credit Agreement (as in effect prior to giving effect to
this Amendment) for the period commencing on September 30, 1999 and ending on
the Third Amendment Effective Date (as hereinafter defined).
2. Section 1.01 of the Credit Agreement is hereby amended by
inserting the following new definitions in the appropriate alphabetical order:
"Level VII" has the meaning specified in Section 2.09(a)(ii).
"Maximum Permitted Borrowing Amount" means (i) at any time that the
Consolidated Leverage Ratio is greater than or equal to 6.50 to 1.00,
$37,500,000, (ii) at any time that the Consolidated Leverage Ratio is greater
than or equal to 6.00 to 1.00 but less than 6.50 to 1.00, $40,000,000, and (iii)
at any time that the Consolidated Leverage Ratio is less than 6.00 to 1.00,
$50,000,00.
"Third Amendment" means the Third Amendment, dated as of October 20,
1999, to this Agreement.
<PAGE>
"Third Amendment Effective Date" has the meaning specified in the
Third Amendment.
3. Section 2.01(c) of the Credit Agreement is hereby amended by
deleting the words "the Aggregate Revolving Commitment" appearing in the first
sentence thereof and inserting the following words in lieu thereof:
"the lesser of (A) the Aggregate Revolving Commitment and (B) the
Maximum Permitted Borrowing Amount at such time".
4. Section 2.01(d)(i) of the Credit Agreement is hereby amended by
deleting the words "the Aggregate Revolving Commitment" appearing in the first
sentence thereof and inserting the following words in lieu thereof:
"the lesser of (A) the Aggregate Revolving Commitment and (B) the
Maximum Permitted Borrowing Amount at such time".
5. Section 2.01(d)(iv) of the Credit Agreement is hereby amended by
inserting the words "the Maximum Permitted Borrowing Amount or" immediately
after the words "the amount of" appearing in clause (iii) of the second sentence
thereof.
6. Section 2.03 of the Credit Agreement is hereby amended by
inserting the following new clause (g) at the end thereof:
"(g) In addition to the requirements set forth in clauses (a) and
(f)(i) of this Section 2.03, each notice of a proposed Borrowing of
Revolving Loans and Swingline Loans also shall contain the calculations (in
reasonable detail) to establish the Consolidated Leverage Ratio after
giving effect to such proposed Borrowing."
7. Section 2.07(a)(i) of the Credit Agreement is hereby amended by
deleting the words "the Aggregate Revolving Commitment" appearing therein and
inserting the following words in lieu thereof:
"the lesser of (A) the Aggregate Revolving Commitment and (B) the
Maximum Permitted Borrowing Amount at such time".
8. Section 2.07(a)(ii) of the Credit Agreement is hereby amended by
deleting the words "the Aggregate Revolving Commitment" appearing therein and
inserting the following words in lieu thereof:
"the lesser of (A) the Aggregate Revolving Commitment and (B) the
Maximum Permitted Borrowing Amount at such time".
-2-
<PAGE>
9. Section 2.09 of the Credit Agreement is hereby amended by
deleting sub-clauses (i), (ii) and (iii) of clause (a) thereof and inserting the
following new sub-clauses (i), (ii) and (iii) in lieu thereof:
"(i) (x) for the period commencing on the Closing Date to January
28, 1999:
<TABLE>
<CAPTION>
Applicable Margin/Tranche A
Term Loans, Revolving Loans Applicable Margin/
and Swingline Loans Tranche B Term Loans
------------------- --------------------
<S> <C>
Base Rate 1.25% 1.75%
Eurodollar Rate 2.25% 2.75%; and
</TABLE>
(y) for the period commencing on January 28, 1999 to the First
Adjustment Date:
<TABLE>
<CAPTION>
Applicable Margin/Tranche A
Term Loans, Revolving Loans Applicable Margin/
and Swingline Loans Tranche B Term Loans
------------------- --------------------
<S> <C>
Base Rate 2.00% 2.50%
Eurodollar Rate 3.00% 3.50%
</TABLE>
(ii) from and after the First Adjustment Date, for each period from an
Adjustment Date to the next succeeding Adjustment Date, the rate per annum for
the relevant type of Loan of the respective Tranche set forth below opposite the
Consolidated Leverage Ratio determined as at the end of the last fiscal quarter
ended prior to the first day of such period (it being understood that,
notwithstanding the foregoing, for periods prior to the Third Amendment
Effective Date, the Applicable Margin for each Type of Loan of a given Tranche
shall be determined pursuant to this Section 2.09(a)(ii) prior to giving effect
to the Third Amendment):
<TABLE>
<CAPTION>
Applicable Margin/
Tranche A Term Loans,
Revolving Loans and Applicable Margin/
Swingline Loans Tranche B Term Loans
--------------- --------------------
Eurodollar Rate Base Rate Eurodollar Rate Base Rate
--------------- --------- --------------- ---------
<S> <C> <C> <C>
Consolidated Leverage Ratio is
less than or equal to 3.00 to
1.00 ("Level I") 1.25% 0.25% 3.50% 2.50%
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
Applicable Margin/
Tranche A Term Loans,
Revolving Loans and Applicable Margin/
Swingline Loans Tranche B Term Loans
-------------------------- --------------------------
Eurodollar Rate Base Rate Eurodollar Rate Base Rate
--------------- --------- --------------- ---------
<S> <C> <C> <C> <C>
Consolidated Leverage Ratio is
less than or equal to 3.50 to 1.0
but greater than 3.00 to 1.00
("Level II") 1.50% 0.50% 3.50% 2.50%
Consolidated Leverage Ratio is
less than or equal to 4.00 to 1.00
but greater than 3.50 to 1.00
("Level III") 2.00% 1.00% 3.50% 2.50%
Consolidated Leverage Ratio is
less than or equal to 4.50 to 1.00
but greater than 4.00 to 1.00
("Level IV") 2.25% 1.25% 3.50% 2.50%
Consolidated Leverage Ratio is
less than or equal to 6.00 to 1.00
but greater than 4.50 to 1.00
("Level V") 2.50% 1.50% 3.50% 2.50%
Consolidated Leverage Ratio is
less than or equal to 7.00 to 1.00
but greater than 6.00 to 1.00
("Level VI") 3.00% 2.00% 3.50% 2.50%
Consolidated Leverage Ratio is
greater than 7.00 to 1.00
("Level VII") 3.25% 2.25% 3.75% 2.75%
</TABLE>
(iii) If by the last day for determining any Adjustment Date,
Holdings has failed to deliver a Leverage Ratio Certificate as at the end
of the fiscal quarter ended immediately prior to such Adjustment Date,
interest for the next succeeding period from such Adjustment Date to the
next succeeding Adjustment Date shall be computed as if the Consolidated
Leverage Ratio were at Level VII; provided, however, to the extent that
Holdings thereafter delivers a Leverage Ratio Certificate during such
succeeding period, interest for the remainder of such succeeding period
shall be computed at the rate prescribed by Section 2.09(a)(ii). In
addition, at any time that a Specified Default shall
-4-
<PAGE>
exist, the Applicable Margin shall be computed as if the Consolidated
Leverage Ratio were at Level VII."
10. Section 2.10(a) of the Credit Agreement is hereby amended to read
in its entirety as follows:
"(a) Commitment Fees. The Borrower shall pay to the Administrative
Agent for the account of each RL Lender which is Non-Defaulting Lender a
commitment fee on the daily unused portion of such Lender's Revolving
Commitment (subject to Section 2.01(d)(iii) in the case of the Swingline
Lender), computed on a quarterly basis in arrears, on each Interest Payment
Date for Base Rate Loans based upon the daily utilization for the previous
three month period as calculated by the Administrative Agent, equal to (A)
for the period from the Closing Date to the First Adjustment Date, 0.500%
per annum and (B) from and after the First Adjustment Date, for each period
from an Adjustment Date to the next succeeding Adjustment Date, the rate
per annum set forth below opposite the relevant Level of Consolidated
Leverage Ratio determined as at the end of the last fiscal quarter ended
prior to the first day of such period (it being understood that,
notwithstanding the foregoing, for periods prior to the Third Amendment
Effective Date, the commitment fee shall be determined pursuant to this
Section 2.10(a) prior to giving effect to the Third Amendment):
Consolidated Leverage Ratio
---------------------------
Level I .300%
Level II .375%
Level III .425%
Level IV .500%
Level V .500%
Level VI .500%
Level VII .500%
provided, however, that if by the last day for determining any Adjustment
Date, Holdings has failed to deliver a Leverage Ratio Certificate as at the
end of the fiscal quarter ended immediately prior to such Adjustment Date,
the commitment fee for the next succeeding period from such Adjustment Date
to the next succeeding Adjustment Date shall be computed as if the
Consolidated Leverage Ratio were at Level VII; provided further, however,
to the extent that Holdings thereafter delivers a Leverage Ratio
Certificate during such succeeding period the commitment fee for the
remainder of such succeeding period shall be computed at the rate
prescribed in the table above in this Section 2.10(a). In addition, at any
time that a Specified Default shall exist, the commitment fee shall be
computed as if the Consolidated Leverage Ratio were at Level VII. Such
commitment fees shall be paid in arrears on each Interest Payment Date for
Base Rate Loans."
11. Section 3.01(a) of the Credit Agreement is hereby amended by
deleting the words "the Aggregate Revolving Commitment" appearing in clause (x)
of the proviso to the first sentence thereof and inserting the following words
in lieu thereof:
-5-
<PAGE>
"the lesser of (A) the Aggregate Revolving Commitment and (B) the
Maximum Permitted Borrowing Amount at such time".
12. Section 3.02 of the Credit Agreement is hereby amended by
inserting the following new sentence at the end thereof:
"In addition to the requirements set forth above in this Section
3.02(a), each request for a Letter of Credit also shall contain the
calculations (in reasonable detail) to establish the Consolidated
Leverage Ratio after giving effect to the issuance of such proposed
Letter of Credit."
13. Section 3.08(a) of the Credit Agreement is hereby amended to read
in its entirety as follows:
"(a) The Borrower shall pay to the Administrative Agent for the
account of each RL Lender a letter of credit fee with respect to the
Letters of Credit computed on the average daily maximum amount available to
be drawn on the outstanding Letters of Credit, on each Interest Payment
Date for Base Rate Loans based upon Letters of Credit outstanding for the
previous three-month period. The letter of credit fee shall be equal to
(i) for the period from the Closing Date to January 28, 1999, 2.25% per
annum, (ii) for the period from January 28, 1999 to the First Adjustment
Date, 3.00% per annum and (iii) from and after the First Adjustment Date,
for each period from an Adjustment Date to the next succeeding Adjustment
Date, the rate per annum set forth below opposite the relevant Level of
Consolidated Leverage Ratio determined as at the end of the last fiscal
quarter ended prior to the first day of such period (it being understood
that, notwithstanding the foregoing, for periods prior to the Third
Amendment Effective Date, the letter of credit fee shall be determined
pursuant to this Section 3.08(a) prior to giving effect to the Third
Amendment):
Consolidated Leverage Ratio
---------------------------
Level I 1.25%
Level II 1.50%
Level III 2.00%
Level IV 2.25%
Level V 2.50%
Level VI 3.00%
Level VII 3.25%
provided, however, that if by the day for determining any Adjustment Date
Holdings has failed to deliver a Leverage Ratio Certificate as at the end
of the fiscal quarter ended immediately prior to such Adjustment Date, the
letter of credit fee for the next succeeding period from such Adjustment
Date to the next succeeding Adjustment Date shall be computed as if the
Consolidated Leverage Ratio were at Level VII; provided further, however,
to the extent that Holdings thereafter delivers a Leverage Ratio
Certificate
-6-
<PAGE>
during such succeeding period, the letter of credit fee for the remainder
of such succeeding period shall be computed at the rate prescribed in the
table above in this Section 3.08(a). In addition, at any time that a
Specified Default shall exist, the letter of credit fee shall be computed
as if the Consolidated Leverage Ratio were at Level VII. Such letter of
credit fee shall be due and payable in arrears on each Interest Payment
Date for Base Rate Loans."
14. Section 8.02(x) of the Credit Agreement is hereby amended by (i)
deleting the date "September 30, 1998" appearing therein and inserting the date
"December 31, 2001" in lieu thereof and (ii) deleting the proviso appearing in
sub-clause (iv) thereof.
15. Section 8.06(iv) of the Credit Agreement is hereby amended to read
in its entirety as follows:
"(iv) so long as (i) no Default under Section 7.01, 7.02(a),
9.01(a), 9.01(f) or 9.01(g) shall exist and no Event of Default shall
exist and (ii) the Consolidated Leverage Ratio for the Measurement
Period then last ended is less than 5.50 to 1.00, the Borrower may pay
management fees to CHS Management and its Affiliates quarterly in
arrears pursuant to, and in accordance with, the terms of the CHS
Management Agreement (as in effect on October 26, 1999) in an
aggregate amount for all such Persons taken together not to exceed
$125,000 per quarter plus the reasonable out-of-pocket expenses
incurred by CHS Management and its Affiliates in performing management
services for the Borrower pursuant to the CHS Management Agreement (it
being understood and agreed that the reimbursement of such reasonable
out-of-pocket expenses may be made whether or not any Default or Event
of Default exists and whether or not the Consolidated Leverage Ratio
is less than 5.50 to 1.00), provided, however, (I) such management
fees may be increased to $250,000 per quarter if the Consolidated
Leverage Ratio for the Measurement Period then last ended is less than
5.00:1.00 and (II) no management fees may be paid pursuant to this
clause (iv) for any quarter until Holdings has delivered a Leverage
Ratio Certificate in respect of the applicable Measurement Period;".
16. Section 8.07(a) of the Credit Agreement is hereby amended by
deleting the amount "$7,000,000" appearing opposite the date "December 31, 1999"
appearing therein and inserting the amount "$8,600,000" in lieu thereof.
17. Section 8.08 of the Credit Agreement is hereby amended to read in
its entirety as follows:
"8.08 Consolidated Interest Coverage Ratio. Holdings and the
Borrower will not permit the Consolidated Interest Coverage Ratio for any
Measurement Period ending on the last day of a fiscal quarter of Holdings
set forth below to be less than the ratio set forth opposite such fiscal
quarter below:
-7-
<PAGE>
<TABLE>
<CAPTION>
Fiscal Quarter Ending Ratio
- ---------------------------------------------------------- ---------------------
<S> <C>
September 30, 1999 1.40:1.00
December 31, 1999 1.45:1.00
March 31, 2000 1.50:1.00
June 30, 2000 1.50:1.00
September 30, 2000 1.50:1.00
December 31, 2000 1.50:1.00
March 31, 2001 1.50:1.00
June 30, 2001 1.50:1.00
September 30, 2001 1.50:1.00
December 31, 2001 1.70:1.00
March 31, 2002 1.70:1.00
June 30, 2002 1.70:1.00
September 30, 2002 1.70:1.00
December 31, 2002 1.90:1.00
March 31, 2003 1.90:1.00
June 30, 2003 1.90:1.00
September 30, 2003 1.90:1.00
December 31, 2003 2.05:1.00
March 31, 2004 2.05:1.00
June 30, 2004 2.05:1.00
September 30, 2004 2.05:1.00
December 31, 2004 2.15:1.00
March 31, 2005 2.15:1.00
June 30, 2005 2.15:1.00
September 30, 2005 2.15:1.00
December 31, 2005
and the last day of each fiscal quarter thereafter 2.30:1.00".
</TABLE>
18. Section 8.09 of the Credit Agreement is hereby amended by
deleting the ratio "1.10:1.00" appearing therein and inserting the ratio
"1.05:1.00" in lieu thereof.
19. Section 8.10 of the Credit Agreement is hereby amended to read
in its entirety as follows:
"8.10 Maximum Leverage Ratio. (a) Holdings and the Borrower will not
permit the Senior Leverage Ratio at any time during a period set forth
below to be greater than the ratio set forth opposite such period below:
-8-
<PAGE>
<TABLE>
<CAPTION>
Period Ratio
- ---------------------------------------------------------- ---------------------
<S> <C>
September 30, 1999 through and including December 30, 1999 3.90:1.00
</TABLE>
(b) Holdings and the Borrower will not permit the Consolidated
Leverage Ratio at any time during a period set forth below to be greater
than the ratio set forth opposite such period below:
<TABLE>
<CAPTION>
Period Ratio
- ---------------------------------------------------------- ---------------------
<S> <C>
December 31, 1999 through and including March 30, 2000 7.30:1.00
March 31, 2000 through and including June 29, 2000 7.05:1.00
June 30, 2000 through and including December 30, 2001 7.00:1.00
December 31, 2001 through and including December 30, 2002 6.10:1.00
December 31, 2002 through and including December 30, 2003 5.45:1.00
December 31, 2003 through and including December 30, 2004 5.00:1.00
December 31, 2004 through and including December 30, 2005 4.65:1.00
Thereafter 4.35:1.00".
</TABLE>
20. Article VIII of the Credit Agreement is hereby amended by
inserting the following new Section 8.16 at the end thereof:
"8.16 Minimum EBITDA. Holdings and the Borrower will not permit
Consolidated EBITDA for any Measurement Period ending on the last day of a
fiscal quarter of Holdings set forth below to be less than the amount set
forth opposite such fiscal quarter below:
-9-
<PAGE>
<TABLE>
<CAPTION>
Fiscal Quarter Ending Amount
------------------------- ----------------------
<S> <C>
December 31, 1999 $37,000,000
March 31, 2000 $38,200,000
June 30, 2000 $38,400,000
September 30, 2000 $38,400,000
December 31, 2000 $38,500,000
March 31, 2001 $39,100,000
June 30, 2001 $39,900,000
September 30, 2001 $41,100,000
December 31, 2001 $42,500,000
March 31, 2002 $42,830,000
June 30, 2002 $43,270,000
September 30, 2002 $43,930,000
December 31, 2002 $44,700,000
March 31, 2003 $44,955,000
June 30, 2003 $45,295,000
September 30, 2003 $45,805,000
December 31, 2003 $46,400,000
March 31, 2004 $46,325,000
June 30, 2004 $46,225,000
September 30, 2004 $46,075,000
December 31, 2004 $45,900,000
March 31, 2005 $45,990,000
June 30, 2005 $46,110,000
</TABLE>
-10-
<PAGE>
<TABLE>
<S> <C>
September 30, 2005 $46,290,000
December 31, 2005 $46,500,000
March 31, 2006 and
the last day of each
fiscal quarter thereafter $47,000,000".
</TABLE>
21. The Lenders hereby agree that the Borrower may amend the CHS Management
Agreement to give effect to the provisions set forth in Section 15 of this
Amendment.
22. Holdings, the Borrower and the Lenders hereby agree that the Compliance
Certificate shall be, and hereby is, amended to the extent necessary to provide
for the calculation of Consolidated EBITDA as required to be determined pursuant
to Section 8.16 of the Credit Agreement (as amended by this Amendment) and
Holdings shall calculate such Consolidated EBITDA in each such Compliance
Certificate.
23. In order to induce the Lenders to enter into this Amendment, the
Borrower hereby agrees to pay to each Lender which executes and delivers to the
Administrative Agent a counterpart of this Amendment on or before 5:00 p.m. (New
York time) on October 26, 1999, a fee equal to 1/4 of 1% of the sum of (I) such
Lender's Revolving Commitment on the Third Amendment Effective Date and (II) the
aggregate outstanding principal amount of such Lender's Term Loans on the Third
Amendment Effective Date, with such fee to be earned on the Third Amendment
Effective Date and payable on the Business Day immediately thereafter.
24. In order to induce the Lenders to enter into this Amendment, each of
Holdings and the Borrower hereby represents and warrants that (i) no Default or
Event of Default exists as of the Third Amendment Effective Date after giving
effect to this Amendment and (ii) all representations and warranties contained
in the Credit Agreement and in the other Loan Documents are true and correct in
all material respects as of the Third Amendment Effective Date after giving
effect to this Amendment.
25. This Amendment shall become effective on the date (the "Third Amendment
Effective Date") when (i) the Administrative Agent, the Required Lenders,
Holdings and the Borrower shall have signed a counterpart hereof (whether the
same or different counterparts) and shall have delivered (including by way of
facsimile transmission) the same to the Administrative Agent as provided in
Section 12.02 of the Credit Agreement and (ii) the Borrower and CHS Management
shall have entered into an amendment to the CHS Management Agreement to give
effect to the provisions of Section 15 of this Amendment and the Administrative
Agent shall have received a true and correct copy of such amendment.
26. This Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any other provision of the Credit
Agreement or any other Loan Document.
-11-
<PAGE>
27. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument. A complete set of counterparts
shall be lodged with the Borrower and the Administrative Agent.
28. All references in the Credit Agreement and each of the Loan Documents
to the Credit Agreement shall be deemed to be references to the Credit Agreement
after giving effect to this Amendment.
29. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
NEW YORK.
* * *
-12-
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed and delivered as of the date
hereof.
GLOBE HOLDINGS, INC.
By: /s/ Lawrence R. Walsh, V.P.
-------------------------------
Name: Lawrence R. Walsh
Title: Vice President
GLOBE MANUFACTURING CORP.
By: /s/ Lawrence R. Walsh, V.P.
-------------------------------
Name: Lawrence R. Walsh
Title: Vice President
BANK OF AMERICA, N.A., as Administrative
Agent
By: /s/ Dietmar Schiel
-------------------------------
Name: Dietmar Schiel
Title: Vice President
BANK OF AMERICA, N.A., as Lender
By: /s/ Heidi-Anne Sandquist
-------------------------------
Name: Heidi-Anne Sandquist
Title: Vice President
-13-
<PAGE>
MERRILL LYNCH CAPITAL CORPORATION
By: /s/ Carol J. E. Feeley
----------------------------------
Name: Carol J. E. Feeley
Title: Vice President
ARCHIMEDES FUNDING, L.L.C.
By: ING Capital Advisors, Inc., as
Collateral Manager
By: /s/ Michael D. Hatley
----------------------------------
Name: Michael D. Hatley
Title: Managing Director
BHF (USA) CAPITAL CORPORATION
By: /s/ Michael Pallerito
----------------------------------
Name: Michael Pallerito
Title: Assistant Vice President
By: /s/ Jeffrey Frost
----------------------------------
Name: Jeffrey Frost
Title: Vice President
CYPRESS TREE INSTITUTIONAL FUND, LLC
By: Cypress Tree Investment Management
Company, Inc., its Managing Manager
By:
----------------------------------
Name:
Title:
-14-
<PAGE>
CYPRESSTREE INVESTMENT FUND, LLC
By: Cypress Tree Investment Management
Company, Inc., its Managing Manager
By:
------------------------------------
Name:
Title:
CYPRESSTREE INVESTMENT MANAGEMENT
COMPANY, INC.
As: Attorney-in-Fact and on behalf of First
Allmerica Financial Life Insurance Company
as Portfolio Manager
By:
------------------------------------
Name:
Title:
CYPRESSTREE SENIOR FLOATING RATE FUND
By: Cypress Tree Investment Management
Company, Inc., as Portfolio Manager
By:
------------------------------------
Name:
Title:
-15-
<PAGE>
CYPRESSTREE INVESTMENT PARTNERS I LTD.
By: Cypress Tree Investment Management
Company, Inc., as Portfolio Manager
By:
----------------------------------
Name:
Title:
NORTH AMERICAN SENIOR FLOATING RATE FUND
By: Cypress Tree Investment Management
Company, Inc., as Portfolio Manager
By:
----------------------------------
Name:
Title:
EATON VANCE SENIOR INCOME TRUST
By: Eaton Vance Management, as Investment
Advisor
By: /s/ Scott H. Page
----------------------------------
Name: Scott H. Page
Title: Vice President
-16-
<PAGE>
FIRST SOURCE FINANCIAL LLP
By: First Source Financial Inc., its
Agent/Member
By: /s/ Jeffery A. Cerny
----------------------------------
Name: Jeffery A. Cerny
Title: Vice President
FLEET NATIONAL BANK
By: /s/ Ted Moran
----------------------------------
Name: Ted Moran
Title: Assistant Vice President
HELLER FINANCIAL, INC.
By: /s/ Sheila C. Walmar
----------------------------------
Name: Sheila C. Walmar
Title: Vice President
ING HIGH INCOME PRINCIPAL PRESERVATION FUND
HOLDINGS, LDC
By: ING Capital Advisors, Inc. as Investment
Advisor
By: /s/ Michael D. Hatley
----------------------------------
Name: Michael D. Hatley
Title: Managing Director
-17-
<PAGE>
KZH - CYPRESSTREE-1 CORPORATION
By: /s/ Peter Chin
-------------------------------------------
Name: Peter Chin
Title: Authorized Agent
THE MITSUBISHI TRUST AND BANKING CORPORATION
By: /s/ Nobuo Tominaga
-------------------------------------------
Name: Nobuo Tominaga
Title: Chief Manager
MORGAN STANLEY DEAN WITTER PRIME INCOME TRUST
PRIME INCOME TRUST
By: c/o Morgan Stanley Dean Witter
Advisors, Inc.
By: /s/ Sheila A. Finnerty
-------------------------------------------
Name: Sheila A. Finnerty
Title: Vice President
NATIONAL CITY BANK
By:
-------------------------------------------
Name:
Title:
-18-
<PAGE>
OXFORD STRATEGIC INCOME FUND
By: Eaton Vance Management, as Investment
Advisor
By: /s/ Scott H. Page
--------------------------------------------
Name: Scott H. Page
Title: Vice President
SENIOR DEBT PORTFOLIO
By: Boston Management and Research, as
Investment Advisor
By: /s/ Scott H. Page
--------------------------------------------
Name: Scott H. Page
Title: Vice President
CITIZENS BANK OF MASSACHUSETTS
By:
--------------------------------------------
Name:
Title:
SUNTRUST BANK
By: /s/ David W. Penter
--------------------------------------------
Name: David W. Penter
Title: Director Senior Relationship Manager
UNION BANK OF CALIFORNIA, N.A.
By: /s/ David W. Kinkela
-------------------------------------------
Name: David W. Kinkela
Title: Vice President
-19-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
the financial statements of Globe Manufacturing Corp. for the nine months ended
September 30, 1999 and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 3,369
<SECURITIES> 0
<RECEIVABLES> 41,985
<ALLOWANCES> 2,467
<INVENTORY> 19,421
<CURRENT-ASSETS> 70,247
<PP&E> 166,449
<DEPRECIATION> 81,407
<TOTAL-ASSETS> 166,236
<CURRENT-LIABILITIES> 53,852
<BONDS> 265,000
0
0
<COMMON> 1
<OTHER-SE> (154,337)
<TOTAL-LIABILITY-AND-EQUITY> 166,236
<SALES> 131,060
<TOTAL-REVENUES> 131,060
<CGS> 88,023
<TOTAL-COSTS> 109,169
<OTHER-EXPENSES> (574)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 21,153
<INCOME-PRETAX> 1,311
<INCOME-TAX> 472
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 839
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
