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EXHIBIT 4(d)
AMENDMENT NO. 3
TO
LOAN AND SECURITY AGREEMENT
DATED AS OF SEPTEMBER 7, 1994
AMENDED AND RESTATED
AS OF AUGUST 20, 1997
THIS AMENDMENT NO. 3 dated as of August 11, 1998 (this
"Amendment") is entered into among BANKAMERICA BUSINESS CREDIT, INC., a Delaware
corporation ("BABC"), BNY FINANCIAL CORPORATION, a New York corporation ("BNY")
formerly known as The Bank of New York Commercial Corporation, NATIONSBANK,
N.A., a national banking association ("NB") (BABC, BNY and NB and their
respective successors and assigns being sometimes hereinafter referred to
collectively as the "Lenders" and each of BABC, BNY and NB and its successors
and assigns being sometimes hereinafter referred to individually as a "Lender"),
BANKAMERICA BUSINESS CREDIT, INC., a Delaware corporation, as agent for the
Lenders (in such capacity as agent, the "Agent"), LACLEDE STEEL COMPANY, a
Delaware corporation (the "Parent"), LACLEDE CHAIN MANUFACTURING COMPANY, a
Delaware corporation ("Laclede Chain"), and LACLEDE MID AMERICA INC., an Indiana
corporation ("Laclede Mid America") (the Parent, Laclede Chain and Laclede Mid
America being sometimes hereinafter referred to collectively as the "Borrowers"
and each of the Parent, Laclede Chain and Laclede Mid America being sometimes
hereinafter referred to individually as a "Borrower").
W I T N E S S E T H:
WHEREAS, the Borrowers, the Lenders and the Agent are parties
to a certain Loan and Security Agreement dated as of September 7, 1994, amended
and restated as of August 20, 1997 and amended by that certain Amendment No. 1
dated as of December 30, 1997 and that certain Amendment No. 2 dated as of March
27, 1998 (the "Loan Agreement," capitalized terms used herein without definition
having the meanings given such terms in the Loan Agreement); and
WHEREAS, the Borrowers, the Lenders and the Agent have agreed
to amend the Loan Agreement on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth
above, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrowers, the Lenders and the
Agent hereby agree as follows:
Section 1. Amendment of the Loan Agreement. Subject to the
fulfillment of the conditions precedent set forth in Section 3 below, the Loan
Agreement is amended as follows:
(a) The definition of "Individual Maximum Revolver Amount" in
Section 1.2 is amended to delete the amount "$55,000,000" in clauses (1)(a)(ii),
(2)(a)(ii), and (3)(a)(ii), and to substitute therefor "the Inventory Sublimit
Amount".
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(b) The definition of "Maximum Revolver Amount" in Section 1.2
is amended to delete the amount "$55,000,000" in clause (a)(ii), and to
substitute therefor "the Inventory Sublimit Amount".
(c) The definition of "Revolver Facility" in Section 1.2 is
amended to delete the amount "$100,000,000" and to substitute therefor
"$85,000,000".
(d) Section 1.2 is further amended to add the following
definition:
"Inventory Sublimit Amount" means the amount set forth below
for the period indicated:
Period Amount
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Restructuring Date - August 30, 1998 $55,000,000
August 31, 1998 - September 29, 1998 $51,000,000
September 30, 1998 - October 30, 1998 $50,000,000
October 31, 1998 - November 29, 1998 $49,000,000
November 30, 1998 - December 30, 1998 $48,000,000
December 31, 1998 and thereafter $47,000,000
(e) Section 2.1 is amended to delete the amount "$100,000,000"
in the second line thereof and to substitute therefor "$85,000,000".
(f) Article 7 is amended to add the following Section 7.30:
7.30 Year 2000 Compliance. On the basis of a comprehensive
review and assessment undertaken by the Borrowers of their respective computer
applications and inquiry made of their material suppliers, vendors and
customers, the Borrowers reasonably believe that the "Year 2000 problem" (that
is, the risk that computer applications used by any person may be unable to
recognize and perform properly certain date-sensitive functions involving dates
prior to and any date after December 31, 1999) will not result in a material
adverse change in any of the operations, business, properties or condition
(financial or otherwise) of the Borrowers. The Borrowers have developed adequate
contingency plans to ensure uninterrupted and unimpaired business operations in
the event of a failure of their own or a third party's systems or equipment due
to the Year 2000 problem, including those of suppliers, vendors and customers,
as well as a general failure of or interruption in their communications and
delivery infrastructure.
(g) Section 8.13 is amended to add the following clause (i)
thereto:
"; and (i) deferred payment notes in a principal amount not to exceed
$25,000,000, which amount represents trade payables and other account payable
that the Borrowers failed pay on their originally scheduled payment dates or in
accordance with trade practices".
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(h) Article 8 is amended to add the following Section 8.29:
8.29 Pre-Tax Losses. The Borrowers shall not permit their
consolidated, cumulative pre-tax losses, determined in each case for the period
beginning July 1, 1998, as at the end of each period listed below, to exceed the
amount set forth opposite such period:
Period Amount
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July 1, 1998 - July 31, 1998 $1,500,000
July 1, 1998 - August 31, 1998 $1,900,000
July 1, 1998 - September 30, 1998 $1,800,000
July 1, 1998 - October 31, 1998 $1,800,000
July 1, 1998 - November 30, 1998 $1,800,000
July 1, 1998 - December 31, 1998 $1,900,000
Section 2. Amendment Fee; Waivers.
(a) The Borrowers agree, on a joint and several basis, to pay the
Agent, for the ratable account of the Lenders, a fee (the "Amendment Fee") in
the amount of $100,000, which Amendment Fee shall be fully earned by the Lenders
on the date of this Amendment and payable upon the first occurrence of an Event
of Default following the effectiveness of this Amendment. The Agent, the Lenders
and the Borrowers agree that the Amendment Fee shall be financed by the Lenders
as Revolving Loans.
(b) Subject to the fulfillment of the conditions precedent set forth
in Section 3 below, the Lenders and the Agent hereby waive the Events of Default
arising from the Borrowers' failure pursuant to Sections 8.24 and 8.25 to (i)
have a Consolidated Fixed Charge Coverage Ratio, in accordance with Section 8.24
as of June 30, 1998 of not less than 0.55 to 1.00, and (ii) have a Consolidated
Adjusted Net Worth, in accordance with Section 8.25, as of June 30, 1998, of not
less than $26,000,000. In addition, compliance by the Borrowers with (i) the
Consolidated Fixed Charge Coverage Ratio of Section 8.24 solely for the periods
January 1, 1998 through September 30, 1998 and January 1, 1998 through December
31, 1998, and (ii) the Consolidated Adjusted Net Worth covenant of Section 8.25
solely for the quarter ending dates September 30, 1998 and December 31, 1998, is
hereby waived. Such waivers shall not permit the Borrowers to qualify for any
Margin reductions set forth in Section 2 of Amendment No. 2 to the Loan
Agreement without complying with the conditions set forth in such Section 2.
Section 3. Conditions to Amendment. This Amendment shall become
effective upon the receipt by the Agent by facsimile transmission of a
counterpart of this Amendment executed by each Borrower and each Lender, and
execution of this Amendment by the Agent (provided, that each Borrower and each
Lenders shall promptly execute six applicable signature pages hereof and deliver
such pages to the Agent).
Section 4. Representations and Warranties. Each Borrower hereby
represents and
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warrants that (i) this Amendment constitutes a legal, valid and binding
obligation of such Borrower, enforceable against such Borrower in accordance
with its terms, (ii) the representations and warranties contained in the Loan
Agreement are correct in all material respects as though made on and as of the
date of this Amendment, and (iii) no Event of Default has occurred and is
continuing.
Section 5. Reference to and Effect on the Loan Agreement.
(a) Upon the effectiveness of this Amendment, each reference
in the Loan Agreement to "this Agreement", "hereunder", "hereof", "herein", or
words of like import shall mean and be a reference to the Loan Agreement, as
amended hereby, and each reference to the Loan Agreement in any other document,
instrument or agreement executed and/or delivered in connection with the Loan
Agreement shall mean and be a reference to the Loan Agreement, as amended
hereby.
(b) Except as specifically amended above, the Loan Agreement
and all other documents, instruments and agreements executed and/or delivered in
connection therewith shall remain in full force and effect and are hereby
ratified and confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of any right, power or remedy of the
Agent or the Lenders under the Loan Agreement, nor constitute a waiver of any
provision of the Loan Agreement, except as specifically set forth herein.
Section 6. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same instrument.
Section 7. Governing Law. This Amendment shall be governed by
and construed in accordance with the internal laws (as opposed to the conflicts
of laws provisions) of the State of Illinois.
Section 8. Legal Fees. The Borrowers agree to pay to the
Agent, for its benefit, on demand, all costs and expenses that the Agent pays or
incurs in connection with the negotiation, preparation, consummation,
administration, enforcement and termination of this Amendment, including,
without limitation, the allocated costs of the Agent's in-house counsel fees.
Section 9. Section Titles. The section titles contained in
this Amendment are and shall be without substance, meaning or content of any
kind whatsoever and are not a part of the agreement between the parties hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered as of August 11, 1998.
LACLEDE STEEL COMPANY
By: /s/ ▇. ▇. ▇▇▇▇
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Vice President
LACLEDE CHAIN MANUFACTURING COMPANY
By: /s/ ▇. ▇. ▇▇▇▇
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Vice President
LACLEDE MID AMERICA INC.
By: /s/ ▇. ▇. ▇▇▇▇
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Vice President
BANKAMERICA BUSINESS CREDIT, INC., as
the Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Vice President
BANKAMERICA BUSINESS CREDIT, INC., as a
Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Vice President
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BNY FINANCIAL CORPORATION, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Vice President
NATIONSBANK, N.A., as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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Vice President
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