<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended May 28, 1995 Commission File Number 1-9967
------------ ------
AMCAST INDUSTRIAL CORPORATION
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
Ohio 31-0258080
- ------------------------ -------------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
7887 Washington Village Drive, Dayton, Ohio 45459
- ------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(Area Code 513) 291-7000
----------------------------------------------------
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 and 15(d) of the Securities Exchange Act of 1934
during the preceding twelve months, and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
Number of Common Shares outstanding, no par value, as of May 28, 1995 -
8,536,971 shares.
<PAGE> 2
AMCAST INDUSTRIAL CORPORATION
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE NO.
--------------------- --------
<S> <C>
Item 1 - Financial Statements:
Consolidated Condensed Statements of Financial 3
Condition - May 28, 1995 and August 31, 1994
Consolidated Condensed Statements of Operations - 4
for the Quarters and Nine Months Ended May 28, 1995
and May 29, 1994
Consolidated Condensed Statements of Retained Earnings - 4
for the Quarters and Nine Months Ended May 28, 1995
and May 29, 1994
Consolidated Condensed Statements of Cash Flows - 5
for the Nine Months Ended May 28, 1995
and May 29, 1994
Notes to Consolidated Condensed Financial Statements 6 - 9
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations 10 - 12
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings 13
Item 6 - Exhibits and Reports on Form 8-K 13
SIGNATURES 14
</TABLE>
2
<PAGE> 3
PART I - FINANCIAL INFORMATION
AMCAST INDUSTRIAL CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(unaudited)
<TABLE>
<CAPTION>
May 28 August 31
ASSETS 1995 1994
- ------ --------- ----------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 2,904 $ 15,414
Accounts receivable 42,265 38,400
Inventories:
Finished products 23,053 17,833
Work-in-process 11,739 11,878
Raw materials and supplies 10,936 8,758
--------- ---------
45,728 38,469
Other current assets 6,650 5,143
--------- ---------
Total current assets 97,547 97,426
Property, Plant and Equipment 172,498 149,185
Less allowances for depreciation (85,199) (75,531)
--------- ---------
87,299 73,654
Net Assets of Discontinued Operation 13,315 12,389
Other Assets 16,130 10,692
--------- ---------
$ 214,291 $ 194,161
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 25,430 $ 27,169
Current portion of notes payable
and lines of credit 9,222 4,019
Accrued expenses, compensation and
related items and other current liabilities 18,164 17,648
--------- ---------
Total current liabilities 52,816 48,836
Long-Term Debt--less current portion 19,545 13,910
Deferred Income Taxes 6,255 4,024
Deferred Liabilities 15,348 17,228
Shareholders' Equity
Preferred shares, without par value:
Authorized--1,000,000 shares
Issued--None
Common shares, at stated value:
Authorized--15,000,000 shares
Issued-- 8,536,971 shares
(8,457,896 at August 31, 1994) 8,537 8,458
Capital in excess of stated value 63,746 62,912
Retained earnings 48,044 38,793
--------- ---------
120,327 110,163
--------- ---------
$ 214,291 $ 194,161
========= =========
</TABLE>
See notes to consolidated condensed financial statements
3
<PAGE> 4
AMCAST INDUSTRIAL CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
AND RETAINED EARNINGS
(dollars in thousands except per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------------ ------------------------
May 28 May 29 May 28 May 29
1995 1994 1995 1994
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Consolidated Condensed Statements
of Operations
Net sales $ 86,397 $ 70,902 $ 245,150 $ 198,927
Cost of sales 68,504 55,080 194,545 155,777
--------- --------- --------- ---------
Gross profit 17,893 15,822 50,605 43,150
Selling, general and
administrative expenses 10,560 9,320 30,411 26,162
Interest expense 324 421 1,023 1,244
Other income (142) (173) (325) (271)
--------- --------- --------- ---------
10,742 9,568 31,109 27,135
--------- --------- --------- ---------
Income before income taxes 7,151 6,254 19,496 16,015
Income taxes 2,477 1,963 6,921 5,525
--------- --------- --------- ---------
Net Income $ 4,674 $ 4,291 $ 12,575 $ 10,490
========= ========= ========= =========
Consolidated Condensed Statements
of Retained Earnings
Beginning retained earnings $ 44,461 $ 32,684 $ 38,793 $ 28,577
Net income 4,674 4,291 12,575 10,490
Less dividends (1,110) (1,014) (3,323) (3,034)
Other 19 (66) (1) (138)
--------- --------- --------- ---------
Ending Retained Earnings $ 48,044 $ 35,895 $ 48,044 $ 35,895
========= ========= ========= =========
Per Share Information
Net income per share $ .55 $ .51 $ 1.48 $ 1.25
========= ========= ========= =========
Dividends declared per share $ .13 $ .12 $ .39 $ .36
========= ========= ========= =========
Dividends paid per share $ .13 $ .12 $ .39 $ .36
========= ========= ========= =========
</TABLE>
See notes to consolidated condensed financial statements.
4
<PAGE> 5
AMCAST INDUSTRIAL CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
--------------------------------
May 28 May 29
1995 1994
----------- ------------
<S> <C> <C>
Operating Activities:
Net income $ 12,575 $ 10,490
Depreciation and amortization 10,915 9,737
Deferred liabilities 351 2,510
Changes in assets and liabilities:
- Accounts receivable (3,865) (3,750)
- Inventories (7,259) (2,529)
- Other current assets (1,507) (1,532)
- Other assets (118) 192
- Accounts payable (1,739) 3,680
- Accrued liabilities 516 1,974
------------ ------------
Net Cash Provided
By Operating Activities 9,869 20,772
Investing Activities:
(Increase) decrease in net assets of
discontinued operation (926) 5,943
Investment in joint venture (5,964) (107)
Additions to plant and equipment, net (23,916) (8,251)
------------ ------------
Net Cash (Used) By
Investing Activities (30,806) (2,415)
Financing Activities:
Proceeds from exercise of stock options 912 804
Long-term debt borrowings 6,800 (0)
Repayments of long-term debt (1,165) (1,162)
Short-term borrowings and current
portion of long-term debt 5,203 (337)
Dividends (3,323) (3,034)
Other 0 (138)
------------ ------------
Net Cash Provided (Used) by
Financing Activities 8,427 (3,867)
------------ ------------
Net change in cash and cash equivalents (12,510) 14,490
Cash and cash equivalents
at beginning of period 15,414 2,251
------------ ------------
Cash and Cash Equivalents
at End of Period $ 2,904 $ 16,741
============ ============
</TABLE>
See notes to consolidated condensed financial statements.
5
<PAGE> 6
AMCAST INDUSTRIAL CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands except share amounts)
(unaudited)
Note A - Preparation of Financial Statements
The consolidated condensed financial statements include the accounts of Amcast
Industrial Corporation and subsidiaries (the Company). Intercompany transactions
have been eliminated. All adjustments, consisting of only normally recurring
accruals, necessary for a fair presentation have been included.
Note B - Accounts Receivable
Accounts receivable are stated net of allowances for doubtful accounts of $167
at May 28, 1995 and $147 at August 31, 1994.
Note C - Inventories
Certain inventories are presented net of the appropriate LIFO reserve.
Note D - Other Assets
The major components are:
<TABLE>
<CAPTION>
May 28 August 31
1995 1994
------- ---------
<S> <C> <C>
Technical and product programs $ 848 $ 1,419
Goodwill 2,709 2,774
Investment in joint venture 6,612 648
Other assets and deferred charges 5,961 5,851
------- -------
$16,130 $10,692
======= =======
</TABLE>
Note E - Deferred Liabilities
Deferred liabilities include the noncurrent portion of retirement, compensation,
medical benefits, and estimated future payouts under the Company's self-insured
workers' compensation program. These liabilities primarily relate to the
Company's provisions for restructuring operations, the discontinued operation,
and postretirement benefits other than pensions. Significant noncurrent
restructuring liabilities for medical and workers' compensation costs were
$2,300 and $2,800 at May 28, 1995 and August 31, 1994, respectively;
consolidation and disposition of operations were $1,500 and $2,100, respectively
at May 28, 1995 and August 31, 1994. Postretirement benefits other than pensions
were $5,400 and $5,600 at May 28, 1995 and August 31, 1994, respectively. These
accruals are not deductible for income tax purposes until paid and are
therefore, accounted for as temporary differences in the Company's tax
provision.
6
<PAGE> 7
AMCAST INDUSTRIAL CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands except share amounts)
(unaudited)
Note F - Long-Term Debt
The following table summarizes the Company's borrowings:
<TABLE>
<CAPTION>
May 28 August 31
1995 1994
------- -------
<S> <C> <C>
Senior notes $10,089 $10,964
Industrial revenue bonds 6,678 6,965
Lines of credit - notes payable 12,000 0
------- -------
Total Obligations 28,767 17,929
Less current portion of notes payable
and lines of credit 9,222 4,019
------- -------
$19,545 $13,910
======= =======
</TABLE>
Note G - Commitments and Contingencies
At May 28, 1995, the Company has committed to capital expenditures of $15.3
million.
The Company, as is normal for the industry in which it operates, is involved in
certain legal proceedings and subject to certain claims and site investigations
which arise under the environmental laws and which have not been finally
adjudicated.
The Company has been identified as a potentially responsible party by various
state agencies and by the United States Environmental Protection Agency (U.S.
EPA) under the Comprehensive Environmental Response Compensation and Liability
Act of 1980, as amended, for costs associated with nine U.S. EPA led multi-party
"superfund" sites and five state environmental agency led remediation sites.
Each of these claims involves third-party owned disposal sites for which
compensation is sought from the Company as an alleged waste generator for
recovery of past governmental costs or for future investigation or remedial
actions. The designation, as a potentially responsible party, and the assertion
of such claims against the Company are made without taking into consideration
the extent of the Company's involvement with the particular site. In each
instance, claims have been asserted against a number of other entities for the
same recovery or other relief as was asserted against the Company. These claims
are in various stages of administrative or judicial proceeding. The Company has
no reason to believe that it will have to pay a significantly disportionate
share of clean-up costs associated with any site.
To the extent possible, with the information available at the time, the Company
has evaluated its responsibility for costs and related liability with respect to
the above sites. In making such evaluation, the Company did not take into
consideration any possible cost reimbursement claims against its insurance
carriers.
7
<PAGE> 8
The Company is of the opinion that its liability with respect to those sites
should not have a material adverse effect on its financial position or results
of operations. In arriving at this conclusion, the principal factors considered
by the Company were on-going settlement discussions with respect to certain of
the sites, the volume and relative toxicity of waste alleged to have been
disposed of by the Company at certain sites, which factors are often used to
allocate investigative and remedial costs among potentially responsible
parties, the probable costs to be paid by other potentially responsible
parties, total projected remedial costs for a site, if known, and the Company's
existing reserve to cover costs associated with unresolved environmental
proceedings. At May 28, 1995, the Company's accrued reserve for such
contingencies, including the Allied-Signal, Inc. and the Public Interest
Research Group, Inc. proceedings described below, was $3.2 million.
Allied-Signal, Inc. has brought a superfund private cost recovery and
contribution action against the Company in the United States District Court for
the Southern District of Ohio, Western Division, which is captioned
Allied-Signal, Inc. v. Amcast Industrial Corporation (Case No. C-3092-013).
The action involves the Goldcamp Disposal Site in Ironton, Ohio. Allied-Signal
has taken the lead in remediating the site and has estimated that its total
costs for the remediation may reach $30 million. Allied is seeking a
contribution from the Company in an amount equal to 50% of the final
remediation costs. A trial in this proceeding was completed in February 1995,
but no judgment is anticipated until after certain post-trial proceedings are
completed. The Company believes its responsibility with respect to the Goldcamp
site is limited, primarily due to the nature of the foundry sand waste it
disposed of at the site. The Company believes that if it has any liability, at
all, in regard to the Goldcamp site, that liability would not be material to
its results of operations.
The Company is also a defendant in a lawsuit captioned Public Interest Research
Group, Inc., et al. v. Stanley G. Flagg & Co., et al., filed in the United
States District Court for the Eastern District of Pennsylvania (Case No.
89-2137). In this proceeding, it is alleged that the content of zinc and other
minerals in the waste water discharged at the Company's Stowe, Pennsylvania
facility exceeded the level allowed under the applicable permit, on certain
days, during the period from October 1984 through October 1988. The suit seeks
the assessment of penalties. The Company had believed that penalties, if any,
would not be material because the discharge has been in compliance with the
permit since at least early 1990 and the proceedings had been inactive for more
than four years prior to March 16, 1995. On March 16, 1995, the Court moved the
case to the current docket from the civil suspense file. Potential penalties
are again at issue. In the event that penalties are assessed against the
Company, they would be limited to a maximum of $25,000 per day for each of
those days on which the minerals in the waste water discharge exceeded the
levels allowed in the applicable permit. The Company believes that any
penalties that might ultimately be assessed would not be material to its
results of operations.
The Company's Flagg division, a discontinued operation, is a defendant in
UNITED STEEL WORKERS OF AMERICA VS. STANLEY G. FLAGG & CO., INC.
filed on March 27, 1995 before the National Labor Relations Board, Fourth
Region (Case No. 4-CA-23069). In August 1994, Flagg declared that negotiations
with the Steelworkers Union relating to a new labor contract for approximately
121 employees at its Stowe, Pennsylvania facility had reached impasse. Flagg
then implemented the last offer made to the Union. The Union claims, among
other things, that Flagg's declaration of an impasse was improper and is
seeking lost wages since August 1, 1994 and other relief. A hearing is
scheduled before the National Labor Realtions Board in October 1995. The
Company believes that if it has any liability, such liability would be subject
to various offsets and would not be material to its results of operations.
8
<PAGE> 9
AMCAST INDUSTRIAL CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands except share amounts)
(unaudited)
Note H - Income Taxes
The estimated effective tax rates were 34.6% and 31.4% for the third quarters
and 35.5% and 34.5% for the nine months of 1995 and 1994, respectively. In the
current quarter, after review, the annual estimated effective income tax rate
was reduced from 36.0% to 35.5%. In the third quarter of 1994, the annual
effective income tax rate was reduced from 36.5% to 34.5% to reflect the tax
benefit derived from the conversion of Casting Technology Corporation, a 60%
owned joint venture, to a partnership. The impact of the 1994 change reduced the
third quarter tax expense by $320,000.
Note I - Net Income Per Share
For the third quarter of 1995 and 1994, the weighted average number of common
shares used to calculate income per share was 8,524,002 and 8,444,491 and for
the first nine months of 1995 and 1994 was 8,504,298 and 8,414,629,
respectively.
9
<PAGE> 10
AMCAST INDUSTRIAL CORPORATION
PART I - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Operating Results
Net sales of $86.4 million in the current quarter ended May 28, 1995 increased
21.9% from the prior year third quarter. Flow Control Products' sales increased
8.0% to $36.3 million, primarily due to price increases that were implemented to
offset the impact of the continuing escalation of copper costs. Engineered
Components' sales rose 34.3% to $50.1 million, primarily due to increased unit
volumes and the pass through of aluminum cost increases. For the first nine
months of 1995, net sales were $245.2 million, up 23.2% from the comparable
prior year period. Flow Control Products' sales rose 22.0% to $108.9 million,
due to increased volumes and pricing actions which passed on escalating copper
costs to the customer. Engineered Components' sales increased 24.3% to $136.2
million, due to higher volumes of wheels and other aluminum automotive
components and contractual price adjustments for increased aluminum cost.
Gross profit for the third quarter of 1995 and 1994 was $17.9 million and $15.8
million, respectively. The increase in gross profit was primarily attributable
to higher sales levels. The gross profit percent for the third quarter of 1995
was 20.7%, compared to 22.3% in 1994. Improvements in margin due to pricing
actions were offset by the cost of launching several new products in the
Engineered Components' business. Gross profit for the first nine months of 1995
increased to $50.6 million from $43.2 million. The year-to-date gross profit
percent was 20.6%, down from 21.7% in the prior year as product launch costs
offset the gains from pricing actions.
Selling, general and administrative expenses for the third quarter of $10.6
million, rose $1.2 million from the third quarter of 1994, primarily due to
higher commission expense relating to increased Flow Control sales. For the
nine-month periods, selling, general and administrative expenses were 12.4% and
13.2% of sales in 1995 and 1994, respectively.
For the third quarter of 1995 and 1994, interest expense was $.3 million and $.4
million, respectively. Current year-to-date interest expense is $1.0 million,
down from $1.2 million in 1994, due to lower average borrowings in fiscal 1995.
10
<PAGE> 11
AMCAST INDUSTRIAL CORPORATION
PART I - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS - CONTINUED
Results by Business Segment (unaudited)
(dollars in thousands)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
--------------------------- ---------------------------
May 28 May 29 May 28 May 29
1995 1994 1995 1994
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net Sales
Flow Control Products $ 36,291 $ 33,602 $ 108,938 $ 89,313
Engineered Components 50,106 37,300 136,212 109,614
--------- --------- --------- ---------
$ 86,397 $ 70,902 $ 245,150 $ 198,927
========= ========= ========= =========
Income Before Taxes
Flow Control Products $ 6,636 $ 4,998 $ 19,094 $ 14,374
Engineered Components 2,669 3,108 6,488 7,415
Corporate Expense (1,830) (1,431) (5,063) (4,529)
Interest Expense (324) (421) (1,023) (1,245)
--------- --------- --------- ---------
$ 7,151 $ 6,254 $ 19,496 $ 16,015
========= ========= ========= =========
</TABLE>
Flow Control Products' operating income in the third quarter of $6.6 million was
up 32.8%, primarily due to improved margins resulting from pricing actions and
increased product sales. Engineered Components' operating income of $2.7 million
decreased $.4 million as gains from higher sales volumes were offset by costs
relating to the launch of several new products. Year-to-date Flow Control
Products' operating income rose by 32.8% from 1994, due to higher margins
realized from improved prices. Engineered Components' nine-month operating
income decreased $.9 million from the prior period, primarily due to costs
related to new product launches which more than offset increased sales of wheels
and other aluminum automotive components.
Capital Resources and Liquidity
For the first nine months of 1995, net cash provided by operations was $9.9
million, down from $20.8 million for the comparable period in 1994. In the
current year, cash provided by net income, depreciation, and amortization was
partially offset by a $13.9 million increase in working capital. In the prior
year, cash provided by net income, depreciation, and amortization was partially
offset by an increase in working capital of $2.2 million.
11
<PAGE> 12
AMCAST INDUSTRIAL CORPORATION
PART I - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS - CONTINUED
Capital expenditures were $23.9 million and $8.3 million for the nine-month
period of fiscal 1995 and 1994, respectively. At May 28, 1995, the Company had
commitments to purchase $15.3 million of machinery, primarily for the Engineered
Components segment.
Total long-term debt at May 28, 1995 was $19.5 or 14.0% of capital, compared to
$13.9 or 11.2% of capital as of August 31, 1994. The current portion of notes
payable and lines of credit increased $5.2 and long-term debt increased $5.6,
due to borrowing against credit lines to partially finance the spending for new
plant and equipment.
The Company has recently completed a new Revolving Credit Agreement which allows
for borrowing up to $60 million and expires April 1, 2000. In addition, the
Company maintains bank lines of credit under which it may borrow up to $25
million. At May 28, 1995, there were no borrowings under the Revolving Credit
Agreement and $12 million outstanding under the bank lines of credit. The
Company considers these external sources of funds, together with funds generated
from operations, to be adequate to meet operating needs.
Net assets of the discontinued operation were $13.3 million and $12.4 million
at May 28, 1995 and August 31, 1994, respectively, consisting of current
assets, current liabilities, and fixed assets of the remaining portion of the
Stanley G. Flagg Division, net of an allowance for estimated loss on disposal.
Environmental Matters
The Company, as is normal for the industry in which it operates, is involved in
certain legal proceedings and subject to certain claims and site investigations
that arise under the environmental laws and which have not been finally
adjudicated. To the extent possible, with the information available, the Company
regularly evaluates its responsibility with respect to environmental
proceedings. The factors considered in this evaluation are described in detail
in the Commitments and Contingencies note to the consolidated condensed
financial statements. At May 28, 1995, the Company had accrued reserves of $3.2
million for environmental liabilities. The Company is of the opinion that, in
light of its existing reserves, its liability in connection with environmental
proceedings should not have a material adverse effect on its financial
condition or results of operation.
12
<PAGE> 13
AMCAST INDUSTRIAL CORPORATION
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings
Refer to Item 3, Part I of Form 10-K for the fiscal year ended August 31, 1994
and Item I, Part II of Form 10-Q for the quarter ended February 26, 1995.
The Company's Flagg division, reported as a discontinued operation, is a
defendant in UNITED STEEL WORKERS OF AMERICA VS. STANLEY G. FLAGG & CO., INC.
filed on March 27, 1995 before the National Labor Relations Board, Fourth
Region (Case No. 4-CA-23069). In August 1994, Flagg declared that negotiations
with the Steelworkers Union relating to a new labor contract for approximately
121 employees at its Stowe, Pennsylvania facility had reached impasse. Flagg
then implemented the last offer made to the Union. The Union claims, among
other things, that Flagg's declaration of an impasse was improper and is
seeking lost wages since August 1, 1994 and other relief. A hearing is
scheduled before the National Labor Realtions Board in October 1995. The
Company believes that if it has any liability, such liability would be subject
to various offsets and would not be material to its results of operations.
Item 6 - Exhibits and Reports on Form 8-K
a) EXHIBITS
Exhibit 4.1 - Amended and restated Revolving Credit Agreement between
the Company and Star Bank, National Association; Bank One, Dayton, NA;
First National Bank of Chicago; NBD Bank; and Society National Bank
dated June 7, 1995.
Exhibit 10.5 - Executive Agreement between the Company and
Leo W. Ladehoff, Chairman of the Board and former Chief Executive
Officer of the Company dated March 3, 1995.
Exhibit 27 - Financial Data Schedule
b) Reports on Form 8-K:
No reports on Form 8-K were filed by the Company during the quarter ended
May 28, 1995.
13
<PAGE> 14
AMCAST INDUSTRIAL CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMCAST INDUSTRIAL CORPORATION
(Registrant Company)
Date: July 12, 1995 By: /s/J. H. Shuey
------------- ----------------------------------
John H. Shuey
President and Chief Executive Officer,
Director
(Principle Executive Officer)
Date: July 12, 1995 By: /s/D. D. Watts
------------- ----------------------------------
Douglas D. Watts
Vice President, Finance
(Principle Financial Officer)
Date: July 12, 1995 By: /s/W. L. Bown
------------- ----------------------------------
William L. Bown
Vice President and Controller
(Principle Accounting Officer)
14
<PAGE> 1
AMCAST INDUSTRIAL CORPORATION
----------------
$60,000,000
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
----------------
DATED AS OF JUNE 7, 1995
1
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
Section 1. Definitions......................................................................... 1
Section 2. Amount and Terms of Credit.......................................................... 7
2.01 Commitments.......................................................................... 7
2.02 Minimum Amount of Each Borrowing..................................................... 7
2.03 Notice of Borrowing.................................................................. 7
2.04 Disbursement of Funds................................................................ 7
2.05 Notes................................................................................ 8
2.06 Pro Rata Borrowings.................................................................. 9
2.07 Interest............................................................................. 9
2.08 Interest Periods..................................................................... 10
2.09 Increased Costs, Illegality.......................................................... 10
2.10 Compensation......................................................................... 12
2.11 Election Revision.................................................................... 12
2.12 Extension of the Revolver Period..................................................... 12
2.13 Term Loan............................................................................ 12
2.14. Proceeds; Initial Loans............................................................. 13
Section 3. Commitments......................................................................... 13
3.01 Commitment Commission................................................................ 13
3.02 Voluntary Termination of Commitments................................................. 13
3.03 Agent's Fee.......................................................................... 14
Section 4. Payments............................................................................ 14
4.01 Voluntary Prepayments................................................................ 14
4.02 Method and Place of Payment.......................................................... 14
4.03 Net Payments......................................................................... 14
Section 5. Conditions Precedent................................................................ 15
5.01 Conditions to Effectiveness.......................................................... 15
5.02 Conditions to Each Loan.............................................................. 15
Section 6. Covenants........................................................................... 16
6.01 Information Covenants................................................................ 16
6.02 Compliance with Law.................................................................. 17
6.03 Payment of Charges................................................................... 17
6.04 Inspection of Books and Assets....................................................... 17
6.05 Maintenance of Records............................................................... 17
6.06 ERISA................................................................................ 17
6.07 Preservation of Corporate Existence.................................................. 18
6.08 Insurance............................................................................ 18
6.09 Liens................................................................................ 18
6.10 Consolidation, Merger and Sale of Assets............................................. 19
6.11 Tangible Net Worth................................................................... 19
6.12 Additional Debt...................................................................... 19
6.13 Changes in Business.................................................................. 19
Section 7. Events of Default................................................................... 19
Section 8. Representations, Warranties and Agreement........................................... 21
8.01 Corporate Status..................................................................... 21
</TABLE>
2
<PAGE> 3
<TABLE>
<S> <C>
8.02 Corporate Power and Authority......................................................... 21
8.03 No Violation.......................................................................... 22
8.04 Litigation............................................................................ 22
8.05 Financial Statements.................................................................. 22
8.06 Use of Proceeds; Regulation U......................................................... 22
8.07 Governmental Approvals................................................................ 22
8.08 Compliance with ERISA................................................................. 22
Section 9. Miscellaneous........................................................................ 23
9.01 Payment of Expenses................................................................... 23
9.02 Right of Setoff....................................................................... 23
9.03 Notices............................................................................... 23
9.04 Benefit of Agreement.................................................................. 23
9.05 No Waiver; Remedies Cumulative........................................................ 24
9.06 Payments Pro Rata..................................................................... 24
9.07 Calculations; Computations............................................................ 24
9.08 Governing Law......................................................................... 25
9.09 Counterparts.......................................................................... 25
9.10 Descriptive Headings.................................................................. 25
9.11 Amendment or Waiver................................................................... 25
9.12 The Agent............................................................................. 25
9.13 Survival.............................................................................. 25
9.14 Confidentiality....................................................................... 25
</TABLE>
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<PAGE> 4
Form 10-Q
May 28, 1995
Exhibit 4.1
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this
"Agreement"), dated as of June 7, 1995, among AMCAST INDUSTRIAL CORPORATION (the
"Company"), an Ohio corporation, the commercial banks listed on the signature
pages hereto (each a "Bank" and, collectively, the "Banks") and STAR BANK,
NATIONAL ASSOCIATION, acting in the manner and to the extent described in
Section 9.12 (in such capacity, the "Agent").
W I T N E S S E T H :
WHEREAS, the Banks, the Company and the Agent are parties to a
certain Amended and Restated Revolving Credit Agreement dated as of September
30, 1992, (the "Original Agreement"); and
WHEREAS, subject to and upon the terms and conditions herein set
forth, the Banks are willing to make available to the Company the credit
facility provided for herein;
NOW, THEREFORE, IT IS AGREED:
Section 1. Definitions
As used herein, the following terms shall have the meanings
herein specified unless the context otherwise requires. Defined terms in this
Agreement shall include in the singular number the plural and in the plural
number the singular:
1.01 "Acquisition" shall mean the purchase or other acquisition
of in excess of 5% of the stock (or other evidences of ownership) of any Person
or the purchase or acquisition of all or substantially all of the assets of any
Person or any division, profit center or other similar subpart of any Person.
1.02 "Agent" shall have the meaning provided in the first
paragraph of this Agreement.
1.03 "Agent's Fee" shall have the meaning provided in Section
3.03.
1.04 "Agreement" shall mean this credit agreement as the same
may hereafter be modified, supplemented or amended.
1.05 "Applicable Margin" shall mean at any time with respect to
each Fixed Rate Loan, (x) in the case of CD Rate Loans the applicable percentage
in excess of the Fixed CD Rate referred to in Section 2.07 and (y) in the case
of Eurodollar Loans, the applicable percentage in excess of the Quoted Rate
referred to in Section 2.07.
1.06 "Associate" shall mean any Person which, directly or
indirectly, controls or is controlled by or is under common control with another
Person and for the purposes of this definition, "control", including "controlled
by" and "under common control with" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities or by
contract or otherwise.
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<PAGE> 5
1.07 "Bank" shall have the meaning provided in the first
paragraph of this Agreement.
1.08 "Borrowing" shall mean the incurrence of one Type of Loan
or Term Loan from all the Banks on a given date, having in the case of Fixed
Rate Loans the same Interest Period, pursuant to Section 2.03.
1.09 "Business Day" shall mean (i) for all purposes other than
as covered by clause (ii) below, any day excluding Saturday, Sunday and any day
which shall be in the City of Cincinnati, Ohio a legal holiday or a day on which
banking institutions are authorized by law or other government actions to close
and (ii) with respect to all notices and determinations in connection with, and
payments of principal and interest on, Eurodollar Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Eurodollar Market.
1.10 "Cash Flow" shall mean the Company's Consolidated Net
Income plus depreciation and amortization for the four fiscal quarters
immediately preceding the date the measurement is calculated.
1.11 "CD Rate Loan" shall mean a Loan or Term Loan bearing
interest at the rates provided in Section 2.07(b).
1.12 "Certificate of Deposit Rate" shall mean the consensus bid
rate determined by the Agent for the bid rates per annum, at approximately 10:00
a.m. (New York time) on the first day of the Interest Period for which such
Certificate of Deposit Rate is to be applicable of two or more New York or other
money center certificate of deposit dealers of recognized standing selected by
the Agent for the purchase at face value from the Agent of certificates of
deposit in an aggregate amount approximately comparable to the CD Rate Loan of
the Agent to which such Certificate of Deposit Rate is to be applicable and with
a maturity equal to the Interest Period for such CD Rate Loan.
1.13 "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations thereunder.
1.14 "Commitment" shall mean, for each Bank, the amount set
forth opposite its name in Annex I hereto, as same may be reduced from time to
time in accordance with the provisions of this Agreement.
1.15 "Company" shall have the meaning provided in the first
paragraph of this Agreement, provided that for purposes of Sections 6.06, 7 and
8.08, "Company" shall be deemed to include any member (whether or not
incorporated) of a group which the Company or any of its Subsidiaries is a
member and which is under common control with the Company or any of its
Subsidiaries within the meeting of Section 414(c) of the Code or Section 1301(b)
of Title 29 of the United States Code.
1.16 "Consolidated Capitalization" shall mean the sum of Funded
Debt of the Company plus Consolidated Tangible Net Worth.
1.17 "Consolidated Current Assets" shall mean the current assets
of the Company and its Subsidiaries determined on a consolidated basis
determined in accord with generally accepted accounting principles consistently
applied.
1.18 "Consolidated Current Liabilities" shall mean the current
liabilities of the Company and its Subsidiaries determined on a consolidated
basis determined in accord with generally accepted accounting principles
consistently applied.
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<PAGE> 6
1.19 "Consolidated Net Income" shall mean for any period the
after tax net income determined in accord with generally accepted accounting
principles consistently applied, of the Company and its Subsidiaries for such
period determined on a consolidated basis.
1.20 "Consolidated Tangible Net Worth" shall mean at any time
the Net Worth of the Company and its Subsidiaries determined on a consolidated
basis after deducting therefrom (i) the amount of all intangible items reflected
therein, including but not limited to goodwill, franchises, licenses, patents,
trademarks, trade names, copyrights, service marks, brand names, write-up of
assets, any unallocated excess cost of investments in Subsidiaries over equity
in underlying net assets at the dates of acquisition, and organizational costs
but only to the extent such items are booked by the company after February 26,
1995.
1.21 "Consolidated Total Assets" shall mean at any time the
total assets of the Company and its Subsidiaries determined on a consolidated
basis.
1.22 "Control" shall have the meaning associated to it by
generally accepted accounting principles.
1.23 "Debt" shall mean, with respect to any Person, all
indebtedness for borrowed money of such Person which in accordance with
generally accepted accounting principles would be shown on the consolidated
balance sheet of such Person as a liability; all rental obligations under leases
required to be capitalized under generally accepted accounting principles; all
guarantees and other contingent obligations of such Person in respect of, or
obligations to purchase or otherwise acquire, Debt of others; the principal
amount of all Debt of Persons other than Subsidiaries of such Person if such
Person is obligated under a Maintenance Agreement with respect to such Persons,
not in excess of the amount of any limitation on aggregate cumulative payments
under such Maintenance Agreement; and Debt of others secured by any Lien upon
property owned by such Person, whether or not assumed; all obligations of such
Person in respect of letters of credit (other than letters of credit required by
insurers to satisfy worker's compensation bonding requirements), provided that
(i) Debt shall not include lease obligations under operating leases which are
not required to be capitalized under generally accepted accounting principles,
(ii) Debt shall not include the presently outstanding secured loans in the
original principal amount of $700,000 and $350,000 from the City of Fremont,
Indiana to WheelTek, Inc., and (iii) Debt shall not include Non-Recourse Debt to
the extent (and only to the extent) that such Non-Recourse Debt does not exceed
$5,000,000 in the aggregate.
1.24 "Default" shall mean any event, act or condition which with
notice, or lapse of time, or both, would constitute an Event of Default.
1.25 "Designated Party" shall have the meaning provided in
Section 7(f).
1.26 "Effective Date" shall have the meaning provided in Section
5.01.
1.27 "ERISA" shall mean the Employee Retirement Income Security
Act of 1974 as amended from time to time. Section references to ERISA are to
ERISA as in effect at the date of this Agreement and any subsequent provisions
of ERISA, amendatory thereof, supplemental thereto or substituted therefor.
1.28 "ERISA Affiliate" shall mean each trade or business
(whether or not incorporated) which together with the Company or a Subsidiary
would be deemed to be a "single employer" within the meaning of Section 4001 of
ERISA.
1.29 "Eurodollar Loan" shall mean any Loan or Term Loan bearing
interest at the rates provided in Section 2.07.
1.30 "Event of Default" shall have the meaning provided in
Section 7.
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<PAGE> 7
1.31 "Expiry Date of the Revolver Period" shall mean the earlier
of the occurrence of an Event of Default or March 31, 1998, unless extended as
provided in Section 2.12 hereof, or, if such Day is not a Business Day, the
immediately preceding Business Day.
1.32 "Expiry Date" of the Term Loan Period shall mean the
earlier of the occurrence of an Event of Default or April 1, 2000 unless the
term period is extended as a result of the extension of the Revolver Period as
provided in Section 2.12 hereof or, if such Day is not a Business Day, the
immediately preceding Business Day.
1.33 "Fixed CD Rate" shall mean, with respect to each Interest
Period, the sum (rounded up to the nearest 1/100 of 1% of (i) the rate obtained
by dividing (x) the Certificate of Deposit Rate for such Interest Period by (y)
a percentage equal to 100% minus the stated maximum rate of all reserve
requirements as specified in Regulation D (including, without limitation, any
marginal, emergency, supplemental, special or other reserves) applicable during
such Interest Period to a negotiable certificate of deposit in excess of
$100,000 with a maturity equal to such Interest Period of any member bank of the
Federal Reserve System, plus (ii) the then daily net annual assessment rate as
estimated by the Agent for determining the current maximum annual assessment
payable by the Banks to the Federal Deposit Insurance Corporation for insuring
such certificates of deposit.
1.34 "Fixed Rate Loan" shall mean and include any CD Rate Loan
and any Eurodollar Loan.
1.35 "Funded Debt" shall mean all short and long term interest
bearing debt, including but not limited to, all amounts outstanding under this
Agreement and the Company's short term bank lines, original issue discount debt
and capitalized leases.
1.36 "Interest Determination Date" shall mean each date for the
determination of the Quoted Rate or the Certificate of Deposit Rate, as the case
may be, for any Interest Period (i.e., two Business Days' prior to the first day
of the Interest Period, in the case of the Quoted Rate, and the first day of the
Interest Period, in the case of the Certificate of Deposit Rate).
1.37 "Interest Period" shall have the meaning specified in
Section 2.08.
1.38 "Interim Maturity Date" shall mean each date other than the
Expiry Date on which Loans mature.
1.39 "Investment" shall mean any investment made after February
26, 1995 including, but not limited to (i) any investments in real estate, (ii)
any investments Joint Ventures (iii) any investments in Subsidiaries, and (iv)
any investments in Persons which, by the nature of such investments, do not
transmit Control of the relevant Person to the Company.
1.40 "Joint Venture" shall mean any association with one or more
Persons to undertake a commercial or business enterprise.
1.41 "Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement or any
lease in the nature thereof).
1.42 "Loan" shall have the meaning specified in Section 2.01.
1.43 "Maintenance Agreement" shall mean any agreement,
contingent or otherwise, pursuant to which a Person, with respect to Debt of any
Person other than a Subsidiary of such Person, obligates itself directly or
indirectly (i) to purchase such Debt or any property constituting security
therefor; (ii) to advance or supply funds (x) for the purchase or payment of
such Debt, or (y) to maintain working capital or any other balance sheet or
income statement condition, or otherwise to advance or make available funds for
the purchase or payment of such Debt; (iii) to
7
<PAGE> 8
lease property or to purchase securities or other property or services primarily
for the purpose of assuring the owner of such Debt of the ability of such Person
to make payment of the Debt; or (iv) otherwise to assure (other than through a
direct guarantee of such Debt) the owner of such Debt against loss in respect
thereof.
1.44 "Margin Stock" shall have the meaning provided such term in
Regulation U of the Board of Governors of the Federal Reserve System.
1.45 "Net Worth" of a Person shall mean the sum of its capital
stock, capital in excess of par or stated value of shares of its capital stock,
retained earnings, and any other account which, in accordance with generally
accepted accounting principles, constitutes stockholders' equity, less, treasury
stock.
1.46 "Non-Recourse Debt" shall mean Debt of Amcast Industrial
Financial Services, Inc. evidenced by a Lien wherein liability is limited to the
security without any liability of the Company or its Subsidiaries (other than
Amcast Industrial Financial Services, Inc.) for any deficiency.
1.47 "Note" shall have the meaning specified in Section 2.05(a).
1.48 "Notice of Borrowing" shall have the meaning provided in
Section 2.03.
1.49 "Notice Office" shall have the meaning provided in Section
2.03.
1.50 "Original Agreement" shall have the meaning provided in the
first WHEREAS clause hereof.
1.51 "Payment Office" shall have the meaning provided in Section
2.04.
1.52 "PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
1.53 "Person" shall mean and include any individual, firm,
corporation, association, trust or other enterprise or any government or
political subdivision or agency, department or instrumentality thereof.
1.54 "Plan" shall mean any multiemployer plan, multiple employer
plan or single employer plan maintained by the Company or any of its
Subsidiaries or to which the Company or any of its Subsidiaries contributes, as
the context may require.
1.55 "Prime Lending Rate" shall mean the rate which the Agent
announces from time to time at its principal office as its prime rate for
domestic unsecured commercial loans.
1.56 "Prime Rate Loan" shall mean any Loan or Term Loan bearing
interest at the rates provided in Section 2.07(a).
1.57 "Quarterly Payment Date: shall mean the last Business Day
of each March, June, September and December of each year commencing June 30,
1995.
1.58 "Quoted Rate" shall mean the rate obtained by dividing (i)
the offered quotation to banks rated (for short term obligations) AA or higher
by Standard and Poor's Corporation in the interbank Eurodollar market by the
Agent for U.S. dollar deposits of amounts in immediately available funds
comparable to the outstanding principal amount of the Eurodollar Loan of the
Agent with maturities comparable to the Interest Period for which a Quoted Rate
determined with reference to such offered rate will apply as of 10:00 a.m. (New
York time) two Business Days prior to the commencement of such Interest Period
by (ii) a percentage equal to 100% minus the maximum stated rate of all reserve
requirements as specified in Regulation D
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<PAGE> 9
including, without limitation, any marginal, emergency, supplemental, special or
other reserves, that would be applicable to any member bank of the Federal
Reserve System during such Interest Period in respect of eurocurrency or
eurofunding lending or liabilities.
1.59 "Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
1.60 "Reportable Event" shall mean any event set forth in
Section 4043(b) of ERISA (with respect to which the 30 day notice requirement
has not been waived by PBGC).
1.61 "Required Banks" as of a particular date shall mean Banks
having a least 100% of the Total Commitment.
1.62 "Restricted Margin Stock" shall mean at any time for
determination thereof all of the Margin Stock owned by the Company to the extent
the value of such Margin Stock does not exceed 25% of the Consolidated Total
Assets subject to the provisions of Sections 6.09 and 6.10.
1.63 "Roll-Over Borrowing" shall mean a Borrowing of Loans or
Term Loans on any Interim Maturity date wherein the aggregate principal amount
of the Loans or Term Loans being incurred equals or is less than the aggregate
principal amount of the Loans or Term Loans maturing on the date of such
Borrowing.
1.64 "Subsidiary" shall mean any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting
power to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by the Company directly or indirectly through
Subsidiaries. The term "Subsidiaries" shall not be construed to include Casting
Technology Company, a partnership in which the Company is a general partner.
1.65 "Term Loan" shall be any loan made pursuant to the
provision of Section 2.13 hereof.
1.66 "Term Loan Repayment" shall have the meaning specified in
Section 2.13
1.67 "Term Note" shall have the meaning specified in Section
2.05(c).
1.68 "Total Commitment" shall mean $60,000,000, as such amount
may be reduced from time to time pursuant to Section 3.02.
1.69 "Total Debt" shall mean the Debt of the Company and its
Subsidiaries determined on a consolidated basis.
1.70 "Type" shall mean any type of Loan, i.e., whether a Prime
Rate Loan, a CD Rate Loan or a Eurodollar Loan.
1.71 "Unrestricted Margin Stock" shall mean all of the Margin
Stock of the Company and its Subsidiaries which is not Restricted Margin Stock.
1.72 "Written" or "in writing" shall mean any form of written
communication or a communication by means of telex, telecopier device, telegraph
or cable.
Section 2. Amount and Terms of Credit.
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<PAGE> 10
2.01 Commitments. Subject to and upon the terms and conditions
herein set forth, each Bank severally agrees at any time and from time to time
prior to the Expiry Date of the Revolver Period (all capitalized terms used
herein shall have the meaning specified therefor in Section 1 unless otherwise
defined herein) to make loans (each a "Loan" and collectively the "Loans") to
the Company, which Loans (x) shall, at the option of the Company, be either
Prime Rate Loans, CD Rate Loans or Eurodollar Loans, provided that all Loans
made pursuant to the same Borrowing shall be of the same Type, (y) may be repaid
and reborrowed in accordance with the provisions hereof and (z) shall not exceed
in aggregate principal amount at any time outstanding such Bank's Commitment.
2.02 Minimum Amount of Each Borrowing. The aggregate principal
amount of each Borrowing hereunder shall (x) in the case of Fixed Rate Loans, be
not less than $2,500,000 and (y) in the case of Prime Rate Loans, be not less
than $1,000,000 and, in each case, if greater, shall be in an integral multiple
of $500,000.
2.03 Notice of Borrowing. (a) Whenever the Company desires to
make a Borrowing (including a Roll-Over Borrowing) hereunder, it shall give
written notice (or telephonic notice, confirmed in writing) to the Agent at its
office located at 425 Walnut Street, Cincinnati, Ohio 45201 (the "Notice
Office") no later than (x) Noon (Cincinnati time) on the date of Borrowing in
the case of each Prime Rate Loan to be made hereunder, (y) 10:30 A.M.
(Cincinnati time) on the date of Borrowing in the case of each CD Rate Loan to
be made hereunder and (z) noon (Cincinnati time) on the second Business Day
preceding the date of Borrowing in the case of each Eurodollar Loan to be made
hereunder. Each such notice (each a "Notice of Borrowing") shall specify (x) the
aggregate principal amount of the Loans to be made pursuant to such Borrowing,
(y) the date of Borrowing (which shall be a Business Day), and (z) whether the
Loans or Term Loans being made pursuant to such Borrowing are to be initially
maintained as Prime Rate Loans, CD Rate Loans or Eurodollar Loans and the
Interest Period to be applicable thereto. The Agent shall promptly give each
Bank telephonic notice (confirmed in writing) of the proposed Borrowing, of such
Bank's proportionate share thereof and of the other matters covered by the
Notice of Borrowing. If any Bank requests that Notices of Borrowing requesting
CD Rate Loans or Eurodollar Loans be given by the Company at times earlier than
those set forth above, the Company shall comply with such request, provided that
such earlier times shall not be earlier than the third Business Day preceding
the date of the Borrowing.
(b) Unless the Company shall have given the Agent (x) a Notice
of Borrowing requesting that Loans or Term Loans be made on any Interim Maturity
Date or (y) written or telephonic notice (confirmed in writing) prior to Noon
(Cincinnati time) on such Interim Maturity Date of the Company's intent not to
incur Loans or Term Loans on such date, the Company shall be deemed to have
requested that the Banks make Prime Rate Loans to the Company on such Interim
Maturity Date. Such Prime Rate Loans or Term Loans deemed requested by the
Company shall be in an aggregate principal amount equal to the aggregate
principal amount of the Loans made by the Banks maturing on such Interim
Maturity Date.
2.04 Disbursement of Funds. No later than Noon (Cincinnati time)
on the date specified in each Notice of Borrowing, each Bank will make available
its pro rata portion of the Borrowing requested to be made on such date in U.S.
dollars and in immediately available funds, at the office (the "Payment Office")
of the Agent located at 425 Walnut Street, Cincinnati, Ohio 45201 and the Agent
will make available to the Company at its Payment Office the aggregate of the
amounts so made available by the Banks, provided that each Bank shall apply the
proceeds of each Roll-Over Borrowing to the payment of the Loans or Term Loans
maturing on the date of such Roll-Over Borrowing. Unless the Agent shall have
been notified by any Bank prior to the date of Borrowing that such Bank does not
intend to make available to the Agent such Bank's portion of the borrowing to be
made on such date, the Agent may assume that such Bank has made such amount
available to the Agent on such date of Borrowing and the Agent may, in reliance
upon such assumption, make available to the Company a corresponding amount. If
such corresponding amount is not in fact made available to the Agent by such
Bank, the Agent shall be entitled to recover such corresponding amount on demand
from such Bank. If such Bank does
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<PAGE> 11
not pay such corresponding amount forthwith upon the Agent's demand therefor,
the Agent shall promptly notify the Company and the Company shall immediately
pay such corresponding amount to the Agent. The Agent shall also be entitled to
recover from such Bank or the Company, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Agent to the Company to the date such
corresponding amount is recovered by the Agent (x) in the case of the Banks, at
the overnight Federal Funds rate in effect from time to time and (y) in the case
of the Company, the interest rate applicable to the Loans or Term Loans made
pursuant to such Borrowing. Nothing herein shall be deemed to relieve any Bank
from its obligation to fulfill its Commitment hereunder or to prejudice any
rights which the Company may have against any Bank as a result of any default by
such Bank hereunder.
2.05 Notes. (a) The Company's obligation to pay the principal
of, and interest on, all the Loans made by each Bank shall be evidenced by a
promissory note (each a "Note" and collectively the "Notes) duly executed and
delivered by the Company substantially in the form of Exhibit A1 hereto with
blanks appropriately completed in conformity herewith. The Note issued to each
Bank shall (i) be payable to the order of such Bank and be dated the Effective
Date, (ii) be in a stated principal amount equal to the Commitment of such Bank
and be payable in the principal amount of the Loans evidenced thereby, (iii)
mature on the expiration of the Interest Period applicable to each Loan
evidenced thereby, (iv) bear interest as provided in the appropriate clauses of
Section 2.07 in respect of the Prime Rate Loans, the CD Rate Loans and the
Eurodollar Loans, as the case may be, evidenced thereby and (v) be entitled to
the benefits of this Agreement. Each Bank shall maintain internal records
showing each Loan made by it hereunder and each principal payment thereon with
such information available to the Company as the Company may from time to time
request.
(b) Although each Note shall be dated the Effective Date,
interest in respect thereof shall be payable only for the periods during which
Loans are outstanding thereunder. In addition, although the stated amount of
each Note shall be equal to each Bank's Commitment, such Note shall be
enforceable with respect to the Company's obligation to pay the principal amount
thereof only to the extent of the unpaid principal amount of the Loans
outstanding thereunder at the time such enforcement shall be sought.
(c) The Company's obligation to pay principal of, and interest
on, all the Term Loans made by each Bank shall be evidenced by a promissory note
(each a "term Note" and collectively the "Term Notes") duly executed and
delivered by the Company to each Bank at the Expiry Date of the Revolver Period,
and substantially in the form of Exhibit A2 attached hereto with blanks
appropriately completed in conformity herewith. The Term Note issued to each
Bank shall (i) be payable to the order of such Bank and dated as of the
Revolving Period Expiry Date, (ii) be in a stated principal amount equal to such
Bank's pro-rata share of all outstanding Term Loans of any Type and be payable
in the principal amount of the Term Loans evidenced thereby (subject at all
times to the payment schedule set forth in Section 2.12 of the Agreement), (iii)
bear interest and provide for Roll-Over borrowings as stated in the appropriate
clauses of Sections 2.07 and 2.12 in respect of the Prime Rate Loans, CD Rate
Loans and Eurodollar Loans, as the case may be, evidenced thereby, and (iv) be
entitled to the benefits of this Agreement. Each Bank shall maintain internal
records showing each Term Loan made by it hereunder and each term Loan Repayment
thereon, and make such information available to the Company as the Company may
from time to time request.
(d) Each Term Note shall be dated as of the Revolving Period
Expiry Date, interest in respect thereto shall be payable only for the periods
during which Term Loans are outstanding thereunder. Although the stated amount
of each term Note shall be equal to each Bank's Commitment as of the Revolving
Period Expiry Date, such Term Note shall be enforceable with respect to the
Company's obligation to pay the principal amount thereof only to the extent of
the unpaid principal amount of Term Loans outstanding thereunder at the time
such enforcement shall be sought.
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<PAGE> 12
2.06 Pro Rata Borrowings. Except as otherwise specifically
contemplated by this Agreement, all Loans and Term Loans under this Agreement
shall be made by the Banks simultaneously and in such amount as necessary so
that after giving effect thereto, to the extent possible, the outstanding Loans
and Term Loans of each Bank shall bear the same proportion to all outstanding
Loans and Term Loans of all Banks as such Bank's Commitment bears to the Total
Commitment. It is understood that no Bank shall be responsible for any default
by any other Bank in its obligation to make Loans and Term Loans hereunder and
that each Bank shall be obligated to make the Loans and Term Loans provided to
be made by it hereunder, regardless of the failure of any other Bank to fulfill
its Commitment hereunder. The aggregate Commitments of all Banks shall never
exceed the Total Commitment.
2.07 Interest. The Company agrees to pay interest in respect to
the unpaid principal amount of each CD Rate Loan and/or Eurodollar Loan from the
date the proceeds thereof are made available to the Company in accord with the
following schedule:
In any fiscal quarter when the Company's financial statements
delivered in accord with Section 6.01(a) or (b) shows that the Company's ratio
of Funded Debt to Cash Flow is
<TABLE>
<CAPTION>
Ratio of Funded Debt to Cash Flow: The relevant CD rate plus: The relevant Quoted Rate for each
Eurodollar Loan plus:
<S> <C> <C>
Less than 1.75:1.0 0.5000% 0.3750%
Equal to or greater than 1.75:1.0, but 0.6250% 0.5000%
equal to or less than 3.5:1.0
Greater than 3.5:1.0 0.7500% 0.6250%
</TABLE>
Interest rates shall be increased or decreased in accord with
the above schedule as of the next proceeding fiscal quarter end by all Banks as
of the quarterly or annual financial statement date upon all CD Rate Loans
and/or Eurodollar Rate Loans which were then outstanding, regardless of whether
such CD Rate Loans and/or Eurodollar Rate Loans remain outstanding at the time
the ratio of Funded Debt to Cash Flow is recalculated.
(a) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan or Term Loan shall bear interest at a
rate per annum equal to greater (i) of 1% per annum in excess of the Prime
Lending Rate or (ii) the interest rate in effect at the time of maturity of the
relevant Loan or Term Loan in effect from time to time, provided that no Loan or
Term Loan shall bear interest after maturity at a rate per annum less than the
rate of interest applicable thereto at maturity.
(b) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (x) in respect of each Prime Rate Loan, quarterly in arrears on each
Quarterly Payment Date, and (y) in respect of each Fixed Rate Loan, on the last
day of each Interest Period applicable to such Loan or Term Loan and on any
prepayment (on the amount prepaid), and in the case of all Loans or Term Loans,
at maturity (whether by acceleration or otherwise), and after such maturity, on
demand.
(c) The Agent, upon determining the Fixed CD Rate or Quoted Rate
for any Interest Period shall promptly notify the Company and the other Banks
thereof by telephone (confirmed in writing).
2.08 Interest Periods. At the time it gives any Notice of
Borrowing, the Company shall have the right to elect, by giving the Agent
written notice (or telephonic notice confirmed in writing), the interest period
(each an "Interest Period") applicable to the Loans being requested by such
Notice of Borrowing, which Interest Period shall (x) in the case of CD Rate
Loans be either
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a 30, 60, 90 or 180 day period, (y) in the case of Eurodollar Loans shall be
either one, two, three, or six month period provided in each case that such six
month period is then available to the Banks and (z) in the case of Prime Rate
Loans shall be a period from one to 360 days, provided that:
(i) The Interest Period for any Loan or Term Loan shall
commence on the date of such Loan or Term Loan;
(ii) If any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period in respect of a
Eurodollar Loan would otherwise expire on a day which is not a Business Day but
is a day of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day; and
(iii) No Interest Period in respect of any Loan shall extend
beyond the Expiry Date for the Revolver Period in the case of a CD Rate,
Eurodollar or Prime Rate Loan or the Expiry Date for the Term Loan Period in the
case of a Term Loan.
(iv) No Interest Period shall extend beyond any date upon which
the Loans or Term Loans (or any portion thereof) are required to be paid
pursuant to the Notes, Term Notes and/or Agreement, unless the aggregate
principal amount of Loans or Term Loans which have Interest Periods which will
expire on or before the date on which principal payments are required under the
Notes, Term Notes and/or the Agreement, is equal to or in excess of the amount
of such payment or payments.
2.09 Increased Costs, Illegality, etc.
(a) In the event that any Bank shall have determined (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties but, with respect to the following clause (i), shall be made
only after consultation with the Company and the Agent):
(i) on any date for determining the Quoted Rate for
any Interest Period, that by reason of any changes arising
after the date of this Agreement affecting the interbank
Eurodollar market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis
provided for in the definition of Quoted Rate; or
(ii) at any time, that by reason of (x) any change
since the date of this Agreement in any applicable law or
governmental rule, regulation, guideline or order (or any
interpretation thereof and including the introduction of
any new law or governmental rule, regulation, guideline or
order) (such as for example but not limited to a change in
official reserve requirements, but, in all events,
excluding reserves required under Regulation D to the
extent included in the computation of the Fixed CD Rate or
the Quoted Rate, as the case may be) and/or (y) in the case
of Eurodollar Loans, other circumstances affecting such
Bank or the interbank Eurodollar market or the position of
such Bank in such market, the Quoted Rate or Fixed CD Rate,
as the case may be, shall not represent the effective
pricing to such Bank for funding or maintaining the
affected Fixed Rate Loan; or
(iii) at any time, that the making or continuance of
any Eurodollar Loan has become unlawful by compliance by
such Bank in good faith with any law, governmental rule,
regulation, guideline or order, or has become impracticable
as a result of a contingency occurring after the date of
this Agreement which materially and adversely affects the
interbank Eurodollar market; then, and in any such event,
such Bank shall on such date give notice (by telephone
confirmed in writing) to the Company and to the Agent of
such determination.
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<PAGE> 14
Thereafter (x) in the case of clauses (i) and (ii), the
Company shall pay to such Bank, upon written demand
therefor, such additional amounts (in the form of an
increased rate of, or a different method of calculating,
interest or otherwise as such Bank in its sole discretion
shall determine) as shall be required to cause such Bank to
receive interest with respect to its affected Fixed Rate
Loan at a rate per annum which shall be equal to the
effective pricing to such Bank to make or maintain such
Fixed Rate Loan plus the Applicable Margin (a written
notice as to additional amounts owed such Bank, showing the
basis for the calculation thereof, submitted to the Company
by such Bank shall, absent manifest error, be final and
conclusive and binding upon all of the parties hereto) and
(y) in the case of clause (iii), take one of the actions
specified in Section 2.09(b) as promptly as possible and,
in any event, within the time period required by law.
(b) At any time that any of its Fixed Rate Loans is affected by
the circumstances described in Section 2.09(a), the Company may (and in the case
of a Fixed Rate Loan affected pursuant to Section 2.09(a)(iii) shall) either (x)
if the affected Fixed Rate Loan is then being made pursuant to a Notice of
Borrowing, cancel said Notice of Borrowing or convert said Notice of Borrowing
into one requesting Prime Rate Loans by giving the Agent telephonic notice
(confirmed in writing) thereof on the same date that the Company was notified by
a Bank pursuant to Section 2.09(a), or (y) if the affected Fixed Rate Loan or
Loans are then outstanding, upon at least three Business Days' written notice to
the Agent and the affected Bank, require the affected Bank to convert each Fixed
Rate Loan so affected into a Loan or Term Loan or Loans or Term Loans of a
different Type, provided that if more than one Bank is affected at any time,
then all affected Banks must be treated the same pursuant to this Section
2.09(b).
(c) If any Bank determines at any time that any applicable law
or governmental rule, regulation, order or request (whether or not having the
force of law) concerning capital adequacy, or any change in interpretation or
administration thereof by any governmental authority, central bank or comparable
agency, will have the effect of increasing the amount of capital required or
expected to be maintained by such Bank based on the existence of such Bank's
Commitment hereunder or its obligations hereunder, then the Company shall pay to
such Bank, upon its written demand therefor, such additional amounts as shall be
required to compensate such Bank for the increased cost to such Bank as a result
of such increase of capital. In determining such additional amounts, each Bank
will act reasonably and in good faith and will use averaging and attribution
methods which are reasonable, provided that such Bank's determination of
compensation owing under this Section 2.09(c) shall, absent manifest error, be
final and conclusive and binding on all the parties hereto. Each Bank, upon
determining that any additional amounts will be payable pursuant to this Section
2.09(c), will give prompt written notice thereof to the Company, which notice
shall show the basis for calculation of such additional amounts, although the
failure to give any such notice shall not release or diminish any of the
Company's obligations to pay additional amounts pursuant to this Section
2.09(c); provided however that the Borrower shall have no obligation to pay any
such amount with respect to any day prior to the 180th day prior to demand by
such Bank.
2.10 Compensation. The Company shall compensate each Bank, upon
its written request (which request shall set forth the basis for requesting such
amounts), for all reasonable losses, expenses and liabilities (including,
without limitation, any interest paid by such Bank to lenders of funds borrowed
by it to make or carry its Fixed Rate Loans to the extent not recovered by such
Bank in connection with the re-employment of such funds), which such Bank may
sustain: (i) if for any reason (other than a default by such Bank or the Agent)
a Borrowing of Fixed Rate Loans does not occur on a date specified therefor in a
Notice of Borrowing (whether or not withdrawn), (ii) if any prepayment of any of
its Fixed Rate Loans occurs on a date which is not the last day of an Interest
Period applicable thereto, (iii) if any prepayment of any of its Fixed Rate
Loans is not made on the date specified in a notice of prepayment given by the
Company, or (iv) as a consequence of (x) any other default by the Company to
repay its Fixed Rate Loans when
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<PAGE> 15
required by the terms of this Agreement or (y) an election made by the Company
pursuant to Section 2.09(b).
2.11 Election Revision. At any time (x) after the Company has
given the Agent a Notice of Borrowing in respect of Fixed Rate Loans and (y)
prior to 10:30 a.m. (Cincinnati time) on the Interest Determination Date in
respect of the Interest Period applicable to such Fixed Rate Loans, the Company
shall have the right to notify the Agent and each Bank (by telephone, confirmed
in writing) that it no longer elects to incur such Fixed Rate Loans. Pursuant to
such notice, the Company shall, withdraw such Notice of Borrowing or, at its
option, convert such Notice of Borrowing into one requesting Prime Rate Loans in
equal principal amount. No amounts shall be payable pursuant to Section 2.10 as
a result of any withdrawal or conversion effected in compliance with this
Section 2.11.
2.12 Extension of the Revolver Period. The Company shall have
the option to request an extension of the Expiry Date of the Revolver Period for
two additional periods of one year each.
(a) The exercise of the option for the first of such one-year
extensions cannot become effective until one year after the effective date of
this agreement. The exercise of the option for the second of such one year
extensions cannot become effective until two years after the effective date of
this agreement. In no event can any extension become effective on any date which
would result in the then remaining term of this agreement exceeding five years.
(b) The Company shall give written notice of the request to
extend, addressed to the Agent Bank as described in Section 9.03 of the
Agreement, no later than ninety (90) days in advance of the date on which the
Company intends for such extension to become effective and ninety (90) days
prior to the Expiry Date of the Revolver Period or extended Expiry Date of the
Revolver Period in effect immediately prior to the exercise of the option to
extend. Notwithstanding anything to the contrary contained herein such extension
shall only become effective if 100% of the Banks agree.
(c) The Banks agree to provide written acceptance or rejection
of the Company's proposed extension within 45 days of the date of the Company's
notice.
(d) In the event that the Company exercises an option to extend
the Expiry Date of the Revolver Period, as provided herein above, the Expiry
Date of the Term Loan Period shall be automatically extended for an equal
period.
2.13 Term Loan. At the Expiry Date of the Revolver Period
assuming no Event of Default or situation which, with the passage of time, would
evolve into an Event of Default if not remedied within the applicable grace
period, has occurred or is ongoing, the Company may elect to convert all Loans
then outstanding to a Term Loan or Term Loans. If the Company elects not to
convert all Loans to Term Loans at the Expiry Date of the Revolver Period, any
such Loans not converted shall be immediately due and payable. At such time the
Total Commitment shall be reduced to an amount equal to the aggregate amount so
converted to a Term Loan or Term Loans and the Commitment of each Bank shall
likewise be ratably reduced and all Term Loans initiated thereafter by the
Company shall be considered Roll-Over Borrowings. Upon each repayment by the
Company of a Term Loan (each a "Term Loan Repayment"), whether partial or in
full, whether contractually required by this Agreement or voluntarily made by
the Company, the Total Commitment will be reduced on the date of such Term Loan
Repayment and the Commitment of each Bank shall likewise be ratably reduced.
Interest is to be calculated and paid on Term Loans in a similar manner as set
forth in Section 2.07, provided that the rates set forth in Section 2.07 shall
each be increased by one eighth of one percent (0.125%) for all Term Loans
outstanding during the Term Loan Period. At the minimum, the Company agrees to
make Term Loan Repayments as follows:
(a) The first day of the seventh month
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<TABLE>
<S> <C>
following the Expiry Date of the
Revolver Period 15% of outstanding balance is due
(b) The first day of the thirteenth month
following the Expiry Date of the
Revolver Period 15% of outstanding balance is due
(c) The first day of the nineteenth month
following the Expiry Date of the
Revolver Period 35% of outstanding balance is due
(d) The first day of the twenty-fifth month
following the Expiry Date of the Revolver
Period All outstanding Term Loans are due and
payable
</TABLE>
2.14 Proceeds; Initial Loans. The proceeds of the initial Loan
made by the Banks hereunder will be applied to pay in full the outstanding
principal indebtedness under the Original Agreement. On the Effective Date, the
Company will pay in full all of its outstanding indebtedness owing under the
Original Agreement (including all interest and fees accrued to date) and upon
such payment the Original Agreement (other than the provisions thereof which by
their terms continue after termination pursuant to Section 9.13 of the Original
Agreement) shall terminate and cease to be in force and effect and each Bank
shall promptly return to the Company the notes issued thereunder.
Section 3. Commitments.
3.01 Commitment Commission. The Company agrees to pay to the
Agent for pro rata distribution to each Bank a commitment commission
("Commitment Commission") for the period commencing on the Effective Date to and
including the Expiry Date of the Revolver Period (or such earlier date as the
Total Commitment shall have been terminated) computed at a rate equal to 3/20 of
1% per annum on the daily average unutilized portion of the Total Commitment.
The Accrued Commitment Commission shall be due and payable quarterly in arrears
on each Quarterly Payment Date and on the Expiry Date of the Revolver Period or
upon such earlier date as the Total Commitment shall be terminated.
3.02 Voluntary Termination of Commitments. Upon at least three
Business Days' prior written notice (or telephonic notice, confirmed in writing)
to the Agent at the Notice Office (which notice the Agent shall promptly
transmit to each of the Banks), the Company shall have the right, without
premium or penalty, to terminate the unutilized portion of the Total Commitment
in whole or in part, in increments of $5,000,000, or if greater in integral
multiples of $1,000,000, provided that any such reduction shall apply
proportionately to the Commitment of each of the Banks.
3.03 Agent's Fee. The Company agrees to pay the Agent for its
own account a fee (the "Agent's Fee") for the period commencing on the Effective
Date to and including the Expiry Date of the Term Loan Period (or such earlier
date as the Total Commitment shall have been terminated) computed at a rate
equal to 3/25 of 1% per annum the Commitment (as it was on the Effective Date)
of the Agent. Accrued Agent's Fee shall be due and payable quarterly in arrears
on each Quarterly Payment Date and on the Expiry Date of the Term Loan Period or
upon such earlier date as the Total Commitment shall be terminated.
Section 4. Payments.
4.01 Voluntary Prepayments. The Company shall have the right to
prepay the Loans or Term Loans in whole or in part, without premium or penalty
(but subject to Section
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<PAGE> 17
2.10) from time to time on the following terms and conditions: (i) the Company
shall give the Agent at the Notice Office at lease three Business Days, in the
case of a prepayment of Fixed Rate Loans or by 12:00 Noon (Cincinnati time) on
the date of prepayment, in the case of a prepayment of Prime Rate Loans, prior
written notice (or telephonic notice confirmed in writing) of its intent to
prepay the Loans or Term Loans, the amount of such prepayment and what Types of
Loans or Term Loans are to be prepaid and the Borrowing(s) pursuant to which
made, which notice the Agent shall promptly transmit to each of the Banks; (ii)
each prepayment shall be in an aggregate principal amount of not less than
$2,500,000 in the case of Fixed Rate Loans, or $1,000,000 in the case of Prime
Rate Loans or in each case, if greater, in an integral multiple of $1,000,000,
provided that no partial prepayment of Fixed Rate Loans made pursuant to a
single Borrowing shall reduce the outstanding Loans or Term Loans made pursuant
to such Borrowing to an amount less than $2,500,000; and (iii) each prepayment
in respect of any Loans or Term Loans made pursuant to a Borrowing shall be
applied pro rata among such Loans or Term Loans. It is understood that each
prepayment of Fixed Rate Loans shall be subject to Section 2.10.
4.02 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement shall be made to
the Agent for the ratable account of the Banks not later than Noon (Cincinnati
time) on the date when due and shall be made in lawful money of the United
States of America in immediately available funds at the Payment Office of the
Agent. Whenever any payment to be made hereunder or under any Note shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day and, with respect to
payments of principal, interest shall be payable at the applicable rate during
such extension.
4.03 Net Payments. If any payment required to be paid by this
Agreement (or by any Note) with respect to any Eurodollar Loan is or will be
subject to any present or future income, withholding or similar tax or
government levy (but not including taxes on or measured by the net income of a
Bank pursuant to the laws of the jurisdictions where such Bank's principal
office or offices or lending office or offices are located), the payment shall
be grossed up so that the amount actually paid is not less than the payment
otherwise specified herein (or in any Note) to be paid in the absence of any
such tax or levy. Each Bank shall promptly furnish to the Company all receipts
or other evidence of such tax or levy. In the event that the Banks receive
notice of the existence of such tax or levy prior to the date on which interest
or penalties for late payment of such tax or levy would be imposed, the Banks
shall promptly give notice of such tax or levy to the Company so that the
Company receives notice of such tax or levy in time to allow the Company to pay
such tax or levy without interest or penalty. Such failure to notify will not
remove the obligation of Company with regard to the original tax or levy,
however, if any penalty or interest is incurred as a result of the failure of
the Banks to provide such notice in the time specified the Banks shall bear the
cost of such interest or penalty.
Section 5. Conditions Precedent.
5.01 Conditions to Effectiveness. This Agreement shall become
effective as of June 7, 1995 or such date (the "Effective Date") on which all of
the following conditions have been satisfied, which ever is later:
(a) Notes. The Company shall have executed and delivered to each
Bank, the appropriate Note in the amount, maturity and as otherwise provided
herein against delivery of the promissory notes delivered pursuant to the
Original Agreement.
(b) No Default; etc. On the Effective Date and after giving
effective to the effectiveness of this Agreement (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein or in any document, certificate or financial or other statement
delivered in connection herewith shall be true and correct with the same force
and effect as though such representations and warranties had been made on and as
of such time.
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<PAGE> 18
(c) Officer's Certificate. The Agent shall have received a
certificate dated the Effective Date, and signed by a duly authorized officer of
the Company stating that the conditions set forth in Section 5.01(b) exist as of
such date.
(d) Opinion of Counsel. The Agent shall have received from Denis
G. Daly, Vice President & Secretary of the Company, an opinion addressed to each
of the Banks and dated the Effective Date covering the matters set forth in
Exhibit B hereto and such other matters incident to the transactions
contemplated herein as any Bank may reasonably request.
(e) Corporate Proceedings. All corporate and legal proceedings
and all instruments and agreements in connection with the transactions
contemplated by this Agreement shall be satisfactory in form and substance to
the Agent and the Agent shall have received all information and copies of all
documents and papers, including records of corporate proceedings and
governmental approvals, if any, which any Bank reasonably may have requested in
connection therewith, such documents and papers where appropriate to be
certified by proper corporate or governmental authorities.
5.02 Conditions to Each Loan. The obligation of each Bank to
make each Loan hereunder is subject, at the time of the making of each Loan
(except as hereinafter indicated), to the satisfaction of the following
conditions, with the making of each Loan (including any Loan made pursuant to a
Roll-Over Borrowing) constituting a representation and warranty by the Company
that the conditions specified in Sections 5.02(a) and (b) below are then
satisfied:
(a) No Default. At the time of the making of each Loan and after
giving effect thereto, there shall exist no Default or Event of Default.
(b) Representations and Warranties. At the time of the making of
each Loan and after giving effect thereto, all representations and warranties
(except, in the case of a Roll-Over Borrowing, the representations and
warranties contained in Section 8.04 and the last sentence of Section 8.05
hereof) contained herein or otherwise made in writing in connection herewith
shall be true and correct with the same force and effect as though such
representations and warranties had been made on and as of such time.
(c) Subsequent Legal Opinions. If, at the time of the making of
any Loan, the Required Banks shall have reasonably requested same, the Agent
shall have received from the counsel of the Company referred to in Section
5.01(d) or such other counsel for the Company (who shall be reasonably
satisfactory to the Agent) an opinion in form and substance satisfactory to the
Agent, addressed to the Banks and dated the date of such Loan, and covering such
of the matters as the Required Banks may reasonably request.
Section 6. Covenants.
The Company and Banks agree that the financial covenants set
forth in Section 6.11, 6.12 and were arrived at based on accounting rules,
methods and principles, and Federal tax laws, rules and regulations in effect
and applicable to the Company as of the date of this Agreement. If, at any time
during which the Total Commitment has not been permanently terminated or
permanently reduced to zero, a change occurs or is instituted in the accounting
rules, regulations or principles, Federal tax laws, rules or regulations
applicable to the Company which materially affects (either adversely or
constructively) the aforementioned financial covenants, the Banks, the Company
and the Agent shall hereby agree that some or all of those financial covenants
set forth in Section 6.11, 6.12 and of the Agreement, in whole or in part, shall
be renegotiated in good faith by all parties to this Agreement. Notwithstanding
the above, the Company covenants and agrees that, so long as this Agreement is
in effect and until the Loans, Notes and Term Notes, together with interest,
Commitment Commission and all other obligations incurred hereunder are paid in
full:
6.01 Information Covenants. The Company will furnish to the
Agent Bank:
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<PAGE> 19
(a) within 45 days after the close of each of the first three
quarterly accounting periods in each fiscal year of the Company, five copies of
the consolidated statements of financial condition of the Company as at the end
of such quarterly period and the related consolidated statements of operations,
shareholder's equity and cash flows for the elapsed portion of the fiscal year
ended with the last day of such quarterly period, all in reasonable detail,
prepared in accordance with generally accepted accounting principles
consistently applied throughout the period involved (except for such changes as
are disclosed in such financial statements or in the notes thereto and concurred
in by the independent certified public accountants) and with the prior year and
certified by the chief financial officer of the Company subject to customary
year-end audit adjustments;
(b) within 90 days after the close of each fiscal year of the
Company, five copies of the consolidated statements of financial condition of
the Company as at the end of such fiscal year and the related consolidated
statements of operations, shareholders equity and cash flows for such fiscal
year, all in reasonable detail, prepared in accordance with generally accepted
accounting principles consistently applied throughout the period involved
(except for such changes as are disclosed in such financial statements or in the
notes thereto and concurred in by the independent certified public accountants)
and with the prior year and accompanied by an opinion relating thereto of Ernst
& Young or other independent certified public accounts of recognized standing
selected by the Company;
(c) at the time of the delivery of the financial statements
required by Section 6.01(b), a certificate of the independent public accountants
stating that in making the examination necessary for expressing an opinion on
such financial statements, nothing came to their attention that caused them to
believe that there is in existence any Default or Event of Default or, if in the
opinion of such accountants any Default or Event of Default exists, the
certificate shall state its nature and the length of time it has existed;
(d) at the time of the delivery of the financial statements
required by Section 6.01(a) and (b) a certificate of the chief financial officer
of the Company to the effect either that such officer is aware of no Default or
Event of Default or, if he is aware that any Default or Event of Default exists,
specifying the nature thereof, its period of existence and the action that is
proposed to be taken with respect thereto and also setting forth the
calculations required to establish whether the Company was in compliance with
the provisions of Sections 6.11, and 6.12, as at the end of such fiscal period;
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<PAGE> 20
(e) within five business days after the Company obtains
knowledge thereof, notice of (x) any event which constitutes a Default or Event
of Default (such notice to specify the nature thereof, the period of existence
thereof and the action that is proposed to be taken with respect thereto) and
(y) any litigation or governmental proceeding pending against the Company or any
Subsidiary which might materially and adversely affect the business, operations
or condition (financial or otherwise) of the Company and its Subsidiaries taken
as a whole;
(f) promptly, copies of all regular and periodic financial and
other reports, if any, which the Company or any of its Subsidiaries shall file
with the Securities and Exchange Commission or any governmental agencies
substituted therefor;
(g) promptly upon the execution after the Effective Date of any
Maintenance Agreements, and any amendments or modifications thereto or waivers
thereof, by the Company or a Subsidiary, written notice thereof; and
(h) from time to time, and promptly upon each request, such
other information or documents as any Bank may reasonably request.
6.02 Compliance with Law. The Company will comply, and will
cause each of its Subsidiaries to comply, with all laws, rules and regulations
relating to their respective businesses, other than laws, rules and regulations
the failure to comply with which and the sanctions and penalties resulting
therefrom, when taken together with the failure to comply with all other laws,
rules and regulations and the sanctions and penalties resulting therefrom, would
not have a material adverse effect on the operations, business, property, assets
or condition (financial or otherwise) of the Company and its Subsidiaries taken
as a whole, provided that the Company and its Subsidiaries shall not be required
to comply with laws, rules and regulations the validity or applicability of
which are being contested in good faith and by appropriate proceedings.
6.03 Payment of Charges. The Company will pay and discharge when
due, and will cause each of its Subsidiaries to pay and discharge when due, all
taxes, assessments and governmental charges or levies imposed upon it or its
property or assets, or upon properties leased by it (but only to the extent
required to do so by the applicable lease), prior to the date on which penalties
attach thereto, and all lawful claims which, if unpaid, might become a lien or
charge upon its property or assets, provided that neither the Company nor any of
its Subsidiaries shall be required to pay any such tax, assessment, charge, levy
or claim, the payment of which is being contested in good faith and by proper
proceedings and with respect to which adequate reserves are maintained in
accordance with generally accepted accounting principles.
6.04 Inspection of Books and Assets. The Company will allow, and
will cause each of its Subsidiaries to allow, any representative of any Bank to
visit and inspect any of its properties, to examine its books of record and
account and to discuss its affairs, finances and accounts with its officers, all
at such reasonable times and as often, as the Banks deem appropriate, but in no
event more frequently than once each calendar quarter, except, in the event the
Company is in default under the provisions of Section 7(c) of this Agreement the
Bank shall be free to conduct such examinations at such times as the Banks
reasonably deem appropriate .
6.05 Maintenance of Records. The Company will keep, and will
cause each of its Subsidiaries to keep, at all times books of record and account
in which full, true and correct entries will be made of all dealings or
transactions in relation to its business and affairs, and the Company will, and
will cause each of its Subsidiaries to, provide reasonable protection against
loss or damage to such books of record and account.
6.06 ERISA. As soon as possible and, in any event, within 30
days after the Company or a Subsidiary knows or has reason to know that a
Reportable Event has occurred, that an accumulated funding deficiency has been
incurred, or an application may be or has been made to the Secretary of the
Treasury for a waiver of the minimum funding standard under Section 412 of the
Code with respect to a Plan, that a Plan has been or may be terminated, that
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<PAGE> 21
proceedings may be or have been instituted to terminate a Plan, or that the
Company, a Subsidiary or an ERISA Affiliate will or may incur any liability to
or on account of a Plan under Section 4062, 4063, 4064, 4201 or 4204 of ERISA,
the Company will deliver to the Banks a certificate of one of its officers
setting forth details as to such occurrence and the action, if any, which the
Company or the Subsidiary is required or proposes to take, together with a copy
of any notices required or proposed to be filed with or by the Company, the
Subsidiary, the ERISA Affiliate, the PBGC or the plan administrator with respect
thereto. Upon the request of any Bank, the Company will furnish to the Banks a
copy of the annual report of each Plan (Form 5500) required to be filed with the
Internal Revenue Service. Copies of annual reports or any notices required to be
delivered to the Banks under this Section 6.06 shall be delivered no later than
30 days after the later of the date such report or notice has been filed with
the Internal Revenue Service or the PBGC or received by the Company or the
Subsidiary.
6.07 Preservation of Corporate Existence. Subject to Section
6.10, the Company will maintain and preserve, and will cause each Subsidiary to
maintain and preserve, its corporate existence and right to carry on its
business and duly procure all necessary renewals and extensions thereof and use,
and cause each Subsidiary to use, its best efforts to maintain, preserve and
renew all of its rights, powers, privileges and franchises which in the opinion
of the Board of Directors or senior management of the Company continue to be
advantageous to the Company and its Subsidiaries.
6.08 Insurance. The Company will insure and keep insured, and
cause each Subsidiary to insure and keep insured, to a reasonable amount with
financially sound and reputable insurance companies, so much of their respective
properties as companies engaged in a similar business and to the extent such
companies in accordance with good business practice customarily insure
properties of a similar character against loss by fire and from other causes.
The Company shall give the Banks prompt written notice of its inability or
failure to continue to maintain its insurance coverage at the levels in effect
on June 7, 1995.
6.09 Liens. The Company will not, nor will it permit any of its
Subsidiaries to, create, assume or incur, directly or indirectly, any Lien on
any of its properties or assets (other than Unrestricted Margin Stock) whether
now owned or hereafter acquired except:
(i) Liens incurred in the ordinary course of business not
in connection with the borrowing of money or the obtaining of
credit and which do not in the aggregate materially impair the
use of the property or assets covered thereby in the operation
of the Company's business,
(ii) pledges or deposits to secure public or statutory
obligations or to secure payment of workmen's compensation or to
secure performance in connection with tenders, leases of real or
personal property, bids or contracts or to secure (or in lieu
of) surety or appeal bonds and pledges or deposits made in the
ordinary course of business for similar purposes.
(iii) Liens on any property hereafter acquired which are
created simultaneously with such acquisition or within 90 days
thereafter to secure the purchase price thereof, provided that
the indebtedness secured thereby does not exceed the cost to the
Company or the relevant Subsidiary of such property.
(iv) Liens on property acquired pursuant to an Acquisition
which existed at the time of such Acquisition, provided that the
Debt secured by such Liens is not increased after the date of
such Acquisition,
(v) Liens existing on the property of another Person on
the date such Person becomes a Subsidiary or whose assets are
acquired by Amcast as a result of an Acquisition, provided that
the Debt secured by such Liens is not increased after the date
of such Acquisition, and
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<PAGE> 22
(vi) Liens on existing property created in connection with
the industrial development bond financing of newly acquired
property which is used in connection with such existing property
to the extent (and only to the extent) required by law.
6.10 Consolidation, Merger and Sale of Assets. The Company will
not, nor will it permit any of its Subsidiaries to, wind up, liquidate or
dissolve its affairs or enter into any transaction of merger or consolidation,
or convey, sell, lease or otherwise dispose of (or agree to do any of the
foregoing at any future time) assets constituting (in the aggregate) 25% or more
of the value of the Company's Consolidated Total Assets (as determined in
accordance with generally accepted accounting principles consistently applied)
(other than Unrestricted Margin Stock provided that any sale of Unrestricted
Margin Stock shall be made for cash consideration equal to the fair value of the
Unrestricted Margin Stock sold or otherwise disposed of at the time of such sale
or disposition), provided that (i) the Company may enter into a merger
transaction if it is the surviving entity and no Default or Event of Default
would result therefrom and (ii) any Subsidiary may merge into, or sell, convey,
lease or otherwise dispose of any or all of its property to, the Company,
another Subsidiary or any Person that after giving effect to the foregoing shall
constitute a Subsidiary, provided that no Default or Event of Default would
result therefrom; and (iii) the Company shall have the right to sell, merge, or
otherwise dispose of all or any part of the assets of its Stanley G. Flagg & Co.
division or to cease in whole or in part operations of the Stanley G. Flagg &
Co. division and deal with the assets of such division, and/or the proceeds from
the sale of such assets, for accounting purposes as the Company shall determine
in accord with generally accepted accounting principles consistently applied.
Such action with regard to Stanley G. Flagg & Co. shall not be included in the
calculation of the 25% limit referred to in this Section 6.10.
6.11 Tangible Net Worth. The Company will maintain as at the end
of each fiscal quarter of the Company Consolidated Tangible Net Worth of not
less than $90,000,000 plus 25% of the company's cumulative Consolidated Net
Income (to the extent said Net Income is greater than zero) since September 1,
1994, to be measured at the end of each fiscal quarter.
6.12 Additional Debt. The Company will not, and will not permit
any Subsidiary to, create, assume, incur or guarantee any Debt except (i) Debt
incurred under this Agreement, (ii) any Debt which is outstanding as of February
26, 1995, as shown on Exhibit D hereto and (iii) any other Debt if after giving
effect to the creation, incurrence, assumption or guarantee thereof, Debt would
not exceed 60% of Consolidated Capitalization.
6.13 Changes in Business. The Company and its Subsidiaries will
not enter into any business which is substantially different from that presently
conducted by them. In the context of this Paragraph 6.14 "substantially
different" shall mean outside of the metal working or processing businesses.
Section 7. Events of Default.
Upon the occurrence of any of the following specified events
(each an "Event of Default") and so long as such Event of Default shall continue
unremedied:
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<PAGE> 23
(a) Principal. The Company shall default in the payment of any
principal of the Loans or Term Loans when due; or
(b) Interest and Commitment Commission. The Company shall
default in the payment of interest in respect of any Loan or Term Loans or any
Commitment Commission or other amounts payable under this Agreement and such
default shall continue unremedied for five Business Days; or
(c) Representations; etc. Any representation, warranty or
statement made by the Company herein or in any document, certificate or
financial or other statement delivered in connection herewith shall prove to be
untrue in any material respect on the date as of which made; or
(d) Certain Covenants. The Company shall default in the due
performance or observance by it of any term, covenant or agreement to be
performed or observed pursuant to Section 6 (other than Sections 6.01 through
6.08) and such default shall continue for a period of five days after the
Company has knowledge or should have knowledge, of such default; or
(e) Other Covenants. The Company shall default in the due
performance or observance by it of any term, covenant or agreement (other than
those referred to in paragraphs (a) through (d) of this Section 7, inclusive)
contained in this Agreement and such default shall continue unremedied for a
period of 30 days after the Company shall have become aware of the existence of
such default; or
(f) Default Under Other Agreements. The Company or any of its
Subsidiaries (each a "Designated Party") shall default in the payment when due
(subject to any applicable grace period), whether by acceleration or otherwise,
of any other indebtedness the total outstanding obligations, including any and
all interest and fees accrued to the date of default the aggregate amount, of
which was at least $5,000,000.00 at the time of the default, for borrowed money
of, or guaranteed by, such Designated Party, or any Designated Party shall
default in the performance or observance of any obligation or condition with
respect to any such other indebtedness (except for a default arising under any
restrictive provision relating to any sale, pledge or other disposition of
Unrestricted Margin Stock contained in any lending agreement to which any Bank
or "affiliate" thereof (as defined in Regulation U) is a party) if the effect of
such default (after giving effect to any applicable grace period) is to
accelerate the maturity of any such indebtedness or to permit the holder or
holders thereof, or any trustee or agent for such holders, to cause such
indebtedness to become due and payable prior to its expressed maturity or any
such indebtedness shall become due prior to its maturity; or
(g) Litigation. A judgment or judgments for the payment of
money, if the aggregate amount involved is at least $1,000,000 in excess of the
amount of all insurance applicable thereto, shall be entered against any
Designated Party, and such judgment or judgments shall remain unsatisfied or
unstayed for a period of 45 days; or
(h) Bankruptcy; etc. Any Designated Party shall commence a
voluntary case concerning itself under Title 11 of the United States Code
entitled "Bankruptcy" as now or hereafter in effect, or any successor thereto
(the "Bankruptcy Code"); or an involuntary case in commenced against any
Designated Party and the petition is controverted but is not dismissed within 60
days after the commencement of the case; or a custodian (as defined in the
Bankruptcy Code) is appointed for, or takes charge of, all or substantially all
of the property of any Designated Party or any Designated Party commences any
other proceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to any Designated Party
or there is commenced against any Designated Party any such proceeding which
remains undismissed for a period of 60 days or any Designated Party is
adjudicated insolvent or bankrupt; or any order of relief or other order
approving any such case or proceeding is entered; or any Designated Party
suffers any appointment of any custodian or the like for it or any
23
<PAGE> 24
substantial part of its property to continue undischarged or unstayed for a
period of 60 days; or any Designated Party makes a general assignment for the
benefit of creditors; or any corporate action is taken by any Designated Party
for the purpose of effecting any of the foregoing; or
(i) ERISA. A Plan shall fail to maintain the minimum funding
standard required by Section 412 of the Code for any plan year or a waiver of
such standard is sought or granted under Section 412(d), or a Plan is or shall
have been terminated or the subject of termination proceedings under ERISA, or
the Company or a Subsidiary or an ERISA Affiliate has incurred a liability to or
on account of a Plan under Section 4062, 4063, 4064, 4201 or 4204 of ERISA, and
there shall result from any such event or events either a liability or a
material risk of incurring a liability to the PBGC or a Plan, which in the
reasonable opinion of the Required Banks, will have a material adverse effect
upon the business, operations or the financial condition of the Company and its
Subsidiaries taken as a whole; or
(j) Ownership. The outstanding capital stock of all classes of
the Company entitled, at the time, to voting power of 25% or more, in the
aggregate, for the election of the Company's directors is owned, or
(k) Qualified Opinions. Any fiscal year end statement submitted
to the Banks pursuant to Section 6.01(b) shall be accompanied by a qualified
opinion (6.01(b)).
In the event of Default, and at any time thereafter, if any
Event of Default shall then be continuing, the Agent, upon the written request
of the Required Banks, shall by written notice to the Company, take either or
both of the following actions, without prejudice to the rights of the Agent, any
Bank or the holder of any Note to enforce its claims against the Company: (i)
declare the Total Commitment terminated, whereupon the Commitment of each Bank
shall forthwith terminate immediately and any Commitment Commission shall
forthwith become due and payable without any other notice of any kind; or (ii)
declare the principal of and any accrued interest in respect of the Loans, and
all obligations owing hereunder, to be, whereupon the same shall become,
forthwith due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Company, provided that, if an
Event of Default specified in clause (h) shall occur with respect to the
Company, the result which would occur upon the giving of written notice by the
Agent to the Company, as specified in clauses (i) and (ii) above, shall occur
automatically without the giving of any such notice.
Section 8. Representations, Warranties and Agreement.
In order to induce the Banks to enter into this Agreement and to
make the Loans provided for herein, the Company makes the following
representations, warranties and agreements which shall survive the execution and
delivery of this Agreement and the Notes and the making of the Loans:
8.01 Corporate Status. The Company and each of its Subsidiaries
(i) is a duly organized and validly existing corporation in good standing under
the laws of the State of its incorporation, (ii) has the corporate power and
authority to own its property and assets and to transact the business in which
it is engaged and (iii) has duly qualified and is authorized to do business and
is in good standing as a foreign corporation in every jurisdiction in which the
failure so to qualify would have a material adverse effect on the business of
the Company and its Subsidiaries taken as a whole.
8.02 Corporate Power and Authority. The Company has the
corporate power to execute, deliver and carry out the terms and provisions of
this Agreement and the Notes and has taken all necessary corporate action
(including, without limitation, any consent of stockholders required by law or
by its Articles of Incorporation or Code of Regulations) to authorize the
execution, delivery and performance of this Agreement and the Notes. This
Agreement has been duly executed and
24
<PAGE> 25
delivered by the Company and constitutes, and the Notes when executed and
delivered by the Company pursuant hereto will constitute, the legal, valid and
binding obligations of the Company enforceable in accordance with their
respective terms except to the extent that enforcement may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights generally and by equitable principles (regardless of
whether enforcement is sought in equity or at law).
8.03 No Violation. Neither the execution, delivery or
performance by the Company of this Agreement or the Notes, nor the consummation
of the transactions herein or therein contemplated, nor compliance with the
terms and provisions hereof or thereof, (i) will contravene any applicable
provision of any law, statute, rule, regulation, order, writ, injunction or
decree of any court or governmental instrumentality or (ii) will conflict or be
inconsistent with or result in any breach of, any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of the Company pursuant to the terms of any
indenture, mortgage, deed of trust, agreement or other instrument to which the
Company is a party or by which it or any of its property or assets is bound or
to which it may be subject, or (iii) will violate any provision of the Articles
of Incorporation or the Code of Regulations of the Company.
8.04 Litigation. There are no actions, suits or proceedings
pending or, to the best of the knowledge of the Company, threatened against or
affecting the Company or any Subsidiary before any court or before any
governmental or administrative body or agency the outcome of which is likely to
have a material and adverse effect upon the operations, business, property or
assets or financial condition of the Company and its Subsidiaries taken as a
whole. A listing of the Company's significant litigation is attached as Exhibit
E.
8.05 Financial Statements. The audited consolidated statement of
financial condition of the Company at August 31, 1994, and the related
consolidated statements of operations, shareholders equity and cash flows of the
Company for the fiscal year ended on said date heretofore furnished to the Banks
present fairly the consolidated financial condition of the Company at the date
of said statements of financial condition and the consolidated results of the
operations of the Company for said fiscal year. All such financial statements
have been prepared in accordance with generally accepted accounting principles
and practices consistently applied. Since February 26, 1995, there has been no
material adverse change in the operations, business, property or assets of, or
in the condition (financial or otherwise ) of, the Company and its Subsidiaries
taken as a whole.
8.06 Use of Proceeds; Regulation U. The proceeds of the Loans
and Term Loans will be used only for general corporate purposes, including,
without limitation, any Acquisition. No part of the proceeds of any Loan or Term
Loan will be used to purchase or carry any Margin Stock in violation of
Regulation U or X of the Board of Governors of the Federal Reserve Board.
8.07 Governmental Approvals. No order, consent, approval,
license, authorization, or validation of, or filing, recording or registration
with, or exemption by, any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection with
(i) the execution, delivery and performance of this Agreement or the Notes, or
(ii) the legality, validity, binding effect or enforceability of this Agreement
or the Notes.
8.08 Compliance with ERISA. The Plans are in substantial
compliance with ERISA, no Plan is insolvent or in reorganization, no Plan has an
accumulated or waived funding deficiency within the meaning of Section 412 of
the Code, neither the Company nor a Subsidiary nor an ERISA Affiliate has
incurred any material liability (including any material contingent liability) to
or on account of a Plan pursuant to Section 4062, 4063, 4064, 4201 or 4204 of
ERISA, no proceedings has been instituted to terminate any Plan, and no other
condition exists which, in any case described in the foregoing clauses, presents
a material risk to the Company or a Subsidiary of incurring a material liability
to or on account of a Plan pursuant to ERISA. It is understood that the
representations set forth in this Section 7.08 (other than with respect to any
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<PAGE> 26
liability under Section 4201 or Section 4204 of ERISA) to the extent applicable
to multiemployer plans shall be made to the best of the Company's knowledge
after reasonable inquiry.
Section 9. Miscellaneous.
9.01 Payment of Expenses; etc. The Company shall: (i) whether or
not the transactions hereby contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses in connection with the preparation, execution,
delivery and enforcement of this Agreement, the Notes, the documents and
instruments referred to herein and any amendment, waiver or consent relating
hereto or thereto (including, without limitation, the reasonable fees and
disbursements of special counsel for each of the Banks); (ii) pay and hold each
of the Banks harmless from and against any and all present and future stamp and
other similar taxes with respect to the foregoing matters and to save each Bank
from and against any and all liabilities with respect to or resulting from any
delay or omission (other than to the extent attributable to such Bank) to pay
such taxes and (iii) to indemnify the Agent and each Bank from and hold each of
them harmless against any and all losses, liabilities, claims, damages, or
expenses incurred by any of them arising out of or by reason of any
investigation, litigation or other proceeding related to any Acquisition
effected or proposed to be effected by the Company with the proceeds of the
Loans or the Company's entering into and performance of this Agreement,
including, without limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation, litigation or other
proceeding (but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified or in connection with any proceeding brought against
the Person to be indemnified by a security holder of such Person based on the
rights afforded such security holder solely in its capacity as such). In
addition, the Company shall not be liable under Section 9.01(iii) with respect
to claims directly arising out of any settlement made without its consent (which
consent shall not be unreasonably withheld) in any action other than one arising
out of a tender offer.
9.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Bank is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Company or to any other Person, any
such notice being hereby expressly waived, to setoff and to appropriate and
apply any and all deposits (general or special) and any other indebtedness at
any time held or owing by such Bank to or for the credit or the account of the
Company against and on account of the obligations and liabilities of the Company
to such Bank under this Agreement and the Notes, including (without limitation)
all claims of any nature or description arising out of or connected with this
Agreement and the Notes, irrespective of whether or not such Bank shall have
made any demand hereunder and although said obligations, liabilities or claims,
or any of them, shall be contingent or unmatured.
9.03 Notices. Except as otherwise specified herein, all notices,
requests, demands or other communications to or upon the respective parties
hereto shall be deemed to have been duly given or made when delivered to the
party to which such notice, request, demand or other communication is required
or permitted to be given or made under this Agreement or the Notes, addressed to
such party at its address set forth opposite its signature below, or at such
other address as any of the parties hereto may hereafter notify the others in
writing.
9.04 Benefit of Agreement. (a) This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto, provided that the Company may not assign or
transfer any of its interest hereunder without the prior written consent of the
Banks.
(b) Any Bank may (i) assign its rights and its obligations under
this Agreement upon notice to and with the prior written consent of the Company,
which consent shall not be unreasonably withheld, and (ii) may sell
participations in (without the consent of the Company) any of its rights or
interest hereunder or in its Note, to another financial institution. In the case
of
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<PAGE> 27
an assignment, upon the notice and consent described above, the assignee shall
have, to the extent of such assignment (unless otherwise provided therein), the
same rights and benefits as it would have if it were a Bank hereunder and the
holder of a Note and, if the assignee has expressly assumed, for the benefit of
the Company, the assignor Bank's obligations hereunder, such assignor Bank shall
be relieved of its obligations hereunder to the extent of such assignment and
assumption. In the case of a participation, the participant shall not have any
rights under this Agreement or any Note or any other document delivered in
connection herewith (the participant's rights against such Bank in respect of
such participation to be those set forth in the Agreement executed by such Bank
in favor of the participant relating thereto) and all amounts payable by the
Company under Sections 2.09, 2.10 and 4.03 hereof or otherwise shall be
determined as if such Bank had not sold such participation.
9.05 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Company, the Agent or any Bank or any holder of a Note in exercising
any right, power or privilege hereunder and no course of dealing between the
Company and the Agent or any Bank or the holder of any Note shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under a Note preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder. The
rights and remedies herein expressly provided are cumulative and not exclusive
of any rights or remedies which the Company, the Agent or any Bank or the holder
of any Note would otherwise have. No notice to or demand on the Company in any
case shall entitle the Company to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Agent, the Banks or the holder of any Note to any other or further action in any
circumstances without notice or demand.
9.06 Payments Pro Rata. Each of the Banks agrees that if it
should receive any payment (whether by voluntary payment, by realization upon
security, by the exercise of the right of setoff or banker's lien, by
counterclaim or cross action, by the enforcement of any right under this
Agreement or the Notes, or otherwise) in respect of any obligation of the
Company hereunder or under the Notes of a sum which with respect to the related
sum or sums received by other Banks is in a greater proportion than the total
amount of principal, interest, Commitment Commission or any other obligation
incurred hereunder, as the case may be, then owed and due to such Bank bears to
the total amount of principal, interest, Commitment Commission, or any such
other obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse from the other Banks an interest in the obligations of the
Company to such Banks in such amount as shall result in a proportional
participation by all of the Banks in the aggregate unpaid amount of principal,
interest, Commitment Commission, or any such other obligation, as the case may
be, owed to all of the Banks, provided that if all or any portion of such excess
payment is thereafter recovered from such Bank, such purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest.
9.07 Calculations; Computations. (a) The financial statements to
be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved except for such changes as are disclosed in such
financial statements or in the notes thereto and are concurred in by the
independent certified public accountants. Except as otherwise specifically
provided in this Agreement, all computations pursuant to Section 6 through
Section 9 shall utilize accounting principles in conformity with those used in
the preparation of the financial statements referred to in Section 8.05.
(b) All computations of interest and Commitment Commission
hereunder shall be made on the actual number of days elapsed over a year of 360
days.
9.08 Governing Law. This Agreement and the rights and
obligations of the parties hereunder and under the Notes shall be construed in
accordance with and be governed by the law of the State of Ohio.
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<PAGE> 28
9.09 Counterparts. This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument. A complete set of
counter parts shall be lodged with the Company and the Agent.
9.10 Descriptive Headings. The descriptive headings of the
several sections and subsections of this Agreement are inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision of this Agreement.
9.11 Amendment or Waiver. This Agreement may not be amended,
changed, waived, discharged or terminated without the written consent of each of
the Banks and the Company.
9.12 The Agent. The Banks hereby designate the Agent to act as
specified herein and in Exhibit C hereto, the terms of which exhibit are hereby
incorporated by reference as if set forth herein at length.
9.13 Survival. All indemnities set forth herein including,
without limitation, in Section 9.01, and in paragraph 6 of Exhibit C annexed
hereto shall survive the execution and delivery of this Agreement and the Notes
and Term Notes and the making and repayment of the Loans and Term Loans
hereunder.
9.14 Confidentiality. Each Bank shall keep confidential all
information which is non-public or confidential or proprietary in nature,
disclosed or furnished to such Bank by the Company pursuant to Sections 6.01 or
604 hereof or otherwise, and shall not, without the prior written consent of the
Company, disclose in any manner whatsoever, in whole or in part, any of such
information to any Person, except that such Bank shall be permitted to disclose
any of such information (i) to any regulatory agency having jurisdiction over
such Bank in connection with such agency's regulatory function, (ii) otherwise
as required by law or court order or in connection with any investigation,
action or proceeding arising out of the transactions contemplated by this
Agreement and (iii) to any prospective assignee, transferee or participant
provided that, prior to such disclosure, such assignee, transferee or
participant enters into a confidentiality agreement with the Company the terms
of which are no less restrictive than this Section 9.14.
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<PAGE> 29
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
<TABLE>
<S> <C>
Address:
7887 Washington Village Drive AMCAST INDUSTRIAL CORPORATION
Dayton, Ohio 45459
By __________________________
Title: President
425 Walnut Street STAR BANK, NATIONAL ASSOCIATION.
Location 8160 Individually and as Agent
Cincinnati, Ohio 45201
By: __________________________
Title:
Kettering Tower BANK ONE, DAYTON, NA
40 North Main Street
P.O. Box 1103
Dayton, OH 45401-1103
By: _________________________
Title:
1301 East 9th Street FIRST NATIONAL BANK OF CHICAGO
Suite 250
Cleveland, Ohio 44114-1824
By __________________________
Title:
611 Woodward Avenue NBD Bank
Detroit, Michigan 48220
By: __________________________
Title:
34 North Main Street SOCIETY NATIONAL BANK
Dayton, Ohio 45401-1103
By: __________________________
Title:
</TABLE>
29
<PAGE> 30
ANNEX I
(See Section 1.14)
<TABLE>
<CAPTION>
BANK COMMITMENT
- ---- -----------
<S> <C>
STAR BANK, NATIONAL ASSOCIATION $14,000,000
BANK ONE, DAYTON NA 14,000,000
THE FIRST NATIONAL BANK OF CHICAGO 9,000,000
NBD BANK 9,000,000
SOCIETY NATIONAL BANK 14,000,000
-----------
Total Commitment $60,000,000
-----------
</TABLE>
30
<PAGE> 31
EXHIBIT A
(See Section 2.05)
NOTE
$_______________________ Cincinnati, Ohio
___________, 19___
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION an
Ohio corporation (the "Company"), hereby promises to pay to the order of
____________ (the "Bank"), in lawful money of the United States of America in
immediately available funds, at the office of STAR BANK, NATIONAL ASSOCIATION
(the "Agent") located at 425 Walnut Street, Cincinnati, Ohio 45201 (i) the
principal amount of each Loan made by the Bank pursuant to, and as defined in
the Agreement referred to below on the last day of the Interest Period (as
defined in the Agreement) applicable thereto and (ii) on March 31, 1998 the
principal sum of _________ dollars ($________) or, if less, the unpaid principal
amount of all Loans made by the Bank pursuant to the Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the
Agreement) shall occur and be continuing, the principal of and accrued interest
on this Note may be declared to be due and payable in the manner and with the
effect provided in the Agreement.
The Company hereby waives presentment, demand, protest
or notice of any kind in connection with this Note.
This Note shall be construed in accordance with and be
governed by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By __________________________________
Title _______________________________
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<PAGE> 32
EXHIBIT B
(See Section 5.01(d))
OPINION OF COUNSEL FOR THE COMPANY
The opinion of Denis G. Daly, counsel for Amcast Industrial
Corporation (the "Company") referred to in Section 4.01(d) of the Credit
Agreement (the "Agreement") to which this Exhibit B is attached shall cover the
matters set forth in paragraphs 1 through 5 below; except as otherwise defined
herein, terms used herein and defined in the Agreement shall be used herein as
so defined.
1. The Company (i) is a duly organized and validly existing
corporation in good standing under the laws of the jurisdiction of its
incorporation and (ii) has the corporate power and authority to own its property
and assets and to transact the business in which it is engaged.
2. The Company has the corporate power to execute, deliver and
carry out the terms and provisions of the Agreement and the Notes and has taken
all necessary corporate action (including, without limitation, any consent of
stockholders required by law or by its Articles of Incorporation or Code of
Regulations) to authorize the execution, delivery and performance of the
Agreement and the Notes. The Agreement and the Notes have been duly executed and
delivered by the Company and constitute the legal, valid and binding obligations
of the Company enforceable in accordance with their respective terms except to
the extent that enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally and
by equitable principles (regardless of whether enforcement is sought in equity
or at law).
3. Neither the execution, delivery or performance by the Company
of the Agreement or the Notes, nor the consummation of the transactions therein
contemplated, nor compliance with the terms and provisions thereof, (i) will
contravene any applicable provision of any law, statute, rule or regulation, or
of any order, writ, injunction or decree of any court or governmental
instrumentality known to such counsel or (ii) will conflict or be inconsistent
with or result in any breach of, any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) and Lien upon any of the
property or assets of the Company pursuant to the terms of any indenture,
mortgage, deed of trust, agreement or other instrument known to such counsel to
which the Company is a party or by which it or any of its property or assets is
bound or to which it may be subject, or (iii) will violate any provision of the
Articles of Incorporation or Code of Regulations of the Company.
4. Except as set forth in Exhibit E to the Agreement, a copy of
which is attached hereto, to the best of the knowledge of such counsel after due
inquiry, there are no actions, suits or proceedings pending or threatened
against or affecting the Company before any court or before any governmental or
administrative body or agency the outcome of which might materially and
adversely affect the operations, business, property or assets or the financial
condition of the Company and its Subsidiaries taken as a whole.
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<PAGE> 33
5. To the best of counsel's knowledge after due inquiry, no
order, consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any governmental or public body
or authority, or any subdivision thereof, is required to authorize, or is
required in connection with (i) the execution, delivery and performance of the
Agreement or the Notes, or (ii) the legality, validity, binding effect or
enforceability of the Agreement or the Notes.
We express no opinion as to the laws of any jurisdiction other
than the laws of the State of Ohio and the federal laws of the United States of
America.
Very truly yours,
Denis G. Daly
Vice President, Legal Affairs & Secretary
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<PAGE> 34
EXHIBIT C
(See Section 9.12 and 9.13)
THE AGENT AGREEMENT
1. Appointment. The Banks hereby designate STAR BANK, NATIONAL
ASSOCIATION, as Agent to act as herein specified. Each Bank hereby irrevocably
authorizes, and each holder of any Note by the acceptance of a Note shall be
deemed irrevocably to authorize, the Agent to take such action on its behalf
under the provisions of this Agreement and the Notes and any other instruments
and agreements referred to herein and to exercise such powers and to perform
such duties hereunder and thereunder as are specifically delegated to or
required of the Agent by the terms hereof and thereof and such other powers as
are reasonably incidental thereto. The Agent may perform any of its duties
hereunder by or through its agents or employees.
2. Nature of Duties. The Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement. Neither the
Agent nor any of its officers, directors, employees or agents shall be liable
for any action taken or omitted by it as such hereunder or in connection
herewith, unless caused by its or their gross negligence or willful misconduct.
The duties of the Agent shall be mechanical and administrative in nature; the
Agent shall not have by reason of this Agreement a fiduciary relationship in
respect of any Bank; and nothing in this Agreement, expressed or implied, is
intended to or shall be so construed as to impose upon the Agent any obligations
in respect of this Agreement except as expressly set forth herein.
3. Lack of Reliance on the Agent. Independently and without
reliance upon the Agent, each Bank, to the extent it deems appropriate, has made
and shall continue to make (i) its own independent investigation of the
financial condition and affairs of the Company in connection with the making and
the continuance of the Loans hereunder and the taking or not taking of any
action in connection herewith, and (ii) its own appraisal of the
creditworthiness of the Company, and, except as expressly provided in this
Agreement, the Agent shall have no duty or responsibility, either initially or
on a continuing basis, to provide any Bank with any credit or other information
with respect thereto, whether coming into its possession before the making of
the Loans or at any time or times thereafter. The Agent shall not be responsible
to any Bank for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforceability, collectibility, priority or sufficiency of this Agreement or the
Notes or the financial condition of the Company or be required to make any
inquiry concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement or the Notes, or the financial
condition of the Company, or the existence or possible existence of any Default
or Event of Default.
4. Certain Rights of the Agent. If the Agent shall request
instructions from the Required Banks with respect to any act or action
(including failure to act) in connection with this Agreement, the Agent shall be
entitled to refrain from such act or taking such action unless and until the
Agent shall have received instructions from the Required Banks; and the Agent
shall not incur liability to any Person by reason of so refraining. Without
limiting the foregoing, no Bank shall have any right of action whatsoever
against the Agent as a result of the Agent acting or refraining from acting
hereunder in accordance with the instructions of the Required Banks.
5. Reliance. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any Note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message believed by it to be
genuine and correct and to have been signed, sent or made by the proper
34
<PAGE> 35
person or entity, and, with respect to all legal matters pertaining to this
Agreement and its duties hereunder, upon advice of counsel selected by it.
6. Indemnification. To the extent the Agent is not reimbursed
and indemnified by the Company, the Banks will reimburse and indemnify the
Agent, in proportion to their respective aggregate Commitments to lend under
this Agreement, for and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suites, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in performing its duties hereunder, in any way
relating to or arising out of this Agreement; provided that no Bank shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Agent's gross negligence or willful misconduct.
7. The Agent in its Individual Capacity. With respect to its
obligation to lend under this Agreement, the Loans made by it and the Note
issued to it, the Agent shall have the same rights and powers hereunder as any
other Bank or holder of a Note and may exercise the same as though it were not
performing the duties specified herein; and the terms "Banks", Required Banks",
"holders of Notes", or any similar terms shall, unless the context clearly
otherwise indicates, include the Agent in its individual capacity. The Agent may
accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with the Company or any affiliate of the
Company as if it were not performing the duties specified herein, and may accept
fees and other consideration from the Company for services in connection with
this Agreement and otherwise without having to account for the same to the
Banks.
8. Holders of Notes. The Agent may deem and treat the payee of
any Note as the owner thereof for all purposes hereof unless and until a written
notice of the assignment or transfer thereof shall have been filed with the
Agent. Any request, authority or consent of any person or entity who, at the
time of making such request or giving such authority or consent, is the holder
of any Note shall be conclusive and binding on any subsequent holder, transferee
or assignee of such Note or of any Note or Notes issued in exchange therefor.
9. Resignation by the Agent. (a) The Agent may resign from the
performance of all its functions and duties hereunder and/or under the
Assignment at any time by giving 15 Business Days' prior written notice to the
Company and the Banks. Such resignation shall take effect upon the appointment
of a successor Agent pursuant to clauses (b) and (c) below or as otherwise
provided below.
(b) Upon any such notice of resignation, the Banks shall appoint
a successor Agent hereunder who shall be reasonably satisfactory to the Company
and shall be an incorporated bank or trust company.
(c) If a successor Agent shall not have been so appointed within
said 15 Business Day period, the Agent, with the consent of the Company, shall
then appoint a successor Agent who shall serve as Agent hereunder until such
time, if any, as the Banks appoint a successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to clause
(b) or (c) by the 20th Business Day after the date such notice of resignation
was given by the Agent, the Agent's resignation shall become effective and the
Banks shall thereafter perform all the duties of the Agent hereunder until such
time, if any, as the Banks appoint a successor Agent as provided above.
STAR BANK, NATIONAL ASSOCIATION
Individually and as "AGENT"
By: ________________________________
35
<PAGE> 36
Title: ______________________________
BANK ONE, DAYTON, NA
By: ________________________________
Title: _______________________________
THE FIRST NATIONAL BANK OF CHICAGO
By: ________________________________
Title: _______________________________
NBD BANK
By: ________________________________
Title: _______________________________
SOCIETY NATIONAL BANK
By: ________________________________
Title: _______________________________
36
<PAGE> 37
EXHIBIT D
(See Section 6.12)
DEBT
$20 Million Senior Note Agreement, due June 5, 1996, 9.32%, between Amcast
Industrial Corporation and Principal Mutual Life Insurance Company, dated May 1,
1986, as amended. Annual principal payments of $2,857,143 starting June 5, 1990.
$10 Million Senior Note Agreement, due September 15, 1999, 9%, between Amcast
Industrial Corporation and Principal Mutual Life Insurance Company, dated
September 1, 1989, as amended. Annual principal payments of $1.5 million in 1990
and 1991, and $875,000 thereafter.
Loan Agreement by and between the City of Fayetteville, Arkansas, and Amcast
Industrial Corporation, dated as of December 1, 1991, for $5,050,000 City of
Fayetteville, Arkansas, variable/ fixed rate demand Industrial Development
Revenue Refunding Bonds, Series 1992. Principal payable at maturity, December 1,
2004. Supported by a letter of credit issued by Bank One, Dayton, NA.
Loan Agreement between City of Elkhart, Indiana, and Elkhart Products
Corporation, dated as of February 1, 1988, for $2,050,000, Economic Development
Revenue Refunding Bonds, Series 1988. Annual principal payments $125,000 in 1992
and $175,000 thereafter. Maturity February 1, 2003. Supported by a letter of
credit issued by Bank One, Columbus, NA.
Loan Agreement between The Town of Fremont, Indiana and WheelTek, Inc., an
Indiana corporation, dated November 20, 1990, for $350,000, 5%, due December 15,
1997. Principal payable annually.
Bank loans under short-term credit facilities provided by the banks
participating in the revolving credit agreement.
37
<PAGE> 38
NOTE
$14,000,000 Cincinnati, Ohio
June 7, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to the order of BANK ONE,
DAYTON, NA (the "Bank"), in lawful money of the United States of America in
immediately available funds, at the office of STAR BANK, NATIONAL ASSOCIATION
(the "Agent") located at 425 Walnut Street, Cincinnati, Ohio 45201 (i) the
principal amount of each Loan made by the Bank pursuant to, and as defined in
the Agreement referred to below on the last day of the Interest Period (as
defined in the Agreement) applicable thereto and (ii) on March 31, 1998 the
principal sum of FOURTEEN MILLION dollars ($14,000,000) or, if less, the unpaid
principal amount of all Loans made by the Bank pursuant to the Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the Agreement) shall
occur and be continuing, the principal of and accrued interest on this Note may
be declared to be due and payable in the manner and with the effect provided in
the Agreement.
The Company hereby waives presentment, demand, protest or notice
of any kind in connection with this Note.
This Note shall be constructed in accordance with and be
governed by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
Title: ______________________________
38
<PAGE> 39
NOTE
$14,000,000 Cincinnati, Ohio
June 7, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to the order of STAR BANK,
NATIONAL ASSOCIATION (the "Bank"), in lawful money of the United States of
America in immediately available funds, at the office of STAR BANK, NATIONAL
ASSOCIATION (the "Agent") located at 425 Walnut Street, Cincinnati, Ohio 45201
(i) the principal amount of each Loan made by the Bank pursuant to, and as
defined in the Agreement referred to below on the last day of the Interest
Period (as defined in the Agreement) applicable thereto and (ii) on March 31,
1998 the principal sum of FOURTEEN MILLION dollars ($14,000,000) or, if less,
the unpaid principal amount of all Loans made by the Bank pursuant to the
Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the Agreement) shall
occur and be continuing the principal of and accrued interest on this Note may
be declared to be due and payable in the manner and with the effect provided in
the Agreement.
The Company hereby waives presentment, demand, protest or notice
of any kind in connection with this Note.
This Note shall be construed in accordance with and be governed
by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: ________________________________
Title: ______________________________
39
<PAGE> 40
NOTE
$9,000,000 Cincinnati, Ohio
June 7, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to the order of THE FIRST
NATIONAL BANK OF CHICAGO (the "Bank"), in lawful money of the United States of
America in immediately available funds, at the office of STAR BANK, NATIONAL
ASSOCIATION (the "Agent") located at 425 Walnut Street, Cincinnati, Ohio 45201
(i) the principal amount of each Loan made by the Bank pursuant to, and as
defined in the Agreement referred to below on the last day of the Interest
Period (as defined in the Agreement) applicable thereto and (ii) on March 31,
1998 the principal sum of NINE MILLION dollars ($9,000,000) or, if less, the
unpaid principal amount of all Loans made by the Bank pursuant to the Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the Agreement) shall
occur and be continuing, the principal of and accrued interest on this Note may
be declared to be due and payable in the manner and with the effect provided in
the Agreement.
The Company hereby waives presentment, demand, protest or notice
of any kind in connection with this Note.
This Note shall be construed in accordance with and be governed
by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
Title: _____________________________
40
<PAGE> 41
NOTE
$9,000,000 Cincinnati, Ohio
June 7, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to the order of NBD BANK
(the "Bank"), in lawful money of the United States of America in immediately
available funds, at the office of STAR BANK, NATIONAL ASSOCIATION (the "Agent")
located at 425 Walnut Street, Cincinnati, Ohio 45201 (i) the principal amount of
each Loan made by the Bank pursuant to, and as defined in the Agreement referred
to below on the last day of the Interest Period (as defined in the Agreement)
applicable thereto and (ii) on March 31, 1998 the principal sum of NINE MILLION
dollars ($9,000,000) or, if less, the unpaid principal amount of all Loans made
by the Bank pursuant to the Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the Agreement) shall
occur and be continuing, the principal of and accrued interest on this Note may
be declared to be due and payable in the manner and with the effect provided in
the Agreement.
The Company hereby waives presentment, demand, protest or notice
of any kind in connection with this Note.
This Note shall be constructed in accordance with and be
governed by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
Title: _____________________________
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<PAGE> 42
NOTE
$14,000,000 Cincinnati, Ohio
June 7, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to the order of SOCIETY
NATIONAL BANK (the "Bank"), in lawful money of the United States of America in
immediately available funds, at the office of STAR BANK, NATIONAL ASSOCIATION
(the "Agent") located at 425 Walnut Street, Cincinnati, Ohio 45201 (i) the
principal amount of each Loan made by the Bank pursuant to, and as defined in
the Agreement referred to below on the last day of the Interest Period (as
defined in the Agreement) applicable thereto and (ii) on March 31, 1998 the
principal sum of FOURTEEN MILLION dollars ($14,000,000) or, if less, the unpaid
principal amount of all Loans made by the Bank pursuant to the Agreement.
The Company promises also to pay interest on the unpaid
principal amount hereof in like money at said office from the date hereof until
paid at the rates and at the times provided in the Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of June 7, 1995 among the Company, the Bank and the other
banking institutions party thereto (as from time to time in effect, the
"Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof.
In case an Event of Default (as defined in the Agreement) shall
occur and be continuing, the principal of and accrued interest on this Note may
be declared to be due and payable in the manner and with the effect provided in
the Agreement.
The Company hereby waives presentment, demand, protest or notice
of any kind in connection with this Note.
This Note shall be constructed in accordance with and be
governed by the law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
Title: _____________________________
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<PAGE> 43
AMCAST INDUSTRIAL CORPORATION
OFFICER'S CERTIFICATE
SECTION 5.01(C) OF
CREDIT AGREEMENT
This certificate is delivered pursuant to Section 5.01(c) of the Credit
Agreement, dated June 7, 1995 (the "Agreement"), among Amcast Industrial
Corporation (the "Company") and Star Bank, National Association acting
individually and as agent, Bank One, Dayton, NA, The First National Bank of
Chicago, NBD Bank, and Society National Bank (the "Banks").
The undersigned officer of Company does hereby certify that he is an
officer of Company and that he is duly authorized to execute this Certificate on
behalf of Company and further certifies as follows:
Each of the representations, warranties and agreements of the Company
set forth in the Agreement is true and correct as of the date hereof
with the same effect as though made on and (except to the extent that
any such representation or warranty relates to a particular date) as of
the date hereof and no Default or Event of Default has occurred and is
continuing under the Agreement.
WITNESS the due execution hereof this 6th day of June, 1995.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
John H. Shuey
President and Chief Executive Officer
I hereby certify that John H. Shuey is the duly elected President and
Chief Executive Officer of AMCAST INDUSTRIAL CORPORATION and that the signature
appearing immediately above is his own true signature.
By: _______________________________
Denis G. Daly
Secretary
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EXHIBIT A2
See Section 2.05(c)
TERM NOTE
$_______________ Cincinnati, Ohio
_________, 1995
FOR VALUE RECEIVED, AMCAST INDUSTRIAL CORPORATION, an Ohio corporation
(the "Company"), hereby promises to pay to the order of
_________________________ (the "Bank"), in lawful money of the United States of
America in immediately available funds, at the office of STAR BANK, NATIONAL
ASSOCIATION (the "Agent") located at 425 Walnut Street, Cincinnati, Ohio, 45201,
by the dates prescribed in Section 2.13 of the Agreement (or such earlier date
as this Term Note may expire, by acceleration or otherwise, pursuant to the
terms and conditions of the Agreement), the principal sum(s) corresponding with
such dates as described in Section 2.13 of the Agreement. Subject to Section
2.13 of the Agreement referred to below, this term Note shall have as its final
maturity April 1, 2000.
The Company promises also to pay interest on the unpaid principal
amount hereof in like money at said office from the date hereof until paid at
the rates and at the times provided in the Agreement.
This Term Note is one of the Term Notes referred to in the Amended and
Restated Credit Agreement dated as of June 7, 1995 among the Company, the Bank
and the other financial institutions party thereto (as from time to time in
effect, the "Agreement") and is entitled to the benefits thereof and shall be
subject to the provisions thereof.
In case an Event of Default (as defined in the Agreement) shall occur
and be continuing, the principal of and accrued interest on this Term Note may
be declared due and payable in the manner and with the effect provided in the
Agreement.
The Company hereby waives presentment, demand, protest or notice of any
kind in connection with this Term Note.
This Note shall be construed in accordance with and be governed by the
law of the State of Ohio.
AMCAST INDUSTRIAL CORPORATION
By: _______________________________
Title: ____________________________
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<PAGE> 1
Form 10-Q
May 28, 1995
Exhibit 10.5
EXECUTIVE AGREEMENT
THIS EXECUTIVE AGREEMENT, is made and entered into the 3rd day of
March, 1995, by and between AMCAST INDUSTRIAL CORPORATION, an Ohio corporation
(the "Company"), and LEO W. LADEHOFF (the "Executive").
A. Executive is Chairman of the Board of Directors and Chief Executive
Officer of the Company; he has been employed by the Company since December 1978,
holding the positions of Chief Executive Officer since May 1979 and Chairman
since December 1980 and having served as President of the Company during the
periods December 1978 to November 1986 and September 1990 to December 1993;
B. Executive presently serves as Chief Executive Officer of the Company
pursuant to the Executive Employment Agreement between Executive and the
Company, dated April 1, 1991, a copy of which is attached hereto as Annex A and
referred to hereinafter as the "1991 Agreement";
C. Executive intends to retire as an employee of the Company on August
31, 1995, after more than 17 years of service during which the Company developed
new businesses, products and facilities and achieved record levels of revenues
and profitability;
D. The Company and Executive desire in this Agreement to set forth the
terms of Executive's continued employment through August 31, 1995, to secure
Executive's consulting services after his retirement, to restate in this
Agreement certain benefits that Executive has earned in the course of his
employment, and to terminate the 1991 Agreement;
1
<PAGE> 2
NOW, THEREFORE, the Company and Executive agree as follows:
1. Employment.
(a) The Company and Executive agree that Executive will continue as an
employee of the Company through August 31, 1995 and will retire as an employee
of the Company, effective September 1, 1995 (the "Retirement Date"). From the
date of this Agreement until his Retirement Date, Executive's compensation for
services as an employee shall be determined in accord with Section 2(a)of the
1991 Agreement ("Standard Compensation"). While Executive shall continue as an
employee until his Retirement Date, the Company and Executive agree, for
purposes of orderly transition, that Executive shall cease to be Chief Executive
Officer of the Company on March 23 1995. After ceasing to be Chief Executive
Officer, Executive shall perform such duties and responsibilities as an employee
of the Company as the then Chief Executive Officer and Board of Directors shall
assign to him and as are consistent with his status as Chairman of the Board and
former Chief Executive Officer.
(b) If for any reason, including death, disability, voluntary
termination, or other termination of employment, Executive shall cease to be
employed by the Company prior to his Retirement Date as defined as Section 1(a),
then (i) the Company shall continue to pay Executive or his spouse, if Executive
is deceased at the time of any payment, his Standard Compensation through August
31, 1995 and (ii) Retirement Date shall continue to be September 1, 1995, and
payment of retirement benefits shall commence in accord with that retirement
date.
2. Termination of 1991 Agreement. The Company and Executive agree that
the 1991 Agreement is hereby terminated and shall be of no further force and
effect, except to the extent that (a) certain provisions of Section 2 of the
1991 Agreement are incorporated in Section
2
<PAGE> 3
1 of this Agreement, and (b) the definition of change of control contained in
Section 9(c) of the 1991 Agreement is incorporated in Section 11 of this
Agreement..
3. Service as a Director of the Company.
(a) Executive has been elected to serve as a director of the
Company until the Annual Meeting of Shareholders of the Company in 1997. The
Company and Executive each desire that Executive continue to serve as a
director for his unexpired term. Commencing with his Retirement Date, Executive
will be compensated for his services as a director of the Company in the same
manner as other directors who are not employed by the Company are compensated
for such services.
(b) Executive has been elected as Chairman of the Board of
Directors of the Company for a term expiring at the organizational meeting of
directors following the Annual Meeting of Shareholders to be held in 1995. The
Company and Executive each desire that Executive continue as Chairman of the
Board for his unexpired term. At the expiration of his current term as
Chairman, the then directors of the Company, in consultation with Executive,
shall determine whether it is in the best interests of the Company that he
continue as its Chairman for an additional term.
4. Consulting Services.
(a) For the period commencing on the Retirement Date and ending on
December 31, 1997 (the "Consulting Period"), the Company hereby engages, and
Executive agrees to serve, as a consultant to the then Chief Executive Officer
of the Company . The consulting services to be rendered to the Company by
Executive shall be rendered at the request of the then Chief Executive Officer
of the Company. Such consulting services shall be consistent with Executive's
position as the former Chief Executive Officer of the Company (and, if
applicable, his status as
3
<PAGE> 4
Chairman of the Board). The Company acknowledges that the benefits it expects to
obtain from Executive's consulting services are not related to any specific time
commitment on the part of Executive, but are related to his availability to
provide advice in connection with special projects, questions, and events that
arise from time to time and Executive agrees to be available at reasonable times
to provide such consultation and advice.
(b) During the Consulting Period, the Company shall (i) provide
Executive office space and secretarial and administrative support; (ii) promptly
reimburse Executive for all reasonable expenses incurred by Executive in
performing services for the Company hereunder, including all expenses of travel
while performing consulting services at the request of the then Chief Executive
Officer, provided such expenses are incurred and accounted for in accordance
with the policies and procedures established by the Company; and (iii) allow
Executive use of corporate aircraft at the Company's expense in circumstances in
which the use of the same is beneficial to Executive and the Company in the
performance of services for the Company hereunder.
5. Non-Competition and Non-Disclosure Provisions.
(a) Executive agrees and covenants that while employed by the Company
and for the five-year period immediately following the Retirement Date,
Executive will not, directly or indirectly, either individually or as an
employee, agent, officer, director, shareholder (excluding being the holder of
any stock which represents less than one percent interest in a corporation),
partner, or in any other capacity whatsoever, become or be associated with any
other corporation, firm, or business which is engaged in providing or marketing
any goods, products, or services then being sold or developed for sale by the
Company. In addition, Executive agrees that for the period of time specified in
the immediately preceding sentence, he will not in any manner participate or
assist any other person or business in selling said products or services to any
person, firm, or corporation which was a customer of the Company at any time
during the sixty (60)
4
<PAGE> 5
months preceding the termination of his active employment with the Company.
Executive agrees that the restrictions imposed herein are reasonable both as to
time and area, necessary for the reasonable protection of the Company's business
and goodwill, and not unduly restrictive of his rights as an individual.
(b) Executive agrees and covenants that while employed by the Company
and throughout the five-year period following his Retirement Date, Executive
will not disclose to any person, corporation, firm, partnership, or other entity
whatsoever (except the Company or any of its affiliates), any confidential
information or trade secrets of the Company or any of its subsidiaries or
affiliates. Executive shall deliver to Company at the termination of the
Consulting Period, any reports and other documents (and copies thereof) relating
to the business of Company or any of its affiliates, which he may then possess
or have under his control.
(c) If Executive commits a breach or threatens to commit a breach of
any of the provisions of this Section 5(a) or 5(b), the Company shall have the
right and remedy, in addition to any others that may be available, at law or in
equity, to have the provisions of such sections specifically enforced by any
court having equity jurisdiction, together with an accounting therefor, it being
acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to the Company and that money damages will not provide an
adequate remedy to the Company. Such injunction shall be available without the
posting of any bond or other security, and Executive hereby consents to the
issuance of such injunction.
(d) If any covenant contained in this Section 5 or any part hereof is
hereafter construed to be invalid or unenforceable, the same shall not affect
the remainder of the covenants, which shall be given full effect, without regard
to the invalid portions, and any court having jurisdiction shall have the power
to reduce the duration and/or area and/or scope of such covenant, and, in its
reduced form, said covenant shall then be enforceable.
5
<PAGE> 6
(e) If Executive commits a breach of this Section 5, the Company,
promptly after acquiring knowledge of such breach, will give written notice
thereof to Executive (or if Executive is deceased, to the person or persons
entitled to receive payments under Section 6(a) (ii) of this Agreement); all
future payments to Executive under the provisions of Section 6(a) of this
Agreement shall be forfeited by him, provided, however, that there will be no
such forfeiture if such breach is promptly cured without material harm to the
Company.
6. Post Retirement Payments. In connection with the retirement of
Executive the Company agrees to make the payments and provide the benefits
described in Sections 6 through 11 hereof, and the parties mutually agree to the
termination of the 1991 Agreement, and the payments include:
(a) Ten-Year Installment Payments.
(i) Commencing on Executive's Retirement Date, the Company
shall pay to Executive Eighty-four Thousand Dollars ($84,000.00) per annum, in
equal monthly installments of Seven Thousand Dollars ($7,000.00), payable on the
first business day of each calendar month, for a period of ten (10) years (each
such $7,000 monthly payment is referred to hereinafter as a "Monthly Payment").
(ii) In the event of Executive's death before the Executive
shall have received 120 Monthly Payments, then the Company shall continue to
make the Monthly Payments to the Executive's spouse, if any, if she survives the
Executive, or, if she shall not have survived Executive, to Executive's estate
or his heirs until the remainder of such 120 monthly payments have been paid
under the Agreement; if such spouse dies prior to the payment of the remainder
of the 120 Monthly Payments, the Company shall make the remaining Monthly
Payments to Executive's estate or his heirs.
(b) Additional Pension Payments.
(i) Executive is a participant in the Amcast Merged Pension
Plan, which is a plan qualified under Section 401 of the Internal Revenue Code
(the "Qualified Plan"), and a participant in the Amcast Industrial Corporation
Non-Qualified Supplementary Benefit Plan, which is not qualified under such
Section 401 (the "SERP").
(ii) Commencing on Executive's Retirement Date the Company
will pay Executive, during his lifetime, an annual amount equal to the
difference between the annual total of payments to Executive under the Qualified
Plan and the SERP, together the ("Pension Plans"), and $210,000 per year so that
Executives total payment from the Pension Plans and the Company payment will
equal $210,000 annually.
(iii) Provided that she is the named beneficiary under the
Pension Plans or the primary beneficiary of a trust or similar arrangement which
is the named beneficiary thereunder and if Executive's present spouse survives
Executive and is married to him at the time of his decease, the Company agrees
to pay to such spouse during her lifetime, an amount equal to the difference
between the annual total of payments due to Executive under the Pension Plans
and $105,000.00 per year, so that, after the death of Executive, his spouse
shall receive total payments from the Pension Plans and the Company equal to
$105,000.00 annually.
(iv) Except as set forth in Section 11 of this Agreement, the
payments provided for in this Section 6(b) shall be made at the times and in the
increments (e.g., bi-weekly, monthly, or annually) as the payments under the
Pension Plans would be made if the Executive elected to receive a joint and 50
percent survivor annuity as set out in the Qualified Plan.
(v) Nothing contained in this Agreement shall be deemed to
alter, restrict or enlarge Executive's existing rights under the Pension Plans
to designate a beneficiary or beneficiaries in the manner permitted under the
terms of the Pension Plans.
6
<PAGE> 7
7. Health, Life and Accidental Death Insurance. Commencing on
Executive's Retirement Date the Company shall provide health, life, and
accidental death insurance to Executive or his spouse in the event of his death
under the Company's health, life, and accidental death plans for employees of
the Company's Corporate Center until December 31, 1997.
8. Stock Options. The Company, with regard to Executive's outstanding
stock options on the date hereof, agrees as follows:
(a) To extend the terms of any such options originally granted for
terms of less than ten years which are not incentive stock options as defined in
the applicable plan by an additional five years provided such extension does not
extend the entire term of the option for more than 10 years;
(b) With regard to the option for 20,000 shares granted February 20,
1991, 11,764 shares of which are incentive stock options and 8,236 shares of
which are non-qualified stock options; to provide new grant letters
appropriately designating the status of each; and
(c) With regard to the non-qualified option grant of 19,071 shares
dated March 21, 1990 and the non-qualified grant of 8,236 shares dated February
20, 1991, the Company agrees to provide to Executive, at the time of his
exercise of such options, a cash payment sufficient to pay his federal, state,
and local income tax liability incurred as a result of such exercise as well as
any additional payment of federal, state or local tax due as a result of the
cash payments made to Executive under the terms of this Section 8(c), in accord
with the resolution of the Company's Board of Directors adopted at its meeting
of February 19, 1992.
9. Long-Term Incentive Compensation. The Company agrees to waive the
application to Executive of the requirement of Section 4.2(a) and any reduction
resulting from the provisions of Section 4(c) of the Company's Long-Term
Incentive Plan ("LTIP") in regard to Awards as defined in the LTIP outstanding
at the date of this Agreement.
7
<PAGE> 8
10. Trust. Promptly after the execution of this Agreement the
Company agrees it will establish a "Rabbi" trust ("the Trust"), and a copy of
which will be attached hereto as Annex B.
(a) Except as provided in Section 11(c) of this Agreement, if the
Trust is funded at the time a payment is required under this Agreement, the
payment will be made on behalf of the Company by the Trustee out of Trust funds
to the extent permitted by the Trust; provided that the making of such payment
shall not reduce the balance in the Trust below the Net Present Value Amount as
defined in Section 12, of the then remaining payments. The Determination Date
for each such calculation of Net Present Value Amount will be the related
payment date.
(b) In the event Executive exercises his option under Section 11(b)
or payments are made to Executive under 11(c) or (d) of this Agreement and
Executive is fully paid all amounts due thereunder, all funds remaining in the
Trust shall be immediately delivered to the Company.
11. Alternative Payment Methods.
(a) At any time after September 1, 1995 and prior to September 1,
2005, at the election of the Executive or his spouse if he is deceased, the
Company shall fund the Trust in an amount equal to the Net Present Value Amount
(as defined at Section 12). In calculating such Net Present Value Amount, the
Determination Date shall be the date on which Executive or his spouse,
exercised the option under this Section. Funding of the Trust, either under
this Section or voluntarily by the Company, will not relieve the Company of any
of its payment obligations under this Agreement, and such obligations will be
fulfilled only upon actual payment in accordance with this Agreement.
(b) At any time after September 1, 1995 and prior to September 1,
2005, at the election of the Executive or his spouse if he is deceased, the
Company shall pay to the Executive an amount equal to the Net Present Value
Amount less 12 percent of such amount. After the
8
<PAGE> 9
payment described in this Section 11(b) is made, Company shall have no further
obligation to Executive or Executive's spouse, under this Agreement or under the
SERP, except as described in Section 4(b), 7, 8 and 9of this Agreement. In
calculating such Net Present Value Amount, the Determination Date shall be the
date on which Executive exercised his option under this Section. Such Net
Present Value Amount shall be paid to Executive as soon as practical, but not
more than 30 days after the Determination Date
(c) If at the end of any fiscal quarter of the Company after the
Retirement Date, the Company's debt to equity ratio exceeds 1 to 1 as derived in
the Company's quarterly report to shareholders (which shall be made available to
the Executive upon his request), then the Company shall pay the Net Present
Value Amount to Executive or his spouse if he is deceased, and shall then have
no further obligation to the Executive or Executive's spouse under this
Agreement or under the SERP, except as described in Section 4(b), 7, 8 and 9 of
this Agreement. In calculating such Net Present Value Amount, the Determination
date shall be the last day of the fiscal quarter on which such condition is
first exists. No payments made under this Section 11(c) shall be made from the
Trust.
(d) In the event a change of control of the Company (as defined in the
1991 Agreement) occurs, the Company shall pay to the Executive the Net Present
Value Amount. After the payment described in this Section 11(d) is made, the
Company shall have no further obligation to the Executive or Executive's spouse
under this Agreement or under the SERP, except as described in Section 7, 8 and
9 of this Agreement. In calculating the Net Present Value Amount in regard to
this Section 11(d), the Determination Date shall be the date on which the change
of control has been deemed to occur as described in the 1991 Agreement.
(e) Emergency Distributions. If, on the written application of
Executive, or his spouse if he is deceased, the Compensation Committee of the
Board of Directors of the Company determines that Executive has experienced an
"Unforeseeable Emergency" (as defined below),
9
<PAGE> 10
then, as of the first day of any calendar month, Executive may receive an
Emergency Distribution of the amount payable pursuant to this Agreement,
provided that the aggregate amount of any such distribution shall not exceed the
amount reasonably needed to satisfy Executive's emergency need. The term
"Unforeseeable Emergency" means severe financial hardship to Executive resulting
from a sudden and unexpected illness or accident of Executive or of a
"dependent" (as defined in Section 152(a) of the Code) of Executive, loss of
Executive's property due to a casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
Executive. The Committee shall not permit an Emergency Distribution to Executive
to the extent that his Unforeseeable Emergency can be relieved:
(i) through reimbursement or compensation by insurance or
otherwise;
(ii) by liquidation of Executive's assets, to the extent the
liquidation of such assets would not itself cause severe financial hardship.
Distribution pursuant to this Section 11(e) will be made, first, from
the amount payable pursuant to Section 6(a) and, second, from the amount payable
pursuant to Section 6(b). Emergency distributions will reduce the remaining
amount payable pursuant to Sections 6(a) and (b), as appropriate, by first,
calculating the Net Present Value Amount of the amount payable, second, reducing
the Net Present Value amount by the Emergency Distribution amount and, third,
recomputing the amount payable pursuant to Section 6(a) or 6(b) over the
remaining years using the discount and actuarial assumptions that would be used
pursuant to Section 12.
(f) The Company and Executive agree that notwithstanding anything to
the contrary contained in the Company's SERP, to the extent of a conflict
between the timing and method of payments under the SERP and the timing and
method of payments under this Agreement, all payments to Executive or his spouse
under the SERP shall be made at the same time and in the same manner as payments
under this Agreement.
10
<PAGE> 11
The options described in Sections 11(a) and (b) of this Agreement may
be exercised by Executive or his spouse by written notice by registered or
certified mail addressed to the chief executive officer of the Company or by
notice given in accordance with Section 15 of this Agreement.
12. Net Present Value Amount. For the purpose of determining the amount
needed to fund the Trust as described in Section 10 or the amount of payments to
be made as described in Section 11, the Company's independent actuaries, will
calculate the net present of value of all payments remaining to be made to
Executive and Executive's spouse if then living (or Executive's spouse if
Executive is then deceased) under this Agreement (herein the "Net Present Value
Amount"). The Net Present Value Amount shall be determined as of the
Determination Date (herein the "Determination Date") in accordance with the
provisions of Exhibit C attached.
13. Successors; Binding Agreement. The Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation, or
otherwise) to all or substantially all of the business and/or assets of the
Company, by agreement in form and substance satisfactory to the Executive, to
expressly assume and agree to perform this Agreement in the
11
<PAGE> 12
same manner and to the same extent that the Company would be required to perform
as if no such succession had taken place.
14. Waiver. The failure of either party to insist, in any one or
more instances, upon the performance of any of the terms, covenants, or
conditions of this Agreement by the other party hereto, shall not be construed
as a waiver or as a relinquishment of any right granted hereunder to the party
failing to insist on such performance, or as a waiver of the future performance
of any such term, covenant, or condition, but the obligations hereunder of both
parties hereto shall remain unimpaired and shall continue in full force and
effect.
15. Notices. Any notices or other communications required or
permitted under this Agreement shall be in writing and shall be sufficiently
communicated, if delivered in person or if sent by certified or registered
mail, postage prepaid, and properly addressed as follows:
(a) To the Company:
Chairman, Compensation Committee
Amcast Industrial Corporation
P.O. Box 98
Dayton, OH 45401
(b) To the Executive:
Leo W. Ladehoff
1426 Finger Lakes
Dayton, OH 45458
Either party may change the address to which notice to it is to be directed by
giving written notice of such change to the other party in the manner specified
in this Section.
12
<PAGE> 13
16. Default. In the event that the Company defaults on its obligations
under this Agreement and fails to remedy such default within thirty (30) days
after having received written notice from the Executive or his estate or
beneficiary, interest on the amount or value of any amount then due but not paid
shall accrue at the rate of ten percent per annum, compounded daily, from the
otherwise due date of such payment or transfer. Further, the Company shall, upon
presentation of appropriate commercial invoices, pay all legal expenses, which
includes reasonable legal fees, court costs, arbitration costs, and ordinary and
necessary out-of-pocket costs of attorneys, billed to and payable by the
Executive or by anyone claiming under or through the Executive (such person
being hereinafter referred to as the Executive's "Claimant"), in connection with
bringing, prosecuting, defending, litigating, arbitrating, negotiating, or
settling any claim or dispute by or against the Executive or the Executive's
Claimant, or any claim or dispute between the Executive or Claimant and the
Company, that may be instituted or arise upon or out of or relate to this
Agreement, or the validity, operation, interpretation, enforceability, or breach
hereof, provided that Executive or Executive's claimant, shall prevail in such
litigation.
17. Tax Withholdings. All payments under this Agreement shall be made
subject to all required federal, state, and local tax withholdings.
18. Entire Agreement; Amendment. This Agreement contains the entire
Agreement between the parties hereto with respect to the matters contemplated by
this Agreement and supersedes all prior negotiations, representations,
warranties, commitments, offers, contracts, and writings. No modification or
amendment of any provision of this Agreement shall be effective unless made in
writing and duly signed by the party to be bound thereby.
13
<PAGE> 14
19. Severability. If any of the provisions of this Agreement shall
be held to be invalid, such holding shall not in any way whatsoever affect the
validity of the remainder of this Agreement.
20. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of Ohio.
IN WITNESS WHEREOF, the parties have signed this agreement as of
the day and year first above written.
AMCAST INDUSTRIAL CORPORATION
By: _________________________________
John H. Shuey
President
By: _________________________________
William G. Roth
Chairman, Compensation Committee
ATTEST:
__________________________________
Robert P. Hensley
Assistant Secretary
EXECUTIVE
_____________________________________
Leo W. Ladehoff
14
<PAGE> 15
EXHIBIT C
In calculating the Net Present Value Amount, the following provisions shall
apply; (i) all remaining payments under this Agreement include (a) the
installment payments provided for in Section 6(a), (b) the additional payments
required under Section 6 (b) (ii) to attain the required $210,000 annual payment
and under Section 6 (b) (iii) to attain the required annual payment of $105,000
to Executive's surviving spouse but only if Executive's spouse is living on the
Determination Date and is his designated beneficiary, or is the primary
beneficiary of a trust or similar arrangement which is the named beneficiary,
under the SERP and (c) payments to be made under the SERP even though such
payments are provided for in the SERP and not in this Agreement; (ii) the
actuarial principles used in connection with the Qualified Plan shall be used to
establish the life expectancy of Executive, Executive's spouse, or their
combined life expectancy, as the case may be, as of the Determination Date for
purposes of establishing the period over which the payments under Section 6
shall assumed to be made; and (iii) an annual discount rate equal to the PBGC
Discount Rate shall be used to discount future payments to the Determination
Date. As used in this Exhibit C, the PBGC Discount Rate shall mean the average
of the PBGC discount rates used pursuant to Section 417(e) (3) (B) of the
Internal Revenue Code of 1986 as amended, for the three months immediately
preceding the Determination Date.
15
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<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> AUG-31-1995
<PERIOD-START> SEP-01-1994
<PERIOD-END> MAY-28-1995
<CASH> 2,904
<SECURITIES> 0
<RECEIVABLES> 42,432
<ALLOWANCES> 167
<INVENTORY> 45,728
<CURRENT-ASSETS> 97,547
<PP&E> 172,498
<DEPRECIATION> 85,199
<TOTAL-ASSETS> 214,291
<CURRENT-LIABILITIES> 52,816
<BONDS> 28,767
<COMMON> 8,537
0
0
<OTHER-SE> 111,790
<TOTAL-LIABILITY-AND-EQUITY> 214,291
<SALES> 245,150
<TOTAL-REVENUES> 245,150
<CGS> 194,545
<TOTAL-COSTS> 224,956
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<INTEREST-EXPENSE> 1,023
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<INCOME-TAX> 6,921
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