FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
EXHIBIT
10.1
FIFTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT
THIS FIFTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT (the “Fifth Amendment”) is executed and entered into this
30th day of January, 2009 by and between CTI Industries Corporation, an Illinois
corporation and CTI Helium, Inc., an Illinois corporation (collectively the
“Borrower”) and RBS Citizens, N.A., successor by merger to Charter
One Bank, N.A., a national banking association (“Bank”) and amends, as of the
effective date hereof, the Loan and Security Agreement between the parties dated
February 1, 2006, as amended by the First Amendment to Loan and Security
Agreement dated June, 2006, the Second Amendment to Loan and Security Agreement
dated December 6, 2006, the Third Amendment to Loan and Security Agreement dated
November 13, 2007, and the Fourth Amendment to Loan and Security Agreement dated
April 15, 2008 (collectively the “Loan Agreement”). Capitalized terms
used herein without definition shall have the meanings ascribed to them in the
Loan Agreement.
For and in consideration of the mutual
covenants and agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Loan Agreement is hereby amended as follows:
1. The
definition of “Applicable Margin” in Section 1.1 of the
Loan Agreement shall be amended in it entirety to read as follows:
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“Applicable
Margin” shall mean the rate per annum added to the Base Rate to
determine the Revolving Interest Rate, Term Interest Rate and Mortgage
Interest Rate, as determined by the ratio of Senior Debt to consolidated
EBITDA of the Borrower and its Subsidiaries for the twelve month period
ending as of the end of the prior fiscal quarter, effective as of any
Interest Rate Change Date, as set forth
below:
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Ratio
of Senior
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Debt to
EBITDA
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Applicable
Margin
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Greater
than or equal to 4.00
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1.50%
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to
1.00
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Greater
than or equal to 3.50
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1.25%
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to
1.00; less than 4.00 to 1.00
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Greater
than or equal to 3.25
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1.00%
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to
1.00; less than 3.50 to 1.00
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Greater
than or equal to 2.75
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0.75%
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to
1.00; less than 3.25 to 1.00
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Less
than 2.75 to 1.00
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0.50%.
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2. The
definition of “Letter of Credit Rate” in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:
“Letter of Credit
Rate” shall mean the per annum rate as determined by the ratio of the
Senior Debt to the consolidated EBITDA of the Borrower and its Subsidiaries for
the twelve month period ending as to the end of the fiscal quarter most recently
ended at the time of the issuance of a Letter of Credit, as set forth
below:
Ratio
of Senior
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Debt to
EBITDA
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Letter of Credit
Rate
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Greater
than or equal to 4.00
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2.50%
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to
1.00
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Greater
than or equal to 3.50
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2.25%
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to
1.00; less than 4.00 to 1.00
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Less
than 3.50 to 1.00
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2.00%
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3. The
definition of “Non-Utilization Fee Rate” in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:
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“Non-Utilization
Fee Rate” shall mean the per annum rate as determined by the ratio
of the Senior Debt to the consolidated EBITDA of the Borrower and its
Subsidiaries for the twelve month period ending as of the end of the prior
fiscal quarter, as set forth
below:
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Ratio
of Senior
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Debt to
EBITDA
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Non-Utilization Fee
Rate
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Greater
than or equal to 4.00
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0.50%
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to
1.00
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Greater
than or equal to 3.50
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0.35%
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to
1.00; less than 4.00 to 1.00
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Less
than 3.50 to 1.00
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0.25%
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4. The
definition of “Revolving Loan Maturity Date” as set forth in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:
“Revolving Loan Maturity
Date” shall mean January 31, 2010, unless extended by the Bank pursuant
to any modification , extension or renewal note executed by the Borrower and
accepted by the Bank in its sole and absolute discretion is substitution for the
Revolving Note.
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5. Section 8.11 of the
Loan Agreement shall be amended in its entirety to read as follows:
“Borrowing Base
Certificate. The Borrower shall, on Wednesday of every other
week deliver to the Bank a Borrowing Base Certificate dated as of the last
Business Day of the prior week, certified as true and correct by an authorized
representative of the Borrower and acceptable to the Bank in its sole and
absolute discretion; provided, however, at any time an Event of
Default exists, the Bank may require the Borrower to deliver Borrowing Base
Certificates more frequently.”
6. Section 10.3 of the
Loan Agreement shall be amended in its entirety to read as follows:
10.3 Senior Debt
to EBITDA. As of the end of each of its fiscal quarters set
forth below, the Borrower and its Subsidiaries shall maintain a ratio of (a)
consolidated Senior Debt; to (b) consolidated EBITDA for the twelve
month period ending on the last day of such fiscal quarter, of not greater than
the following:
Senior
Debt
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Computation Period
Ending
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to
EBITDA
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March
31, 2009-June 30, 2009
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3.25
to 1.00
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September
30, 2009 and thereafter
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3.00
to 1.00
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7. The
effectiveness of this Fifth Amendment is subject to the satisfaction of all of
the following conditions precedent:
(a)
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Bank
shall have accepted this Fifth Amendment in the spaces provided for that
purpose below.
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(b)
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The
Guaranties shall have been reaffirmed by the
Guarantors.
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(c)
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Except
as set forth herein, the Borrower shall be in full compliance with the
terms of the Loan Documents and no Event of Default or Unmatured Event of
Default shall have occurred or be continuing after giving effect to this
Fifth Amendment.
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(d)
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Borrower
shall have paid Bank a waiver/modification fee of
$31,500.00.
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(e)
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Borrower
shall have delivered certified copies of Board of Director resolutions
authorizing this Fifth Amendment.
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(f)
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All
other legal matters incident to the execution and delivery hereof
contemplated hereby and to the transaction contemplated hereby (including
the delivery of ancillary documentation requested by Bank) shall be
satisfactory to Bank and its
counsel.
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8. To
the extent the terms of this Fifth Amendment conflict with the terms of the Loan
Agreement, the terms hereof shall be controlling. Except as
specifically amended hereby, the Loan Agreement shall remain unchanged and in
full force and effect. The Loan Agreement, as amended hereby, and all
rights and powers created thereby and thereunder are in all respects ratified
and confirmed. This Fifth Amendment may be executed in any number of
counterparts and by different parties hereto on separate counterparts and each
such counterpart shall be deemed an original, but all such counterparts together
shall constitute but one and the same Fifth Amendment. This Fifth
Amendment shall be binding upon and inure to the benefit of the Bank and the
Borrower, and their respective successors and assigns. This Fifth
Amendment shall be governed by and construed in accordance with the laws of the
State of Illinois.
IN WITNESS WHEREOF the parties hereto
have caused this Fifth Amendment to be duly executed and delivered by their duly
authorized officers as of the date first set forth above.
BORROWER:
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CTI
Helium, Inc.
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CTI
Industries Corporation
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By: /s/ Xxxxxxx X.
Xxxxxxx
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By: /s/ Xxxxxxx X.
Xxxxxxx
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Title: Executive Vice
President
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Title: Executive Vice
President
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BANK:
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RBS
Citizens, N.A., successor by merger to Charter One Bank,
N.A.
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By: /s/ Xxxxxxx X.
Xxxxx
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Title: Senior Vice
President
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[Fifth
Amendment to Loan and Security Agreement]
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