SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 44)*
KEYSTONE CONSOLIDATED INDUSTRIES, INC.
(Name of Issuer)
Common Stock, $1.00 par value
(Title of Class of Securities)
49342210900
(CUSIP Number)
STEVEN L. WATSON
THREE LINCOLN CENTRE
SUITE 1700
5430 LBJ FREEWAY
DALLAS, TEXAS 75240-2694
(972) 233-1700
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
September 16, 1996
(Date of Event which requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box. [ ]
Check the following box if a fee is being paid with the statement. [ ] (A
fee is not required only if the reporting person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.
See Rule 13d-7.)
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to by "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
CUSIP No. 49342210900
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Contran Corporation
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS)
(a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 3,735,233
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON
WITH -0-
10 SHARED DISPOSITIVE POWER
3,735,233
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
3,735,233
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES (SEE INSTRUCTIONS) [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.7%
14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS)
CO
CUSIP No. 49342210900
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Harold C. Simmons
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP(SEE
INSTRUCTIONS)
(a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS(SEE INSTRUCTIONS)
Not applicable
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 4,025,733
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON
WITH -0-
10 SHARED DISPOSITIVE POWER
4,025,733
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
-0-
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES (SEE INSTRUCTIONS) [ X ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
-0-
14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS)
IN
AMENDMENT NO. 44
TO SCHEDULE 13D
This amended and restated statement on Schedule 13D is hereby amended and
restated in its entirety as set forth below, except for Item 3, which is merely
amended (collectively, this "Statement").
Item 1. Security and Issuer
This Statement relates to the common stock, $1.00 par value per share (the
"Shares"), of Keystone Consolidated Industries, Inc., a Delaware corporation
(the "Company"). The principal executive offices of the Company are located at
Three Lincoln Centre, 5430 LBJ Freeway, Suite 1740, Dallas, Texas 75240.
Item 2. Identity and Background
(a) This Statement is filed by Contran Corporation, a Delaware corporation
("Contran"), and, by virtue of the positions reported below, Harold C. Simmons
(collectively, the "Reporting Persons"). By signing this Statement, each
Reporting Person agrees that this Statement is filed on its or his behalf.
On September 27, 1996, the Company acquired by merger (the "Merger")
DeSoto, Inc., a Delaware corporation ("DeSoto"). Pursuant to the Merger, the
Company will issue an estimated 3,499,982 Shares (the "Estimated Additional
Outstanding Merger Shares") to the holders of DeSoto common stock, par value
$1.00 per share (the "DeSoto Common Stock") immediately prior to the
effectiveness of the Merger. The ownership percentages for all persons or
entities discussed in this Statement are based on 9,186,406 Shares outstanding
(the "Outstanding Shares"), which number is the sum of 5,686,424 Shares
outstanding on August 21, 1996 as reported in the Company's Registration
Statement on Form S-4 (Registration No. 333-9117, effective August 23, 1996)(the
"Registration Statement") plus the Estimated Additional Outstanding Merger
Shares. The Estimated Additional Outstanding Merger Shares are based on the
4,688,523 shares of DeSoto Common Stock outstanding on August 22, 1996 as
reported in the Registration Statement multiplied by the exchange ratio in the
Merger of 0.7465 of a Share for each share of DeSoto Common Stock. Since the
Estimated Additional Outstanding Merger Shares does not consider, among other
things, the cash that will be issued to former holders of DeSoto Common Stock in
lieu of fractional Shares, the Estimated Additional Outstanding Merger Shares
overstates the actual number of Shares that will be issued in the Merger
attributable solely to former holdings of DeSoto Common Stock.
Contran and NL Industries, Inc. ("NL") are the direct holders of
approximately 35.9% and 3.5%, respectively of the Outstanding Shares. Valhi,
Inc. ("Valhi") and Tremont Corporation ("Tremont") are the direct holders of
approximately 55.2% and 17.7%, respectively, of the outstanding common stock of
NL and together may be deemed to control NL. Valhi Group, Inc. ("VGI"), National
City Lines, Inc. ("National"), Contran, NL and Valmont Insurance Company
("Valmont") are the direct holders of approximately 35.2%, 4.7%, 1.1%, 0.5% and
0.4%, respectively, of the outstanding common stock of Tremont. Together, VGI,
National and Contran may be deemed to control Tremont. Valhi is the holder of
100% of the outstanding common stock of Valmont and may be deemed to control
Valmont. VGI, National and Contran are the direct holders of approximately
75.1%, 10.1%, and 6.0%, respectively, of the outstanding common stock of Valhi.
Together, VGI, National and Contran may be deemed to control Valhi. National,
NOA, Inc. ("NOA") and Dixie Holding Company ("Dixie Holding") are the direct
holders of approximately 73.3%, 11.4% and 15.3%, respectively, of the
outstanding common stock of VGI. Together, National, NOA and Dixie Holding may
be deemed to control VGI. Contran and NOA are the direct holders of
approximately 85.7% and 14.3%, respectively, of the outstanding common stock of
National and together may be deemed to control National. Contran and Southwest
Louisiana Land Company, Inc. ("Southwest") are the direct holders of
approximately 49.9% and 50.1%, respectively, of the outstanding common stock of
NOA and together may be deemed to control NOA. Dixie Rice Agricultural
Corporation, Inc. ("Dixie Rice") is the holder of 100% of the outstanding common
stock of Dixie Holding and may be deemed to control Dixie Holding. Contran is
the holder of approximately 88.7% and 54.3% of the outstanding common stock of
Southwest and Dixie Rice, respectively, and may be deemed to control Southwest
and Dixie Rice.
Mr. Harold C. Simmons is Chairman of the Board, President and Chief
Executive Officer of Valhi, VGI, National, NOA, Dixie Holding and Contran. Mr.
Simmons is also Chairman of the Board and Chief Executive Officer of Dixie Rice
and Southwest. Additionally, Mr. Simmons is Chairman of the Board of NL and is a
Director of Tremont.
Substantially all of Contran's outstanding voting stock is held by two
trusts, the Harold C. Simmons Family Trust No. 1 dated January 1, 1964 and the
Harold C. Simmons Family Trust No. 2 dated January 1, 1964 (together, the
"Trusts"), established for the benefit of Mr. Simmons' children and
grandchildren, of which Mr. Simmons is the sole trustee. As sole trustee of
each of the Trusts, Mr. Simmons has the power to vote and direct the disposition
of the shares of Contran stock held by each of the Trusts. Mr. Simmons,
however, disclaims beneficial ownership of such Shares.
The Contran Deferred Compensation Trust No. 2 (the "CDCT No. 2") directly
holds approximately 1.3% of the Outstanding Shares, 0.2% of the outstanding
shares of Valhi common stock and 2.1% of the outstanding shares of Tremont
common stock. Contran contributed to the CDCT No. 2 the 115,550 Shares held by
the CDCT No. 2 on October 15, 1995.
Contran established the CDCT No. 2 pursuant to an agreement (the "Trust
Agreement"), dated as of October 1, 1995, between Contran and NationsBank of
Texas, N.A., a national banking association ("NationsBank"). NationsBank
serves as the trustee of the CDCT No. 2 (the "Trustee"). The CDCT No. 2 was
established in connection with the Amended Deferred Compensation Agreement,
dated as of October 1, 1995, between Contran and Harold C. Simmons.
Pursuant to the Trust Agreement, Contran retains the right to vote the
Shares held by the CDCT No. 2. Except to fund withholding obligations with
respect to payments to Mr. Simmons, the Trustee may not sell the Shares without
Contran's consent. Contran retains the right at anytime, in its sole
discretion, to substitute assets of equal fair market value for any Shares held
by the CDCT No. 2.
Contran exercised its authority under the Trust Agreement to direct the
Trustee not to reinvest proceeds from assets of the CDCT No. 2, including
dividends on Shares, in securities of Contran or subsidiaries of Contran,
including Shares. The foregoing summary of the Trust Agreement is qualified in
its entirety by reference to Exhibit 2 to this Statement, which is incorporated
herein by this reference.
As a result of the relationship between Contran and the CDCT No. 2, Contran
(i) retains sole power to vote the Shares that Contran will contribute to the
CDCT No. 2, (ii) shares dispositive power with the Trustee over such Shares and
(iii) may be deemed the indirect beneficial owner of such Shares.
The Harold Simmons Foundation, Inc. (the "Foundation") directly holds
approximately 2.7% of the Outstanding Shares. The Foundation is a tax-exempt
foundation organized for charitable purposes. Harold C. Simmons is the Chairman
of the Board and Chief Executive Officer of the Foundation and may be deemed to
control the Foundation. Mr. Simmons, however, disclaims beneficial ownership of
any Shares held by the Foundation.
The Combined Master Retirement Trust (the "CMRT") directly holds less than
1.0% of the Outstanding Shares and less than 1.0% of the outstanding shares of
Tremont and Valhi common stock, respectively. The CMRT is a trust formed by
Valhi to permit the collective investment by trusts that maintain the assets of
certain employee benefit plans adopted by Valhi and related companies. Mr.
Simmons is sole trustee of the CMRT and sole member of the Trust Investment
Committee for the CMRT. Mr. Simmons is a participant in one or more of the
employee benefit plans that invest through the CMRT. Mr. Simmons, however,
disclaims beneficial ownership of the Shares held by the CMRT, except to the
extent of his vested beneficial interest therein.
Harold C. Simmons' spouse is the direct beneficial owner of 10,500 Shares,
or approximately 0.1% of the Outstanding Shares. Mr. Simmons may be deemed to
share indirect beneficial ownership of such Shares. Mr. Simmons disclaims all
such beneficial ownership.
By virtue of the holding of such offices, the stock ownership and his
service as trustee, all as described above, (a) Mr. Simmons may be deemed to
control such entities and (b) Mr. Simmons and certain of such entities may be
deemed to possess indirect beneficial ownership of Shares directly held by
certain of such other entities. However, Mr. Simmons and the Trusts disclaim
such beneficial ownership of the Shares beneficially owned, directly or
indirectly, by any of such entities.
The Reporting Persons understand that Valmont and NL beneficially owned
1,000,000 shares and 1,186,200 shares, respectively, of Valhi common stock as of
the date of this report. The Reporting Persons further understand that the
shares of Valhi common stock owned by Valmont and NL are treated as treasury
stock by Valhi for voting purposes and for the purposes of this Statement.
Certain information concerning the directors and executive officers of
Contran, including offices held by Mr. Simmons is set forth on Schedule A
attached hereto and incorporated herein by reference.
(b) The principal executive offices of Contran are located at Three
Lincoln Centre, 5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240-2697.
(c) Contran is a diversified holding company engaged through its
subsidiaries in the production of, among other things, chemicals, titanium
metals, refined sugar, building products, fast food, hardware products and steel
rod, wire and wire products and in land management, agriculture and oil and gas
activities.
(d) Neither of the Reporting Persons nor, to the best knowledge of such
persons, any of the persons named in Schedule A to this Statement has been
convicted in a criminal proceeding in the past five years (excluding traffic
violations or similar misdemeanors).
(e) Neither of the Reporting Persons nor, to the best knowledge of such
persons, any person named in Schedule A to this Statement, was a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
as a result of which such person was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
(e) Contran is Delaware corporation. Harold C. Simmons and all persons
named on Schedule A to this Statement are citizens of the United States of
America.
Item 3. Source and Amount of Funds or Other Consideration
The total amount of funds required by Contran to acquire the Shares
reported in Item 5(c) was $1,336,622.50 (including commissions). Such funds
were or will be provided by Contran's cash on hand and no funds were borrowed
for such purpose.
The Reporting Persons understand that the funds required by each person
named in Schedule A to this Statement to acquire Shares were from such person's
personal funds.
Item 4. Purpose of Transaction
Contran purchased the additional Shares reported in Item 5(c) of this
Statement in order to increase its equity interest in the Company. Depending
upon their evaluation of the Company's business and prospects, and upon future
developments (including, but not limited to, performance of the Shares in the
market, availability of funds, alternative uses of funds, and money, stock
market and general economic conditions), any of the Reporting Persons or other
entities that may be deemed to be affiliated with Contran may from time to time
purchase Shares, and any of the Reporting Persons, or other entities that may be
deemed to be affiliated with Contran may from time to time dispose of all or a
portion of the Shares held by such person, or cease buying or selling Shares.
Any such additional purchases or sales of the Shares may be in open market or
privately negotiated transactions or otherwise.
Harold C. Simmons, through Contran, may be deemed to control the Company.
The Reporting Persons understand that prior purchases of Shares by each of the
persons named in Schedule A to this Statement and Mr. Simmons' spouse were made
for the purpose of such person's personal investment.
Except as described in this Item 4, none of the Reporting Persons nor, to
the best knowledge of such persons, any other person named in Schedule A to the
this Statement has formulated any plans or proposals that relate to or would
result in any matter required to be disclosed in response to paragraphs (a)
through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) As a result of the purchases described under Item 5(c), Contran is the
direct beneficial owner of 3,293,633 Shares, or approximately 35.9% of the
Outstanding Shares. In addition, NL, and the CDCT No. 2 are the direct
beneficial owners of 326,050, and 115,550 of the Outstanding Shares,
respectively. By virtue of the relationships described under Item 2 of this
Statement, Contran may be deemed to be the beneficial owner of 3,735,233 Shares,
or approximately 40.7% of the Outstanding Shares.
Harold C. Simmons does not directly own any of the Outstanding Shares.
Contran, NL, the Foundation the CDCT No. 2, the CMRT and Mr. Simmons' spouse,
however, are the direct beneficial owners of 3,293,633, 326,050, 250,000,
115,550, 30,000 and 10,500 of the Outstanding Shares. By virtue of the
relationships described under Item 2 of this Statement, Harold C. Simmons may
be deemed to share indirect beneficial ownership of the Shares directly owned
by Contran, NL, the Foundation, the CDCT No. 2, the CMRT and Mr. Simmons'
spouse. Mr. Simmons disclaims all such beneficial ownership.
The Reporting Persons understand, based on ownership filings with the
Securities and Exchange Commission or upon information provided by persons
named in Schedule A to this Statement, that the following persons may be
deemed to personally beneficially own Shares, as indicated below.
<TABLE>
<CAPTION>
NUMBER OF SHARES
NAME BENEFICIALLY OWNED
- ------------------------- -------------------
<S> <C>
Eugene K. Anderson 200
Glenn R. Simmons 63,600 (1)
Harold C. Simmons 10,500 (2)
Robert W. Singer 28,770 (3)
Steven L. Watson 250
</TABLE>
[FN]
- -----------
(1) Includes 22,500 Shares issuable upon the
exercise of stock options within 60 days of
the date of this Statement.
(2) Shares held by such person's spouse of which
such person expressly disclaims beneficial
ownership.
(3) Includes 6,000 Shares issuable upon the
exercise of stock options within 60 days of
the date of this Statement.
(b) Contran has the direct power to vote and direct the disposition of the
3,273,633 Shares directly held by it and the indirect power to vote and direct
the disposition of the 326,050 Shares directly held by NL and the 115,550 Shares
directly held by the CDCT No. 2. By virtue of the relationships described in
Item 2, Harold C. Simmons may be deemed to have the power to vote and direct the
disposition of the Shares directly held by Contran, NL, the Foundation, the CDCT
No. 2 and the CMRT.
(c) The table below sets forth additional purchases of the Shares by the
Reporting Persons during the 60 days prior to September 16, 1996 and
subsequently to the date of the filing of this Statement. All of such purchases
were effected by Contran on the New York Stock Exchange.
<TABLE>
<CAPTION>
Approximate
Price
Per Share ($)
Amount of (exclusive of
Date Shares commissions)
- ------------------- ------------------- ----------------
<S> <C> <C>
07/18/96 2,500 $9.875
07/22/96 600 $9.875
07/23/96 1,000 $9.875
07/24/96 800 $9.875
08/02/96 4,200 $9.750
08/06/96 800 $9.750
08/22/96 4,800 $9.625
08/26/96 7,400 $9.625
08/27/96 2,500 $9.625
08/29/96 100 $9.625
09/10/96 3,600 $9.500
09/11/96 3,000 $9.500
09/12/96 1,300 $9.500
09/13/96 25,100 $9.500
09/16/96 14,100 $9.500
09/19/96 15,000 $9.375
09/20/96 5,000 $9.375
09/23/96 12,700 $9.250
09/24/96 7,300 $9.250
09/24/96 10,000 $9.125
09/25/96 10,000 $9.000
09/27/96 10,000 $8.875
</TABLE>
(d) Each of Contran, NL, the Foundation, the CDCT No. 2 and the CMRT has
the right to receive and the power to direct the receipt of dividends from, and
proceeds from the sale of, the shares directly held by such entity.
(e) As a result of the Merger on September 27, 1996 and the issuance of
the Estimated Additional Outstanding Merger Shares, the ownership percentages of
following entities dropped below 5%, and, consequently, such entities ceased
being reporting persons under this Statement: NL, Tremont, Valhi, VGI, National,
NOA, Dixie Holding, Dixie Rice, Southwest, the CMRT and the Foundation.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
Contran is a party to a $20 million credit facility dated as of October 31,
1991, as amended and supplemented through March 27, 1996 with Banque Paribas,
Houston Agency and Societe Generale, Southwest Agency (the "Paribas/Societe
Facility"). Borrowings under the Paribas/Societe Facility bear interest at the
rate announced publicly from time to time by each bank as its base rate or at a
rate of 1.5% over LIBOR, are due October 29, 1996 or such extended maturity date
as may be mutually agreed to, and are secured by certain Shares. On September
30, 1996, approximately $9 million had been borrowed under the Paribas/Societe
Facility. The foregoing summary of the Paribas/Societe Facility is qualified in
its entirety by reference to Exhibit 1 to this Statement, which is incorporated
herein by this reference.
Other than set forth above, neither of the Reporting Persons nor, to the
best knowledge of such persons, any person named in Schedule A to this Statement
has any contract, arrangement, understanding or relationship (legal or
otherwise) with any person with respect to securities of the Company, including,
but not limited to, transfer or voting of any such securities, finder's fees,
joint ventures, loans or option arrangements, puts or calls, guarantees of
profits, division of profits or losses, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
Exhibit 1. Credit Facility dated as of October 31, 1991, as amended and
supplemented December 17, 1991, October 31, 1992, October 31,
1993, September 30, 1994, October 31, 1994, October 30, 1995 and
March 27, 1996 among Contran, Banque Paribas, Houston Agency and
Societe Generale, Southwest Agency (the foregoing documents that
are dated October 31, 1991, December 17, 1991, October 31, 1992,
are incorporated by reference to Exhibit 1 to Amendment No. 39 to
this Statement; the balance of the foregoing documents dated
October 31, 1993, September 30, 1994, October 31, 1994, October
30, 1995 and March 27, 1996 are filed herewith as Exhibit 1).
Exhibit 2. Contran Deferred Compensation Trust No. 2, dated as of October 1,
1995, between Contran Corporation and NationsBank of Texas, N.A.
(incorporated by reference to Exhibit 1 to Amendment No. 43 to
this Statement).
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
Date: October 4, 1996
By: /s/ Harold C. Simmons
----------------------------
Harold C. Simmons
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
Date: October 4, 1996
CONTRAN CORPORATION
By: /s/ Steven L. Watson
----------------------------
Steven L. Watson
Vice President
Exhibit A
The names of the directors and executive officers of Contran and their
present principal occupations are set forth below.
Name Present Principal Occupation
- ------------------------- -------------------------------------
Eugene K. Anderson Vice President of Contran, Dixie
Holding, National, NOA, Valhi and
VGI; and Treasurer of the Foundation.
J. Mark Hollingsworth General Counsel of Contran, Dixie
Holding, National, NOA, Southwest,
VGI, Valhi and the Foundation.
William J. Lindquist Vice President and Tax Director of
Contran, Dixie Rice, Dixie Holding,
National, NOA, Southwest, VGI and
Valhi.
J. Thomas Montgomery, Jr. Vice President and Controller of
Contran, Dixie Holding, National,
NOA, Southwest, VGI and Valhi; Vice
President of Dixie Rice.
Glenn R. Simmons Vice Chairman of the Board and
Director of Contran, Dixie Holding,
National, NOA, VGI and Valhi;
Director of NL and Tremont; Executive
Vice President and Director of Dixie
Rice and Southwest; Chairman of the
Board, Chief Executive Officer and
Director of the Company.
Harold C. Simmons Chairman of the Board, President,
Chief Executive Officer and Director
of Contran, Dixie Holding, National,
NOA, VGI and Valhi; Chairman of the
Board and Director of NL; Director of
Tremont; Chairman of the Board, Chief
Executive Officer and Director of
Dixie Rice, Southwest and the
Foundation.
Robert W. Singer Vice President of Contran and Valhi;
President and Chief Operating
Officer of The Company.
William C. Timm Vice President-Finance and Treasurer
of Contran, Dixie Holding, National,
NOA, VGI and Valhi; Vice President-
Finance and Director of Dixie Rice;
Vice President-Finance of Southwest.
Steven L. Watson Vice President and Secretary of
Contran, Dixie Rice, Dixie Holding,
National, NOA, Southwest, VGI and
Valhi; Vice President, Secretary and
Director of the Foundation.
EXHIBIT INDEX
Exhibit 1. Credit Facility dated as of October 31, 1991, as amended and
supplemented December 17, 1991, October 31, 1992, October 31,
1993, September 30, 1994, October 31, 1994, October 30, 1995 and
March 27, 1996 among Contran, Banque Paribas, Houston Agency and
Societe Generale, Southwest Agency (the foregoing documents that
are dated October 31, 1991, December 17, 1991, October 31, 1992,
are incorporated by reference to Exhibit 1 to Amendment No. 39 to
this Statement; the balance of the foregoing documents dated
October 31, 1993, September 30, 1994, October 31, 1994, October
30, 1995 and March 27, 1996 are filed herewith as Exhibit 1).
Exhibit 2. Contran Deferred Compensation Trust No. 2, dated as of October 1,
1995, between Contran Corporation and NationsBank of Texas, N.A.
(incorporated by reference to Exhibit 1 to Amendment No. 44 to
this statement).
October 31, 1993
Contran Corporation
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas 75240-2697
Attention: Mr. William C. Timm, Vice President-Finance
Re: Third Amendment to Letter Agreement and Security Agreement
Ladies and Gentlemen:
Reference is made to (a) that certain Letter Agreement dated October 31,
1991, by and among BANQUE PARIBAS HOUSTON AGENCY ("Paribas"), SOCIETE GENERALE
("SG"), BANQUE PARIBAS HOUSTON AGENCY as Agent for Paribas and SG ("Agent") and
CONTRAN CORPORATION ("Borrower") relating to a line of credit and letter of
credit facility extended to Borrower (as amended, the "Letter Agreement"), (b)
that certain Security Agreement dated October 31, 1991, executed by Borrower to
and in favor of Agent, Paribas and SG (as amended, the "Security Agreement"),
(c) that certain First Amendment to Letter Agreement and Security Agreement
dated March 17, 1991, by among Borrower, Paribas, SG and Agent and (d) that
certain Second Amendment to Letter Agreement and Security Agreement dated
October 31, 1992, by and among Borrower, Paribas, SG and Agent. Borrower,
Paribas, SG and Agent desire to amend the Letter Agreement and the Security
Agreement as hereinafter set forth. Accordingly, Borrower, Paribas, SG and
Agent, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, hereby agree as follows:
1. Definitions. The term "Letter Agreement", as used in this Third
Amendment to Letter Agreement and Security Agreement (this "Amendment"), shall
mean the Letter Agreement referred to hereinabove, as amended hereby. The term
"Security Agreement", as used in this Amendment, shall mean the Security
Agreement referred to hereinabove, as amended hereby. Capitalized terms used in
this Amendment, if and to the extent not otherwise defined in this Amendment,
shall have the same meanings in this Amendment as in the Letter Agreement;
provided, however, that capitalized terms used in amended terms and provisions
of the Security Agreement shall have the same meanings as in the Security
Agreement.
2. Amendments to the Letter Agreement
(a) Maturity Date. The section of the Letter Agreement entitled
"Maturity Date" is hereby amended to read in its entirety as follows:
"October 31, 1994 (the 'Maturity Date'), subject to
acceleration upon the occurrence of an Event of Default."
(b) Other Terms and Provisions. The first sentence of the section of
the Letter Agreement entitled "Other Terms and Provisions" is hereby
amended to read in its entirety as follows:
"In addition to the terms an provisions specified herein,
the terms and provisions contained in that certain (a)
Security Agreement dated October 31, 1991, executed by
Borrower to and in favor of Agent and Banks, as amended by
that certain First Amendment to Letter Agreement and
Security Agreement dated December 17, 1991, by and among
Borrower, Banks and Agent, that certain Second Amendment to
Letter Agreement and Security Agreement dated October 31,
1992, by and among Borrower, Banks and Agent and that
certain Third Amendment to Letter Agreement and Security
Agreement dated October 31, 1993, by and among Borrower,
Banks and Agent (as amended, the "Security Agreement"), (b)
Amended and Restated Promissory Note dated October 31, 1993,
in the original principal amount of $9,000,000 made by
Borrower payable to the order of Paribas (the "Paribas
Note"), (c) Amended and Restated Promissory Note dated
October 31, 1993, in the original principal amount of
$9,000,000 made by Borrower payable to the order of SG (the
"SG Note") (the Paribas Note and the SG Note, together with
all renewals, extensions, amendments and replacements
thereof from time to time, are hereinafter collectively
called the "Promissory Notes"), and (d) all other
agreements, documents, instruments and certificates.
executed or delivered in connection herewith (this
Agreement, the Security Agreement, the Promissory Notes and
such other agreements, documents, instruments and
certificates, as the same may be amended, renewed, extended,
restated or supplemented from time to time, are hereinafter
collectively called the "Loan Papers") all of which are
incorporated herein by reference for all purposes, shall
apply and shall govern the relationship among Borrower,
Agent and Banks with respect to the Facility."
3. Amendment to Security Agreement.
(a) Definition of Loan Papers. The first sentence of Subparagraph
(f) of Paragraph 21 of the Security Agreement is hereby amended to read in
its entirety as follows:
"The term "Loan Papers", as used in this Agreement, shall
mean and refer to (i) the Letter Agreement, (ii) that
certain Amended and Restated Promissory Note dated October
31, 1993, in the original principal amount of $9,000,000
made by the undersigned payable to the order of Banque
Paribas Houston Agency, (iii) that certain Amended and
Restated Promissory Note dated October 3 1, 1993, in the
original principal amount of $9,000,000 made by the
undersigned payable to the order of Societe Generale,
Southwest Agency, (iv) this Agreement, and (v) the other
'Loan Papers', as such term is defined in the Letter
Agreement, as the same may be amended, renewed, extended,
restated or supplemented from time to time."
4. Ratifications, Representations and Warranties.
(a) Except as expressly amended by this Amendment, the terms and
provisions of the Letter Agreement and the Security Agreement are hereby
ratified and confirmed and shall continue in full force and effect. The
Letter Agreement and the Security Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with
their terms.
(b) Borrower hereby represents and warrants to Banks that the
execution, delivery and performance of this Amendment and gill other Loan
Papers executed and/or delivered in connection herewith, and the
performance of the transactions contemplated hereby and thereby, have been
duly authorized by all requisite corporate action on the part of Borrower
and will not violate the Certificate of Incorporation or Bylaws of Borrower
or any other material agreement, document, instrument or certificate to
which Borrower, or any of its assets, is a party or is bound or affected.
5. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Agent shall have received the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Banks:
(i) an Amended and Restated Promissory Note in the original
principal amount of $9,000,000 made by Borrower payable to the order
of each of Paribas and SG;
(ii) an Amended and Restated Federal Reserve Form U- 1 executed
by Borrower pertaining to this Amendment; and
(iii) a Corporate Certificate executed by Borrower and
certain officers of Borrower evidencing that the transactions
contemplated by this Amendment have been duly authorized by all
requisite corporate action on the part of Borrower.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all agreements, documents,
instruments and certificates and other legal matters incident thereto shall
be reasonably satisfactory to Agent and its legal counsel, Jenkens &
Gilchrist, P.C.
6. Miscellaneous
(a) All representations and warranties contained in this Amendment
shall survive the execution and delivery of this Amendment and the other
Loan Papers, and no investigation by Agent or Banks or any closing shall
affect such representations and warranties or the right of Agent and Banks
to rely thereon.
(b) The Loan Papers are hereby amended so that any reference therein
to the Letter Agreement or the Security Agreement shall mean a reference to
the Letter Agreement or the Security Agreement, respectively, as amended
hereby.
(c) Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall be confined to
the provision so held to be invalid or unenforceable.
(d) This Amendment is binding upon and shall inure to the benefit of
Banks, Agent and Borrower and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer any of its
rights or obligations hereunder without the prior written consent of Banks.
(e) This Amendment may be executed in one or more counterparts.
(f) Borrower agrees to pay on demand by Agent the reasonable fees and
out-of-pocket expenses of counsel to Agent and Paribas in connection with
the preparation, negotiation and execution of this Amendment and the other
Loan Papers executed pursuant hereto.
(g) THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN PAPERS AS WRITTEN,
REPRESENT THE FINAL AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO WITH
RESPECT TO THE FACILITY, THE LOANS AND THE LETTERS OF CREDIT AND MAY NOT BE
CONTRADICTED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
(1) BORROWER AND (2) AGENT OR ANY BANK.
If you are in agreement with all of the terms and conditions stated herein,
please indicate by signing below whereupon this Amendment shall become effective
as of the date first above written.
Sincerely,
BANQUE PARIBAS HOUSTON AGENCY
Individually and as Agent
By: /s/ Robert G. Shaw
-------------------------
Name: Robert G. Shaw
Title: Vice President
By: /s/ Pierre-Jean de Filippis
-------------------------
Name: Pierre-Jean de Filippis
Title: General Manager
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Matthew C. Flanigan
-------------------------
Name: Matthew C. Flanigan
Title: Vice President and Manager
AGREED AND ACCEPTED:
CONTRAN CORPORATION
By: /s/ William C. Timm
-------------------------
Name: William C. Timm
Title: Vice President-Finance
Effective as of September 30, 1994
(except as otherwise provided herein)
Contran Corporation
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas 75240-2697
Attention: Mr. William C. Timm, Vice President-Finance
Re: Fourth Amendment to Letter Agreement and Security Agreement
Ladies and Gentlemen:
Reference is made to (a) that certain Letter Agreement dated October 31,
1991, by and among BANQUE PARIBAS HOUSTON AGENCY ("Paribas"), SOCIETE GENERALE,
SOUTHWEST AGENCY ("SG"), BANQUE PARIBAS HOUSTON AGENCY as Agent for Paribas and
SG ("Agent") and CONTRAN CORPORATION ("Borrower") relating to a line of credit
and letter of credit facility extended to Borrower (as amended, the "Letter
Agreement"), (b) that certain Security Agreement dated October 31, 1991,
executed by Borrower to and in favor of Agent, Paribas and SG (as amended, the
"Security Agreement"), (c) that certain First Amendment to Letter Agreement and
Security Agreement dated March 17, 1991, by among Borrower, Paribas, SG and
Agent, (d) that certain Second Amendment to Letter Agreement and Security
Agreement dated October 31, 1992, by and among Borrower, Paribas, SG and Agent
and (e) that certain Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Paribas, SG and Agent. Borrower,
Paribas, SG and Agent desire to amend the Letter Agreement and the Security
Agreement as hereinafter set forth. Accordingly, Borrower, Paribas, SG and
Agent, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, hereby agree as follows:
1. Definitions. The term "Letter Agreement", as used in this Fourth Amendment
to Letter Agreement and Security Agreement (this "Amendment"), shall mean the
Letter Agreement referred to hereinabove, as amended hereby. The term "Security
Agreement", as used in this Amendment, shall mean the Security Agreement
referred to hereinabove, as amended hereby. Capitalized terms used in this
Amendment, if and to the extent not otherwise defined in this Amendment, shall
have the same meanings in this Amendment as in the Letter Agreement; provided,
however, that capitalized terms used in amended terms and provisions of the
Security Agreement shall have the same meanings as in the Security Agreement.
2. Amendments to the Letter Agreement.
(a) Letter of Credit Sublimit. The section of the Letter Agreement
entitled "Letter of Credit Sublimit" is hereby amended to read in its
entirety as follows:
"The amount available for drawing under outstanding Letters
of Credit from time to time shall not exceed $10,000,000 in
the aggregate, and the maturity of each Letter of Credit may
not exceed one (1) year from the issuance date and may not
extend beyond the Maturity Date; provided, however, that the
maturity of a Letter of Credit may extend beyond the
Maturity Date with the prior written consent of Banks."
(b) Cash Collateral and Substitution of Collateral. A new section of
the Letter Agreement entitled "Cash Collateral and Substitution of
Collateral" is hereby added to the Letter Agreement immediately following
the section of the Low Agreement entitled "Security", which new section
shall read in its entirety as follows:
"Notwithstanding anything to the contrary contained herein,
in the event that, for whatever reason (a) any Letter of
Credit is outstanding after the Maturity Date, (b) all
Indebtedness (as such term is defined in the Security
Agreement) is irrevocably paid in full (other than the
contingent indebtedness of Borrower to Banks in connection
with outstanding Letters of Credit) and (c) Agent delivers a
written notice to Borrower requesting that cash collateral
be provided to secure the contingent indebtedness of
Borrower to Banks in connection with the outstanding Letters
of Credit, then Borrower shall, on or before sixty (60) days
after the Maturity Date, pledge, assign and grant a security
interest in, to and in favor of Agent on behalf of Banks,
Cash Collateral having an aggregate fair market value equal
to or greater than the aggregate undrawn amount of the
Letters of Credit that are outstanding on the day after the
Maturity Date, which Cash Collateral and pledge, assignment
and security interest thereof or therein shall be in form
and substance reasonably satisfactory to Banks. For
purposes of this Agreement, the term "Cash Collateral" shall
mean (and shall consist of) cash and any cash equivalents
(if any) as Banks may approve as being acceptable cash
collateral from time to time. In the event that such Cash
Collateral in form and substance reasonably satisfactory to
Banks is timely provided to Agent on behalf of Banks as
required hereby, then Agent shall, in connection with the
providing of such Cash Collateral, release the shares of
common stock of Keystone pledged by Borrower to Agent
pursuant to the Security Agreement; provided, however, that
Agent shall not release any such shares and Borrower shall
not be obligated to provide any such Cash Collateral if, on
or before the appropriate date of the proposed release, an
Event of Default specified in clause (d), (e) or (f) of the
"Event of Default" section of this Agreement shall have
occurred. In the event that, for whatever reason, Borrower
fails to timely provide such Cash Collateral as required
pursuant to this section, then, notwithstanding anything to
the contrary contained herein or in the Security Agreement,
Agent may (at its discretion) sell, transfer, dispose of or
otherwise liquidate all or any portion of the shares of
common stock of Keystone pledged by Borrower to Agent
pursuant to the Security Agreement and any other Collateral
securing the Indebtedness (as such term is defined in the
Security Agreement) and hold the proceeds thereof as cash
collateral to secure the Indebtedness (as such term is
defined in the Security Agreement), including, without
limitation, the contingent indebtedness of Borrower to Banks
in connection with outstanding Letters of Credit, pursuant
to the Security Agreement. To the extent the Cash
Collateral consists of cash, it shall be held in an interest
bearing account or accounts mutually acceptable to Borrower
and Agent and, if and to the extent feasible, the interest
accrued thereon shall be distributed to Borrower from time
to time upon request by Borrower to Agent so long as no
Event of Default, or occurrence or event which, with the
giving of notice or lapse of time, or both, would become an
Event of Default, has occurred and is then continuing."
(c) Representations and Warranties. Subparagraph (d) of the section
of the Letter Agreement entitled "Representations and Warranties" is hereby
amended to read in its entirety as follows:
"all shares of common stock of Keystone constituting a part
of the Collateral and all shares of common stock of Keystone
which may be subsequently pledged as Collateral (i) are not
subject to any restrictions on sale or transfer except for
any restrictions regarding compliance with applicable
securities laws and (ii) either (A) are not, and will not
be, "restricted securities" as such term is used or defined
in paragraph (a)(3) of Rule 144, or (B) if and to the extent
such shares are or will be "restricted securities" as so
defined, such shares have been held by Borrower for greater
than three (3) years within the meaning of and as calculated
pursuant to the holding period provisions of paragraph (d)
of Rule 144, and Borrower fully paid the purchase price of
the Keystone shares at the time it acquired the Keystone
shares and did not give a promissory note or enter into any
installment purchase contract or any other obligation as any
part of its payment of the purchase price of the Keystone
shares; provided, however, that the representation and
warranty contained in clause (ii) immediately preceding
shall apply only to 2,971,233 shares of common stock of
Keystone pledged as Collateral."
(d) Other Terms and Provisions. The first sentence of the section of
the Letter Agreement entitled "Other Terms and Provisions" is hereby
amended to read in its entirety as follows:
"In addition to the terms and provisions specified herein,
the terms and provisions contained in that certain (a)
Security Agreement dated October 31, 1991, executed by
Borrower to and in favor of Agent and Banks, as amended by
that certain First Amendment to Letter Agreement and
Security Agreement dated December 17, 1991, by and among
Borrower, Banks and Agent, that certain Second Amendment to
Letter Agreement and Security Agreement dated October 31,
1992, by and among Borrower, Banks and Agent, that certain
Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Banks and
Agent and that certain Fourth Amendment to Letter Agreement
and Security Agreement dated September 30, 1994, by and
among Borrower, Banks and Agent (as amended, the "Security
Agreement"), (b) Amended and Restated Promissory Note dated
October 31, 1993, in the original principal amount of
$9,000,000 made by Borrower payable to the order of Paribas
(the "Paribas Note"), (c) Amended and Restated Promissory
Note dated October 31, 1993, in the original principal
amount of $9,000,000 made by Borrower payable to the order
of SG (the "SG Note") (the Paribas Note and the SG Note,
together with all renewals, extensions, amendments and
replacements thereof from time to time, are hereinafter
collectively called the 'Promissory Notes'), and (d) all
other agreements, documents, instruments and certificates
executed or delivered in connection herewith (this
Agreement, the Security Agreement, the Promissory Notes and
such other agreements, documents, instruments and
certificates, as the same may be amended, renewed, extended,
restated or supplemented from time to time, are hereinafter
collectively called the "Loan Papers"), all of which are
incorporated herein by reference for all purposes, shall
apply and shall govern the relationship among Borrower,
Agent and Banks with respect to the Facility."
3. Amendments to the Security Agreement.
(a) Definition of Keystone Shares. Clause (i) of Subparagraph (b) of
Paragraph 21 of the Security Agreement is hereby amended to read in its
entirety as follows:
"(i) the 2,971,233 shares of common stock of Keystone
Consolidated Industries, Inc. ("Keystone") delivered to the
Bank prior to or on or about October 31, 1991 and any and
all additional shares of common stock of Keystone at any
time delivered to the Bank (collectively, the "Keystone
Shares");".
(b) Definition of Indebtedness. Subparagraph (d)) of Paragraph 21 of
the Security Agreement is hereby amended to read in its entirety as
follows:
"The term 'Indebtedness', as used in this Agreement, shall
mean and refer to any and all debts, obligations or
liabilities, whether now existing or herewith or hereafter
incurred or created, whether voluntary or involuntary,
whether due or not due, whether absolute or contingent, or
whether incurred directly or acquired by the Bank by
assignment or otherwise, of the undersigned to the Bank
pursuant to the Letter Agreement (as hereinafter defined),
the Promissory Notes (as hereinafter defined), the Letters
of Credit (as such term is defined in the Letter Agreement)
or the other Loan Papers (as hereinafter defined)."
(c) Cash Collateral. Subparagraph (1) of Paragraph 21 of the
Security Agreement is hereby amended to read in its entirety as follows:
"If, by reason of the occurrence of an Event of Default or
the fact that any Letter of Credit is outstanding after the
Maturity Date (as such term is defined in the Letter
Agreement), Agent or any Bank receives cash collateral or
other payment from Borrower or proceeds from the disposition
of any Collateral at a time when any Letter of Credit
remains outstanding, Agent shall be entitled, after
application of such cash collateral or other payment or
proceeds to any Indebtedness then due and payable by
Borrower if Agent elects to make such application, to retain
such cash collateral or other payment or proceeds as cash
collateral to secure the remaining Indebtedness (including
without limitation any Indebtedness consisting of contingent
indebtedness with respect to Letters of Credit) and, in
furtherance thereof, Borrower hereby grants to the Bank a
security interest therein as security for the Indebtedness
in accordance with this Agreement."
4. Ratifications, Representations and Warranties.
(a) Except as expressly amended by this Amendment, the terms and
provisions of the Letter Agreement and the Security Agreement are hereby
ratified and confirmed and shall continue in full force and effect. The
Letter Agreement and the Security Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with
their terms.
(b) Borrower hereby represents and warrants to Banks that the
execution, delivery and performance of this Amendment and all other Loan
Papers executed and/or delivered in connection herewith, and the
performance of the transactions contemplated hereby and thereby, have been
duly authorized by all requisite corporate action on the part of Borrower
and will not violate the Certificate of Incorporation or Bylaws of Borrower
or any other material agreement, document, instrument or certificate to
which Borrower, or any of its assets, is a party or is bound or affected.
5. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Agent shall have received the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Banks:
(i) a Corporate Certificate executed by Borrower and certain
officers of Borrower evidencing that the transactions contemplated by
this Amendment have been duly authorized by all requisite corporate
action on the part of Borrower.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all agreements, documents,
instruments and certificates and other legal matters incident thereto shall
be reasonably satisfactory to Agent and its legal counsel, Jenkens &
Gilchrist, P.C.
6. Miscellaneous.
(a) All representations and warranties contained in this Amendment
shall survive the execution and delivery of this Amendment and the other
Loan Papers, and no investigation by Agent or Banks or any closing shall
affect such representations and warranties or the right of Agent and Banks
to rely thereon.
(b) The Loan Papers are hereby amended so that any reference therein
to the Letter Agreement or the Security Agreement shall mean a reference
to the Letter Agreement or the Security Agreement, respectively, as
amended hereby.
(c) Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall be confined
to the provision so held to be invalid or unenforceable.
(d) This Amendment is binding upon and shall inure to the benefit of
Banks, Agent and Borrower and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer any of its
rights or obligations hereunder without the prior written consent of Banks.
(e) This Amendment may be executed in one or more counterparts.
(f) Borrower agrees to pay on demand by Agent the reasonable fees and
out-of-pocket expenses of counsel to Agent and Paribas in connection with
the preparation, negotiation and execution of this Amendment and the other
Loan Papers executed pursuant hereto.
(g) THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN PAPERS AS WRITTEN,
REPRESENT THE FINAL AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO WITH
RESPECT TO THE FACILITY, THE LOANS AND THE LETTERS OF CREDIT AND MAY NOT
BE CONTRADICTED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
(1) BORROWER AND (2) AGENT OR ANY BANK.
If you are in agreement with all of the terms and conditions stated herein,
please indicate by signing below whereupon this Amendment shall become effective
as of the date first above written.
Sincerely,
BANQUE PARIBAS HOUSTON AGENCY
Individually and as Agent
By: /s/ Robert G. Shaw
-------------------------
Name: Robert G. Shaw
Title: Vice President
By: /s/ Pierre-Jean de Filippis
-------------------------
Name: Pierre-Jean de Filippis
Title: General Manager
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Matthew C. Flanigan
-------------------------
Name: Matthew C. Flanigan
Title: Vice President and Manager
By: /s/ Richard M. Lewis
-------------------------
Name: Richard M. Lewis
Title: Assistant Vice President
AGREED AND ACCEPTED:
CONTRAN CORPORATION
By: /s/ William C. Timm
-------------------------
Name: William C. Timm
Title: Vice President-Finance
Effective as of October 31, 1994
Contran Corporation
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas 75240-2697
Attention: Mr. William C. Timm, Vice President-Finance
Re: Fifth Amendment to Letter Agreement and Security Agreement
Ladies and Gentlemen:
Reference is made to (a) that certain Letter Agreement dated October 31,
1991, by and among BANQUE PARIBAS HOUSTON AGENCY ("Paribas"), SOCIETE GENERALE,
SOUTHWEST AGENCY ("SG"), BANQUE PARIBAS HOUSTON AGENCY as Agent for Paribas and
SG ("Agent") and CONTRAN CORPORATION ("Borrower") relating to a line of credit
and letter of credit facility extended to Borrower (as amended, the "Letter
Agreement"), (b) that certain Security Agreement dated October 31, 1991,
executed by Borrower to and in favor of Agent, Paribas and SG (as amended, the
"Security Agreement"), (c) that certain First Amendment to Letter Agreement and
Security Agreement dated March 17, 1991, by among Borrower, Paribas, SG and
Agent, (d) that certain Second Amendment to Letter Agreement and Security
Agreement dated October 31, 1992, by and among Borrower, Paribas, SG and Agent,
(e) that certain Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Paribas, SG and Agent and (f)
that certain Fourth Amendment to Letter Agreement and Security Agreement dated
October 31, 1994, by and among Borrower, Paribas, SG and Agent. Borrower,
Paribas, SG and Agent desire to amend the Letter Agreement and the Security
Agreement as hereinafter set forth. Accordingly, Borrower, Paribas, SG and
Agent, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, hereby agree as follows:
1. Definitions. The term "Letter Agreement", as used in this Fourth
Amendment to Letter Agreement and Security Agreement (this "Amendment"), shall
mean the Letter Agreement referred to hereinabove, as amended hereby. The term
"Security Agreement", as used in this Amendment, shall mean the Security
Agreement referred to hereinabove, as amended hereby. Capitalized terms used in
this Amendment, if and to the extent not otherwise defined in this Amendment,
shall have the same meanings in this Amendment as in the Letter Agreement;
provided, however, that capitalized terms used in amended terms and provisions
of the Security Agreement shall have the same meanings as in the Security
Agreement.
2. Amendments to the Letter Agreement.
(a) Maturity Date. The section of the Letter Agreement entitled
"Maturity Date" is hereby amended to read in its entirety as follows:
"October 30, 1995 (the 'Maturity Date'), subject to
acceleration upon the occurrence of an Event of Default."
(b) Other Terms and Provisions. The first sentence of the section of
the Letter Agreement entitled "Other Terms and Provisions' is hereby
amended to read in its entirety as follows:
"In addition to the terms and provisions specified herein,
the terms and provisions contained in that certain (a)
Security Agreement dated October 31, 1991, executed by
Borrower to and in favor of Agent and Banks, as amended by
that certain First Amendment to Letter Agreement and
Security Agreement dated December 17, 1991, by and among
Borrower, Banks and Agent, that certain Second Amendment to
Letter Agreement and Security Agreement dated October 31,
1992, by and among Borrower, Banks and Agent, that certain
Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Banks and
Agent, that certain Fourth Amendment to Letter Agreement and
Security Agreement dated September 30, 1994, by and among
Borrower, Banks and Agent and that certain Fifth Amendment
to Letter Agreement and Security Agreement dated October 31,
1994, by and among Borrower, Banks and Agent (as amended,
the 'Security Agreement'), (b) Amended and Restated
Promissory Note dated October 31, 1994, in the original
principal amount of $9,000,000 made by Borrower payable to
the order of Paribas (the 'Paribas Note'), (c) Amended and
Restated Promissory Note dated October 31, 1994, in the
original principal amount of $9,000,000 made by Borrower
payable to the order of SG (the 'SG Note') (the Paribas Note
and the SG Note, together with all renewals, extensions,
amendments and replacements thereof from time to time, are
hereinafter collectively called the 'Promissory Notes'), and
(d) all other agreements, documents, instruments and
certificates executed or delivered in connection herewith
(this Agreement, the Security Agreement, the Promissory
Notes and such other agreements, documents, instruments and
certificates, as the same may be amended, renewed, extended,
restated or supplemented from time to time, are hereinafter
collectively called the 'Loan Papers'), all of which are
incorporated herein by reference for all purposes, shall
apply and shall govern the relationship among Borrower,
Agent and Banks with respect to the Facility."
3. Amendments to the Security Agreement.
(a) Definition of Loan Papers. The first sentence of Subpargraph (f)
of Paragraph 21 of the Security Agreement is hereby amended to read in its
entirety as follows:
"The term 'Loan Papers', as used in this Agreement, shall
mean and refer to (i) the Letter Agreement, (ii) that
certain Amended and Restated Promissory Note dated October
31, 1994, in the original principal amount of $9,000,000
made by the undersigned payable to the order of Banque
Paribas Houston Agency, (iii) that certain Amended and
Restated Promissory Note dated October 31, 1994, in the
original principal amount of $9,000,000 made by the
undersigned payable to the order of Societe Generale,
Southwest Agency, (iv) this Agreement, and (v) the other
'Loan Papers', as such term is defined in the Letter
Agreement, as the same may be amended, renewed, extended,
restated or supplemented from time to time."
4. Ratifications, Representations and Warranties.
(a) Except as expressly amended by this Amendment, the terms and
provisions of the Letter Agreement and the Security Agreement are hereby
ratified and confirmed and shall continue in full force and effect. The
Letter Agreement and the Security Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with
their terms.
(b) Borrower hereby represents and warrants to Banks that the
execution, delivery and performance of this Amendment and all other Loan
Papers executed and/or delivered in connection herewith, and the
performance of the transactions contemplated hereby and thereby, have been
duly authorized by all requisite corporate action on the part of Borrower
and will not violate the Certificate of Incorporation or Bylaws of Borrower
or any other material agreement, document, instrument or certificate to
which Borrower, or any of its assets, is a party or is bound or affected.
5. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Agent shall have received the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Banks:
(i) an Amended and Restated Promissory Note in the original
principal amount of $9,000,000 made by Borrower payable to the order
of each of Paribas and SG;
(ii) an Amended and Restated Federal Reserve Form U-1 executed
by Borrower pertaining to this Amendment; and
(iii) a Corporate Certificate executed by Borrower and
certain officers of Borrower evidencing that the transactions
contemplated by this Amendment have been duly authorized by all
requisite corporate action on the part of Borrower.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all agreements, documents,
instruments and certificates and other legal matters incident thereto
shall be reasonably satisfactory to Agent and its legal counsel, Jenkens &
Gilchrist, P.C.
6. Miscellaneous.
(a) All representations and warranties contained in this Amendment
shall survive the execution and delivery of this Amendment and the other
Loan Papers, and no investigation by Agent or Banks or any closing shall
affect such representations and warranties or the right of Agent and Banks
to rely thereon.
(b) The Loan Papers are hereby amended so that any reference therein
to the Letter Agreement or the Security Agreement shall mean a reference
to the Letter Agreement or the Security Agreement, respectively, as
amended hereby.
(c) Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall be confined
to the provision so held to be invalid or unenforceable.
(d) This Amendment is binding upon and shall inure to the benefit of
Banks, Agent and Borrower and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer any of its
rights or obligations hereunder without the prior written consent of Banks.
(e) This Amendment may be executed in one or more counterparts.
(f) Borrower agrees to pay on demand by Agent the reasonable fees and
out-of-pocket expenses of counsel to Agent and Paribas in connection with
the preparation, negotiation and execution of this Amendment and the other
Loan Papers executed pursuant hereto.
(g) THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN PAPERS AS WRITTEN,
REPRESENT THE FINAL AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO WITH
RESPECT TO THE FACILITY, THE LOANS AND THE LETTERS OF CREDIT AND MAY NOT
BE CONTRADICTED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
(1) BORROWER AND (2) AGENT OR ANY BANK.
If you are in agreement with all of the terms and conditions stated herein,
please indicate by signing below whereupon this Amendment shall become effective
as of the date first above written.
Sincerely,
BANQUE PARIBAS HOUSTON AGENCY
Individually and as Agent
By: /s/ Robert G. Shaw
-------------------------
Name: Robert G. Shaw
Title: Vice President
By: /s/ Pierre-Jean de Filippis
-------------------------
Name: Pierre-Jean de Filippis
Title: General Manager
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Matthew C. Flanigan
-------------------------
Name: Matthew C. Flanigan
Title: Vice President and Manager
By: /s/ Richard M. Lewis
-------------------------
Name: Richard M. Lewis
Title: Assistant Vice President
AGREED AND ACCEPTED:
CONTRAN CORPORATION
By: /s/ William C. Timm
-------------------------
Name: William C. Timm
Title: Vice President-Finance
Effective as of October 30, 1995
Contran Corporation
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas 75240-2697
Attention: Mr. William C. Timm, Vice President-Finance
Re: Sixth Amendment to Letter Agreement and Security Agreement
Ladies and Gentlemen:
Reference is made to (a) that certain Letter Agreement dated October 31,
1991, by and among BANQUE PARIBAS HOUSTON AGENCY ("Paribas"), SOCIETE GENERALE
SOUTHWEST AGENCY, BANQUE PARIBAS HOUSTON AGENCY as Agent for Paribas and SG
("Agent") and CONTRAN CORPORATION ("Borrower") relating to a line of credit and
letter of credit facility extended to Borrower (as amended, the "Letter
Agreement"), (b) that certain Security Agreement dated October 31, 1991,
executed by Borrower to and in favor of Agent, Paribas and SG (as amended, the
"Security Agreement"), (c) that certain First Amendment to Letter Agreement and
Security Agreement dated March 17, 1991, by among Borrower, Paribas, SG and
Agent, (d) that certain Second Amendment to Letter Agreement and Security
Agreement dated October 31, 1992, by and among Borrower, Paribas, SG and Agent,
(e) that certain Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Paribas, SG and Agent, (f) that
certain Fourth Amendment to Letter Agreement and Security Agreement dated
September 30, 1994, by and among Borrower, Paribas, SG and Agent and (g) that
certain Fifth Amendment to Letter Agreement and Security Agreement dated October
31, 1994, by and among Borrower, Paribas, SG and Agent. Borrower, Paribas, SG
and Agent desire to amend the Letter Agreement and the Security Agreement as
hereinafter set forth. Accordingly, Borrower, Paribas, SG and Agent, for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, hereby agree as follows:
1. Definitions. The term "Letter Agreement" , as used in this Sixth
Amendment to Utter Agreement and Security Agreement (this "Amendment"), shall
mean the Letter Agreement referred to hereinabove, as amended hereby. The term
"Security Agreement", as used in this Amendment, shall mean the Security
Agreement referred to hereinabove, as amended hereby. Capitalized terms used in
this Amendment, if and to the extent not otherwise defined in this Amendment,
shall have the same meanings in this Amendment as in the Letter Agreement;
provided, however, that capitalized terms used in amended terms and provisions
of the Security Agreement shall have the same meanings as in the Security
Agreement.
2. Amendments to the Letter Agreement.
(a) Facility. The section of the Letter Agreement entitled
"Facility" is hereby amended to read in its entirety as follows:
"$20,000,000 (the 'Committed Amount') aggregate committed
line of credit for loans (the 'Loan') and letters of credit
(the 'Letters of Credit'), subject to the Advance Rate (as
hereinafter defined) and the other terms and conditions of
this Agreement and the other Loan Papers (as hereinafter
defined); provided, however, that the commitment of Paribas
shall be $11,000,000 of the Committed Amount and the
commitment of SG shall be $9,000,000 of the Committed
Amount. The commitments of Banks under this Facility shall
expire on the earlier to occur of the Maturity Date (as
hereinafter defined) or the occurrence of an Event of
Default. Banks shall not be obligated to make any advances
of Loans or issue any Letter of Credit under the Facility on
or after the Maturity Date."
(b) Security. The section of the Letter Agreement entitled
"Security" is hereby amended to read in its entirety as follows:
"Banks shall have a perfected first priority security
interest in at least 3,121,233 shares of common stock of
Keystone Consolidated Industries, Inc. ('Keystone').
Borrower shall deliver to Agent the stock certificates
representing the Keystone shares and appropriate stock
powers, executed in blank and in proper form for transfer,
relating thereto, and thereby pledge the Keystone shares to
Banks as further provided in the Security Agreement (as
hereinafter defined). Borrower may, from time to time,
pledge additional marketable securities acceptable to Banks
in their discretion, including shares of common stock of
Keystone which Banks hereby agree, in advance, are
acceptable collateral."
(c) Maturity Date. The section of the Letter Agreement entitled
"Maturity Date" is hereby amended to read in its entirety as follows:
"October 29, 1996 (the 'Maturity Date'), subject to
acceleration upon the occurrence of an Event of Default."
(d) Borrowing Rates. The first sentence of the section of the Letter
Agreement entitled "Borrowing Rates" is hereby amended to read in its
entirety as follows:
"Borrower's option of Base Rate (as defined in the
Promissory Notes) or one, two or three month reserve
adjusted LIBOR + 1-1/2 %(the 'LIBOR Rate')".
(e) Representations and Warranties. Subparagraph (d) of the, section
of the Letter Agreement entitled "Representations and Warranties' is hereby
amended to read in its entirety as follows:
"all shares of common stock of Keystone constituting a part
of the Collateral and all shares of common stock of Keystone
which may be subsequently pledged as Collateral (i) are not
subject to any restrictions on sale or transfer except for
any restrictions regarding compliance with applicable
securities laws and (ii) either (A) are not, and will not
be, "restricted securities" as such term is used or defined
in paragraph (a)(3) of Rule 144, or (B) if and to the extent
such shares are or will be "restricted securities" as so
defined, such shares have been held by Borrower for greater
than three (3) years within the meaning of and as calculated
pursuant to the holding period provisions of paragraph (d)
of Rule 144, and Borrower fully paid the purchase price of
the Keystone shares at the time it acquired the Keystone
shares and did not give a promissory note or enter into any
installment purchase contract or any other obligation as any
part of its payment of the purchase price of the Keystone
shares; provided, however, that (1) the representation and
warranty contained in clause (ii) immediately preceding
shall apply only to 3,121,233 shares of common stock of
Keystone pledged as Collateral and (2) 400,000 shares of
common stock of Keystone pledged as Collateral have been
held by Borrower only since the date of the stock
certificates evidencing such shares as stated in Paragraph 4
of the certain letter agreement dated December 7, 1994, by
and among Borrower, Banks and Agent."
(f) Other, Terms and Provisions. The first sentence of the section
of the Letter Agreement entitled "Other Terms and Provisions" is hereby
amended to read in its entirety as follows:
"In addition to the terms and provisions specified herein,
the terms and provisions contained in that certain (a)
Security Agreement dated October 31, 1991, executed by
Borrower to and in favor of Agent and Banks, as amended by
that certain First Amendment to Letter Agreement and
Security Agreement dated December 17, 1991, by and among
Borrower, Banks and Agent, that certain Second Amendment to
Letter Agreement and Security Agreement dated October 31,
1992, by and among Borrower, Banks and Agent, that certain
Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Banks and
Agent, that certain Fourth Amendment to Letter Agreement and
Security Agreement dated September 30, 1994, by and among
Borrower, Banks and Agent, that certain Fifth Amendment to
Letter Agreement and Security Agreement dated October 31,
1994, by and among Borrower, Banks and Agent and that
certain Sixth Amendment to Letter Agreement and Security
Agreement dated October 30, 1995, by and among Borrower,
Banks and Agent (as amended, the 'Security Agreement'), (b)
Amended and Restated Promissory Note dated October 30, 1995,
in the original principal amount of $11,000,000 made by
Borrower payable to the order of Paribas (the 'Paribas
Note), (c) Amended and Restated Promissory Note dated
October 30, 1995, in the original principal amount of
$9,000,000 made by Borrower payable to the order of SG (the
'SG Note') (the Paribas Note and the SG Note, together with
all renewals, extensions, amendments and replacements
thereof from time to time, are hereinafter collectively
called the 'Promissory Notes), and (d) all other agreements,
documents, instruments and certificates executed or
delivered in connection herewith (this Agreement, the
Security Agreement, the Promissory Notes and such other
agreements, documents, instruments and certificates, as the
same may be amended, renewed, extended, restated or
supplemented from time to time, are hereinafter collectively
called the 'Loan Papers'), all of which are incorporated
herein by reference for all purposes, shall apply and shall
govern the relationship among Borrower, Agent and Banks with
respect to the Facility."
(g) Pro Rata Share. The first sentence of the section of the Letter
Agreement entitled "Pro Rata Share" is hereby deleted.
3. Amendments to Security Agreement.
(a) Definition of Collateral. Clause (i) of Subparagraph (b) of
Paragraph 21 of the Security Agreement (see Addendum 2 to the Security
Agreement regarding definition of Collateral) is hereby amended to read in
its entirety as follows:
"(i) the 3,121,233 shares of common stock of Keystone
Consolidated Industries, Inc. ('Keystone') previously delivered
and/or concurrently herewith being delivered to the Bank (the
'Keystone Shares');".
(b) Definition of Loan Papers. The first sentence of Subparagraph
(f) of Paragraph 21 of the Security Agreement is hereby amended to read in
its entirety as follows:
"The term 'Loan Papers', as used in this Agreement, shall
mean and refer to (i) the Letter Agreement, (ii) that
certain Amended and Restated Promissory Note dated October
30, 1995, in the original principal amount of $1 1,000,000
made by the undersigned payable to the order of Banque
Paribas Houston Agency, (iii) that certain Amended and
Restated Promissory Note dated October 30, 1995, in the
original principal amount of $9,000,000 made by the
undersigned payable to the order of Societe Generale,
Southwest Agency, (iv) this Agreement, and (v) the other
'Loan Papers', as such term is defined in the Letter
Agreement, as the same may be amended, renewed, extended,
restated or supplemented from time to time."
4. Ratifications, Representations and Warranties.
(a) Except as expressly amended by this Amendment, the terms and
provisions of the Letter Agreement and the Security Agreement are hereby
ratified and confirmed and shall continue in full force and effect. The
Letter Agreement and the Security Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with
their terms.
(b) Borrower hereby represents and warrants to Banks that the
execution, delivery and performance of this Amendment and all other Loan
Papers executed and/or delivered in connection herewith, and the
performance of the transactions contemplated hereby and thereby, have been
duly authorized by all requisite corporate action on the part of Borrower
and will not violate the Certificate of Incorporation or Bylaws of Borrower
or any other material agreement, document, instrument or certificate to
which Borrower, or any of its assets, is a party or is bound or affected.
5. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Agent shall have received the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Banks:
(i) an Amended and Restated Promissory Note in the original
principal amount of $11,000,000 made by Borrower payable to the order
of Paribas and an Amended and Restated Promissory Note in the original
principal amount of $9,000,000 made by Borrower payable to the order
of SG;
(ii) an Amended and Restated Federal Reserve Form U-I executed by
Borrower pertaining to this Amendment; and
(iii) a Corporate Certificate executed by Borrower and
certain officers of Borrower evidencing that the transactions
contemplated by this Amendment have been duly authorized by all
requisite corporate action on the part of Borrower.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all agreements, documents,
instruments and certificates and other legal matters incident thereto
shall be reasonably satisfactory to Agent and its legal counsel, Jenkens &
Gilchrist, P.C.
6. Miscellaneous
(a) All representations and warranties contained in this Amendment
shall survive the execution and delivery of this Amendment and the other
Loan Papers, and no investigation by Agent or Banks or any closing shall
affect such representations and warranties or the right of Agent and Banks
to rely thereon.
(b) The Loan Papers are hereby amended so that any reference therein
to the Letter Agreement or the Security Agreement shall mean a reference to
the Letter Agreement or the Security Agreement, respectively, as amended
hereby.
(c) Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall be confined to
the provision so held to be invalid or unenforceable.
(d) This Amendment is binding upon and shall inure to the benefit of
Banks, Agent and Borrower and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer any of its
rights or obligations hereunder without the prior written consent of Banks.
(e) This Amendment may be executed in one or more counterparts.
(f) Borrower agrees to pay on demand by Agent the reasonable fees and
out-of-pocket expenses of counsel to Agent and Paribas in connection with
the preparation, negotiation and execution of this Amendment and the other
Loan Papers executed pursuant hereto.
(g) THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN PAPERS AS WRITTEN,
REPRESENT THE FINAL AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO WITH
RESPECT TO THE FACILITY, THE LOANS AND THE LETTERS OF CREDIT AND MAY NOT
BE CONTRADICTED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
(1) BORROWER AND (2) AGENT OR ANY BANK.
If you are in agreement with all of the terms and conditions stated herein,
please indicate by signing below whereupon this Amendment shall become effective
as of the date first above written.
Sincerely,
BANQUE PARIBAS HOUSTON AGENCY
Individually and as Agent
By: /s/ Christopher S. Goodwin
-------------------------
Name: Christopher S. Goodwin
Title: Vice President
By: /s/ Cheryl Johnson
-------------------------
Name: Cheryl Johnson
Title: Assistant Vice President
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Richard M. Lewis
-------------------------
Name: Richard M. Lewis
Title: Vice President
AGREED AND ACCEPTED:
CONTRAN CORPORATION
By: /s/ William C. Timm
-------------------------
Name: William C. Timm
Title: Vice President-Finance
Effective as of March 27, 1996
Contran Corporation
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas 75240-2697
Attention: Mr. William C. Timm, Vice President-Finance
Re: Seventh Amendment to Letter Agreement and Security Agreement
Ladies and Gentlemen:
Reference is made to (a) that certain Letter Agreement dated October 31,
1991, by and among BANQUE PARIBAS HOUSTON AGENCY ("Paribas"), SOCIETE GENERALE,
SOUTHWEST AGENCY, BANQUE PARIBAS, HOUSTON AGENCY as Agent for Paribas and SG
("Agent") and CONTRAN CORPORATION ("Borrower") relating to a line of credit and
letter of credit facility extended to Borrower (as amended, the "Letter
Agreement"), (b) that certain Security Agreement dated October 31, 1991,
executed by Borrower to and in favor of Agent, Paribas and SG (as amended, the
"Security Agreement"), (c) that certain First Amendment to Letter Agreement and
Security Agreement dated March 17, 1991, by among Borrower, Paribas, SG and
Agent, (d) that certain Second Amendment to Letter Agreement and Security
Agreement dated October 31, 1992, by and among Borrower, Paribas, SG and Agent,
(e) that certain Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Paribas, SG and Agent, (f) that
certain Fourth Amendment to Letter Agreement and Security Agreement dated
September 30, 1994, by and among Borrower, Paribas, SG and Agent, (g) that
certain Fifth Amendment to Letter Agreement and Security Agreement dated October
31, 1994, by and among Borrower, Paribas, SG and Agent, and (h) that certain
Sixth Amendment to Letter Agreement and Security Agreement dated October 30,
1995, by and among Borrower, Paribas, SG and Agent. Borrower, Paribas, SG and
Agent desire to amend the Letter Agreement and the Security Agreement as
hereinafter set forth. Accordingly, Borrower, Paribas, SG and Agent, for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, hereby agree as follows:
1. Definitions. The term "Letter Agreement", as used in this Seventh
Amendment to Letter Agreement and Security Agreement (this "Amendment"), shall
mean the Letter Agreement referred to hereinabove, as amended hereby. The term
"Security Agreement", as used in this Amendment, shall mean the Security
Agreement referred to hereinabove, as amended hereby. Capitalized terms used in
this Amendment, if and to the extent not otherwise defined in this Amendment,
shall have the same meanings in this Amendment as in the Letter Agreement;
provided, however, that capitalized terms used in amended terms and provisions
of the Security Agreement shall have the same meanings as in the Security
Agreement.
2. Amendments to the Letter Agreement.
(a) Security. The section of the Letter Agreement entitled
"Security" is hereby amended to read in its entirety as follows:
"Banks shall have a perfected first priority security
interest in at least (a) 3,121,233 shares of common stock of
Keystone Consolidated Industries, Inc. ('Keystone') and (b)
2,000,000 shares of common stock of Valhi, Inc. ('Valhi').
Borrower shall deliver to Agent the stock certificates
representing the Keystone shares and the Valhi shares and
appropriate stock powers, executed in blank and in proper
form for transfer, relating thereto, and thereby pledge the
Keystone shares and the Valhi shares to Banks as further
provided in the Security Agreement (as hereinafter defined).
Borrower may, from time to time, pledge additional
marketable securities acceptable to Banks in their
discretion, including shares of common stock of Keystone and
Valhi which Banks hereby agree, in advance, are acceptable
collateral; provided, however, that additional shares of
common stock of Valhi that would result in the pledge of ten
percent or more of any class of stock issued by Valhi are
not so agreed by the Banks in advance to be acceptable
collateral."
(b) Collateral Value Maintenance. The section of the Letter
Agreement entitled 'Collateral Value Maintenance' is hereby amended to add
the word "promptly" immediately following the word "shall" and preceding
the word 'either' in the fifth line of such section.
(c) Representations and Warranties. Subparagraph (d) of the section
of the Letter Agreement entitled "Representations and Warranties" is hereby
amended to read in its entirety as follows:
"all shares of common stock of Keystone constituting a part
of the Collateral, all shares of common stock of Valhi
constituting a part of the Collateral and all shares of
common stock of Keystone or Valhi which may be subsequently
pledged as Collateral (i) are not subject to any
restrictions on sale or transfer except for any restrictions
regarding compliance with applicable securities laws and
(ii) either (A) are not, and will not be, 'restricted
securities' as such term is used or defined in paragraph
(a)(3) of Rule 144, or (B) if and to the extent such shares
are or will be 'restricted securities' as so defined, such
shares have been held by Borrower for greater than three (3)
years within the meaning of and as calculated pursuant to
the holding period provisions of paragraph (d) of Rule 144,
and Borrower fully paid the purchase price of the Keystone
shares and the Valhi shares at the time it acquired the
Keystone shares and the Valhi shares, respectively, and did
not give a promissory note or enter into any installment
purchase contract or any other obligation to or with the
transferor of such Keystone shares or Valhi shares,
respectively, as any part of its payment of the purchase
price of the Keystone shares or the Valhi shares,
respectively; provided, however, that (1) the representation
and warranty contained in clause (ii) immediately preceding
as it relates to the Keystone shares only (but not as it
relates to the Valhi shares) shall apply only to 3,121,233
shares of common stock of Keystone pledged as Collateral and
(2) 400,000 shares of common stock of Keystone pledged as
Collateral have been held by Borrower only since the date of
the stock certificates evidencing such shares as stated in
Paragraph 4 of the certain letter agreement dated December
7, 1994, by and among Borrower, Banks and Agent."
(d) Other Terms and Provisions. The first sentence of the section of
the Letter Agreement entitled "Other Terms and Provisions" is hereby
amended to read in its entirety as follows:
"In addition to the terms and provisions specified herein,
the terms and provisions contained in that certain (a)
Security Agreement dated October 31, 1991, executed by
Borrower to and in favor of Agent and Banks, as amended by
that certain First Amendment to Letter Agreement and
Security Agreement dated December 17, 1991, by and among
Borrower, Banks and Agent, that certain Second Amendment to
Letter Agreement and Security Agreement dated October 31,
1992, by and among Borrower, Banks and Agent, that certain
Third Amendment to Letter Agreement and Security Agreement
dated October 31, 1993, by and among Borrower, Banks and
Agent, that certain Fourth Amendment to Letter Agreement and
Security Agreement dated September 30, 1994, by and among
Borrower, Banks and Agent, that certain Fifth Amendment to
Letter Agreement and Security Agreement dated October 31,
1994, by and among Borrower, Banks and Agent, that certain
Sixth Amendment to Letter Agreement and Security Agreement
dated October 30, 1995, by and among Borrower, Banks and
Agent and that certain Seventh Amendment to Letter Agreement
and Security Agreement dated March 27, 1996, by and among
Borrower, Banks and Agent (as amended, the 'Security
Agreement'), (b) Amended and Restated Promissory Note dated
October 30, 1995, in the original principal amount of
$11,000,000 made by Borrower payable to the order of Paribas
(the 'Paribas Note'), (c) Amended and Restated Promissory
Note dated October 30, 1995, in the original principal
amount of $9,000,000 made by Borrower payable to the order
of SG (the 'SG Note') (the Paribas Note and the SG Note,
together with all renewals, extensions, amendments and
replacements thereof from time to time, are hereinafter
collectively called the 'Promissory Notes'), and (d) all
other agreements, documents, instruments and certificates
executed or delivered in connection herewith (this
Agreement, the Security Agreement, the Promissory Notes and
such other agreements, documents, instruments and
certificates, as the same may be amended, renewed, extended,
restated or supplemented from time to time, are hereinafter
collectively called the 'Loan Papers'), all of which are
incorporated herein by reference for all purposes, shall
apply and shall govern the relationship among Borrower,
Agent and Banks with respect to the Facility. "
3. Amendments to the Security Agreement.
(a) Definition of Collateral. Subparagraph (b) of Paragraph 21 of
the Security Agreement (see Addendum 2 to the Security Agreement regarding
definition of Collateral) is hereby amended to read in its entirety as
follows:
"(b) Definition of Collateral. The term 'Collateral',
as used in this Agreement, shall mean and refer to any and
all rights, titles and interests of the undersigned, Contran
Corporation ('Contran'), in and to the following:
(i) 3,121,233 shares of common stock of Keystone
Consolidated Industries, Inc. ('Keystone') previously
delivered and/or concurrently herewith being delivered
to the Bank (the 'Keystone Shares') (which Keystone
Shares presently, as of March 27, 1996, include those
identified on Schedule 3 attached hereto and
incorporated herein by reference);
(ii) 2,000,000 shares of common stock of Valhi,
Inc. ('Valhi') previously delivered and/or concurrently
herewith being delivered to the Bank (the 'Valhi
Shares') (which Valhi Shares presently, as of March 27,
1996, include those identified on Schedule 3 attached
hereto and incorporated herein by reference);
(iii) any and all money, securities
(certificated and uncertificated), instruments,
investment property, financial assets, securities
accounts, security entitlements and other property
heretofore delivered or which shall concurrently
herewith or hereafter be delivered to or come into
possession, custody or control of the Bank or any third
party acting on the Bank's behalf, in any manner or for
any purposes whatever during the existence of this
Agreement, and whether held in a general or special
account or deposit or for safe-keeping, or otherwise,
to the extent but only to the extent that such money,
securities, instruments, investment property, financial
assets, securities accounts, security entitlements and
other property relate, to or constitute proceeds of the
Keystone Shares or the Valhi Shares, together with any
and all interest, stock rights, rights to subscribe,
liquidating dividends, stock dividends, dividends in
cash and other assets, new securities and other
property to which Contran is or may hereafter become
entitled to receive on account of the Keystone Shares
and the Valhi Shares (provided, however, that, except
as provided in the proviso below, any cash or stock
dividends which are both declared and paid prior to the
occurrence of an Event of Default and prior to the
occurrence of an occurrence or event which, with the
giving of notice or lapse of time, or both, would
become an Event of Default may be received by Contran
free and clear of the security interest created by this
Agreement, provided further, however, that the
foregoing proviso shall not apply to (A) cash dividends
paid or payable in connection with a partial or total
liquidation or dissolution or in connection with a
reduction of capital or surplus or in connection with a
redemption of or exchange for any Collateral or (B)
stock dividends if, at the time of declaration or
payment thereof, and assuming such stock dividends were
not pledged to the Bank as security for the
Indebtedness, the sum of the outstanding principal
amount of the Loans plus the amount available for
drawing under outstanding Letters of Credit exceeds 49%
of the then current aggregate market value of the
Keystone Shares and Valhi Shares pledged to the Bank as
security for the Indebtedness); and
(iv) any and all proceeds of the Keystone Shares
and the Valhi Shares and of the money, securities,
instruments, investment property, financial assets,
securities accounts, security entitlements and other
property referred to in clauses (i), (ii), and (iii)
preceding."
(b) Valid Security Interest. Subparagraph (j) of Paragraph 21 of the
Security Agreement (see Addendum 2 to the Security Agreement) is hereby
amended to read in its entirety as follows:
"(j) Valid Security Interest. Contran represents and
warrants to the Bank that the Bank has a valid, enforceable,
first priority pledge of and security interest in the
Keystone Shares and the Valhi Shares."
(c) Rule 144. Subparagraph (k) of Paragraph 21 of the Security
Agreement (see Addendum 2 to the Security Agreement) is hereby amended to
read in its entirety as follows:
"(k) Rule 144. Contran agrees that, if ten percent or
more of any class of Keystone Shares or Valhi Shares is then
pledged as Collateral or if the Bank otherwise is or would
be an affiliate of the issuer of such shares for purposes of
Rule 144, (i) it shall not, without the prior written
consent of the Bank (which consent shall not be unreasonably
withheld), sell any securities of the issuers of the
Keystone Shares or the Valhi Shares (the 'Stock'),
respectively, that are of the same class as the Stock, and
(ii) it shall (A) give prompt written notice to Agent of any
sales or purchases by the undersigned, or by any other
person or entity whose sales would be aggregated with those
of the Bank for purposes of Rule 144, of any securities of
the issuers of the Stock that are of the same class as the
Stock, whether such sales or purchases have occurred within
the past three (3) months from the date thereof or are
proposed to occur and (B) use its best efforts to cause any
person or entity whose sales are to be aggregated with those
of Contran or the Bank for purposes of Rule 144 to withhold
from any sales any securities of the issuers of the Stock
that are of the same class as the Stock."
(d) Addendum. Numbered Paragraph 21 of the Security Agreement which
appears immediately above Borrower's signature on the fourth page of the
Security Agreement is hereby amended to read in its entirety as follows:
"21. The terms and provisions of Addendum 1, Addendum 2
and Addendum 3 attached hereto are hereby incorporated
herein by reference for all purposes."
(e) Addendum 3 to the Security Agreement. A new Addendum 3 is hereby
added to the Security Agreement, which Addendum 3 shall read in its
entirety as set forth on Seventh Amendment Addendum A attached hereto and
incorporated herein by reference.
4. Ratifications, Representations and Warranties.
(a) Except as expressly amended by this Amendment, the terms and
provisions of the Letter Agreement and the Security Agreement are hereby
ratified and confirmed and shall continue in full force and effect. The
Letter Agreement and the Security Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with
their terms.
(b) Borrower hereby represents and warrants to Banks that the
execution, delivery and performance of this Amendment and all other Loan
Papers executed and/or delivered in connection herewith, and the
performance of the transactions contemplated hereby and thereby, have been
duly authorized by all requisite corporate action on the part of Borrower
and will not violate the Certificate of Incorporation or Bylaws of Borrower
or any other material agreement, document, instrument or certificate to
which Borrower, or any of its assets, is a party or is bound or affected.
5. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Agent shall have received the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Banks:
(i) the stock certificates representing the shares of common
stock of Valhi, Inc. being pledged by Borrower in connection with this
Amendment and instruments of transfer executed in blank by Borrower
with respect to such stock certificates, and a UCC-1 financing
statement executed by Borrower covering the Collateral (including such
shares of common stock of Valhi, Inc.);
(ii) an Amended and Restated Federal Reserve Form U-1 executed by
Borrower pertaining to this Amendment; and
(iii) a Corporate Certificate executed by Borrower and
certain officers of Borrower evidencing that the transactions
contemplated by this Amendment have been duly authorized by all
requisite corporate action on the part of Borrower.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all agreements, documents,
instruments and certificates and other legal matters incident thereto shall
be reasonably satisfactory to Agent and its legal counsel, Jenkens &
Gilchrist, P.C.
6. Miscellaneous.
(a) All representations and warranties contained in this Amendment
shall survive the execution and delivery of this Amendment and the other
Loan Papers, and no investigation by Agent or Banks or any closing shall
affect such representations and warranties or the right of Agent and Banks
to rely thereon.
(b) The Loan Papers are hereby amended so that any reference therein
to the Letter Agreement or the Security Agreement shall mean a reference to
the Letter Agreement or the Security Agreement, respectively, as amended
hereby.
(c) Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall be confined to
the provision so held to be invalid or unenforceable.
(d) This Amendment is binding upon and shall inure to the benefit of
Banks, Agent and Borrower and their respective successors and assigns;
provided, however, that Borrower may not assign or transfer any of its
rights or obligations hereunder without the prior written consent of Banks.
(e) This Amendment may be executed in one or more counterparts.
(f) Borrower agrees to pay on demand by Agent the reasonable fees and
out-of-pocket expenses of counsel to Agent and Paribas in connection with
the preparation, negotiation and execution of this Amendment and the other
Loan Papers executed pursuant hereto.
(g) THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN PAPERS AS WRITTEN,
REPRESENT THE FINAL AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO WITH
RESPECT TO THE FACILITY, THE LOANS AND THE LETTERS OF CREDIT AND MAY NOT
BE CONTRADICTED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
(1) BORROWER AND (2) AGENT OR ANY BANK.
(h) Borrower agrees that it will, from time to time upon the request
of Agent, execute and deliver to Agent such financing or continuation
statements or amendments thereto, and take or cause to be taken such other
actions, as may be necessary or appropriate in the reasonable opinion of
Agent to create, perfect and preserve the perfected and first priority
security interests in the Collateral (as defined in the Security Agreement)
granted (or purported to be granted) by the Security Agreement as amended
hereby.
(i) Borrower represents and warrants that (i) the shares of common
stock of Keystone Consolidated Industries, Inc. and Valhi, Inc. described
on Seventh Amendment Addendum A attached hereto (the "Presently Pledged
Shares") are and shall be deemed to be pledged as Collateral to secure the
payment and performance of the Indebtedness (as defined in the Security
Agreement) in accordance with the terms and provisions of the Security
Agreement, (ii) none of the stock certificates representing the Presently
Pledged Shares contains any restrictions on transfer, and (iii) the chief
executive office and principal place of business of Borrower are located in
Dallas County, Texas.
If you are in agreement with all of the terms and conditions stated herein,
please indicate by signing below whereupon this Amendment shall become effective
as of the date first above written.
Sincerely,
BANQUE PARIBAS HOUSTON AGENCY
Individually and as Agent
By: /s/ Christopher S. Goodwin
-------------------------
Name: Christopher S. Goodwin
Title: Vice President
By: /s/ Cheryl Johnson
-------------------------
Name: Cheryl Johnson
Title: Assistant Vice President
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Richard M. Lewis
-------------------------
Name: Richard M. Lewis
Title: Vice President
AGREED AND ACCEPTED:
CONTRAN CORPORATION
By: /s/ William C. Timm
-------------------------
Name: William C. Timm
