<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
Amendment No. 2
CONTINENTAL CIRCUITS CORP.
------------------------------------------------------------------
(NAME OF SUBJECT COMPANY)
HADCO ACQUISITION CORP. II
HADCO CORPORATION
------------------------------------------------------------------
(BIDDERS)
COMMON STOCK, $.01 PAR VALUE
------------------------------------------------------------------
(TITLE OF CLASS OF SECURITIES)
989852-10-8
------------------------------------------------------------------
(CUSIP NUMBER)
--------------------
ANDREW E. LIETZ
CHIEF EXECUTIVE OFFICER
HADCO CORPORATION
12A MANOR PARKWAY
SALEM, NEW HAMPSHIRE 03079
(603) 898-8000
------------------------------------------------------------------
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF BIDDERS)
--------------------
COPIES TO:
STEPHEN A. HURWITZ, ESQ.
TESTA, HURWITZ & THIBEAULT, LLP
HIGH STREET TOWER
125 HIGH STREET
BOSTON, MA 02110
--------------------
<PAGE> 2
TENDER OFFER
This Amendment No. 2 amends and supplements the Schedule 14D-1 filed by
Hadco Corporation, a Massachusetts corporation ("Parent"), and Hadco Acquisition
Corp. II, a Delaware corporation and a wholly-owned subsidiary of Parent
("Purchaser"), relating to the offer by Purchaser to purchase all outstanding
shares of Common Stock, $.01 par value per share (the "Shares"), of Continental
Circuits Corp. (the "Company"), a Delaware corporation, at $23.90 per Share, net
to the seller in cash, on the terms and subject to the conditions set forth in
the Offer to Purchase, dated February 20, 1998 (the "Offer to Purchase"), and in
the related Letter of Transmittal (which collectively constitute the "Offer").
All capitalized terms contained herein and not otherwise defined shall have the
meanings assigned to them in the Offer to Purchase.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Item 4 is hereby amended by the addition of the following:
On March 19, 1998, the Parent and BankBoston, N.A. entered into a First
Amendment and Modification Agreement to the Amended and Restated Revolving
Credit Agreement to amend certain definitions.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS
Item 11 is hereby amended as follows:
(a)(9) Text of Press Release issued by Parent, dated March 16, 1998.
(b)(2) First Amendment and Modification Agreement by and among the Parent and
BankBoston, N.A. dated as of March 19, 1998 amending the Amended and
Restated Revolving Credit Agreement.
(b)(3) Guaranty dated as of March 19, 1998 by Purchaser in favor of BankBoston,
N.A.
(b)(4) Stock Pledge Agreement dated as of March 19, 1998 by Purchaser in favor
of BankBoston, N.A.
(b)(5) Confirmation of Guaranty made as of March 20, 1998 by Purchaser in favor
of BankBoston, N.A.
-2-
<PAGE> 3
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: March 20, 1998 HADCO ACQUISITION CORP. II
By: /s/ TIMOTHY P. LOSIK
----------------------------
Name: Timothy P. Losik
-3-
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C>
(a) (9) Text of Press Release issued by Parent, dated
March 16, 1998.
(b) (2) First Amendment and Modification Agreement by and
among the Parent and BankBoston, N.A. dated as of
March 19, 1998 amending the Amended and Restated
Revolving Credit Agreement.
(b)(3) Guaranty dated as of March 19, 1998 by Purchaser in
favor of BankBoston, N.A.
(b)(4) Stock Pledge Agreement dated as of March 19, 1998 by
Purchaser in favor of BankBoston, N.A.
(b)(5) Confirmation of Guaranty made as of March 20, 1998
by Purchaser in favor of BankBoston, N.A.
</TABLE>
-4-
<PAGE> 1
Exhibit (a)(9)
HADCO CORPORATION ANNOUNCES THE
EXPIRATION OF HSR PERIOD
SALEM, New Hampshire, March 16, 1998 - Hadco Corporation (Nasdaq:HDCO)
announced today that the Hart-Scott-Rodino Act waiting period applicable to its
cash tender offer for the voting securities of Continental Circuits Corp.
(Nasdaq:CCIR) expired on March 14, 1998.
Headquartered in Phoenix, AZ, Continental Circuits Corp. manufactures
complex multilayer printed circuits. Markets served include original equipment
manufacturers and contract assemblers in the computer, communications,
instrumentation and industrial control industries.
Hadco is the largest manufacturer of advanced electronic interconnect
products in North America. The Company offers a wide array of sophisticated
manufacturing, engineering and systems integration services to meet its
customers electronic interconnect needs. The Company's principal products are
complex multilayer rigid printed circuits and backplane assemblies. Hadco
provides customers with a range of products and services that includes
development, design, quick-turn prototype, pre-production, volume products, and
backplane assembly. Hadco's customers are a diverse group of original equipment
manufacturers and contract manufacturers in the computing (mainly workstations,
servers, mainframes, storage and notebooks), data
communications/telecommunications and industrial automation industries,
including process controls, automotive, medical and instrumentation. The Company
operates ten facilities, with nine facilities in the United States and one in
Malaysia.
Except for the historical information contained in this press release
(including, net revenue, net income, and operating expectations) there may be
forward looking statements that involve risks and uncertainties. Factors that
could cause actual results to differ materially from forward looking statements
include, but are not limited to, general economic conditions, business
conditions in the electronics industry, demand for the company's products, and
other risks and uncertainties described in reports and other documents filed by
the company from time to time with the Securities and Exchange Commission.
Hadco Corporation's press releases are available through Company News
on-Call by fax at 800-758-5804, PIN #390325, or on the Internet at
HTTP://WWW.HADCO.COM:8080/.
<PAGE> 1
EXHIBIT (b)(2)
FIRST AMENDMENT AND MODIFICATION AGREEMENT
FIRST AMENDMENT AND MODIFICATION AGREEMENT dated as of March
19, 1998 (this "Amendment") by and among HADCO CORPORATION, a Massachusetts
corporation (the "Borrower"); the direct and indirect subsidiaries of the
Borrower listed on the signature pages hereto (collectively, the "Hadco
Subsidiaries"); BANKBOSTON, N.A., AS AGENT (the "Agent"); and BANKBOSTON, N.A.,
individually and the other lending institutions (collectively, the "Banks")
party to the Amended and Restated Revolving Credit Agreement dated as of
December 8, 1997 (as amended and in effect from time to time, the "Agreement")
among the Borrower, the Banks and the Agent. Terms not otherwise defined herein
which are defined in the Agreement shall have the respective meanings assigned
to such terms in the Agreement.
WHEREAS, the Borrower and its newly formed, wholly owned
Subsidiary Hadco Acquisition Corp. II ("Hadco Acquisition II") have offered,
pursuant to an Offer To Purchase dated February 20, 1998 (the "Tender Offer") to
purchase one hundred percent (100%) of the outstanding capital stock of
Continental Circuits, Corp., a Delaware corporation ("Continental Circuits");
WHEREAS, following the completion of the Tender Offer, the
Borrower intends to cause the merger of Hadco Acquisition II and Continental
Circuits (the "Continental Merger"), with Continental Circuits (to be renamed
Hadco Phoenix, Inc. ("Hadco Phoenix")) as the surviving entity;
WHEREAS, ss.9.5.2(b) of the Agreement sets forth certain
requirements for the acquisition contemplated by the Tender Offer and the
Continental Merger;
WHEREAS, in connection with the Tender Offer and the
Continental Merger, the Borrower has requested that the Agent and the Banks
amend certain provisions of the Agreement; and
WHEREAS, upon the terms and subject to the conditions contained
herein, the Agent and the Banks are willing to amend such provisions of the
Credit Agreement;
<PAGE> 2
-2-
NOW, THEREFORE, in consideration of the mutual agreements
contained in the Agreement, the other Loan Documents and this Amendment and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ss.1. AMENDMENT OF ss.1.1 OF THE AGREEMENT. Section 1.1 of the
Agreement is hereby amended by:
(a) deleting the definition of "Applicable Commitment
Fee Percentage" in its entirety and substituting in lieu
thereof the following new definition:
"APPLICABLE COMMITMENT FEE PERCENTAGE. For any fiscal
quarter or portion thereof, three-eighths of one percent
(0.375%) per annum; PROVIDED, HOWEVER, that in the event that
the ratio of Funded Debt (calculated as of the last day of such
fiscal quarter or portion thereof) to EBITDA (calculated for
the four consecutive fiscal quarters ending on the last day of
such fiscal quarter or portion thereof) meets the requirements
set forth in the chart below, the Applicable Commitment Fee
Percentage shall, commencing with the date (the "Commitment Fee
Adjustment Commencement Date") which is ten (10) days after the
date on which the Borrower delivers to the Banks the financial
statements referred to in ss.8.4(a) or (b) for such fiscal
quarter or portion thereof, and ending with the date (the
"Commitment Fee Adjustment Termination Date") which is nine (9)
days after the next date on which the Borrower delivers to each
of the Banks the financial statements referred to in ss.8.4(a)
or (b), be the percentage set forth opposite the applicable
ratio of Consolidated Funded Debt to EBITDA in the table below;
PROVIDED, HOWEVER, that in connection with any Permitted
Acquisition pursuant to ss.9.5.2(b), the next Commitment Fee
Adjustment Termination Date shall be deemed to be one day prior
to the Permitted Acquisition Funding Date for such Permitted
Acquisition, and the next Commitment Fee Adjustment
Commencement Date (with the Applicable Commitment Fee
Percentage to be based upon the ratio contained in the
Permitted Acquisition Ratio Compliance Certficate for such
Permitted Acquisition) shall be deemed to be the Permitted
Acquisition Funding Date for such Permitted Acquisition:
Ratio of Consolidated Funded Applicable Commitment
Debt to EBITDA Fee Percentage
-------------- --------------
Greater than or equal to 2.5:1.0 0.375%
<PAGE> 3
-3-
Greater than or equal to 2.0:1.0 0.275%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.225%
but less than 2.0:1.0
Less than 1.5:1.0 0.200%
If any financial statements referred to above are not delivered within the time
periods specified in ss.8.4(a) or, as the case may be, ss.8.4(b), then, until
such financial statements are delivered, the Applicable Commitment Fee
Percentage as at the end of the fiscal period that would have been covered
thereby shall, for the purposes of this definition, be deemed to be 0.375%. In
addition, at all times while a Default or Event of Default shall have occurred
and be continuing, the Applicable Commitment Fee Percentage shall, for the
purposes of this definition, be deemed to be 0.375%."
(b) deleting the definition of "Applicable Eurodollar
Rate Margin" in its entirety and substituting in lieu thereof
the following new definition:
"APPLICABLE EURODOLLAR RATE MARGIN. For any fiscal
quarter or portion thereof within any Interest Period with
respect to any Eurodollar Rate Loan, one and three-eighths
percent (1.375%) per annum; PROVIDED, HOWEVER, that in the
event that the ratio of Consolidated Funded Debt (calculated as
of the last day of such fiscal quarter or portion thereof) to
EBITDA (calculated for the four fiscal quarters ending on the
last day of such fiscal quarter or portion thereof) meets the
requirements set forth in the chart below, the Applicable
Eurodollar Rate Margin shall, commencing with (but not before)
the date (the "Eurodollar Rate Margin Adjustment Commencement
Date") which is ten (10) days after the date on which the
Borrower delivers to the Banks the financial statements
referred to in ss.8.4(a) or (b) for such fiscal quarter or
portion thereof and ending with the date (the "Eurodollar Rate
Margin Adjustment Termination Date") which is nine (9) days
after the next date on which the Borrower delivers to each of
the Banks the financial statements referred to in ss.8.4(a) or
(b), be the percentage set forth opposite the applicable ratio
of Consolidated Funded Debt to EBITDA in the table below;
PROVIDED, HOWEVER, that in connection with any Permitted
Acquisition pursuant to ss.9.5.2(b), the next Eurodollar Rate
Margin Adjustment Termination Date shall be deemed to be one
day prior to the Permitted Acqusition Funding Date for such
Permitted Acquisition, and the next Eurodollar Rate Margin
Adjustment Commencement Date (with the Applicable
<PAGE> 4
-4-
Eurodollar Rate Margin to be based upon the ratio contained in
the Permitted Acquisition Ratio Compliance Certficate for such
Permitted Acquisition) shall be the Permitted Acquisition
Funding Date for such Permitted Acquisition:
Ratio of Consolidated Funded Applicable Eurodollar
Debt to EBITDA Rate Margin
-------------- -----------
Greater than or equal to 3.0:1.0 1.375%
Greater than or equal to 2.5:1.0 1.125%
but less than 3.0:1.0
Greater than or equal to 2.0:1.0 0.875%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.625%
but less than 2.0:1.0
Less than 1.5:1.0 0.500%
If any financial statements referred to above are not delivered within the time
periods specified in ss.8.4(a) or, as the case may be, ss.8.4(b), then, until
such financial statements are delivered, the Applicable Eurodollar Rate Margin
as at the end of the fiscal period that would have been covered thereby shall,
for the purposes of this definition, be deemed to be 1.375%. In addition, at all
times while a Default or Event of Default shall have occurred and be continuing,
the Applicable Eurodollar Rate Margin shall, for the purposes of this
definition, be deemed to be 1.375%."
(c) inserting the following new definitions in the
order required by alphabetical order:
"CCIR INTERNATIONAL. CCIR International, Inc., a
Barbados corporation."
"CCIR OF CALIFORNIA. CCIR of California, Corp., a
California corporation."
"CCIR OF TEXAS. CCIR of Texas, Corp., a Texas
corporation."
"CONTINENTAL CIRCUITS. Continental Circuits Corp.,
a Delaware corporation, and the issuer of the
Securities.
"CONTINENTAL MERGER. As contemplated by the Continental
Merger Documents, the merger of Hadco Acquisition II with and
into Continental Circuits, with Continental Circuits (to be
renamed Hadco Phoenix, Inc.) as the surviving entity."
<PAGE> 5
-5-
"CONTINENTAL MERGER DOCUMENTS. The Agreement and Plan of
Merger, dated February 16, 1998, among the Borrower, Hadco
Acquisition II and Continental Circuits, together with all
schedules, exhibits and annexes thereto, and all agreements and
documents entered into or required to be entered into and
delivered pursuant to such Agreement and Plan of Merger or in
connection with the Continental Merger, including the
Stockholders Agreement dated February 16, 1998 among the
Borrower, Hadco Acquisition II and certain selling shareholders
of Continental Circuits."
"FIRST AMENDMENT EFFECTIVE DATE. The "Effective Date",
as defined in the First Amendment and Modification Agreement
dated as of March 19, 1998 among the Borrower, certain of its
Subsidiaries, the Agent and the Banks."
(d) deleting the definition of "Guarantor" in its
entirety and substituting in lieu thereof the following new
definition:
"GUARANTORS. (i) Hadco Santa Clara, Hadco Acquisition II
and, following the consummation of the Continental Merger,
Hadco Phoenix, CCIR of Texas and CCIR of California; and (ii)
any other direct or indirect Subsidiary of the Borrower (other
than Hadco FSC, New Zycon, New Continental, Hadco Malaysia or
CCIR International)."
(e) inserting the following new definition in the
place required by alphabetical order:
"HADCO ACQUISITION II. Hadco Acquisition Corp. II, a
Delaware corporation, wholly owned Subsidiary of the Borrower,
and party to, but not the survivor of, the Continental Merger."
"HADCO PHOENIX. Hadco Phoenix, Inc., a Delaware
corporation, and the survivor of the Continental Merger."
(f) inserting into the definition of "Loan Documents",
immediately after the text "the Guaranties" and immediately
before the text "the Agent's Side Letter", the text "the Stock
Pledge Agreement".
(g) inserting the following new definitions in the
places required by alphabetical order:
<PAGE> 6
-6-
"MAXIMUM GUARANTEED LOAN VALUE. "Maximum loan value" as
used and defined in Section 221.8 of Regulation U of the Board
of Governors of the Federal Reserve System, 12 C.F.R.
ss.221.8."
"NEW CONTINENTAL. Continental Circuits Corp., a Delaware
corporation and wholly owned Subsidiary of the Borrower, to be
incorporated following the consummation of the Continental
Merger."
"PERMITTED ACQUISITION FUNDING DATE. With respect to any
Permitted Acquisition pursuant to ss.9.5.2(b), the Drawdown
Date for the initial or sole Loan, the proceeds of which are to
be used to fund all or any portion of such Permitted
Acquisition."
"PERMITTED ACQUISITION RATIO COMPLIANCE CERTIFICATE. For
any Permitted Acquisition pursuant to ss.9.5.2(b), the
compliance certificate delivered pursuant to
ss.9.5.2(b)(vi)(y), setting forth on a PRO FORMA basis, the
ratio of Consolidated Funded Debt to EBITDA described in
ss.9.5.2(b)(v), after giving effect to such Permitted
Acquisition and assuming full funding of such Permitted
Acquisition on the initial Drawdown Date of the sole or initial
Loan, the proceeds of which are to be used to fund all or any
portion of such Permitted Acquisition."
"SECURITIES. Shares of the outstanding common stock,
$.01 par value per share of Continental Circuits, to be
purchased by Hadco Acquisition II pursuant to the Tender
Offer."
"STOCK PLEDGE AGREEMENT. The Stock Pledge Agreement
dated on or about March 19, 1998, made by Hadco Acquisition II
in favor of the Agent and the Banks, pursuant to which Hadco
Acquisition II will, until the consummation of the Continental
Merger and the compliance by the Borrower and the other
Transaction Parties with the requirements of ss.8.15.1, pledge
to the Agent the Securities in order to secure its obligations
under its Guaranty."
"TENDER OFFER. The offer to purchase the Securities
pursuant to the Tender Offer Documents".
"TENDER OFFER DOCUMENTS. The Offer to Purchase dated
February 20, 1998 from Hadco Acquisition II to the holders of
the Securities, and all amendments and instruments required to
be entered into or delivered by the Borrower pursuant to such
Offer to Purchase in order to complete the purchase of the
Securities contemplated by the Tender Offer."
<PAGE> 7
-7-
ss.2. AMENDMENT OF SS.7.18 OF THE AGREEMENT. Section 7.18 of
the Agreement is hereby amended by deleting the first three sentences thereof in
their entirety and substituting in lieu thereof the following text:
"Hadco Santa Clara, New Zycon, Hadco FSC, Hadco Acquisition II
(prior to the consummation of the Continental Merger) and Hadco Phoenix and New
Continental (following the consummation of the Continental Merger), are the
only direct Subsidiaries of the Borrower. The Borrower owns one hundred percent
(100%) of the capital stock of each of Hadco Santa Clara, New Zycon and Hadco
FSC; prior to the consummation of the Continental Merger, the Borrower owns one
hundred percent (100%) of the capital stock of Hadco Acquisition II, and
following the consummation of the Continental Merger, the Borrower will own one
hundred percent (100%) of the capital stock of Hadco Phoenix and of New
Continental. Hadco Malaysia is the only Subsidiary of Hadco Santa Clara, and
Hadco Santa Clara owns one hundred percent (100%) of the capital stock of Hadco
Malaysia. Following the consummation of the Continental Merger, CCIR of
California, CCIR of Texas and CCIR International will be the only Subsidiaries
of Hadco Phoenix, and Hadco Phoenix will own one hundred percent (100%) of each
such Subsidiary. None of New Zycon, New Continental, Hadco FSC, or, following
the consummation of the Continental Merger, CCIR of California, CCIR of Texas
or CCIR International has any Subsidiaries."
ss.3. ADDITION OF NEW SS.8.15 TO THE AGREEMENT. The Agreement
is hereby amended by inserting, immediately after ss.8.14 of the Agreement, and
immediately before ss.9 of the Agreement, the following new ss.8.15:
"8.15. UNDERTAKINGS WITH RESPECT TO THE CONTINENTAL
MERGER.
8.15.1. CONFIRMATION OF GUARANTY; ADDITIONAL
GUARANTY. Immediately following the consummation of the
Continental Merger, the Borrower shall cause Hadco
Phoenix to execute and deliver to the Agent a
confirmation, in form and substance satisfactory to the
Agent, of the Guaranty to which Hadco Acquisition II is a
party, ratifying and confirming as its own the
obligations of Hadco Acquisition II under such Guaranty
following the consummation of the Continental Merger and
confirming that the amount of the obligations guaranteed
thereunder (a) equals the aggregate amount of the
Obligations, and (b) are no longer limited to the Maximum
Guaranteed Loan Value. Immediately following the
Continental Merger, the Borrower shall cause each of CCIR
of
<PAGE> 8
-8-
California and CCIR of Texas to execute and deliver to
the Agent a separate Guaranty, each in the form of
EXHIBIT E hereto, together with such evidence of
corporate authorization, legal opinions (including local
counsel opinions) and other documentation as the Agent
may request. The Agent and the Banks agree that, so long
as no other Default or Event of Default has occurred and
is continuing or would occur after giving effect thereto,
the Stock Pledge Agreement will terminate upon the
earliest to occur of (a)(i) the consummation of the
Continental Merger, and (ii) the Borrower's and the other
Transaction Parties' compliance with the other
requirements of this ss.8.15.1, and (b) the date upon
which the Securities no longer constitute Margin Stock."
8.15.2. CONSUMMATION OF CONTINENTAL MERGER. The
Borrower will take, and will cause the other Transaction
Parties to take, all corporate and legal actions
advisable or necessary to cause the Continental Merger to
be approved and effected in accordance with the
Continental Merger Documents and applicable law within
sixty (60) days after the First Amendment Effective Date.
8.15.3. DELIVERY OF SECURITIES. In the event that
the Stock Pledge Agreement is then still in effect, the
Borrower shall, within seven (7) days following the first
Drawdown Date on which the Borrower receives Loans, the
proceeds of which are used to fund the Borrower's and
Hadco Acquisition II's obligations in respect of the
Tender Offer, cause Hadco Acquisition II to deliver stock
certificates representing each of the Securities
purchased by Hadco Acquisition II in connection with the
Tender Offer, together with blank stock powers, duly
executed in blank, and to take such other actions as are
necessary or desirable in the opinion of the Agent to
protect and preserve its security interest in the
Securities. Immediately following any subsequent purchase
of Securities for so long as the Stock Pledge Agreement
remains in effect, the Borrower shall cause Hadco
Acquisition II to deliver to the Agent stock certificates
representing such additional Securities, together with
undated stock powers, duly executed in blank.
8.15.4. NOTIFICATION OF CLAIMS AGAINST SECURITIES.
For so long as the Stock Pledge Agreement is in effect,
the Borrower will, immediately upon becoming aware
thereof, notify the Agent and each of the Banks in
writing of any setoff, claims, withholdings or other
defenses to which any of the Securities, or the Agent's
rights with respect to the Securities, are subject.
<PAGE> 9
-9-
8.15.5. TERMINATION OF UCC FINANCING STATEMENTS.
Within thirty (30) days following the First Amendment
Effective Date, the Borrower shall, or shall cause the
Transaction Parties to, cause the termination of the
financing statements described in the table below:
<TABLE>
<CAPTION>
Secured File Date of Jurisdiction
Debtor Party Number Filing of Filing
------ ------- ------ ------- ------------
<S> <C> <C> <C> <C>
PCA Design, Wells Fargo Bank, 9527660413 9/29/95 SOS, CA
Incorporated National Association
PCA Design, Inc. Bank of America 9713560561 5/12/97 SOS, CA
</TABLE>
Within thirty (30) days following any request therefor by the Agent, the
Borrower shall, or shall cause the Transaction Parties to, cause the termination
of any additional financing statements against any of the Transaction Parties or
related entities disclosed by any additional UCC searches initiated by the
Borrower or the Agent. The Borrower agrees that the requirements of this
ss.8.15.5 shall not be deemed to be waived by virtue of the fact that they are
not completed on the First Amendment Effective Date.
8.15.6. INDUSTRIAL DEVELOPMENT BONDS/BANK ONE, ARIZONA, NA. Within
twenty-seven (27) days following the First Amendment Effective Date, the
Borrower and/or one or more of the Transaction Parties shall (1) enter into a
reimbursement agreement with Bank One, Arizona, NA ("Bank One"), with respect
to reimbursement obligations of the Borrower or such Transaction Party under and
with respect to two letters of credit, issued by Bank One on behalf of
Continental Circuits and/or its Subsidiaries to secure obligations under the
Industrial Revenue Bonds described on SCHEDULE 9.1(a) and with a maximum
aggregate drawing amount of $7,086,301.61, with such reimbursement agreement to
be satisfactory in form and substance to the Agent and the Majority Banks in
their sole and absolute discretion, or (2)(a) give notice to the trustee(s) and
the bondholders under the Industrial Development Bonds described on SCHEDULE
9.1(a) hereto that such bonds shall be absolutely, fully and finally defeased or
paid within forty-five (45) days following the giving of such notice and (b)
within forty-five (45) days following the giving of such notice, cause the
absolute, full and final defeasance or payment of such bonds, together with the
termination of all reimbursement obligations of the Borrower or any of the
Transaction Parties under or with respect to the letters of credit described in
clause (a)
<PAGE> 10
-10-
above and the release of any and all collateral securing such reimbursement
obligations."
ss.4. AMENDMENT OF ss.9.1 OF THE AGREEMENT. Section 9.1 of the
Agreement is hereby amended by:
(a) deleting subparagraph (h) thereof in its entirety and
substituting in lieu thereof the following new subparagraph (h):
"(h) Indebtedness of the Borrower and the other Transaction
Parties (i) existing on the date hereof or on the First
Amendment Effective Date and (ii) listed and described on
SCHEDULE 9.1 hereto;".
(b) deleting clause (iv) of subparagraph (i) in its entirety
and substituting in lieu thereof the following new clause (iv): "(iv) New Zycon
or New Continental to the Borrower in an aggregate amount, for each such
company, not to exceed $50,000;".
ss.5. AMENDMENT OF ss.9.2 OF THE AGREEMENT. Section 9.2 of
the Agreement is hereby amended by deleting subparagraph (g)
thereof in its entirety and substituting in lieu thereof the
following new subparagraph (g):
"(g) liens (i) existing on the date hereof or on the First
Amendment Effective Date and (ii) listed on SCHEDULE 9.2 hereto;".
ss.6. AMENDMENT OF ss.9.3 OF THE AGREEMENT. Section 9.3 of the
Agreement is hereby amended by deleting clause (iii) of subparagraph (f) thereof
in its entirety and substituting in lieu thereof the following new clause (iii):
"(iii) New Zycon or New Continental in an aggregate amount for each such company
not to exceed $50,000;".
ss.7. AMENDMENT OF ss.9.5.2(b) OF THE AGREEMENT. Section
9.5.2(b) of the Agreement is hereby amended by inserting in clause (v) thereof,
immediately after the text "after giving effect to such Permitted Acquisition"
and immediately before the text", the ratio of Consolidated Funded Debt ...",
the text "and assuming full funding of such Permitted Acquisition on the initial
Drawdown Date of the sole or initial Loan, the proceeds of which are to be used
to fund all or any portion of such Permitted Acquisition".
ss.8. AMENDMENT OF ss.9.10 OF THE AGREEMENT. Section 9.10 of
the Agreement is hereby amended by:
<PAGE> 11
-11-
(a) deleting the title thereof in its entirety and
substituting in lieu thereof the following new title:
"AGREEMENTS REGARDING HADCO FSC, NEW ZYCON, NEW CONTINENTAL AND
CCIR INTERNATIONAL."
(b) inserting at the end thereof the following text:
"Neither the Borrower nor any of the other Transaction Parties
shall permit CCIR International (a) to engage in any activities
other than those directly related to its purpose as a foreign
sales corporation pursuant to secs.921-927 of the Code or (b)
at any time to own, hold or havE an interest in property or
assets, whether tangible or intangible and including cash and
cash equivalents, with a fair market value in excess of
$1,000,000. Neither the Borrower nor any of the other
Transaction Parties shall permit New Continental (x) to engage
in any activities other than holding the name "Continental
Circuits Corp." for the benefit of the Borrower and its
Subsidiaries or (y) at any time to own, hold or have an
interest in property or assets, whether tangible or intangible
and including cash and cash equivalents, with a fair market
value in excess of $50,000."
ss.9. AMENDMENT OF SS.10.4 OF THE AGREEMENT. Section 10.4 of
the Agreement is hereby amended by deleting the text "(ii) Capital Expenditures
made by the Borrower or any of its Subsidiaries during such period" and
substituting in lieu thereof the following text: "(ii) Capital Expenditures made
by the Borrower or any of its Subsidiaries during such period but excluding, for
each period of four consecutive fiscal quarters ending on or before the end of
the Borrower's third fiscal quarter, 1999, $30,000,000 of Capital Expenditures
made or to be made with respect to Continental Circuits' inner layer facility
located in Phoenix, Arizona and its quick turn facility located in Austin,
Texas,".
ss.10. SUPPLEMENTATION OF SCHEDULES TO THE AGREEMENT. SCHEDULES
7.7, 7.17, 9.1 and 9.2 are hereby respectively supplemented by adding, effective
upon the consummation of the Continental Merger, the attached SCHEDULES 7.7(a),
7.17(a), 9.1(a) and 9.2(a).
ss.11. LIMITED WAIVER. Subject to the satisfaction of each of
the conditions set forth in ss.12 of this Amendment, each of the Agent and the
Banks hereby waives the condition set forth in ss.9.5.2(b)(v) of the Agreement
that the financial statements which the Borrower delivers for Continental as at
the most recent quarter end be both audited and accompanied by an unqualified
audited opinion letter. The waiver herein granted shall not extend to or affect
any obligations not expressly herein
<PAGE> 12
-12-
waived and will not impair any right of the Agent or the Banks consequent
thereon. The waiver herein granted is limited expressly to its terms, and
nothing contained herein shall be deemed to imply any willingness of the Agent
or the Banks to agree to, or otherwise prejudice any rights of the Agent and the
Banks with respect to, any other or similar waiver which may be requested by the
Borrower.
ss.12. CONDITIONS TO EFFECTIVENESS. This Amendment shall be
deemed to be effective as of March 20, 1998 (the "Effective Date"), upon the
Agent's receipt of the following, each in form and substance satisfactory to the
Agent:
(a) facsimile copies of original counterparts (to be
followed promptly by original counterparts) or original counterparts of this
Amendment, duly executed by each of the Company, the Hadco Subsidiaries, the
Agent and the Banks;
(b) copies of the annual financial statements of
Continental Circuits and its Subsidiaries for each of the preceding three fiscal
years of Continental Circuits, each showing a positive net income prior to
adjustments;
(c) evidence of calculations, duly certified by the
principal financial or accounting officer of the Borrower, showing that, after
giving effect to the consummation of the Continental Merger and assuming the
full funding of such Permitted Acquisition on the initial Drawdown Date of the
sole or initial Loan, the proceeds of which are to be used to fund all or any
portion of such Permitted Acquisition, the ratio of Consolidated Funded Debt as
at the most recent fiscal quarter end of the Borrower to EBITDA for the four
consecutive fiscal quarters of the Borrower ending with such quarter end (as
shown on a PRO FORMA basis based upon (i) the most recently delivered financial
statements of the Borrower and its Subsidiaries delivered in accordance with
ss.8.4 of the Agreement and (ii) financial statements for Continental Circuits
and its Subsidiaries as at the most recent fiscal quarter end of the Borrower do
not exceed 3.0:1.0;
(d) a compliance certificate in the form of EXHIBIT C to
the Agreement, duly certified by the principal financial or accounting officer
of the Borrower, indicating the Borrower's compliance with the financial
covenants contained in ss.10 of the Agreement (as amended hereby) immediately
prior to and, on a PRO FORMA basis, immediately following the consummation of
the Continental Merger.
(e) duly executed originals of the Guaranty of Hadco
Acquisition II in substantially the form attached hereto as EXHIBIT X and
<PAGE> 13
-13-
of the Stock Pledge Agreement in substantially the form of EXHIBIT Y hereto,
pursuant to which the Borrower pledges to the Agent, for the benefit of the
Agent and the Banks, all of the capital stock of Hadco Acquisition II to secure
the Obligations;
(f) a duly executed secretary's certificate of the
secretary or assistant secretary of Hadco Acquisition II certifying (and where
applicable, attaching copies of) Hadco Acquisitions II's (i) certificate of
incorporation; (ii) by-laws; (iii) resolutions of the Board of Directors
authorizing the Guaranty and Stock Pledge Agreement referred to in clause (e)
above; and (iv) the incumbency of its officers;
(g) good standing certificates for Hadco Acquisition II,
issued by the Secretary of State of its jurisdiction of incorporation and of
each jurisdiction in which it has qualified to do business;
(h) favorable legal opinions from counsel to Hadco
Acquisition II in substantially the form of EXHIBITS Z-1 and Z-2 hereto,
addressed to each of the Agent and the Banks;
(i) evidence satisfactory to the Agent, of (i) the
payment in full of all outstanding Indebtedness of Continental Circuits and/or
its Subsidiaries (other than Indebtedness described on SCHEDULE 9.1(a) hereto)
and the termination of all commitments to lend with respect thereto, and (ii)
the release of all liens securing such Indebtedness (other than Indebtedness
described on SCHEDULE 9.1(a) hereto) pursuant to UCC-3 termination statements or
other appropriate release or termination documents;
(j) UCC search results against each of Continental
Circuits and its Subsidiaries, as debtors, from jurisdictions satisfactory to
the Agent as disclosed by the certification of each such company as to the
location of its chief executive office, other locations and certain other
information requested by the Agent;
(k) certification from a duly authorized officer of the
Borrower that the Borrower or Hadco Acquisition II has received proper tenders
of securities representing at least a majority of the issued and outstanding
capital stock of Continental Circuits (the "Securities") and as to which
Securities all (if any) rights of withdrawal of the trading shareholders under
Section 14(d)(5) of the Securities Exchange Act of 1934, as amended, and the
regulations thereunder with respect to such Securities shall have expired upon
the purchase thereof;
<PAGE> 14
-14-
(l) certification from a duly authorized officer of the
Borrower that all of the conditions to the purchase of the Securities pursuant
to the Merger Agreement dated February 16, 1998 shall have been satisfied, and
none of such conditions shall have been amended, supplemented or waived except
with the consent of the Agent and the Majority Banks;
(m) copies of each of the Continental Merger Documents
and the Tender Offer Documents (as each such term is defined in the Credit
Agreement, as amended hereby), together with the certification of a duly
authorized officer of the Borrower that such copies are true, correct and
complete and have not been amended, modified, rescinded, evoked or supplemented;
and
(n) Forms U-1 (as specified by Regulation U of the
Federal Reserve Board of Governors) for the Agent and each Bank, duly executed
by the Borrower and Hadco Acquisition II.
ss.13. REPRESENTATIONS AND WARRANTIES; NO DEFAULT;
AUTHORIZATION. Each of the Company and the Hadco Subsidiaries hereby represents
and warrants to each of the Agent and the Banks as follows:
(a) Each of the representations and warranties of the
Company and the Hadco Subsidiaries contained in the Agreement,
the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with the Agreement, the
other Loan Documents or this Amendment was true as of the date
as of which it was made, and no Default or Event of Default has
occurred and is continuing as of the date of this Amendment or
would, following the effectiveness of this Amendment, occur
after giving effect to the Continental Merger; and
(b) This Amendment has been duly authorized, executed and
delivered by the Company and each of the Hadco Subsidiaries,
and shall be in full force and effect upon the satisfaction of
the conditions set forth in ss.12 hereof, and the agreements of
the Company and each of the Hadco Subsidiaries contained
herein, in the Agreement as herein amended, or in the other
Loan Documents respectively, constitute the legal, valid and
binding obligations of the Company and each of the Hadco
Subsidiaries party hereto or thereto, enforceable against the
Company or such Hadco Subsidiary, in accordance with their
respective terms, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting generally the enforcement of
creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief
<PAGE> 15
-15-
is subject to the discretion of the court before which any
proceeding therefor may be brought.
(c) Upon the consummation of the Tender Offer, Hadco
Acquisition II will be the owner of all Securities which have
been tendered by the current owners thereof, free from any
lien, security interest, encumbrance and any other claim or
demand;
(d) Each of the representations and warranties made by
the Borrower and Hadco Acquisition II and, to the best of the
Borrower's knowledge, Continental Circuits and its Subsidiaries
in any of the Continental Merger Documents or the Tender Offer
Documents is true and correct in all material respects. Without
limiting the foregoing, all Indebtedness of Continental
Circuits and its Subsidiaries owing to Wells Fargo Bank,
National Association, Bank of America and/or any of their
respective Affiliates has been repaid in full, and any and all
commitments to lend by any such lenders have been terminated.
ss.14. RATIFICATION, ETC. Except as expressly amended hereby,
the Agreement, the other Loan Documents and all documents, instruments and
agreements related thereto are hereby ratified and confirmed in all respects and
shall continue in full force and effect. All references in the Agreement or such
other Loan Documents or in any related agreement or instrument to the Agreement
or such other Loan Documents shall hereafter refer to such agreements as amended
hereby, pursuant to the provisions of the Agreement.
ss.15. NO IMPLIED WAIVER, ETC. Except as expressly provided
herein, nothing contained herein shall constitute a waiver of, impair or
otherwise affect any of the Obligations, any other obligations of the Company or
any of the Hadco Subsidiaries or any right of the Agent or the Banks consequent
thereon. The waivers and consents provided herein are limited strictly to their
terms. Neither the Agent nor any of the Banks shall have any obligation to issue
any further waiver or consent with respect to the subject matter hereof or any
other matter.
ss.16. COUNTERPARTS. This Amendment may be executed in one or
more counterparts, each of which shall be deemed an original but which together
shall constitute one and the same instrument.
ss.17. GOVERNING LAW. THIS AMENDMENT SHALL FOR ALL PURPOSES BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF
<PAGE> 16
-16-
MASSACHUSETTS (WITHOUT REFERENCE TO CHOICE OR CONFLICTS OF LAWS).
<PAGE> 17
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment as a document under seal as of the date first above written.
HADCO CORPORATION
By: _____________________________
Name:
Title:
BANKBOSTON, N.A., individually
and as Agent
By: _____________________________
Name:
Title: Vice President
ABN AMRO BANK N.V.
By:_________________________ By:______________________________
Name: Name:
Title: Title:
THE BANK OF TOKYO -
MITSUBISHI TRUST COMPANY
By: _____________________________
Name:
Title:
<PAGE> 18
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
THE FIRST NATIONAL BANK OF
CHICAGO
By: _______________________________
Name:
Title:
KEYBANK NATIONAL ASSOCIATION.
By: _______________________________
Name:
Title:
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS
ASSOCIATION
By: _______________________________
Name:
Title:
THE BANK OF NOVA SCOTIA
By: _______________________________
Name:
Title:
<PAGE> 19
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
THE FUJI BANK, LIMITED
By: _______________________________
Name:
Title:
SUNTRUST BANK, ATLANTA
By:____________________________ By:________________________________
Name: Name:
Title: Title:
THE INDUSTRIAL BANK OF
JAPAN, LIMITED
By: _______________________________
Name:
Title:
CORESTATES BANK, N.A.
By: _______________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
By: _______________________________
Name:
Title:
<PAGE> 20
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
MELLON BANK, N.A.
By: __________________________________
Name:
Title:
THE SANWA BANK, LIMITED
By:___________________________________
Name:
Title:
THE SUMITOMO BANK, LIMITED
By: __________________________________
Name:
Title:
<PAGE> 21
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
The undersigned hereby acknowledges the foregoing Amendment as of the Effective
Date and agrees that its obligations under the Guaranty will extend to the
Agreement, as so amended, and the other Loan Documents, as so amended.
HADCO SANTA CLARA, INC.
By:___________________________________
Title:
HADCO ACQUISITION CORP. II
By:___________________________________
Title:
<PAGE> 1
EXHIBIT (b)(3)
GUARANTY
GUARANTY, dated as of March 19, 1998, by HADCO ACQUISITION CORP. II, a
Delaware corporation (the "Guarantor") in favor of (i) BANKBOSTON, N.A. (f/k/a
The First National Bank of Boston), as agent (hereinafter, in such capacity, the
"Agent") for itself and the other banking institutions (hereinafter,
collectively, the "Banks") which are or may become parties to an Amended and
Restated Revolving Credit Agreement dated as of December 8, 1997 (as amended and
in effect from time to time, the "Credit Agreement"), among HADCO CORPORATION, a
Massachusetts corporation (the "Company"), the Banks and the Agent and (ii)
each of the Banks.
WHEREAS, the Company and the Guarantor are members of a group of related
corporations, the success of either one of which is dependent in part on the
success of the other members of such group;
WHEREAS, the Guarantor expects to receive substantial direct and indirect
benefits from the extensions of credit to the Company by the Banks pursuant to
the Credit Agreement (which benefits are hereby acknowledged);
WHEREAS, it is a condition precedent to the Banks' making any loans or
otherwise extending credit to the Company under the Credit Agreement that the
Guarantor execute and deliver to the Agent, for the benefit of the Banks and the
Agent, a guaranty substantially in the form hereof; and
WHEREAS, the Guarantor wishes to guaranty the Company's obligations to the
Banks and the Agent under or in respect of the Credit Agreement as provided
herein;
NOW, THEREFORE, the Guarantor hereby agrees with the Banks and the Agent as
follows:
1. DEFINITIONS. The term "Obligations" and all capitalized terms used herein
without definition shall have the respective meanings provided therefor in the
Credit Agreement; PROVIDED, HOWEVER, that until the earliest to occur of (a) the
consummation of the Continental Merger and (b) the date upon which the
Securities no longer constitute Margin Stock, the term "Obligations" shall mean
the "Obligations", as defined in the Credit Agreement, in an aggregate amount
not to exceed the Maximum Guaranteed Loan Value. Immediately upon the earlier to
occur of the consummation of the Merger and the date on which the Securities no
longer constitute Margin Stock, the term "Obligations" shall automatically be
deemed to refer to the "Obligations", as defined in the Credit Agreement,
without further action by any party.
<PAGE> 2
-2-
2. GUARANTY OF PAYMENT AND PERFORMANCE. The Guarantor hereby guarantees to
the Banks and the Agent the full and punctual payment when due (whether at
stated maturity, by required pre-payment, by acceleration or otherwise), as well
as the performance, of all of the Obligations including all such which would
become due but for the operation of the automatic stay pursuant to ss.362(a) of
the Federal Bankruptcy Code and the operation of secs.502(b) and 506(b) of the
Federal Bankruptcy Code. This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment and performance of all of
the Obligations and not of their collectibility only and is in no way
conditioned upon any requirement that the Agent or any Bank first attempt to
collect any of the Obligations from the Company or resort to any collateral
security or other means of obtaining payment. Should the Company default in the
payment or performance of any of the Obligations, the obligations of the
Guarantor hereunder with respect to such Obligations in default shall, upon
demand by the Agent, become immediately due and payable to the Agent, for the
benefit of the Banks and the Agent, without demand or notice of any nature, all
of which are expressly waived by the Guarantor. Payments by the Guarantor
hereunder may be required by the Agent on any number of occasions. All payments
by the Guarantor hereunder shall be made to the Agent, in the manner and at the
place of payment specified therefor in the Credit Agreement, for the account of
the Banks and the Agent.
3. GUARANTOR'S AGREEMENT TO PAY ENFORCEMENT COSTS, ETC. The Guarantor
further agrees, as the principal obligor and not as a guarantor only, to pay to
the Agent, on demand, all costs and expenses (including court costs and legal
expenses) incurred or expended by the Agent or any Bank in connection with the
Obligations, this Guaranty and the enforcement thereof, together with interest
on amounts recoverable under this ss.3 from the time when such amounts become
due until payment, whether before or after judgment, at the rate of interest for
overdue principal set forth in the Credit Agreement, PROVIDED that if such
interest exceeds the maximum amount permitted to be paid under applicable law,
then such interest shall be reduced to such maximum permitted amount.
4. WAIVERS BY GUARANTOR; BANK'S FREEDOM TO ACT. The Guarantor agrees that
the Obligations will be paid and performed strictly in accordance with their
respective terms, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Agent or any Bank with respect thereto. The Guarantor waives promptness,
diligences, presentment, demand, protest, notice of acceptance, notice of any
Obligations incurred and all other notices of any kind, all defenses which may
be available by virtue of any valuation, stay, moratorium law or other similar
law now or hereafter in effect, any right to require the marshalling of assets
of the Company or any other entity or other person primarily or secondarily
liable with respect to any of the Obligations, and all suretyship defenses
generally. Without limiting the generality of the foregoing, the Guarantor
agrees to the provisions of any instrument evidencing, securing or otherwise
executed in connection with any Obligation and agrees that the obligations of
the Guarantor
<PAGE> 3
-3-
hereunder shall not be released or discharged, in whole or in part, or otherwise
affected by (i) the failure of the Agent or any Bank to assert any claim or
demand or to enforce any right or remedy against the Company or any other entity
or other person primarily or secondarily liable with respect to any of the
Obligations; (ii) any extensions, compromise, refinancing, consolidation or
renewals of any Obligation; (iii) any change in the time, place or manner of
payment of any of the Obligations or any rescissions, waivers, compromise,
refinancing, consolidation or other amendments or modifications of any of the
terms or provisions of the Credit Agreement, the Notes, the other Loan Documents
or any other agreement evidencing, securing or otherwise executed in connection
with any of the Obligations, (iv) the addition, substitution or release of any
entity or other person primarily or secondarily liable for any Obligation; (v)
the adequacy of any rights which the Agent or any Bank may have against any
collateral security or other means of obtaining repayment of any of the
Obligations; (vi) the impairment of any collateral securing any of the
Obligations, including without limitation the failure to perfect or preserve any
rights which the Agent or any Bank might have in such collateral security or the
substitution, exchange, surrender, release, loss or destruction of any such
collateral security; or (vii) any other act or omission which might in any
manner or to any extent vary the risk of the Guarantor or otherwise operate as a
release or discharge of the Guarantor, all of which may be done without notice
to the Guarantor. To the fullest extent permitted by law, the Guarantor hereby
expressly waives any and all rights or defenses arising by reason of (A) any
"one action" or "anti-deficiency" law which would otherwise prevent the Agent or
any Bank from bringing any action, including any claim for a deficiency, or
exercising any other right or remedy (including any right of set-off), against
the Guarantor before or after the Agent's or such Bank's commencement or
completion of any foreclosure action, whether judicially, by exercise of power
of sale or otherwise, or (B) any other law which in any other way would
otherwise require any election of remedies by the Agent or any Bank.
5. UNENFORCEABILITY OF OBLIGATIONS AGAINST COMPANY. If for any reason the
Company has no legal existence or is under no legal obligation to discharge any
of the Obligations, or if any of the Obligations have become irrecoverable from
the Company by reason of the Company's insolvency, bankruptcy or reorganization
or by other operation of law or for any other reason, this Guaranty shall
nevertheless be binding on the Guarantor to the same extent as if the Guarantor
at all times had been the principal obligor on all such Obligations. In the
event that acceleration of the time for payment of any of the Obligations is
stayed upon the insolvency, bankruptcy or reorganization of the Company, or for
any other reason, all such amounts otherwise subject to acceleration under the
terms of the Credit Agreement, the Notes, the other Loan Documents or any other
agreement evidencing, securing or otherwise executed in connection with any
Obligation shall be immediately due and payable by the Guarantor.
<PAGE> 4
-4-
6. SUBROGATION; SUBORDINATION.
6.1. WAIVER OF RIGHTS AGAINST COMPANY. Until the final payment and
performance in full of all of the Obligations, the Guarantor shall not
exercise and hereby waives any rights against the Company arising as a
result of payment by the Guarantor hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and will not prove
any claim in competition with the Agent or any Bank in respect of any
payment hereunder in any bankruptcy, insolvency or reorganization case or
proceedings of any nature; the Guarantor will not claim any setoff,
recoupment or counterclaim against the Company in respect of any liability
of the Guarantor to the Company; and the Guarantor waives any benefit of and
any right to participate in any collateral security which may be held by the
Agent or any Bank.
6.2. SUBORDINATION. The payment of any amounts due with respect to any
indebtedness of the Company for money borrowed or credit received now or
hereafter owed to the Guarantor is hereby subordinated to the prior payment
in full of all of the Obligations. The Guarantor agrees that, after the
occurrence of any default in the payment or performance of any of the
Obligations, the Guarantor will not demand, sue for or otherwise attempt to
collect any such indebtedness of the Company to the Guarantor until all of
the Obligations shall have been paid in full. If, notwithstanding the
foregoing sentence, the Guarantor shall collect, enforce or receive any
amounts in respect of such indebtedness while any Obligations are still
outstanding, such amounts shall be collected, enforced and received by the
Guarantor as trustee for the Banks and the Agent and be paid over to the
Agent, for the benefit of the Banks and the Agent, on account of the
Obligations without affecting in any manner the liability of the Guarantor
under the other provisions of this Guaranty.
6.3. PROVISIONS SUPPLEMENTAL. The provisions of this ss.6 shall be
supplemental to and not in derogation of any rights and remedies of the
Banks and the Agent under any separate subordination agreement which the
Agent may at any time and from time to time enter into with the Guarantor
for the benefit of the Banks and the Agent.
7. SECURITY; SETOFF. The Guarantor grants to each of the Agent and the
Banks, as security for the full and punctual payment and performance of all of
the Guarantor's obligations hereunder, a continuing lien on and security
interest in all securities or other property belonging to the Guarantor now or
hereafter held by the Agent or such Bank and in all deposits (general or
special, time or demand, provisional or final) and other sums credited by or due
from the Agent or such Bank to the Guarantor or subject to withdrawal by the
Guarantor. Regardless of the adequacy of any collateral security or other means
of obtaining payment of any of the Obligations, each of the Agent and the Banks
<PAGE> 5
-5-
is hereby authorized at any time and from time to time, without notice to the
Guarantor (any such notice being expressly waived by the Guarantor) and to the
fullest extent permitted by law, to set off and apply such deposits and other
sums against the obligations of the Guarantor under this Guaranty, whether or
not the Agent or such Bank shall have made any demand under this Guaranty and
although such obligations may be contingent or unmatured.
8. FURTHER ASSURANCES. The Guarantor agrees that it will from time to time,
at the request of the Agent, do all such things and execute all such documents
as the Agent may consider necessary or desirable to give full effect to this
Guaranty and to perfect and preserve the rights and powers of the Banks and the
Agent hereunder. The Guarantor acknowledges and confirms that the Guarantor
itself has established its own adequate means of obtaining from the Company on a
continuing basis all information desired by the Guarantor concerning the
financial condition of the Company and that the Guarantor will look to the
Company and not to the Agent or any Bank in order for the Guarantor to keep
adequately informed of changes in the Company's financial condition.
9. TERMINATION; REINSTATEMENT. This Guaranty shall remain in full force and
effect until the Agent is given written notice of the Guarantor's intention to
discontinue this Guaranty, notwithstanding any intermediate or temporary payment
or settlement of the whole or any part of the Obligations. No such notice shall
be effective unless received and acknowledged by an officer of the Agent at the
address of the Agent for notices set forth in ss.20 of the Credit Agreement. No
such notice shall affect any rights of the Agent or any Bank hereunder,
including without limitation the rights set forth in secs.4 and 6, with respect
to any Obligations incurred or accrued prior to the receipt of such notice or
any Obligations incurred or accrued pursuant to any contract or commitment in
existence prior to such receipt. This Guaranty shall continue to be effective or
be reinstated, notwithstanding any such notice, if at any time any payment made
or value received with respect to any Obligation is rescinded or must otherwise
be returned by the Agent or any Bank upon the insolvency, bankruptcy or
reorganization of the Company, or otherwise, all as though such payment had not
been made or value received.
10. SUCCESSORS AND ASSIGNS. This Guaranty shall be binding upon the
Guarantor, its successors and assigns, and shall inure to the benefit of the
Agent and the Banks and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing sentence, each Bank may assign
or otherwise transfer the Credit Agreement, the Notes, the other Loan Documents
or any other agreement or note held by it evidencing, securing or otherwise
executed in connection with the Obligations, or sell participations in any
interest therein, to any other entity or other person, and such other entity or
other person shall thereupon become vested, to the extent set forth in the
agreement evidencing such assignment, transfer or participation, with all the
rights in respect thereof granted to such Bank herein, all in accordance with
ss.19
<PAGE> 6
-6-
of the Credit Agreement. The Guarantor may not assign any of its obligations
hereunder.
11. AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by the Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Agent with the
consent of the Majority Banks. No failure on the part of the Agent or any Bank
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.
12. NOTICES. All notices and other communications called for hereunder shall
be made in writing and, unless otherwise specifically provided herein, shall be
deemed to have been duly made or given when delivered by hand or mailed first
class, postage prepaid, or, in the case of telegraphic or telexed notice, when
transmitted, answer back received, addressed as follows: if to the Guarantor, at
the address set forth beneath its signature hereto, and if to the Agent, at the
address for notices to the Agent set forth in ss.20 of the Credit Agreement, or
at such address as either party may designate in writing to the other.
13. GOVERNING LAW; CONSENT TO JURISDICTION. THIS GUARANTY IS INTENDED TO
TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. The Guarantor
agrees that any suit for the enforcement of this Guaranty may be brought in the
courts of the Commonwealth of Massachusetts or any federal court sitting therein
and consents to the nonexclusive jurisdiction of such court and to service of
process in any such suit being made upon the Guarantor by mail at the address
specified by reference in ss.12. The Guarantor hereby waives any objection that
it may now or hereafter have to the venue of any such suit or any such court or
that such suit was brought in an inconvenient court.
14. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY WAIVES ITS RIGHT TO A JURY
TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE
PERFORMANCE OF ANY OF SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law,
the Guarantor hereby waives any right which it may have to claim or recover in
any litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. The Guarantor (i) certifies that neither the Agent or any Bank
nor any representative, agent or attorney of the Agent or any Bank has
represented, expressly or otherwise, that the Agent or any Bank would not, in
the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that, in entering into the Credit Agreement and the other Loan
Documents to which the Agent or any Bank is a party, the Agent and the
<PAGE> 7
-7-
Banks are relying upon, among other things, the waivers and certifications
contained in this ss.14.
15. MISCELLANEOUS. This Guaranty constitutes the entire agreement of the
Guarantor with respect to the matters set forth herein. The rights and remedies
herein provided are cumulative and not exclusive of any remedies provided by law
or any other agreement, and this Guaranty shall be in addition to any other
guaranty of or collateral security for any of the Obligations. The invalidity or
unenforceability of any one or more sections of this Guaranty shall not affect
the validity or enforceability of its remaining provisions. Captions are for the
ease of reference only and shall not affect the meaning of the relevant
provisions. The meanings of all defined terms used in this Guaranty shall be
equally applicable to the singular and plural forms of the terms defined.
<PAGE> 8
-8-
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
and delivered as of the date first above written.
HADCO ACQUISITION CORP. II
By: ________________________________
Title:
Address: 12A Manor Parkway
Salem, NH 03709
<PAGE> 1
EXHIBIT (b)(4)
STOCK PLEDGE AGREEMENT
This STOCK PLEDGE AGREEMENT is made as of March 19, 1998, by and between
HADCO ACQUISITION CORP. II, (the "Company"), and BANKBOSTON, N.A. a national
banking association, as agent (hereinafter, in such capacity, the "Agent") for
itself and the other banking institutions (hereinafter, collectively, the
"Banks") which are or may become parties to an Amended and Restated Revolving
Credit Agreement dated as of December 8, 1997 (as amended and in effect from
time to time, the "Credit Agreement"), among Hadco Corporation (the "Borrower"),
the Banks and the Agent.
WHEREAS, the Company is the wholly owned subsidiary of the Borrower;
WHEREAS, the Company expects to receive substantial direct and indirect
benefits from the extensions of credit to the Borrower by the Bank pursuant to
the Credit Agreement which benefits are hereby acknowledged;
WHEREAS, contemporaneously herewith, the Company is issuing a Guaranty in
favor of the Agent (the "Guaranty"), pursuant to which the Company is
guarantying all of the Obligations (as defined in the Guaranty);
WHEREAS, the Company is the direct legal and beneficial owner of the issued
and outstanding shares of each class of the capital stock of Continental
Circuits Corp., a Delaware corporation (the "Subsidiary"), described on ANNEX A
hereto; and
WHEREAS, it is a condition precedent to the Banks' making any loans or
otherwise extending credit to the Company under the Credit Agreement that the
Company execute and deliver to the Agent, for the benefit of the Banks and the
Agent, in order to secure the obligations of the Company under the Guaranty, a
pledge agreement in substantially the form hereof; and
WHEREAS, the Company wishes to grant pledges and security interests in favor
of the Agent, for the benefit of the Banks and the Agent, as herein provided;
NOW, THEREFORE, in consideration of the premises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
<PAGE> 2
2
1. PLEDGE OF STOCK, ETC.
1.1. PLEDGE OF STOCK. The Company hereby pledges, assigns, grants a
security interest in, and delivers to the Agent, for the benefit of the
Banks and the Agent, all of the shares of capital stock of the Subsidiary of
every class owned by it, as more fully described on ANNEX A hereto, to be
held by the Agent, for the benefit of the Banks and the Agent, subject to
the terms and conditions hereinafter set forth. The certificates for such
shares, accompanied by stock powers or other appropriate instruments of
assignment thereof duly executed in blank by the Company, have been
delivered to the Agent.
1.2. ADDITIONAL STOCK. In case, pursuant to the Tender Offer or
otherwise, the Company shall acquire any additional shares of the capital
stock of the Subsidiary or any corporation which is the successor of the
Subsidiary, or any securities exchangeable for or convertible into shares of
such capital stock of any class of the Subsidiary, by purchase, stock
dividend, stock split or otherwise, then the Company shall forthwith deliver
to and pledge such shares or other securities to the Agent, for the benefit
of the Banks and the Agent, under this Agreement and shall deliver to the
Agent forthwith any certificates therefor, accompanied by stock powers or
other appropriate instruments of assignment duly executed by the Company in
blank. The Company agrees that the Agent may from time to time attach as
ANNEX A hereto an updated list of the shares of capital stock or securities
at the time pledged with the Agent hereunder.
1.3. PLEDGE OF CASH COLLATERAL ACCOUNT. The Company also hereby pledges,
assigns, grants a security interest in, and delivers to the Agent, for the
benefit of the Banks and the Agent, the Cash Collateral Account and all of
the Cash Collateral as such terms are hereinafter defined.
2. DEFINITIONS. The term "Obligations" shall have the meaning provided
therefor in the Guaranty, and all other capitalized terms used herein without
definition shall have the respective meanings provided therefor in the Credit
Agreement. Terms used herein and not defined in the Credit Agreement or
otherwise defined herein that are defined in the Uniform Commercial Code in
effect in Massachusetts (the "Massachusetts UCC") have such defined meanings
herein, unless the context otherwise indicated or requires, and the following
terms shall have the following meanings:
CASH COLLATERAL. See ss.4.
CASH COLLATERAL ACCOUNT. See ss.4.
<PAGE> 3
3
STOCK. Includes the shares of stock described in ANNEX A attached hereto and
any additional shares of stock at the time pledged with the Agent hereunder.
STOCK COLLATERAL. The property at any time pledged to the Agent hereunder
(whether described herein or not) and all income therefrom, increases therein
and proceeds thereof, including without limitation that included in Cash
Collateral, but excluding from the definition of "Stock Collateral" any income,
increases or proceeds received by the Company to the extent expressly permitted
by ss.6.
TIME DEPOSITS. See ss.4.
3. SECURITY FOR OBLIGATIONS. This Agreement and the security interest in and
pledge of the Stock Collateral hereunder are made with and granted to the Agent,
for the benefit of the Banks and the Agent, as security for the payment and
performance in full of all the Obligations.
4. LIQUIDATION, RECAPITALIZATION, ETC.
4.1. DISTRIBUTIONS PAID TO AGENT. Any sums or other property paid or
distributed upon or with respect to any of the Stock, whether by dividend or
redemption or upon the liquidation or dissolution of the issuer thereof or
otherwise, shall, except to the limited extent provided in ss.6, be paid
over and delivered to the Agent to be held by the Agent, for the benefit of
the Banks and the Agent, as security for the payment and performance in full
of all of the Obligations. In case, pursuant to the recapitalization or
reclassification of the capital of the issuer thereof or pursuant to the
reorganization thereof, any distribution of capital shall be made on or in
respect of any of the Stock or any property shall be distributed upon or
with respect to any of the Stock, the property so distributed shall be
delivered to the Agent, for the benefit of the Banks and the Agent, to be
held by it as security for the Obligations. Except to the limited extent
provided in ss.6, all sums of money and property paid or distributed in
respect of the Stock, whether as a dividend or upon such a liquidation,
dissolution, recapitalization or reclassification or otherwise, that are
received by the Company shall, until paid or delivered to the Agent, be held
in trust for the Agent, for the benefit of the Banks and the Agent, as
security for the payment and performance in full of all of the Obligations.
4.2. CASH COLLATERAL ACCOUNT. All sums of money that are delivered to
the Agent pursuant to this ss.4 shall be deposited into an interest bearing
account with the Agent (the "Cash Collateral Account"). Some or all of the
funds from time to time in the Cash Collateral Account may be invested in
time deposits, including, without limitation, certificates of deposit issued
by the Agent (such certificates of deposit or other time deposits being
hereinafter referred to, collectively, as "Time
<PAGE> 4
4
Deposits"), that are satisfactory to the Agent after consultation with the
Company, PROVIDED, that, in each such case, arrangements satisfactory to the
Agent are made and are in place to perfect and to insure the first priority
of the Agent's security interest therein. Interest earned on the Cash
Collateral Account and on the Time Deposits, and the principal of the Time
Deposits at maturity that is not invested in new Time Deposits, shall be
deposited in the Cash Collateral Account. The Cash Collateral Account, all
sums from time to time standing to the credit of the Cash Collateral
Account, any and all Time Deposits, any and all instruments or other
writings evidencing Time Deposits and any and all proceeds or any thereof
are hereinafter referred to as the "Cash Collateral."
4.3. COMPANY'S RIGHTS TO CASH COLLATERAL, ETC. Except as otherwise
expressly provided in ss.15, the Company shall have no right to withdraw
sums from the Cash Collateral Account, to receive any of the Cash Collateral
or to require the Agent to part with the Agent's possession of any
instruments or other writings evidencing any Time Deposits.
5. WARRANTY OF TITLE; AUTHORITY. The Company hereby represents and warrants
that: (i) upon the consummation of the Tender Offer, the Company has good and
marketable title to, and is the sole record and beneficial owner of, the Stock
described in ss.1, subject to no pledges, liens, security interests, charges,
options, restrictions or other encumbrances except the pledge and security
interest created by this Agreement, (ii) all of the Stock described in ss.1 is
validly issued, fully paid and non-assessable, (iii) the Company has full power,
authority and legal right to execute, deliver and perform its obligations under
this Agreement and to pledge and grant a security interest in all of the Stock
Collateral pursuant to this Agreement, and the execution, delivery and
performance hereof and the pledge of and granting of a security interest in the
Stock Collateral hereunder have been duly authorized by all necessary corporate
or other action and do not contravene any law, rule or regulation or any
provision of the Company's charter documents or by-laws or of any judgment,
decree or order of any tribunal or of any agreement or instrument to which the
Company is a party or by which it or any of its property is bound or affected or
constitute a default thereunder, and (iv) the information set forth in ANNEX A
hereto relating to the Stock is true, correct and complete in all respects. The
Company covenants that it will defend the rights of the Banks and the Agent and
security interest of the Agent, for the benefit of the Banks and the Agent, in
such Stock against the claims and demands of all other persons whomsoever. The
Company further covenants that it will have the like title to and right to
pledge and grant a security interest in the Stock Collateral hereafter pledged
or in which a security interest is granted to the Agent hereunder and will
likewise defend the rights, pledge and security interest thereof and therein of
the Banks and the Agent.
6. DIVIDENDS, VOTING, ETC., PRIOR TO MATURITY. So long as no Default or
Event of Default shall have occurred and be continuing, the Company shall be
<PAGE> 5
5
entitled to receive all cash dividends paid in respect of the Stock, to vote
the Stock and to give consents, waivers and ratifications in respect of the
Stock; PROVIDED, HOWEVER, that no vote shall be cast or consent, waiver or
ratification given by the Company if the effect thereof would in the reasonable
judgment of the Majority Banks impair any of the Stock Collateral or be
inconsistent with or result in any violation of any of the provisions of the
Credit Agreement, the Notes or any of the other Transaction Documents. All such
rights of the Company to receive cash dividends shall cease in case a Default or
an Event of Default shall have occurred and be continuing. All such rights of
the Company to vote and give consents, waivers and ratifications with respect to
the Stock shall, at the Agent's option, as evidenced by the Agent's notifying
the Company of such election, cease in case a Default or an Event of Default
shall have occurred and be continuing.
7. REMEDIES.
7.1. IN GENERAL. If a Default or an Event of Default shall have occurred
and be continuing, the Agent shall thereafter have the following rights and
remedies (to the extent permitted by applicable law) in addition to the
rights and remedies of a secured party under the Massachusetts UCC, all such
rights and remedies being cumulative, not exclusive, and enforceable
alternatively, successively or concurrently, at such time or times as the
Agent deems expedient:
(a) if the Agent so elects and gives notice of such election to the
Company, the Agent may vote any or all shares of the Stock (whether or
not the same shall have been transferred into its name or the name of
its nominee or nominees) for any lawful purpose, including, without
limitation, if the Agent so elects, for the liquidation of the assets of
the issuer thereof, and give all consents, waivers and ratifications in
respect of the Stock and otherwise act with respect thereto as though it
were the outright owner thereof (the Company hereby irrevocably
constituting and appointing the Agent the proxy and attorney-in-fact of
the Company, with full power of substitution, to do so);
(b) the Agent may demand, sue for, collect or make any compromise or
settlement the Agent deems suitable in respect of any Stock Collateral;
(c) the Agent may sell, resell, assign and deliver, or otherwise
dispose of any or all of the Stock Collateral, for cash or credit or
both and upon such terms at such place or places, at such time or times
and to such entities or other persons as the Agent thinks expedient, all
without demand for performance by the Company or any notice or
advertisement whatsoever except as expressly provided herein or as may
otherwise be required by law;
<PAGE> 6
6
(d) the Agent may cause all or any part of the Stock held by it to
be transferred into its name or the name of its nominee or nominees; and
(e) the Agent may set off against the Obligations any and all sums
deposited with it or held by it, including without limitation, any sums
standing to the credit of the Cash Collateral Account and any Time
Deposits issued by the Agent.
7.2. SALE OF STOCK COLLATERAL. In the event of any disposition of the
Stock Collateral as provided in clause (c) of ss.7.1, the Agent shall give
to the Company at least five Business Days prior written notice of the time
and place of any public sale of the Stock Collateral or of the time after
which any private sale or any other intended disposition is to be made. The
Company hereby acknowledges that five Business Days prior written notice of
such sale or sales shall be reasonable notice. The Agent may enforce its
rights hereunder without any other notice and without compliance with any
other condition precedent now or hereunder imposed by statute, rule of law
or otherwise (all of which are hereby expressly waived by the Company, to
the fullest extent permitted by law). The Agent may buy any part or all of
the Stock Collateral at any public sale and if any part or all of the Stock
Collateral is of a type customarily sold in a recognized market or is of the
type which is the subject of widely-distributed standard price quotations,
the Agent may buy at private sale and may make payments thereof by any
means. The Agent may apply the cash proceeds actually received from any sale
or other disposition to the reasonable expenses of retaking, holding,
preparing for sale, selling and the like, to reasonable attorneys' fees,
travel and all other expenses which may be incurred by the Agent in
attempting to collect the Obligations or to enforce this Agreement or in the
prosecution or defense of any action or proceeding related to the subject
matter of this Agreement, and then to the Obligations in such order or
preference as the Agent may determine after proper allowance for Obligations
not then due. Only after such applications, and after payment by the Agent
of any amount required by ss.9-504(1)(c) of the Massachusetts UCC, need the
Agent account to the Company for any surplus. To the extent that any of the
Obligations are to be paid or performed by a person other than the Company,
the Company waives and agrees not to assert any rights or privileges which
it may have under ss.9-112 of the Massachusetts UCC.
7.3. REGISTRATION OF STOCK. If the Agent shall determine to exercise its
right to sell any or all of the Stock pursuant to this ss.7, and if in the
opinion of counsel for the Agent it is necessary, or if in the reasonable
opinion of the Agent it is advisable, to have the Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act of
1933, as amended (the "Securities Act"), the Company agrees to use its best
efforts to cause the issuer or issuers of the Stock contemplated to be sold,
to execute and deliver, and cause the directors
<PAGE> 7
7
and officers of such issuer to execute and deliver, all at the Company's
expense, all such instruments and documents, and to do or cause to be done
all such other acts and things as may be necessary or, in the reasonable
opinion of the Agent, advisable to register such Stock under the provisions
of the Securities Act and to cause the registration statement relating
thereto to become effective and to remain effective for a period of 9 months
from the date such registration statement became effective, and to make all
amendments thereto or to the related prospectus or both that, in the
reasonable opinion of the Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto.
The Company agrees to use its best efforts to cause such issuer or issuers
to comply with the provisions of the securities or "Blue Sky" laws of any
jurisdiction which the Agent shall designate and to cause such issuer or
issuers to make available to its security holders, as soon as practicable,
an earnings statement (which need not be audited) which will satisfy the
provisions of Section 11(a) of the Securities Act.
7.4. PRIVATE SALES. The Company recognizes that the Agent may be unable
to effect a public sale of the Stock by reason of certain prohibitions
contained in the Securities Act, federal banking laws, and other applicable
laws, but may be compelled to resort to one or more private sales thereof to
a restricted group of purchasers. The Company agrees that any such private
sales may be at prices and other terms less favorable to the seller than if
sold at public sales and that such private sales shall not by reason thereof
be deemed not to have been made in a commercially reasonable manner. The
Agent shall be under no obligation to delay a sale of any of the Stock for
the period of time necessary to permit the issuer of such securities to
register such securities for public sale under the Securities Act, or such
other federal banking or other applicable laws, even if the issuer would
agree to do so. Subject to the foregoing, the Agent agrees that any sale of
the Stock shall be made in a commercially reasonable manner, and the Company
agrees to use its best efforts to cause the issuer or issuers of the Stock
contemplated to be sold, to execute and deliver, and cause the directors and
officers of such issuer to execute and deliver, all at the Company's
expense, all such instruments and documents, and to do or cause to be done
all such other acts and things as may be necessary or, in the reasonable
opinion of the Agent, advisable to exempt such Stock from registration under
the provisions of the Securities Act, and to make all amendments to such
instruments and documents which, in the opinion of the Agent, are necessary
or advisable, all in conformity with the requirements of the Securities Act
and the rules and regulations of the Securities and Exchange Commission
applicable thereto. The Company further agrees to use its best efforts to
cause such issuer or issuers to comply with the provisions of the securities
or "Blue Sky" laws of any jurisdiction which
<PAGE> 8
8
the Agent shall designate and, if required, to cause such issuer or issuers
to make available to its security holders, as soon as practicable, an
earnings statement (which need not be audited) which will satisfy the
provisions of Section 11(a) of the Securities Act.
7.5. COMPANY'S AGREEMENTS, ETC. The Company further agrees to do or
cause to be done all such other acts and things as may be reasonably
necessary to make any sales of any portion or all of the Stock pursuant to
this ss.7 valid and binding and in compliance with any and all applicable
laws (including, without limitation, the Securities Act, the Securities
Exchange Act of 1934, as amended, the rules and regulations of the
Securities and Exchange Commission applicable thereto and all applicable
state securities or "Blue Sky" laws), regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdiction
over any such sale or sales, all at the Company's expense. The Company
further agrees that a breach of any of the covenants contained in this ss.7
will cause irreparable injury to the Agent and the Banks, that the Agent and
the Banks have no adequate remedy at law in respect of such breach and, as a
consequence, agrees that each and every covenant contained in this ss.7
shall be specifically enforceable against the Company by the Agent and the
Company hereby waives and agrees not to assert any defenses against an
action for specific performance of such covenants.
8. MARSHALLING. Neither the Agent nor any Bank shall be required to marshal
any present or future collateral security for (including but not limited to this
Agreement and the Stock Collateral), or other assurances of payment of, the
Obligations or any of them, or to resort to such collateral security or other
assurances of payment in any particular order. All of the Agent's rights
hereunder and of the Banks and the Agent in respect of such collateral security
and other assurances of payment shall be cumulative and in addition to all other
rights, however existing or arising. To the extent that it lawfully may, the
Company hereby agrees that it will not invoke any law relating to the
marshalling of collateral that might cause delay in or impede the enforcement of
the Agent's rights under this Agreement or under any other instrument evidencing
any of the Obligations or under which any of the Obligations is outstanding or
by which any of the Obligations is secured or payment thereof is otherwise
assured, and to the extent that it lawfully may the Company hereby irrevocably
waives the benefits of all such laws.
9. COMPANY'S OBLIGATIONS NOT AFFECTED. The obligations of the Company
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by (i) any exercise or nonexercise, or any waiver, by the Agent or
any Bank of any right, remedy, power or privilege under or in respect of any of
the Obligations or any security thereof (including this Agreement); (ii) any
amendment to or modification of the Credit Agreement, the Note, the other
Transaction Documents or any of the Obligations; (iii) any amendment to or
modification of any instrument (other than this Agreement) guarantying or
<PAGE> 9
9
securing any of the Obligations, including, without limitation, the Guaranties;
or (iv) the taking of additional security for, or any other assurances of
payment of, any of the Obligations or the release or discharge or termination of
any security or other assurances of payment or performance for any of the
Obligations, whether or not the Company shall have notice or knowledge of any of
the foregoing.
10. TRANSFER, ETC., BY COMPANY. Without the prior written consent of the
Agent, the Company will not sell, assign, transfer or otherwise dispose of,
grant any option with respect to, or pledge or grant any security interest in or
otherwise encumber or restrict any of the Stock Collateral or any interest
therein, except for the pledge thereof and security interest therein provided
for in this Agreement.
11. FURTHER ASSURANCES. The Company will do all such acts, and will furnish
to the Agent all such financing statements, certificates, legal opinions and
other documents and will obtain all such governmental consents and corporate
approvals and will do or cause to be done all such other things as the Agent may
reasonably request from time to time in order to give full effect to this
Agreement and to secure the rights of the Banks and the Agent hereunder, all
without any cost or expense to the Agent or any Bank. If the Agent so elects, a
photocopy of this Agreement may at any time and from time to time be filed by
the Agent as a financing statement in any recording office in any jurisdiction.
12. AGENT'S EXONERATION. Under no circumstances shall the Agent be deemed to
assume any responsibility for or obligation or duty with respect to any part or
all of the Stock Collateral of any nature or kind or any matter or proceedings
arising out of or relating thereto, other than (i) to exercise reasonable care
in the physical custody of the Stock Collateral and (ii) after a Default or an
Event of Default shall have occurred and be continuing to act in a commercially
reasonable manner. Neither the Agent nor any Bank shall be required to take any
action of any kind to collect, preserve or protect its or the Company's rights
in the Stock Collateral or against other parties thereto. The Agent's prior
recourse to any part or all of the Stock Collateral shall not constitute a
condition of any demand, suit or proceeding for payment or collection of any of
the Obligations.
13. NO WAIVER, ETC. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated except by a written instrument
expressly referring to this Agreement and to the provisions so modified or
limited, and executed by the Agent, with the consent of the Majority Banks, and
the Company. No act, failure or delay by the Agent shall constitute a waiver of
its rights and remedies hereunder or otherwise. No single or partial waiver by
the Agent of any default or right or remedy that it may have shall operate as a
waiver of any other default, right or remedy or of the same default, right or
remedy on a future occasion. The Company hereby waives presentment, notice of
dishonor and protest of all instruments, included in or evidencing any of the
<PAGE> 10
10
Obligations or the Stock Collateral, and any and all other notices and demands
whatsoever (except as expressly provided herein or in the Credit Agreement).
14. NOTICE, ETC. All notices, requests and other communications hereunder
shall be made in the manner set forth in ss.20 of the Credit Agreement.
15. TERMINATION. Upon (a) final payment and performance in full of the
Obligations or (b) provided that no Default or Event of Default has occurred and
is continuing, the occurrence of the Guaranty Delivery Date, this Agreement
shall terminate and the Agent shall, at the Company's request and expense,
return such Stock Collateral in the possession or control of the Agent as has
not theretofore been disposed of pursuant to the provisions hereof, together
with any moneys and other property at the time held by the Agent hereunder.
16. OVERDUE AMOUNTS. Until paid, all amounts due and payable by the Company
hereunder shall be a debt secured by the Stock Collateral and shall bear,
whether before or after judgment, interest at the rate of interest for overdue
principal set forth in the Credit Agreement.
17. GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT IS INTENDED TO
TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. The Company
agrees that any suit for the enforcement of this Agreement may be brought in the
courts of the Commonwealth of Massachusetts or any federal court sitting therein
and consents to the non-exclusive jurisdiction of such court and to service of
process in any such suit being made upon the Company by mail at the address
specified in ss.20 of the Credit Agreement. The Company hereby waives any
objection that it may now or hereafter have to the venue of any such suit or any
such court or that such suit is brought in an inconvenient court.
18. WAIVER OF JURY TRIAL. THE COMPANY WAIVES ITS RIGHT TO A JURY TRIAL WITH
RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH
THIS AGREEMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY
SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law, the Company waives any
right which it may have to claim or recover in any litigation referred to in the
preceding sentence any special, exemplary, punitive or consequential damages or
any damages other than, or in addition to, actual damages. The Company (i)
certifies that neither the Agent or any Bank nor any representative, agent or
attorney of the Agent or any Bank has represented, expressly or otherwise, that
the Agent or any Bank would not, in the event of litigation, seek to enforce the
foregoing waivers and (ii) acknowledges that, in entering into the Credit
Agreement and the other Transaction Documents to which the Agent is a party, the
Agent and the Banks are relying upon, among other things, the waivers and
certifications contained in this ss.18.
<PAGE> 11
11
19. MISCELLANEOUS. The headings of each section of this Agreement are for
convenience only and shall not define or limit the provisions thereof. This
Agreement and all rights and obligations hereunder shall be binding upon the
Company and its respective successors and assigns, and shall inure to the
benefit of the Agent and the Banks and their respective successors and assigns.
If any term of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity of all other terms hereof shall be in no way
affected thereby, and this Agreement shall be construed and be enforceable as if
such invalid, illegal or unenforceable term had not been included herein. The
Company acknowledges receipt of a copy of this Agreement.
[Remainder of page intentionally left blank]
<PAGE> 12
12
IN WITNESS WHEREOF, intending to be legally bound, the Company and the
Agent have caused this Stock Pledge Agreement to be executed as of the date
first above written.
HADCO ACQUISTION CORP. II
By: _______________________________
Title:
BANKBOSTON, N.A., as Agent
By: _______________________________
Title:
The undersigned Subsidiary hereby joins in the above Agreement for the sole
purpose of consenting to and being bound by the provisions of secs.4.1, 6 and 7
thereof, the undersigned hereby agreeing to cooperate fully and in good faith
with the Agent and the Company in carrying out such provisions.
CONTINENTAL CIRCUITS CORP.
By: _______________________________
Title:
<PAGE> 13
ANNEX A TO PLEDGE AGREEMENT
None of the issuers has any authorized, issued or outstanding shares of its
capital stock of any class or any commitments to issue any shares of its capital
stock of any class or any securities convertible into or exchangeable for any
shares of its capital stock of any class except as otherwise stated in this
ANNEX A.
<TABLE>
<CAPTION>
Number of Number of Number of Par or
Record Class of Authorized Issued Outstanding Liquidation
Issuer Owner Shares Shares Shares Shares Value
------ ----- ------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C>
Continental Hadco Common 3000 1000 2000 $0.01
Circuits Acquisition
Corp. Corp. II
</TABLE>
<PAGE> 1
EXHIBIT (b)(5)
CONFIRMATION OF GUARANTY
THIS CONFIRMATION OF GUARANTY (this "Confirmation") is made as of the 20th
day of March, 1998 by HADCO PHOENIX, INC., a Delaware corporation, in favor of
BANKBOSTON, N.A., as Agent (the "Agent") for itself and the lenders
(collectively, the "Banks") which are or may become party to the Amended and
Restated Revolving Credit Agreement dated as of December 8, 1997 (as amended and
in effect from time to time, the "Credit Agreement") among HADCO CORPORATION
(the "Borrower), the Agent and the Banks. Capitalized terms used herein without
other definition shall have the meanings set forth in the Credit Agreement.
WHEREAS, Hadco Acquisition Corp. II, a Delaware corporation ("Hadco
Acquisition II") has previously issued in favor of the Agent a Guaranty dated as
of March 19, 1998 (as amended and in effect from time to time, the "Guaranty")
pursuant to which Hadco Acquisition II has guaranteed the obligations of the
Borrower under and in respect of the Credit Agreement and the related Loan
Documents;
WHEREAS, Hadco Acquisition II and Continental Circuits Corp., a Delaware
corporation ("Continental Circuits"), have merged with and into each other (with
such merger hereinafter referred to as the "Continental Merger");
WHEREAS, Continental Circuits is the surviving entity of the Merger and has
changed its name to Hadco Phoenix, Inc. ("Hadco Phoenix");
WHEREAS, Hadco Phoenix wishes to ratify and confirm its obligations under
the Guaranty;
NOW, THEREFORE, in consideration of the promises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged:
SS.1. RATIFICATION OF GUARANTY. Hadco Phoenix hereby ratifies and confirms
the Guaranty, and its obligations as the successor of Hadco Acquisition II
thereunder, in all respects and agrees that the Guaranty shall continue in full
force and effect. Hadco Phoenix confirms that it (through its predecessor Hadco
Acquisition II) has previously guaranteed, and hereby expressly guarantees, to
the Agent and the Banks the full and punctual payment when due (whether at
stated maturity, by required pre-payment, by acceleration or otherwise), as well
as the performance, of all of the Obligations, including all such Obligations
<PAGE> 2
2
which would become due but for the operation of the automatic stay pursuant to
ss.362(a) of the Federal Bankruptcy Code and the operation of secs.502(b) and
506(b) of the Federal Bankruptcy Code. Hadco Phoenix agrees to be bound by and
to comply with all of the terms and conditions of, and to perform all of the
obligations of the Guarantor under, the Guaranty and further agrees that it
shall be deemed the "Guarantor" under, as defined in and for all purposes of the
Guaranty.
SS.2. DEFINITION OF "OBLIGATIONS" IN AND FOR ALL PURPOSES OF THE GUARANTY.
Pursuant to ss.1 of the Guaranty, Hadco Phoenix confirms that the consummation
of the Continental Merger has occurred and agrees that the term "Obligations" in
the Guaranty has the meaning provided therefor in the Credit Agreement and is no
longer limited to the Maximum Guaranteed Loan Value.
SS.3. COUNTERPARTS. This Confirmation may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
SS.4. GOVERNING LAW. This Confirmation shall for all purposes be governed by
and construed in accordance with the laws of the Commonwealth of Massachusetts
(without reference to conflicts of laws).
HADCO PHOENIX, INC.,
formerly known as Continental
Circuits Corp. and the survivor
of the merger of Continental
Circuits Corp. and Hadco Acquisition
Corp. II
By:
-------------------------------------
Title:
ACCEPTED AND ACKNOWLEDGED:
BANKBOSTON, N.A., AS AGENT
By:
-----------------------------
Title:
