FIRST AMENDMENT
TO AMENDED AND RESTATED LOAN AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED LOAN
AGREEMENT (this "Amendment") is made and entered into as of October
10, 1997, by and among [i] STEEL TECHNOLOGIES INC., a Kentucky
corporation with principal office and place of business in
Louisville, Kentucky (the "Borrower"), [ii] (a) PNC BANK, KENTUCKY,
INC., a Kentucky banking corporation with principal office and
place of business in Louisville, Kentucky ("PNC"), (b) NATIONAL
CITY BANK OF KENTUCKY, a national banking association with
principal office and place of business in Louisville, Kentucky
("National City"), (c) NBD BANK, N.A., a national banking associa-
tion with principal office and place of business in Indianapolis,
Indiana ("NBD"), and (d) SUNTRUST BANK, NASHVILLE, N.A., a national
banking association with principal office and place of business in
Nashville, Tennessee ("Suntrust") (each of PNC, National City, NBD
and Suntrust is hereinafter individually referred to as a "Bank",
and all of the same are hereinafter collectively referred to as the
"Banks"), and [iii] PNC BANK, KENTUCKY, INC., in its capacity as
agent for the Banks (in such capacity, the "Agent").
PRELIMINARY STATEMENTS
A. Borrower, the Banks and the Agent are parties to a
certain Amended and Restated Loan Agreement dated as of March 26,
1997 (the "Loan Agreement") (certain capitalized terms used in this
Amendment have the meanings set forth for them in the Loan
Agreement unless expressly otherwise defined herein), pursuant to
which, among other things, the Banks established the Revolver in
favor of Borrower in the amount of $30,000,000, and the Line of
Credit in favor of Borrower in the amount of $25,000,000, and PNC
established the Swing Line Loan Commitment in favor of Borrower in
the amount of $5,000,000.
B. Borrower has requested that PNC extend the Swing
Line Loan Commitment Termination Date from October 10, 1997, until
October 12, 1998, and that the Banks extend the Line of Credit
Commitment Termination Date from October 10, 1997 until October 12,
1998, extend the Revolving Loan Commitment Termination Date from
October 11, 1999 until October 11, 2000, increase the maximum
permitted aggregate outstanding principal amount of the Revolver
from $30,000,000 to $55,000,000, reduce the existing Pricing Levels
and establish additional Pricing Levels as hereinafter set forth,
and modify certain financial covenants applicable under the Loan
Agreement, and PNC and the other Banks have agreed to do so subject
to and in accordance with the provisions of this Amendment, and
Borrower, the Banks and the Agent have agreed to modify the Loan
Agreement otherwise as hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements set forth herein and for other good
and valuable consideration, the mutuality, receipt and sufficiency
of which are hereby acknowledged, it is hereby agreed as follows:
ARTICLE 1.
Amendments to Loan Agreement
Subject to delivery to the Agent of each of the "Amend-
ment Documents" more particularly described in Article 2 of this
Amendment and fulfillment to the satisfaction of the Agent and the
Banks of each of the other conditions described in Article 2 of
this Amendment, the Loan Agreement is hereby amended as follows:
1.1 A new Section 1.7A is added to the Loan Agreement
immediately following existing Section 1.7 and shall read as
follows:
1.7A. "Applicable Line of Credit Commitment Fee"
means each per annum percentage set forth in the table
appearing in Section 2.3A(ii) of this Loan Agreement.
1.2 Exhibit E-1 and Exhibit E-2, each in the form attached
to and made a part of this Amendment, shall be substituted for
Exhibit E-1 and Exhibit E-2, respectively, in the forms originally
made part of the Loan Agreement, and the references in Section 1.10
of the Loan Agreement and each other reference contained in the
Loan Agreement and the other Loan Instruments to Exhibit E-1 and
Exhibit E-2, respectively, or to the Assignment Agreement, shall
mean and be deemed to refer to, respectively, Exhibits E-1 and E-2
to this Amendment and to the Assignment Agreement between an
Assigning Bank and its Eligible Assignee, substantially in the form
of Exhibit E-1 annexed to this Amendment with respect to the
Revolving Loan Commitment, and Exhibit E-2 annexed to this
Amendment with respect to the Line of Credit Commitment.
1.3 Exhibit A in the form attached to and made a part of
this Amendment shall be substituted for Exhibit A in the form
originally made part of the Loan Agreement, and the reference in
Section 1.12 of the Loan Agreement and each other reference
contained in the Loan Agreement and the other Loan Instruments to
Exhibit A and to the Atlantic Guaranty Agreement shall mean and be
deemed to refer to, respectively, Exhibit A to this Amendment and
to the absolute, unconditional and joint and several guarantee of
payment by Atlantic of the Obligations, substantially in the form
of Exhibit A to this Amendment.
1.4 Exhibit D in the form attached to and made a part of
this Amendment shall be substituted for Exhibit D in the form
originally made a part of the Loan Agreement, and the reference in
Section 1.26 of the Loan Agreement and each other reference
contained in the Loan Agreement and the other Loan Instruments to
Exhibit D and to the Compliance Certificate shall mean and be
deemed to refer to, respectively, Exhibit D to this Amendment and
to a certificate substantially in the form of Exhibit D attached to
this Amendment delivered by the Borrower to the Agent on behalf of
the Banks pursuant to Section 5.3(c) of the Loan Agreement.
1.5 The Line of Credit Commitment Termination Date, which
prior to the effectiveness of this Article 1 of this Amendment is
October 10, 1997 as provided in Section 1.75 of the Loan Agreement,
is extended to and shall be October 12, 1998.
1.6 Section 1.92 of the Loan Agreement is amended and
restated in its entirety as follows:
1.92. "Pricing Level" means, for any Pricing
Period, Pricing Level I, Pricing Level II, Pricing Level
III, Pricing Level IV or Pricing Level V, as may be in
effect for such Pricing Period; provided that the
Default Rate shall be in effect upon the occurrence and
during the continuation of any Event of Default.
1.7 Section 1.95 of the Loan Agreement is hereby amended and
restated in its entirety as follows:
1.95. "Pricing Level III" means the Pricing Level
that will be in effect for the applicable Pricing Period
if, as of the relevant Date of Determination, the
Leverage Ratio of the Borrower is equal to or greater
than .40 to 1.0 but less than .50 to 1.0.
1.8 New Sections 1.95A and 1.95B are added to the Loan
Agreement immediately following Section 1.95, as follows:
1.95A. "Pricing Level IV" means the Pricing Level
that will be in effect for the applicable Pricing Period
if, as of the relevant Date of Determination, the
Leverage Ratio of the Borrower is equal to or greater
than .50 to 1.0 but less than .60 to 1.0.
1.95B. "Pricing Level V" means the Pricing Level
that will be in effect for the applicable Pricing Period
if, as of the relevant Date of Determination, the
Leverage Ratio of the Borrower is equal to or greater
than .60 to 1.0.
1.9 The first sentence of Section 1.107 of the Loan
Agreement shall be amended and restated in its entirety as follows:
1.107. "Revolver" means the revolving credit
facility established by the Banks pursuant to this Loan
Agreement in favor of the Borrower in the maximum
permitted aggregate principal amount at any one time
outstanding of Fifty-five Million Dollars ($55,000,000),
pursuant to which the Borrower may obtain Revolving
Loans and Letters of Credit during the term of the
Revolver upon the terms and conditions set forth in this
Loan Agreement.
1.10 The Revolving Loan Commitment Termination Date, which
prior to the effectiveness of this Article 1 of this Amendment is
October 11, 1999 as provided in Section 1.109 of the Loan Agree-
ment, is extended to and shall be October 11, 2000.
1.11 Section 1.111 of the Loan Agreement is amended and
restated in its entirety as follows:
1.111. "Revolving Note" means, collectively, the
Amended and Restated Revolving Promissory Notes, all
dated as of October 11, 1997 and made by Borrower to the
order of, respectively, PNC in face principal amount of
$20,625,000, NBD in face principal amount of
$13,750,000, Suntrust in face principal amount of
$13,750,000 and National City in face principal amount
of $6,875,000, in the forms attached to and made a part
of this Loan Agreement as Exhibits L-1, L-2, L-3 and L-
4, respectively, together with all amendments,
modifications, renewals, extensions, restatements and
replacements of each of them, respectively.
1.12 The Swing Line Loan Commitment Termination Date, which
prior to the effectiveness of this Article 1 to the this Amendment
is October 10, 1997 as provided in Section 1.116 of the Loan
Agreement, is extended to and shall be October 12, 1998.
1.13 Exhibit K in the form attached to and made a part of
this Amendment shall be substituted for Exhibit K in the form
originally made a part of the Loan Agreement, each reference in the
Loan Agreement and the other Loan Instruments to Exhibit K or to
the Wabash Guaranty Agreement shall mean and be deemed to refer to,
respectively, Exhibit K to this Amendment and to the Amended and
Restated Guaranty Agreement delivered by Wabash substantially in
the form of Exhibit K to this Agreement, and Section 1.125 of the
Loan Agreement is amended and restated in its entirety as follows:
1.125. "Wabash Guaranty Agreement" means that
certain Amended and Restated Guaranty Agreement required
to be delivered by Wabash in favor of Agent for the
benefit of the Banks in satisfaction of one of the
conditions precedent to the effectiveness of the modifi-
cations to the Loan Agreement provided in the First
Amendment to Amended and Restated Loan Agreement dated
as of October 10, 1997 and, if applicable, any and all
amendments, modifications, renewals, extensions,
restatements and replacements thereof.
1.14 The first sentence of Section 2 of the Loan Agreement,
entitled "Revolver", is amended and restated in its entirety as
follows:
2. Revolver. Subject to the terms and conditions
of this Loan Agreement, the Banks hereby establish the
Revolver in favor of the Borrower in the maximum permit-
xxx aggregate principal amount at any one time outstand-
ing of Fifty-Five Million Dollars ($55,000,000).
1.15 The second sentence of Section 2.1A of the Loan Agree-
ment, entitled "Revolving Loan Commitments", is amended and
restated in its entirety as follows:
The amount of each Bank's Revolving Loan Commitment is
equal to the Pro Rata Share Revolving Loan Commitment
set forth opposite its name on Schedule 2.1 annexed
hereto applied to the maximum permitted aggregate
outstanding principal amount of the Revolving Loan
Commitment in effect from time to time, and the maximum
permitted aggregate outstanding principal amount of the
Revolving Loan Commitments presently is Fifty-Five
Million Dollars ($55,000,000); provided that the amount
of the Revolving Loan Commitments shall be reduced from
time to time by the amount of any reductions thereto
made pursuant to Section 2.4C hereof (it being
understood that all references to the Revolving Loan
Commitments of the Banks set forth in this Loan
Agreement shall mean the initial Revolving Loan
Commitments of the Banks set forth on Schedule 2.1
annexed hereto as reduced by voluntary reductions of the
Revolving Loan Commitments effected by the Borrower
pursuant to Section 2.4C hereof).
1.16 The date "October 11, 2000" is substituted for the date
"October 11, 1999" in the third sentence of Section 2.1B of the
Loan Agreement entitled "Term of Revolving Loan Commitments."
1.17 Pricing Levels I, II and III, and the related Applicable
LIBOR Rate Margins, all as set forth at the end of clause (ii)
contained in Section 2.2A of the Loan Agreement entitled "Rates of
Interest", are deleted and the following Pricing Levels and related
Applicable LIBOR Rate Margins are substituted therefor:
Applicable
Pricing Level LIBOR Rate Margin
Pricing Level I .450%
Pricing Level II .525%
Pricing Level III .575%
Pricing Level IV .625%
Pricing Level V .750%
1.18 The Pricing Levels and related Applicable Revolver
Commitment Fee percentages set forth in Section 2.3A(i), entitled
"Revolver Commitment Fee", are deleted and the following Pricing
Levels and related Applicable Revolving Commitment Fee percentages
are substituted therefor:
Applicable Revolver
Pricing Levels Commitment Fee
Pricing Level I .150%
Pricing Level II .175%
Pricing Level III .200%
Pricing Level IV .225%
Pricing Level V .250%
1.19 Section 2.3A(ii), entitled "Line of Credit Commitment
Fee", is amended and restated in its entirety as follows:
(ii) Line of Credit Commitment Fee. Borrower
agrees to pay to the Agent, for the benefit of the Banks
in proportion to their respective Line of Credit Commit-
ment Fee Pro Rata Shares, commitment fees ("the Line of
Credit Commitment Fees") for the period from and includ-
ing October 11, 1997 to and excluding the Line of Credit
Termination Date, equal to the average of the daily
excess of the Line of Credit Commitments (as reduced
pursuant to section 2.4C hereof) over the aggregate
principal amount of Line of Credit Advances multiplied
by the Applicable Line of Credit Commitment Fee per
annum. The Line of Credit Commitment Fees shall be
calculated on the basis of a 360-day year and the actual
number of days elapsed and shall be payable quarterly in
arrears on the last day of each Fiscal Quarter,
commencing on the first such date to occur after October
11, 1997, and on the Line of Credit Commitment
Termination Date. The Borrower shall have no liability
to any Bank for any Line of Credit Commitment Fees paid
to the Agent which the Agent does not properly remit to
such Bank, and any such Bank's sole remedy in respect
thereof shall be against the Agent. The Applicable Line
of Credit Commitment Fee in effect for the Pricing
Period commencing on the first day of each Fiscal
Quarter and continuing for the term of the Fiscal
Quarter that begins on such first day of the Fiscal
Quarter shall be the Applicable Line of Credit
Commitment Fee corresponding to the Pricing Level in
effect for such period, as applicable:
Applicable Line of Credit
Pricing Level Commitment Fee
Pricing Level I .100%
Pricing Level II .100%
Pricing Level III .100%
Pricing Level IV .125%
Pricing Level V .125%
1.20 The Pricing Levels and related Applicable Letter of
Credit Fee percentages set forth at the end of clause (ii) of
Section 2.7F, entitled "Compensation", are deleted and the
following are substituted therefor:
Applicable
Pricing Level Letter of Credit Fee
Pricing Level I .450%
Pricing Level II .525%
Pricing Level III .575%
Pricing Level IV .625%
Pricing Level V .750%
1.21 The amount "Ten Million Dollars ($10,000,000.00)"
contained in Section 6.5 (iv)(A) is deleted and the amount "Twelve
Million Dollars ($12,000,000.00)" is substituted therefor.
1.22 The amount "Ten Million Dollars ($10,000,000.00)"
contained in Section 6.5(ix)(A) is deleted and the amount "Twelve
Million Dollars ($12,000,000.00)" is substituted therefor.
1.23 Section 6.9 of the Loan Agreement is amended and
restated in its entirety as follows:
6.9. Consolidated Total Debt to Consolidated Total
Capitalization. The Borrower will not permit the ratio
of its Consolidated Total Debt to its Consolidated Total
Capitalization to exceed .60 to 1.0 as at any Fiscal
Quarter end.
1.24 Section 6.10 of the Loan Agreement is amended and
restated in its entirety as follows:
6.10. Consolidated Interest Expense and
Consolidated Rent Expense Coverage Ratio. The Borrower
will not permit, as of each Fiscal Quarter end, the
ratio of (a) its Consolidated Net Income plus
Consolidated Interest Expense, provisions for all taxes
and Consolidated Rent Expense for the four-Fiscal
Quarter period ended on such Fiscal Quarter end, to (b)
the sum of its Consolidated Interest Expense and
Consolidated Rent Expense for the four-Fiscal Quarter
period ended on such Fiscal Quarter end, to be less than
2.0 to 1.0 as at any Fiscal Quarter end.
1.25 The date "September 30, 1997" is substituted for the
date "September 30, 1996" appearing in Section 6.11(ii), the date
"October 11, 1997" is substituted for the date "October 11, 1996"
appearing in Section 6.11(ii), and Section 6.11(i) is amended and
restated in its entirety as follows:
(i) As of September 30, 1997 to be less than
Ninety Million Dollars ($90,000,000); and
1.26 A new Section 6.13 is added to the Loan Agreement
immediately after existing Section 6.12, to read as follows:
6.13. Change in Manner of Conducting Business.
Neither the Borrower nor any Subsidiary will engage in
any business if, as a result, the general nature of the
business, taken on a consolidated basis, which would
then be engaged in by the Borrower and its Subsidiaries
would be substantially changed from the general nature
of the business engaged in by the Borrower and its
Subsidiaries as of September 30, 1997.
1.27 A new Section 10F is added to the Loan Agreement
immediately following existing Section 10E, to read as follows:
10F. Notwithstanding the provisions of Section
10A, no consent of the Borrower shall be required as a
condition to any sale, assignment, transfer or negotia-
tion pursuant to Section 10A if such sale, assignment,
transfer or negotiation occurs following a Potential
Event of Default that has not either been cured in a
manner permitted under this Loan Agreement and the other
Loan Instruments or expressly waived in writing by all
of the Banks or by the Agent with the consent of all of
the Banks. Without limitation of the foregoing or of
Section 10A, Borrower shall not unreasonably withhold
its consent to any sale, assignment, transfer or
negotiation requested by a Bank pursuant to Section 10A
if such request is made with regard to a prospective
assignee contacted by the Agent for the purpose of
facilitating the syndication of the funding for all or
part of the Obligations. Each sale, assignment,
transfer or negotiation by a Bank pursuant to Section
10A, other than a sale, assignment, transfer or
negotiation to an Affiliate of such Bank, shall, at the
sole and exclusive option of the Agent, be conditioned
upon the payment to the Agent by the assigning Bank of a
service fee in the amount of $3,500 as a condition
precedent to such sale, assignment, transfer or
negotiation.
ARTICLE 2
Conditions Precedent
2.1 The modifications to the Loan Agreement described in
Article 1 of this Amendment shall become effective on that date
(the "Effective Date") on which each of the following documents
(collectively, the "Amendment Documents") has been executed by each
of the parties to them and delivered to the Agent, on behalf of the
Banks, and when the Agent determines to its satisfaction that each
other condition set forth below has been fulfilled:
A. This Amendment, duly executed by the Borrower,
Agent and each of the Banks;
B. The Revolving Notes payable by Borrower to the
order of each of the Banks, in the forms of Xxxxxxxx X-0, X-0, X-0
xxx X-0 to this Amendment, duly executed and delivered on behalf of
Borrower;
C. The Wabash Guaranty Agreement in the form of
Exhibit K to this Amendment, duly executed on behalf of Wabash; and
D. Certified Resolutions of the Board of Directors of
the Borrower, authorizing the execution and delivery by Borrower of
this Amendment, each of the Revolving Notes and each of the other
Amendment Documents executed and delivered by the Borrower;
E. Certified Resolutions of the Board of Directors of
Wabash, authorizing the execution and delivery of the Wabash
Guaranty Agreement in the form of Exhibit K to this Amendment;
F. Supplemental written opinions of counsel to the
Borrower and Wabash, respectively, substantially in the form of
Exhibits H-1 and H-2 attached to and made a part of this Amendment;
G. A copy of an amendment, as executed and delivered
by the Borrower and each of the Note Purchasers, to the Note
Purchase Agreement, modifying certain financial covenants contained
in the Note Purchase Agreement to the satisfaction of the Banks and
otherwise in form and substance satisfactory to the Banks; and
H. Borrower shall have delivered to Agent a certain
letter agreement in the form requested by Agent from Borrower
confirming Borrower's agreement to pay the fees to the Agent
described therein.
ARTICLE 3
Other Stipulations
3.1 Upon the Effective Date, the provisions of and Exhibits
referenced in Article 1 of this Amendment shall become effective
and modify or supersede and replace, as applicable, the applicable
provisions and Exhibits of the Loan Agreement recited as being
modified by them and, without limitation of the foregoing, the
Revolving Notes and the Wabash Guaranty Agreement delivered as part
of the Amendment Documents described in Article 2 of this Amendment
shall supersede and replace the Revolving Notes and the Wabash
Guaranty Agreement as in effect immediately prior to the Effective
Date. From and after the Effective Date each reference to the
"Loan Agreement" or words of like import shall mean and be deemed a
reference to the Loan Agreement as modified by this Amendment but,
except as modified by this Amendment and the other Amendment
Documents, the Loan Agreement and the other Loan Instruments shall
remain in full force and effect in the same form as existed
immediately prior to the Effective Date.
3.2 If each of the Amendment Documents has not been fully
executed and delivered to the Agent on or before October 10, 1997,
this Amendment shall be voidable at any time prior to the delivery
of each of such Amendment Documents upon notice given by Borrower
to the Banks or by notice given by the Agent, acting at the
direction of the Requisite Banks, to the Borrower.
3.3 This Amendment and the other Amendment Documents contain
the final, complete and exclusive agreement of the parties to them
with regard to their subject matter, may not be amended except in
writing signed by each of the parties to them, shall be binding
upon and inure to the benefit of the respective successors and
assigns of each of the parties to them (subject to applicable
provisions of the Loan Agreement), and shall be construed in
accordance with and otherwise governed in all respects by the laws
of the Commonwealth of Kentucky. This Amendment may be executed in
counterparts, and all counterparts collectively shall constitute
but one original document. Borrower hereby agrees to reimburse the
Agent for all costs and expenses incurred by the Agent in connec-
tion with the preparation, negotiation, documentation, execution
and delivery of this Amendment and the other Amendment Documents,
including but not limited to the reasonable fees of legal counsel
to Agent.
IN WITNESS WHEREOF, the parties hereto have caused this
Loan Agreement to be duly executed as of the day and year first
above written.
(the "Borrower")
STEEL TECHNOLOGIES INC.
By:/s/ Xxxxxxx X. Bates________
(signature)
Name: Xxxxxxx X. Bates________
(type or print)
Title:_Chief Financial Officer_
(type or print)
("PNC")
PNC BANK, KENTUCKY, INC.
By:__/s/ Xxxxx Phillips__
(signature)
Name:__Ralph Phillips__
(type or print)
Title:_Vice President__
(type or print)
Address: PNC Bank, Kentucky, Inc.
Citizens Plaza
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
("National City")
NATIONAL CITY BANK OF KENTUCKY
By:_/s/ Xxxxx Scott__
(signature)
Name:___Deroy Scott_
(type or print)
Title:__Vice President
(type or print)
Address: 000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxx
Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
("NBD")
NBD BANK, N.A.
By:__/s/ Xxxxxxx X. Stephens__
(signature)
Name:____Randall K. Stephens_
(type or print)
Title:___First Vice President
(type or print)
Address: Xxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
("SunTrust")
SUNTRUST BANK, NASHVILLE, N.A.
By:_/s/ Xxxxxxx X. Howard_
(signature)
Name:___Jeffery L. Howard_
(type or print)
Title:__Senior Vice President
(type or print)
Address: 000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Senior Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(collectively, the "Banks")
(the "Agent")
PNC BANK, KENTUCKY, INC., in its
capacity as Agent
By:/s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
Vice President
