SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[ X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
Commission file number 1-11415
AMERICAN STANDARD COMPANIES INC.
(Exact name of Registrant as specified in its charter)
Delaware 13-3465896
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Centennial Avenue, P.O. Box 6820, Piscataway, NJ 08855-6820
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (908) 980-6000
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
X Yes No No Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
Common stock, $.01 par value, outstanding at
April 30, 1995 76,225,217
(shares)
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
American Standard Companies Inc. is a Delaware corporation organized in
March 1988, and has as its only significant asset all the outstanding common
stock of American Standard Inc. Hereinafter, "the Company" will refer to
American Standard Companies Inc. or to its subsidiary, American Standard Inc.,
as the context requires.
The following consolidated summary statement of operations of the Company
and subsidiaries for the three months ended March 31, 1995 and 1994 has not been
audited, but management believes that all adjustments, consisting of normal
recurring items, necessary to a fair statement for those periods have been
included. Results for the first three months of 1995 are not necessarily
indicative of results for the entire year.
<TABLE>
AMERICAN STANDARD COMPANIES INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED SUMMARY STATEMENT OF OPERATIONS
<CAPTION>
(Dollars in millions except
per share amounts)
Three months ended
March 31,
1995 1994
<S> <C> <C>
SALES $1,223.2 $989.6
-------- ------
COST AND EXPENSES
Cost of sales 909.1 746.3
Selling and administrative expenses 200.6 169.6
Other expense 10.7 6.2
Interest expense 57.4 64.1
1,177.8 986.2
INCOME BEFORE INCOME TAXES AND
EXTRAORDINARY ITEM 45.4 3.4
Income taxes 18.9 16.7
INCOME (LOSS) BEFORE
EXTRAORDINARY ITEM 26.5 (13.3)
Extraordinary loss on retirement of debt (30.1) -
NET LOSS $ (3.6) $ (13.3)
========== =======
Income (loss) per common share:
Income (loss) before extraordinary item $ .38 $ (.22)
Extraordinary loss (.43) -
----------- -----------
NET LOSS $ (.05) $ (.22)
========== ========
Average number of outstanding common shares 69,888,575 59,803,748
<FN>
See accompanying notes
</FN>
</TABLE>
<PAGE>
Item 1. Financial Statements (continued)
<TABLE>
AMERICAN STANDARD COMPANIES INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED SUMMARY BALANCE SHEET
<CAPTION>
(Dollars in millions
except share data)
March 31, December 31,
<S> <C> <C>
1995 1994
CURRENT ASSETS
Cash and cash equivalents $ 62.4 $ 92.7
Accounts receivable 706.2 595.2
Inventories
Finished products 213.2 160.2
Products in process 98.2 82.5
Raw materials 92.6 80.5
404.0 323.2
Other current assets 63.1 53.4
TOTAL CURRENT ASSETS 1,235.7 1,064.5
FACILITIES, less accumulated depreciation;
March 1995 - $486.6; Dec. 1994 - $430.2 826.7 812.7
GOODWILL 1,102.7 1,053.0
OTHER ASSETS 200.5 225.9
---------- ----------
TOTAL ASSETS $3,365.6 $3,156.1
======== ========
CURRENT LIABILITIES
Loans payable to banks $ 315.0 $ 70.3
Current maturities of long-term debt 64.7 141.6
Accounts payable 358.1 350.5
Accrued payrolls 152.7 140.3
Other accrued liabilities 433.1 376.0
--------- ---------
TOTAL CURRENT LIABILITIES 1,323.6 1,078.7
LONG-TERM DEBT 1,780.2 2,152.3
RESERVE FOR POSTRETIREMENT BENEFITS 485.7 437.7
OTHER LIABILITIES 311.5 285.0
TOTAL LIABILITIES 3,901.0 3,953.7
STOCKHOLDERS' DEFICIT
Preferred stock, 2,000,000 shares authorized,
none issued and outstanding - -
Common stock $.01 par value, 200,000,000 shares
authorized; 76,049,896 shares issued and
outstanding in 1995; 60,932,457 in 1994 .8 .6
Capital surplus and other 481.1 192.6
Accumulated deficit (840.0) (836.4)
Foreign currency translation effects (174.6) (151.7)
Minimum pension liability adjustment (2.7) (2.7)
----------- ------------
TOTAL STOCKHOLDERS' DEFICIT (535.4) (797.6)
----------- -----------
$3,365.6 $ 3,156.1
======== =========
<FN>
See accompanying notes
</FN>
</TABLE>
<PAGE>
Item 1. Financial Statements (continued)
<TABLE>
AMERICAN STANDARD COMPANIES INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED SUMMARY STATEMENT OF CASH FLOWS
<CAPTION>
(Dollars in millions)
Three months ended
March 31,
1995 1994
<S> <C> <C>
CASH PROVIDED (USED) BY:
OPERATING ACTIVITIES:
Income (loss) before extraordinary item $ 26.5 $(13.3)
Depreciation 27.1 27.1
Amortization of goodwill 8.2 7.6
Non-cash interest 14.2 12.7
Accrued interest 16.7 32.3
Amortization of debt issuance costs 2.1 3.7
Non-cash stock compensation 6.8 6.0
Changes in assets and liabilities (77.0) (72.2)
-------- ------
Net cash provided by operating activities 24.6 3.9
INVESTING ACTIVITIES:
Purchase of property, plant and equipment (19.4) (10.5)
Investments in affiliated companies (5.3) (7.6)
Other 6.2 2.5
Net cash used by investing activities (18.5) (15.6)
-------- ------
FINANCING ACTIVITIES:
Proceeds from issuance of common stock 302.2 -
Costs of issuance of common stock (21.7) -
Proceeds from issuance of long-term debt 450.2 2.8
Repayments of long-term debt (960.0) (50.8)
Net change in revolving credit facility 222.9 62.4
Net change in other short-term debt (14.0) 3.7
Common stock repurchases (2.7) (2.7)
Other financing costs (13.3) -
-------- ----------
Net cash (used) provided by financing activities (36.4) 15.4
-------- -------
Effect of exchange rate changes on cash and
cash equivalents - .4
----------- ---------
Net (decrease) increase in cash and cash equivalents (30.3) 4.1
Cash and cash equivalents at beginning of period 92.7 53.2
-------- --------
Cash and cash equivalents at end of period $ 62.4 $ 57.3
======= ======
<FN>
See accompanying notes
</FN>
</TABLE>
<PAGE>
AMERICAN STANDARD COMPANIES INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
Note 1. The 1995 Refinancing
As described in Notes 2 and 10 of Notes to Consolidated Financial
Statements in the Company's Annual Report to Stockholders for the year ended
December 31, 1994, the Company completed a major refinancing (the "1995
Refinancing") in the first quarter of 1995, including an amendment to the
Company's 1993 credit agreement which provided an additional term loan (the
"October Borrowing"), the initial public offering of the Company's common stock
(the "Offering") and an amended and restated credit agreement (the "1995 Credit
Agreement"). See "Management's Discussion and Analysis of Financial Condition
and Results of Operations - Liquidity and Capital Resources."
Note 2. Tax Matters
As described in Note 7 of Notes to Consolidated Financial Statements in the
Company's Annual Report to Stockholders on for the year ended December 31, 1994,
there are pending German tax issues for the years 1984 through 1990. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources."
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Overview
Operating results improved significantly in the first quarter of 1995
compared with the first quarter of 1994, due principally to volume increases in
each of the Company's three business segments. As a result of the Company's
leveraged buyout in 1988, the results of operations include the effects of
purchase accounting and reflect a highly leveraged capital structure.
<TABLE>
SUMMARY SEGMENT AND INCOME DATA
(Dollars in millions except per share data)
(Unaudited)
<CAPTION>
Three Months Ended
March 31,
1995 1994
<S> <C> <C>
SALES:
Air Conditioning Products $ 643 $520
Plumbing Products 323 296
Automotive Products 257 174
-------- -----
Total sales $1,223 $990
====== ====
OPERATING INCOME:
Air Conditioning Products $ 42 $ 32
Plumbing Products 41 38
Automotive Products 43 18
-------- ------
Total operating income 126 88
Interest expense(a) (57) (64)
Corporate items (24) (21)
-------- -------
Income before income taxes and
extraordinary item 45 3
Income taxes 19 16
-------- ------
Income (loss) before extraordinary item $ 26 $ (13)
======== =======
Income (loss) before extraordinary item
per common share(a) $ .38 $(.22)
======= ======
<FN>
(a) Had the initial public offering of the Company's common stock and
related debt refinancing occurred on January 1, 1995, interest expense for the
first quarter of 1995 would have been reduced by $4 million, and income before
extraordinary item per common share would have increased from $.38 to $.40.
</FN>
</TABLE>
<PAGE>
Results of Operations for the First Quarter of 1995 Compared with the First
Quarter of 1994
Operating Review
Consolidated sales for the first quarter of 1995 were $1,223 million, an
increase of $233 million, or 24% (20% excluding the favorable effects of foreign
exchange), from $990 million in the first quarter of 1994. Sales increased for
all three segments with gains of 24% for Air Conditioning Products, 9% for
Plumbing Products and 48% for Automotive Products.
Consolidated operating income for the first quarter of 1995 was $126
million, an increase of $38 million, or 43% (35% excluding the favorable effects
of foreign exchange), from $88 million in the first quarter of 1994. Operating
income improved for all three segments -- increasing 31% for Air Conditioning
Products, 8% for Plumbing Products and more than doubling for Automotive
Products.
Sales of Air Conditioning Products increased 24% (with little effect from
foreign exchange) to $643 million for the first quarter of 1995 from $520
million for the comparable quarter of 1994, as a result of strong gains in U.S.
and international sales of applied and unitary commercial systems. Markets in
the U.S. continued the improvement trend of 1994 in both the commercial
new-construction and the commercial and residential replacement markets. Sales
of commercial products in the U.S. increased 23% because of improved markets,
CFC-related chiller replacement, gains in market share and a shift to newer,
larger-capacity, higher-efficiency products. Residential sales were up 6% due to
increased preseason purchases by distributors and favorable product shifts (to
heat pumps from cooling units and to outdoor from indoor equipment).
International sales of Air Conditioning Products for the first quarter of 1995
increased principally because of volume increases in the Far East and Latin
America.
Operating income of Air Conditioning Products increased 31% (with little
effect from foreign exchange) to $42 million in the first quarter of 1995 from
$32 million in the 1994 quarter, primarily reflecting expanded commercial
product sales in the United States. Operating income for residential products
declined slightly primarily because of lower prices due to competitive pressures
and distributor concessions.
Sales of Plumbing Products increased 9% (7% excluding the favorable effects
of foreign exchange) to $323 million in the first quarter of 1995 from $296
million in the first quarter of 1994. The exchange-adjusted improvement resulted
from sales increases of 4% for international operations and 14% for U.S.
operations. The sales increase for the international operations resulted
primarily from price gains in Italy, Germany and Brazil. Sales increases also
occurred in Mexico, the Philippines, Thailand and Korea. These increases were
partly offset by the effect of the deconsolidation of operations in the People's
Republic of China ("PRC") which in April 1994 were contributed to the new joint
venture operating in that country. Sales in the U.S. increased as a result of
higher volumes in both wholesale and retail market channels and an expanded
retail customer base, offset partly by an unfavorable shift in sales mix to
lower-priced products.
Operating income of Plumbing Products for the first quarter of 1995 was $41
million compared with $38 million for the 1994 period, but was flat excluding
the positive effects of foreign exchange. Despite higher sales,
exchange-adjusted operating income was at the same level as in the year-earlier
quarter for both international and U.S. operations. Because Italian and U.K.
operations purchase products from Germany, the strength of the Deutschemark
against Italian and U.K. currencies resulted in Italian and U.K. product cost
increases not being fully recovered through pricing; these effects offset the
benefits of sales increases. In the U.S., the positive effect of higher volumes
was offset by the effect of an unfavorable product mix and the inability to
fully recover material and labor cost increases due to competitive pressures.
Sales of Automotive Products for the first quarter of 1995 were $257
million, an increase of 48% (31% excluding the favorable effects of foreign
exchange) from $174 million in the first quarter of 1994. Unit volume of truck
and bus production in western Europe improved 29% and aftermarket sales grew
approximately 15%. The exchange-adjusted sales increase was the result of higher
volumes, led by Germany and France reflecting the increased commercial vehicle
production in western Europe, and the U.K. as a result of the growing utility
vehicle business in that country. Sales also increased in all other major
markets in which the Company has operations.
Operating income for Automotive Products more than doubled to $43 million
in the 1995 quarter, compared with $18 million in the comparable 1994 period (an
increase of 139%, or 108% excluding the favorable effects of foreign exchange).
This significant increase was primarily attributable to the substantially higher
sales volume in improved markets in nearly all European countries and Brazil,
higher margins due to increasing benefits of Demand Flow Technology, a reduced
salaried workforce and other cost reductions .
Financial Review
Interest expense decreased $7 million in the first quarter of 1995 compared
to the year-earlier quarter primarily as a result of lower overall interest
rates on debt outstanding under the 1995 Credit Agreement, together with reduced
debt balances due to application of the net proceeds from the Offering (see
"Liquidity and Capital Resources"). Corporate costs increased moderately
primarily because of higher accretion expense related to postretirement
benefits.
The income tax provisions for the first quarters of 1995 and 1994 were $19
million and $16 million, respectively, on income before income taxes and
extraordinary item of $45 million and $3 million for 1995 and 1994,
respectively. These provisions reflected the taxes payable on profitable foreign
operations, offset partly in 1995 by tax benefits from U.S. and certain foreign
net operating losses. The unusual relationship between the pre-tax results and
the tax provision for the first quarter of 1994 (and to a lesser extent the 1995
quarter) is explained by tax rate differences and withholding taxes on foreign
earnings as well as by the nondeductibility for tax purposes of the amortization
of goodwill and other purchase accounting adjustments, and in 1994, the share
allocations made by the Company's Employee Stock Ownership Plan ("ESOP").
Through 1994 the ESOP allocations were made from a plan established in 1988
through a reversion of excess pension plan assets. In 1995 and future years,
Company contributions of either cash or stock to fund ESOP allocations will be
tax deductible.
As a result of the repayment of debt in the first quarter of 1995 upon
completion of the 1995 Refinancing (see "Liquidity and Capital Resources"), the
first quarter of 1995 included an extraordinary charge of $30 million
attributable to the write-off of unamortized debt issuance costs, for which no
tax benefit was available.
Cash Flows
Net cash provided by operating activities, after cash interest paid of $25
million, was $25 million for the first quarter of 1995, compared with $4 million
for the similar period of 1994. The $21 million increase resulted primarily from
improved operating results. The Company made capital expenditures of $25
million, including $5 million of investments in affiliated companies (compared
with capital expenditures of $18 million in 1994, including $8 million of
investments in affiliated companies). Inventories and receivables increased
during the first quarter reflecting the increased sales volume and the seasonal
pattern typical of first quarters and expected to recur in the future. Working
capital as a percentage of sales, however, decreased to 7.1% for the first
quarter of 1995 from 7.6% for the first quarter of 1994. The principal financing
activities during the first quarter of 1995 were related to the 1995 Refinancing
described in "Liquidity and Capital Resources."
Liquidity and Capital Resources
In the first quarter of 1995 the Company completed the 1995 Refinancing
consisting of the October Borrowing, the Offering and the 1995 Credit Agreement.
This refinancing reduced the amount of debt outstanding, will significantly
lower future interest costs and provides less restrictive covenants. The October
Borrowing was used to redeem, in November 1994, $317 million of high-interest
rate bonds with lower-rate bank debt; the net proceeds from the Offering,
totaling approximately $281 million, were used to repay indebtedness; and the
1995 Credit Agreement provided a secured multi-currency, multi-borrower credit
facility aggregating $1.0 billion, the proceeds of which replaced outstanding
borrowings (including the October Borrowing) under the Company's previous bank
credit agreement. Had the Offering and the 1995 Credit Agreement been completed
as of January 1, 1995, interest expense would have been reduced by $4 million
and income before extraordinary item would have been $31 million ($.40 per
share) in the first quarter of 1995.
The 1995 Credit Agreement provides lower interest costs, increased
borrowing capacity, less restrictive covenants and lower annual scheduled debt
maturities through 2001 as compared with the previous credit agreement. The
Company believes that the amounts available from operating cash flows and funds
available under revolving facilities (the "Revolving Facilities") will be
sufficient to meet its expected cash needs and planned capital expenditures for
the foreseeable future.
As of May 11, 1995, the Company had outstanding borrowings of $347 million
under the Revolving Facilities. There was $151 million available under the
Revolving Facilities
<PAGE>
after reduction for borrowings and for $52 million of letters of credit
usage. In addition the Company's foreign subsidiaries had approximately $99
million available under overdraft facilities which can be withdrawn by the banks
at any time. The Revolving Facilities are short-term borrowings by their terms
under the 1995 Credit Agreement, and since a portion of the long-term debt under
the Company's previous bank credit agreement was replaced with borrowings under
the Revolving Facilities, a significantly larger portion of debt is classified
as short-term.
The 1995 Credit Agreement contains various covenants that limit certain
activities and transactions and require the Company to meet certain financial
tests as described in Note 10 of Notes to Consolidated Financial Statements in
the Company's Annual Report on Form 10-K for the year ended December 31, 1994.
Certain American Standard Inc. debt instruments also contain financial tests and
other covenants. In order to maintain compliance with the covenants and
restrictions contained in its previous credit agreements, it was necessary from
time to time for the Company to obtain waivers and amendments. The Company
believes it is currently in compliance with the covenants contained in the 1995
Credit Agreement, but may have to obtain similar waivers or amendments in the
future.
As described in Note 7 of Notes to Consolidated Financial Statements in the
Company's Annual Report to Stockholders for the year ended December 31, 1994,
there are pending German tax issues for the years 1984 through 1990. During the
first quarter of 1995, the Company received the first of two reports on audit
findings and it was silent on one of the major issues under audit which
represents over a third of the adjustments the Company anticipated that the
German tax authorities might propose relating to the 1984-1990 period and which
is not an issue in any subsequent period. While there can be no assurance, the
Company believes it is unlikely the issue will be pursued further by the German
tax authorities.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
For a discussion of German tax issues see "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources".
Item 2. Changes in Securities
On January 4, 1995, in connection with the Offering, the Board of Directors
of the Company adopted a Stockholder Rights Plan and declared a dividend of one
right on each outstanding share of common stock. Newly issues shares of common
stock after that date will have associated with them such rights. The
Stockholder Rights Plan provides that, with stated exceptions, if any person
acquires more than 15% of the Company's outstanding common stock, the rights are
triggered, allowing stockholders (other than the 15% holder) to obtain stock in
the Company at half price. Under certain circumstances the Board may exchange
the rights for common stock at an exchange ratio of one share of common stock
per right. The foregoing description is qualified in its entirety by reference
to the form of Stockholder Rights Plan filed as an exhibit to the Company's Form
10-K for the fiscal year ended December 31, 1994.
The 1995 Credit Agreement, together with certain American Standard Inc.
debt instruments, limit the Company's ability to pay dividends to shareholders.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources". Item 4. Submission of Matters to
a Vote of Security Holders
By the written consent dated as of January 4, 1995 of the holder of
45,000,000 shares of the common stock of the Company constituting a majority of
the common stock outstanding, a Restated Certificate of Incorporation of
American Standard Companies Inc. was adopted which, among other things,
established a classified Board of Directors, authorized issuance of rights
related to the Common Stock of the Company, imposed a 65% stockholder vote to
adopt, amend or repeal certain provisions of the Restated Certificate of
Incorporation and By-laws, prohibited stockholder action by written consent in
lieu of meeting and imposed certain conditions for submission of stockholder
proposals and nominations for directors.
By the written consent dated as of January 18, 1995 of the holder of
45,000,000 shares of the common stock of the Company, constituting a majority of
the common stock outstanding, the American Standard Companies Inc. Stock
Incentive Plan was approved. Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits. The exhibits listed on the accompanying Index to Exhibits are
filed as part of this quarterly report on Form 10-Q.
(b) Reports on Form 8-K for the quarter ended March 31, 1995.
None
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN STANDARD COMPANIES INC.
By: G. Ronald Simon
(Vice President and Controller)
(also signing as Principal
Accounting Officer)
May 15, 1995
<PAGE>
AMERICAN STANDARD COMPANIES INC.
INDEX TO EXHIBITS
(Item 6(a) - Exhibits Required by Item 601
of Regulation S-K and Additional Exhibits)
(The Commission File Number of the Registrant, American Standard Companies
Inc. (formerly named ASI Holding Corporation) ("Holding"), and for all Exhibits
incorporated by reference, is 1-11415, except those Exhibits incorporated by
reference in filings made by American Standard Inc. (the "Company") whose
Commission File Number is 33-64450. Prior to filing its Registration Statement
on Form S-2 on November 10, 1994, Holding's Commission File Number was
33-23070.)
(3) (i) Restated Certificate of Incorporation of Holding; previously filed
as Exhibit 3(i) in Amendment No. 4 to Registration Statement No.
33-56409 under the Securities Act of 1933, as amended, filed January
31, 1995, and herein incorporated by reference.
(ii) Amended By-Laws of Holding; previously filed as Exhibit 3(ii) in
Amendment No. 4 to Registration Statement No. 33-56409 under the
Securities Act of 1933, as amended, filed January 31, 1995, and herein
incorporated by reference.
(4) (i) Form of Common Stock Certificate previously filed as Exhibit 4(I)
in Amendment No. 3 to Registration Statement No. 33-56409 under the
Securities Act of 1933, as amended, filed January 5, 1995, and herein
incorporated by reference.
(ii) Assignment and Amendment Agreement dated as of February 9, 1995, among
Holding, the Company, certain subsidiaries of the Company, and the
financial institutions listed in Schedule I thereto (the Original
Lenders); the financial institutions listed in Schedule II thereto
(the Continuing Lenders), including Chemical Bank as Administrative
Agent for the Original Lenders and Continuing Lenders and as
Collateral Agent for the Original Lenders and Continuing Lenders;
previously filed as Exhibit 4 (xvi) in Holding's Form 10-K for the
fiscal year ended December 31, 1994, and herein incorporated by
reference.
(iii)Amended and Restated Credit Agreement, dated as of February 9, 1995,
among Holding, the Company, certain subsidiaries of the Company and
the lending institutions listed therein, Chemical Bank, as
Administrative Agent; Citibank, N.A. and NationsBank, N.A.
(Carolinas), as Senior Managing Agents; Bank of America Illinois, The
Bank of Nova Scotia, Bankers Trust Company, The Chase Manhattan Bank,
N.A., Compagnie Financiere de CIC et de L'Union Europeenne, Credit
Suisse, Deutsche Bank AG, The Industrial Bank of Japan Trust Company,
The Long Term Credit Bank of Japan, Limited and The Sumitomo Bank,
Ltd., as Managing Agents; and The Bank of New York, Canadian Imperial
Bank of Commerce, The Fuji Bank, Limited and The Sanwa Bank Limited,
as Co-Agents (the "1995 Credit Agreement"), with exhibits but without
schedules. (The 1995 Credit Agreement replaces the Credit Agreement
dated as of June 1, 1993 (the "1993 Credit Agreement"), but the
Security Documents and the Guarantee Documents entered into pursuant
to the 1993 Credit Agreement continue in force and effect as amended
by the Credit Documents Amendment Agreement dated as of February 9,
1995 described in Exhibit (4)(iv) below; previously filed as Exhibit
4(xvii) in Holding's Form 10-K for the fiscal year ended December 31,
1994, and herein incorporated by reference.
(iv) Credit Documents Amendment Agreement dated as of February 9, 1995,
among Holding, the Company, certain domestic and foreign subsidiaries
of the Company, and Chemical Bank, as Administrative Agent and as
Collateral Agent for the Lenders under the 1995 Credit Agreement dated
as of February 9, 1995, described in Exhibit (4)(iii) above;
previously filed as Exhibit 4(xviii) in Holding's Form 10-K for the
fiscal year ended December 31, 1994, and herein incorporated by
reference.
(v) Schedules I, II, and III to the 1995 Credit Agreement referred to in
Exhibit (4)(iii) above.
(vi) First Amendment dated as of March 15, 1995 to the 1995 Credit
Agreement referred to above.
(vii)Rights Agreement, dated as of January 5, 1995 between Holding and
Citibank, N.A.as Rights Agent; previously filed as Exhibit 4(xxv) to
Holding's Form 10-K for the fiscal year ended December 31, 1994, and
herein incorporated by reference.
(10)(i) American Standard Inc. Long-Term Incentive Compensation Plan, as
amended and restated as of February 3, 1995; previously filed as
Exhibit (10)(i) by the Company in its Form 10-K for the fiscal year
ended December 31, 1994, concurrently with the filing of Holding's
Form 10-K for the same year, and herein incorporated by reference.
(ii) Trust Agreement for American Standard Inc. Long-Term Incentive
Compensation Plan and Supplemental Incentive Plan, as amended and
restated as of February 3, 1995; previously filed as Exhibit (10)(ii)
by the Company in its Form 10-K for the fiscal year ended December 31,
1994, concurrently with the filing of Holding's Form 10-K for the same
year, and herein incorporated by reference.
(iii)Amendment No. 2 to American Standard Employee Stock Ownership Plan
authorized March 2, 1995, previously filed as Exhibit (10)(viii) by
the Company in its Form 10-K for the fiscal year ended December 31,
1994, concurrently with the filing of Holding's Form 10-K for the same
year, and herein incorporated by reference.
(iv) American Standard Inc. Supplemental Compensation Plan for Outside
Directors, as amended through February 3, 1995; previously filed as
Exhibit (10)(xii) by the Company in its Form 10-K for the fiscal year
ended December 31, 1994, concurrently with the filing of Holding's
Form 10-K for the same year, and herein incorporated by reference.
(v) American Standard Companies Inc. Stock Incentive Plan; previously
filed as Exhibit (10)(xx) in Amendment No. 3 to Registration Statement
No. 33-56409 under the Securities Act of 1933, as amended, filed
January 5, 1995, and herein incorporated by reference.
(vi) American Standard Inc. and Subsidiaries 1994-1995 Supplemental
Incentive Compensation Plan (formerly named TNE Incentive Plan), as
amended through February 3, 1995; previously filed as Exhibit
(10)(xviii) by the Company in its Form 10-K for the fiscal year ended
December 31, 1994, concurrently with the filing of Holding's Form 10-K
for the same year, and herein incorporated by reference.
(vii)Form of Indemnification Agreement; previously filed as Exhibit
(10)(xxi) in Amendment No. 3 to Registration Statement No. 33-56409
under the Securities Act of 1933, as amended, filed January 5, 1995
(27) Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5 5
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1.00000
<CASH> 58,613
<SECURITIES> 3,819
<RECEIVABLES> 727,421
<ALLOWANCES> 21,195
<INVENTORY> 404,042
<CURRENT-ASSETS> 1,235,741
<PP&E> 1,313,321
<DEPRECIATION> 486,633
<TOTAL-ASSETS> 3,365,601
<CURRENT-LIABILITIES> 1,323,635
<BONDS> 1,780,170
<COMMON> 0
0
0
<OTHER-SE> (535,443)
<TOTAL-LIABILITY-AND-EQUITY> 3,365,601
<SALES> 1,223,186
<TOTAL-REVENUES> 1,223,186
<CGS> (909,096)
<TOTAL-COSTS> (909,096)
<OTHER-EXPENSES> (10,664)
<LOSS-PROVISION> (1,930)
<INTEREST-EXPENSE> (57,406)
<INCOME-PRETAX> 45,382
<INCOME-TAX> 18,875
<INCOME-CONTINUING> 26,507
<DISCONTINUED> 0
<EXTRAORDINARY> (30,109)
<CHANGES> 0
<NET-INCOME> (3,602)
<EPS-PRIMARY> (0.05)
<EPS-DILUTED> 0.00
</TABLE>
FIRST AMENDMENT dated as of March 15, 1995
to the Amended and Restated Credit Agreement dated as
of February 9, 1995 (the "Credit Agreement"), among
American Standard Companies Inc. ("Holding");
American Standard Inc. ("ASI"); the Subsidiaries of
ASI listed in Schedule I thereto (the "Subsidiary
Borrowers" and, together with ASI, the "Borrowers");
the financial institutions party thereto (the
"Lenders"); Chemical Bank, as administrative agent
for the Lenders (in such capacity, the
"Administrative Agent"); Citibank, N.A. and
NationsBank N.A. (Carolinas), as Senior Managing
Agents (the "Senior Managing Agents"); Bank of
America Illinois, The Bank of Nova Scotia, Bankers
Trust Company, The Chase Manhattan Bank, N.A.,
Compagnie Financiere de Cic et de L'Union Europeenne,
Credit Suisse, Deutsche Bank AG, The Industrial Bank
of Japan, Limited, The Long Term Credit Bank of
Japan, Limited and The Sumitomo Bank Ltd., as
Managing Agents (the "Managing Agents"); and The Bank
of New York, Canadian Imperial Bank of Commerce, The
Fuji Bank, Limited and The Sanwa Bank Limited, as
Co-Agents (the "Co-Agents" and, together with the
Senior Managing Agents, the Managing Agents and the
Administrative Agent, the "Agents").
ASI, Holding and the Subsidiary Borrowers have requested that
the Credit Agreement be amended as provided in Article II, and the Lenders and
the Agents have agreed to the amendments so provided for upon the terms and
subject to the conditions set forth herein. Accordingly, the parties hereto
agree as follows:
ARTICLE I. DEFINED TERMS
Capitalized terms used and not otherwise defined herein shall
have the meanings assigned to them in the Credit Agreement.
ARTICLE II. AMENDMENTS TO CREDIT AGREEMENT
The Credit Agreement is amended, effective as of the Effective
Date (as defined in Article IV), as set forth below:
SECTION 2.01. Amendments to Article I. Section 1.01 of the Credit Agreement
is amended as follows:
(a) The definition of "Alternative Currency" is amended by the
insertion of ", Dutch Guilders" immediately after "Italian Lire".
(b) The definition of "Applicable Margin" is amended by
deleting the financial ratio conditions for ASI and its Consolidated
Subsidiaries set forth under the caption "Financial Ratios" and the amounts set
forth under "Margin Reduction" and the insertion in place thereof of the
following:
Financial Ratios Margin Reduction
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >1.90:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 3.5:1 0.25%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >2.15:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 3.0:1 0.50%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >2.40:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 2.75:1 0.75%
- -
Ratio of Consolidated Free Cash Flow to
Consolidated Fixed Charges >2.65:1 and Ratio of
Consolidated Total Debt to Consolidated EBITDA 2.25:1 1.00%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >3.15:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 2.00:1 1.125%
- -
<PAGE>
(c) The following new definition is added to Section 1.01 of the
Credit Agreement in its proper alphabetical position:
"Consolidated Fixed Charges" of any person shall mean, for any
period, the sum of the amounts for such period of (i) Consolidated
Interest Expense and (ii) dividends on preferred or preference stock of
such person that are made during such period, all as determined on a
consolidated basis for such person and its Consolidated Subsidiaries in
accordance with GAAP.
SECTION 2.02. Amendment to Article II. Article II of the Credit Agreement
is amended as follows:
(a) Section 2.05(b) of the Credit Agreement is amended by
deleting the financial ratio conditions for ASI and its Consolidated
Subsidiaries set forth under the caption "Financial Ratios" and the amounts set
forth under the "Fee Reduction" and the insertion in its place thereof of the
following:
Financial Ratios Fee Reduction
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >1.90:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 3.5:1 .0625%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >2.15:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 3.0:1 .1250%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >2.40:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 2.75:1 .1500%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >2.65:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 2.25:1 .1750%
- -
Ratio of Consolidated Free Cash Flow to Consolidated Fixed
Charges >3.15:1 and Ratio of Consolidated Total Debt to
Consolidated EBITDA 2.00:1 .1875%
- -
ARTICLE III. REPRESENTATIONS AND WARRANTIES.
Each of Holding, ASI and the other Borrowers hereby represents
and warrants (but, in the case of representations and warranties relating to
Credit Parties and their Subsidiaries, only as to itself and its Subsidiaries,
it being understood that Holding and ASI make all representations and warranties
as to all parties) to each Lender and the Administrative Agent that this First
Amendment (a) has been duly authorized, executed and delivered by Holding, ASI
and each other Borrower or Credit Party and constitutes the legal, valid and
binding obligation of each such person enforceable against it in accordance with
its terms, except as enforcement thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the enforceability of creditors' rights generally and by general
principles of equity, and (b) will not conflict in any respect material to the
rights or interests of the Lenders with or result in any breach of any of the
terms, covenants, conditions or provisions of, or constitute (with notice or
lapse of time or both) a default under, or result in a required prepayment of,
or (other than as contemplated by the Security Documents) result in the creation
or imposition of (or the obligation to create or impose) any Lien upon any of
the properties or assets of any Credit Party or any of its Subsidiaries pursuant
to the terms of, any indenture, mortgage, deed of trust, agreement or other
instrument to which any Credit Party is a party or by which it may be subject.
ARTICLE IV. EFFECTIVENESS
SECTION 4.01. Amendment A. The amendments provided for in
Section 2.01(a) (collectively, "Amendment A"), together with the provisions of
Articles I, III and V, shall become effective when the following conditions
precedent shall have been satisfied:
(a) the Administrative Agent shall have received, on behalf of
the Lenders, an Officer's Certificate of ASI, dated the Effective Date,
confirming compliance with the conditions precedent set forth in paragraphs (b)
and (c) of Section 4.01 of the Credit Agreement insofar as such Conditions
precedent relate to ASI and its subsidiaries;
(b) all legal matters incidental to this First Amendment shall
be satisfactory to the Administrative Agent and to Cravath, Swaine & Moore,
counsel for the Administrative Agent; and
(c) the Amendment A signature lines at the foot hereof shall
have been executed by Lenders sufficient to effect Amendment A under the terms
of the Credit Agreement.
SECTION 4.02. Amendment B. The amendments provided for in
Sections 2.01(b), 2.01(c) and 2.02 (collectively, "Amendment B"), together with
the provisions of Articles I, III and V, shall become effective when the
following conditions precedent shall have been satisfied:
(a) the Administrative Agent shall have received, on behalf of
the Lenders, an Officer's Certificate of ASI, dated the Effective Date,
confirming compliance with the conditions precedent set forth in paragraphs (b)
and (c) of Section 4.01 of the Credit Agreement insofar as such conditions
precedent relate to ASI and its subsidiaries;
(b) all legal matters incidental to this First Amendment shall
be satisfactory to the Administrative Agent and to Cravath, Swaine & Moore,
counsel for the Administrative Agent; and
(c) the Amendment B signature lines at the foot hereof shall
have been executed by Lenders sufficient to effect Amendment B under the terms
of the Credit Agreement.
ARTICLE V. MISCELLANEOUS
SECTION 5.01. APPLICABLE LAW. THIS FIRST AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
<PAGE>
SECTION 5.02. Expenses. ASI shall pay all reasonable
out-of-pocket expenses incurred by the Administrative Agent in connection with
the preparation, negotiation, execution, delivery and enforcement of this First
Amendment, including, but not limited to, the reasonable fees, charges and
disbursements of Cravath, Swaine & Moore, counsel for the Administrative Agent.
The agreement set forth in this Section 5.02 shall survive the termination of
this First Amendment and the Credit Agreement.
SECTION 5.04. Counterparts. This First Amendment may be executed in any
number of counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one agreement.
IN WITNESS WHEREOF, the parties hereto have caused this First
Amendment to be duly executed by their duly authorized officers, all as of the
date first above written.
<TABLE>
<CAPTION>
AMENDMENT A AMENDMENT B
<S> <C> <C>
AMERICAN STANDARD COMPANIES INC.,
by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: Vice Title: Vice President
President and and Treasurer
Treasurer
BORROWERS:
AMERICAN STANDARD INC., by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: Vice Title: Vice President
President and and Treasurer
Treasurer
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMENDMENT A AMENDMENT B
<S> <C> <C>
AMERICAN STANDARD CREDIT INC.,
by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: Vice President and Title: Vice President
and Treasurer
Treasurer
WABCO STANDARD GMBH, by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title:Attorney-in-Fact Title: Attorney-in-Fact
AMERICAN STANDARD (UK) LIMITED, by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: itle: Attorney-in-Fact
Attorney-in-Fact
STANDARD EUROPE, a European by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Economic Interest Grouping, Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title:Attorney-in-Fact Title: Attorney-in-Fact
WABCO STANDARD TRANE INC., by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: Authorized itle: Authorized
Signing Officer Signing Officer
WABCO STANDARD TRANE B.V., by: /s/ Thomas S. Battaglia by: /s/ Thomas S. Battaglia
Name: Thomas S. Name: Thomas S.
Battaglia Battaglia
Title: Title: Attorney-in-Fact
Attorney-in-Fact
ADMINISTRATIVE AGENT:
CHEMICAL BANK, by: /s/ Robert K. Gaynor by: /s/ Robert K. Gaynor
Name: Robert K. Name: Robert K. Gaynor
Gaynor Title: Vice President
Title: Vice President
SENIOR MANAGING AGENTS:
CITIBANK, N.A., by: /s/ Prakash Chonkar by: /s/ Prakash Chonkar
Name: Prakash Chonkar Name: Prakash Chonkar
Title: Vice President
Title: Vice President
NATIONSBANK, N.A. (CAROLINAS), by: /s/ Chris. C. Browder by: /s/ Chris. C. Browder
Name: Chris. C. Name: Chris. C.
Browder Browder
Title: Vice President Title: Vice President
MANAGING AGENTS:
BANK OF AMERICA ILLINOIS, by: /s/ Phillip F. Van Winkle by: /s/ Phillip F. Van Winkle
------------------------- -------------------------
Name: Phillip F. Name: Phillip F. Van
Van Winkle Winkle
Title: Vice President Title: Vice President
THE BANK OF NOVA SCOTIA, by: /s/ Stephen Lockhart by: /s/ Stephen Lockhart
------------------------ --------------------
Name: Stephen Name: Stephen Lockhart
Lockhart Title: Senior Manager
Title: Senior
Manager
BANKERS TRUST COMPANY, by: /s/ Mary Kay Coyle by: /s/ Mary Kay Coyle
------------------------ ------------------
Name: Mary Kay Coyle Name: Mary Kay Coyle
Title: Vice President Title: Vice President
THE CHASE MANHATTAN BANK, N.A., by: /s/ Carol A. Ulmer by: /s/ Carol A. Ulmer
Name: Carol A. Ulmer Name: Carol A. Ulmer
Title:Vice President Title: Vice President
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
COMPAGNIE FINANCIERE DE CIC ET by: /s/ Sean Mounier by: /s/ Sean Mounier
DE L'UNION EUROPEENNE, Name: Sean Mournier Name: Sean Mounier
Title: First Vice President Title: First Vice President
by: /s/ Marcus Edward by: /s/ Marcus Edward
Name: Marcus Edward Name: Marcus Edward
Title: Vice President Title: Vice President
CREDIT SUISSE, by: /s/ Andrea Shkane by: /s/ Andrea Shkane
Name: Andrea Shkane Name: Andrea Shkane
Title: Associate Title: Associate
by: /s/ Christopher J. Eldin by: /s/ Christopher J. Eldin
Name: Christopher J. Eldin Name: Christopher J. Eldin
Title: Member of Senior Title: Member of Senior
Management Management
DEUTSCHE BANK AG, NEW YORK by: /s/ Colin T. Taylor by: /s/ Colin T. Taylor
AND/OR CAYMAN ISLANDS BRANCH, Name: Colin T. Taylor Name: Colin T. Taylor
Title: Director Title: Director
by: /s/ Iain Stewart by: /s/ Iain Stewart
Name: Iain Stewart Name: Iain Stewart
Title: Associate Title: Associate
THE INDUSTRIAL BANK OF JAPAN by: /s/ Junri Oda by: /s/ Junri Oda
TRUST COMPANY, Name: Junri Oda Name: Junri Oda
Title: Senior Vice President Title: Senior Vice President
and Manager and Manager
THE LONG TERM CREDIT BANK OF by: /s/ Rene O. LeBlanc by: /s/ Rene O. LeBlanc
JAPAN, LIMITED, Name: Rene O. LeBlanc Name: Rene O. LeBlanc
Title: Deputy General Title: Deputy General Manager
Manager
THE SUMITOMO BANK, LTD., by: /s/ Yoshinoro Kawamura by: /s/ Yoshinoro Kawamura
Name: Yoshinoro Kawamura Name: Yoshinoro Kawamura
Title: Joint General Manager Title: Joint General
Manager
CO-AGENTS:
THE BANK OF NEW YORK, by: /s/ Peter A. Abdill by: /s/ Peter A. Abdill
------------------------- -------------------
Name: Peter A. Abdill Name: Peter A. Abdill
Title: Asst. Vice President Title: Asst. Vice President
CANADIAN IMPERIAL BANK OF by: /s/ E.L. Gordon by: /s/ E.L. Gordon
COMMERCE, Name: E.L. Gordon Name: E.L. Gordon
Title: Vice President Title: Vice President
THE FUJI BANK, LIMITED, by: /s/ Katsunori Nozawa by: /s/ Katsunori Nozawa
Name: Katsunori Nozawa Name: Katsunori Nozawa
Title: Vice President and Title: Vice President and
Manager Manager
THE SANWA BANK LIMITED, by: /s/ Paul Judicke by: /s/ Paul Judicke
Name: Paul Judicke Name: Paul Judicke
Title: Asst. Vice President Title: Asst. Vice President
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LENDERS:
<S> <C> <C>
BANCA COMMERCIALE ITALIANA, NEW by: /s/ Charles by: /s/ Charles Dougherty
YORK BRANCH, Dougherty Name: Charles Dougherty
Name: Charles Dougherty Title: Vice President
Title: Vice President
by: /s/ Sara by: /s/ Sara Kim
Kim Name: Sara Kim
Name: Sara Kim Title: Asst. Vice President
Title: Asst. Vice President
BANK OF IRELAND, by: /s/ Randolph M. by: /s/ Randolph M. Ross
Ross Name: Randolph M. Ross
Name: Randolph M. Ross Title: Vice President
Title: Vice President
BANK OF SCOTLAND, by: /s/ Catherine M. by: /s/ Catherine M. Oniffrey
Oniffrey Name: Catherine M. Oniffrey
Name: Catherine M. Oniffrey Title: Vice President
Title: Vice President
BANQUE PARIBAS, by: /s/ David C. by: /s/ David C. Buseck
Buseck Name: David C. Buseck
Name: David C. Buseck Title: Vice President
Title: Vice President
by: /s/ Jeffrey by: /s/ Jeffrey Youle
Youle Name: Jeffrey Youle
Name: Jeffrey Youle Title: Senior Vice President
Title: Senior Vice President
CREDIT LYONNAIS, NEW YORK BRANCH, by: /s/ F. by: /s/ F. Haddad
Haddad Name: F. Haddad
Name: F. Haddad Title: Senior Vice President
Title: Senior Vice President
CREDITO ITALIANO, by: /s/ Harmon P. by: /s/ Harmon P. Butler
Butler Name: Harmon P. Butler
Name: Harmon P. Butler Title: First Vice President
Title: First Vice President
by: /s/ Saiyed A. by: /s/ Saiyed A. Abbas
Abbas Name: Saiyed A. Abbas
Name: Saiyed A. Abbas Title: Asst. Vice President
Title: Asst. Vice President
DRESDNER BANK AG, NEW YORK AND by: /s/ Andrew K. by: /s/ Andrew K. Mittag
CAYMAN BRANCHES, Mittag Name: Andrew K. Mittag
Name: Andrew K. Mittag Title: Vice President
Title: Vice President
by: /s/ Richard W. by: /s/ Richard W. Conroy
Conroy Name: Richard W. Conroy
Name: Richard W. Conroy Title: Vice President
Title: Vice President
FLEET BANK OF MASSACHUSETTS, by: /s/ Kimberly S. by: /s/ Kimberly S. Kersten
N.A., Kersten Name: Kimberly S. Kersten
Name: Kimberly S. Kersten Title: Asst. Vice President
Title: Asst. Vice President
THE HOKKAIDO TAKUSHOKU BANK, by: by: /s/ Hirohioto Ishizuka
LTD., Name: Hirohioto Ishizuka
Name: Title: Vice President
Title:
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
THE MITSUBISHI BANK, LTD., by: /s/ Paula by: /s/ Paula Mueller
Mueller Name: Paula Mueller
Name: Paula Mueller Title: Vice President
Title: Vice President
THE MITSUBISHI TRUST AND BANKING by: /s/ Pat Loret de by: /s/ Pat Loret de Mola
----------------- ---------------------
CORPORATION, Mola Name: Pat Loret de Mola
Name: Pat Loret de Mola Title: Senior Vice President
Title: Senior Vice President
NATIONAL CITY BANK, by: /s/ Lisa B. by: /s/ Lisa B. Lisi
Lisi Name: Lisa B. Lisi
Name: Lisa B. Lisi Title: Account Rep.
Title: Account Rep.
NBD BANK, by: /s/ Timothy J. King by: /s/ Timothy J. King
Name: Timothy L. King Name: Timothy L. King
Title: Second V.P. Title: Second V.P.
THE SAKURA BANK, LIMITED, by: /s/ Masahiro Nakajo by: /s/ Masahiro Nakajo
Name: Masahiro Nakajo Name: Masahiro Nakajo
Title: Senior Vice President Title: Senior Vice President
and Manager and Manager
SOCIETE GENERALE, by: /s/ James H. Nangle by: /s/ James H. Nangle
Name: James H. Nangle Name: James H. Nangle
Title: First Vice President Title: First Vice President
THE SUMITOMO TRUST AND BANKING by: by: /s/ Suraj P. Bhatia
CO., LTD., NEW YORK BRANCH, Name: Suraj P. Bhatia
Name: Title: Senior Vice President
Title:
THE TORONTO-DOMINION BANK, by: /s/ Robert G. Harris by: /s/ Robert G. Harris
Name: Robert G. Harris Name: Robert G. Harris
Title: Director Title: Director
UNION BANK OF FINLAND, LTD., by: /s/ Pentti Masukoski by: /s/ Pentti Masukoski
-------------------------- --------------------
Name: Pentti Masukoski Name: Pentti Masukoski
Title: Senior Vice President Title: Senior Vice President
by: /s/ Eric I. Mann by: /s/ Eric I. Mann
Name: Eric I. Mann Name: Eric I. Mann
Title: Vice President Title: Vice President
UNITED STATES NATIONAL BANK OF by: /s/ Chris J. Karlin
OREGON, by: Name: Chris J. Karlin
Name: Title: Vice President
Title:
</TABLE>
Schedule I
to
Credit Agreement
Subsidiary Borrowers
(Credit Agreement Introduction)
WABCO Standard GmbH
Standard Europe (a European Economic Interest Grouping)
WABCO-STANDARD Trane B.V.
American Standard Credit Inc.
American Standard (UK) Limited
Wabco Standard Trane Inc.
<PAGE>
<TABLE>
<CAPTION>
Schedule II
American Standard Inc.
Lenders and Commitments
<S> <C> <C> <C> <C>
Multi-Currency US $
Periodic Access Revolving Credit Revolving Credit Term Loan
Lenders Loan Commitment Commitment Commitment Commitment
- ------- --------------- ---------- ---------- ----------
Banca Commerciale Italiana $5,552,486.19 $4,972,375.69 $3,196,527.23 $1,278,610.89
Bank of America Illinois $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
Bank of Scotland $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
Bankers Trust Company $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
Banque Paribas $11,104,972.38 $9,944,751.38 $6,393,054.46 $2,557,221.78
Canadian Imperial Bank
of Commerce $12,770,718.23 $11,436,464.09 $7,352,012.63 $2,940,805.05
Chemical Bank $14,066,298.35 $12,596,685.08 $8,097,868.98 $3,239,147.59
Citibank, N.A. $14,066,298.35 $12,596,685.08 $8,097,868.98 $3,239,147.59
Compagnie Financiere de
CIC et de l'Union Europeene $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
Credit Lyonnais, New York Branch $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
Credit Suisse $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
Credito Italiano $3,701,657.46 $3,314,917.13 $2,131,018.15 $852,407.26
Deutsche Bank AG $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
Dresdner Bank AG $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
Fleet Bank, N.A. $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
National City Bank $0.00 $0.00 $10,714,285.71 $4,285,714.29
NationsBank, N.A. (Carolinas) $14,066,298.35 $12,596,685.08 $8,097,868.98 $3,239,147.59
NBD Bank $5,552,486.19 $4,972,375.69 $3,196,527.23 $1,278,610.89
Societe Generale $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
The Bank of New York $12,770,718.23 $11,436,464.09 $7,352,012.63 $2,940,805.05
The Bank of Nova Scotia $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
The Chase Manhattan Bank, N.A. $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
The Fuji Bank, Limited $12,770,718.23 $11,436,464.09 $7,352,012.63 $2,940,805.05
The Hokkaido Takushoku Bank, Ltd. $0.00 $0.00 $7,142,857.14 $2,857,142.86
The Industrial Bank of Japan
Trust Company $13,696,132.59 $12,265,193.37 $7,884,767.17 $3,153,906.87
The Long Term Credit Bank
of Japan, Limited $18,508,287.29 $16,574,585.63 $10,655,090.77 $4,262,036.31
The Mitsubishi Bank, Ltd. $5,552,486.19 $4,972,375.69 $3,196,527.23 $1,278,610.89
The Mitsubishi Trust and
Banking Corporation $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
The Sakura Bank, Limited $15,000,000.00 $0.00 $10,714,285.71 $4,285,714.29
The Sanwa Bank Limited $12,770,718.23 $11,436,464.09 $7,352,012.63 $2,940,805.05
The Sumitomo Bank, Ltd. $13,696,132.60 $12,265,193.36 $7,884,767.17 $3,153,906.87
The Sumitomo Trust and
Banking Co., Ltd. $0.00 $0.00 $17,857,142.86 $7,142,857.14
The Toronto-Dominion Bank $9,254,143.65 $8,287,292.82 $5,327,545.38 $2,131,018.15
U.S. Bank $0.00 $0.00 $10,714,285.71 $4,285,714.29
Union Bank of Finland, Ltd. $3,701,657.46 $3,314,917.13 $2,131,018.15 $852,407.26
-------------- -------------- -------------- -----------
Totals $350,000,000.00 $300,000,000.00 $250,000,000.00 $100,000,000.00
</TABLE>
<PAGE>
Schedule III
to
Credit Agreement
Subsidiary Guarantors
I. U.S. GROUP
Name Activity
A.L. Rand Inc. Thai holding co.*
American Radiator & Standard Sanitary Corporation Holding co.
American Standard Credit Inc. ("ASCI") (Borrower) Finance co.
American Standard Inc. ("ASI") Parent co.
(Borrower)
American Standard International Inc. Holding co.
American Standard Trane, Ltd. Registered in Japan
Amstan Corporation Holding co.
Amstan International Ltd. Holding co.
Amstan Trucking Inc. Interstate trucking
A-S Energy, Inc. Energy operations
A.S. Thai Holdings Ltd. Thai holding co.*
American Standard Companies Inc. Parent holding co.
CAG Inc. Thai holding co.*
Cardwell Westinghouse Company Thai holding co.*
Compromise Holdings, Corp. Thai holding co.*
Curtis Alcorn Corp. Thai holding co.*
DFM Corporation Holding co.
*ASI is in the process of consolidating all of the shares of American Standard
Sanitaryware (Thailand) Public Company Limited (other than the shares held by
ASI) into Thai Holdings Ltd., formerly known as Toensing Chart Supply, Inc.
<PAGE>
Domino Dopant Inc. Thai holding co.*
Fluid Power Inc. Thai holding co.*
FWJ Inc. Thai holding co.*
Ideal-Standard Inc. Holding co.
IT Holdings Inc. Holding co.
IAS Inc. Thai holding co.*
IVES Rep, Inc. Thai holding co.*
Locus Coeruleus, Corp. Thai holding co.*
M.C. Capsule Inc Thai holding co.*
McDermott Sizing Corp Thai holding co.*
Mongrue & Sons, Inc Thai holding co.*
MWM Corporation Holding co.
Nether Holdings Inc Holding co.
Reefco Inc Holding co.
Pammel Creek Corp Thai holding co.*
S.S. Frosca & Co Thai holding co.*
SAU Corp Holding co.
Standard Sanitary Manufacturing Company Holding co.
The Hermann Safe Company Thai holding co.*
The Trane Company (Del.) Holding co.; Saudi
branch
The Trane Company (Nevada) Advance product
sales to foreign
customers
Trane Export, Inc Export for Trane
products; foreign
branches
Trane Hellas, Inc Greek branch
<PAGE>
Twitty & Co Thai holding co.*
U.S. Railway Inc Thai holding co.*
Universal Railway Devices Company Holding co.
WABCO Automotive Control Systems Inc.* Holder of 50% of
WABCO/Rockwell JV
WABCO Company Holding co.
WABCO-Standard Export Ltd Export Vehicle for
ASI
Wabco Westinghouse CIS Holdings Inc Holding co.
Westinghouse Air Brake International Corporation Holding co.
World Standard Ltd Brussels HQ Co.
and other foreign
branches
II. GERMANY*
WABCO Standard GmbH (Borrower) Operating Co.
Ideal Standard GmbH Property hold co.
WABCO GmbH (1) Holding Co.
Trane Beteiligungs GmbH (2) Sales Office
Trane Deutschland GmbH (3) Sales Office
Former company names (1) Wabco Vermogensverwaltungs GmbH, (2) Trane Hamburg
GmbH, (3) the former Trane Frankfurt. GmbH was closed and its assets merged
into Trane Deutschland GmbH, formerly Trane Dusseldorf GmbH.
<PAGE>
III. CANADA
Wabco Standard Trane Inc. (Borrower) Operating and holding co.
IV. NETHERLANDS
WABCO Standard Holdings B.V. (Borrower) Holding and operatin co.
WABCO Westinghouse B.V. Operating co.
WABCO Westinghouse Spring Brakes B.V . Operating co.
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* Foreign subsidiaries will not guarantee debt of ASI or ASCI.
V. FRANCE*
Ideal Standard S.A. All operating or holding cos.
Societe Trane
WABCO Westinghouse Equipements Automobiles SNC
WABCO Westinghouse S.A.
VI. ITALY*
Ideal-Standard S.p.A. Operating and holding co.
Trane Italia S.R.L. Operating co.
<PAGE>
WABCO Westinghouse Automotive Products S.p.A. Operating co.
VII. U.K.
American Standard (UK) Limited (Borrower) Operating and holding co.
Trane (U.K.) Limited Operating cos.
Clayton Dewandre Holdings Limited
Bridge Foundry Company Limited
WABCO Automotive U.K. Limited
Ideal Standard Limited
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* As members of the EEIG Borrower, these companies will be "Credit Parties"
but not Subsidiary Guarantors.
<PAGE>
VIII. AUSTRIA
WABCO Westinghouse Ges. m.b.H. Operating co.
IX. EEIG
Standard Europe EEIG (Borrower) Financing co.
X BRAZIL
Westinghouse Air Brake Brasil S.A. Holding co.
Ideal Standard Wabco Industria e Comercio Ltda. Operating co.
XI. MEXICO
Ideal Standard S.A. de C.V. Operating co.
XI. SWITZERLAND
WABCO Westinghouse A.G. Operating Co.
Trane S.A. Holding Co.
