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EXHIBIT 10.8
ACME GROUP
FIFTH AMENDMENT TO CREDIT AGREEMENT
▇▇▇▇▇▇ Trust and Savings Bank National City Bank
Chicago, Illinois Cleveland, Ohio
NBD Bank General Electric Capital Corporation
Chicago, Illinois Chicago, Illinois
Mercantile Bank National Association
St. Louis, Missouri
Ladies and Gentlemen:
Reference is hereby made to that certain Credit Agreement dated as of
August 11, 1994 between the undersigned, Acme Steel Company, a Delaware
corporation ("Acme Steel"), Acme Packaging Corporation, a Delaware corporation
("Acme Packaging"), Alpha Tube Corporation, a Delaware corporation ("Alpha
Tube"), and Universal Tool & Stamping Company, Inc., an Indiana corporation
("Universal Tool") (Acme Steel, Acme Packaging, Alpha Tube and Universal Tool
are being hereinafter referred to collectively as the "Borrowers" and
individually as a "Borrower") and you (the "Lenders") as amended by that
certain First Amendment to Credit Agreement dated as of May 21, 1995, that
certain Second Amendment to Credit Agreement effective as of August 8, 1995,
that certain Third Amendment to Credit Agreement dated as of April 5, 1996 and
that certain Fourth Amendment to Credit Agreement dated as of April 30, 1997
(said Credit Agreement as so amended being referred to herein as the "Credit
Agreement"). All capitalized terms used herein without definition shall have
the same meanings herein as such terms have in the Credit Agreement.
The Borrowers have requested that the Lenders amend various provisions
of the Credit Agreement, and the Lenders are willing to do so under the terms
and conditions set forth in this amendment.
SECTION 1. AMENDMENTS.
Upon the satisfaction of the conditions precedent set forth in Section
2 hereof, the Credit Agreement shall be and hereby is amended (effective as of
September 27, 1997) as follows:
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(a) Section 1.1 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
"Section 1.1. Revolving Credit. Subject to all of the terms
and conditions hereof, each Lender, by its acceptance hereof,
severally agrees to extend a Revolving Credit to the Borrowers
in the amount of its commitment to extend the Revolving Credit
set forth on the applicable signature page hereof (its
"Commitment" and cumulatively for all the Lenders, the
"Commitments") (subject to any reductions thereof pursuant to
the terms hereof) prior to the Termination Date. Such
Revolving Credit may be availed of by each Borrower in its
discretion from time to time, be repaid and used again, during
the period from the date hereof to and including the
Termination Date. The Revolving Credit, subject to all of the
terms and conditions hereof, may be utilized by any one or
more of the Borrowers in the form of Revolving Loans, Swing
Line Loans and Letters of Credit, all as more fully
hereinafter set forth; provided, however, that the aggregate
amount of the Revolving Loans, the Swing Line Loans and the
L/C Obligations outstanding at any one time from all the
Borrowers taken together shall not at any time exceed the
lesser of the Commitments then in effect or the Available
Borrowing Base as then determined and computed for all the
Borrowers; provided further, however, that the aggregate
amount outstanding at any time on Revolving Loans and Swing
Line Loans made to each Borrower, and L/C Obligations in
respect of Letters of Credit issued for such Borrower's sole
or joint account, shall not exceed such Borrower's Available
Borrowing Base as then determined and computed. For all
purposes of this Agreement and except as otherwise set forth
in Section 3.1 hereof, where a determination of the unused or
available amount of the Commitments is necessary, the
Revolving Loans, the Swing Line Loans and the L/C Obligations
shall all be deemed to utilize the Commitments. The
obligations of the Lenders hereunder are several and not joint
and no Lender shall under any circumstances be obligated to
extend credit hereunder in excess of its Commitment."
(b) Section 1 of the Credit Agreement shall be amended by
inserting the following new Section 1.2-A immediately after Section
1.2 thereof:
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"Section 1.2-A. The Swing Line.
(a) Swing Line Loans. Subject to all of the
terms and conditions hereof, ▇▇▇▇▇▇ Trust and Savings Bank
("▇▇▇▇▇▇ Bank") agrees to make loans ("Swing Line Loans") to
each Borrower under a swing line of credit ("Swing Line");
provided, however, that the aggregate amount of Swing Line
Loans at any time outstanding to all Borrowers taken together
shall not exceed the Swing Line Commitment; provided further,
however, that the aggregate amount of the Revolving Loans, the
Swing Line Loans and the L/C Obligations outstanding at any
one time from all the Borrowers taken together shall not at
any time exceed the lesser of the Commitments then in effect
or the Available Borrowing Base as then determined and
computed for all the Borrowers; provided still further,
however, that the aggregate amount outstanding at any time on
Revolving Loans and Swing Line Loans made to each Borrower,
and L/C Obligations in respect of Letters of Credit issued for
such Borrower's sole or joint account, shall not exceed such
Borrower's Available Borrowing Base as then determined and
computed. The Swing Line Commitment shall be available to the
Borrowers and may be availed of by each Borrower from time to
time and borrowings thereunder may be repaid and used again
during the period ending on the Termination Date. Without
regard to the face principal amount of the Swing Line Note,
the actual principal amount at any time outstanding and owing
by the Borrowers on account of the Swing Line Note on any date
during the period ending on the Termination Date shall be the
sum of all Swing Line Loans then or theretofor made thereon
through such date less all payments actually received thereon
through such date. Each Swing Line Loan shall be due and
payable on the last day of the Interest Period selected
therefor.
(b) Minimum Borrowing Amount. Each Swing Line
Loan shall be in an amount not less than $250,000.
(c) Interest on Swing Line Loans. Each Swing
Line Loan shall bear interest (computed on the basis of a year
of 360 days and actual days elapsed) for the Interest Period
selected by the Company (which is acting on behalf of the
Borrowers pursuant to Section 1.5 hereof) therefor at the
Domestic Rate or at ▇▇▇▇▇▇
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Bank's Quoted Rate for such Interest Period, provided that if
any Swing Line Loan is not paid when due (whether by lapse of
time, acceleration or otherwise) such Swing Line Loan shall
bear interest whether before or after judgment, until payment
in full thereof through the end of the Interest Period then
applicable thereto at the rate per annum determined by adding
2% to the Domestic Rate. Interest on each Swing Line Loan
shall be due and payable on the last day of each Interest
Period applicable thereto, and interest after maturity
(whether by lapse of time, acceleration or otherwise) shall be
due and payable upon demand.
(d) Requests for Swing Line Loans. The Company
(which is acting on behalf of the Borrowers pursuant to
Section 1.5 hereof) shall give ▇▇▇▇▇▇ Bank prior notice (which
may be written or oral) no later than 12:00 Noon (Chicago
time) on the date upon which any Swing Line Loan is to be
made, specifying in each case the Borrower to which the
proceeds of such Loan are to be made, the amount and date of
such Swing Line Loan and the Interest Period selected
therefor. Within thirty (30) minutes after receiving such
notice, ▇▇▇▇▇▇ Bank shall quote an interest rate determined in
its discretion to the Company at which ▇▇▇▇▇▇ Bank would be
willing to make such Swing Line Loan available to the relevant
Borrower for such Interest Period (the rate so quoted for a
given Interest Period being herein referred to as "▇▇▇▇▇▇
Bank's Quoted Rate"). The Borrowers acknowledge and agree
that ▇▇▇▇▇▇ Bank's Quoted Rate is given to the Company for
immediate and irrevocable acceptance, and if the Company does
not so immediately accept ▇▇▇▇▇▇ Bank's Quoted Rate for the
full amount requested by the Company for such Swing Line Loan,
▇▇▇▇▇▇ Bank's Quoted Rate shall be deemed immediately
withdrawn and such Swing Line Loan shall be made at the
Domestic Rate. Subject to all of the terms and conditions
hereof, the proceeds of such Swing Line Loan shall be made
available to the relevant Borrower on the date so requested at
the offices of the Agent in Chicago, Illinois. Anything
contained in the foregoing to the contrary notwithstanding (i)
the obligation of ▇▇▇▇▇▇ Bank to make Swing Line Loans shall
be subject to all of the terms and conditions of this
Agreement and (ii) ▇▇▇▇▇▇ Bank shall not be obligated to make
more than one Swing Line Loan during any one day.
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(e) Refunding Loans. In its sole and absolute
discretion, ▇▇▇▇▇▇ Bank may at any time, on behalf of the
Borrowers (which hereby irrevocably authorize ▇▇▇▇▇▇ Bank to
act on their behalf for such purpose), request each Lender to
make a Borrowing of Revolving Loans in an amount equal to such
Lender's pro rata share of the amount of the Swing Line Loans
outstanding on the date such notice is given. Borrowings of
Revolving Loans under this Section 1.2-A(e) shall initially
bear interest at the Domestic Rate unless timely notice is
given pursuant to Section 2.4 hereof. Unless any of the
conditions of Section 6 are not fulfilled on such date, each
Lender shall make its requested Revolving Loan available to
▇▇▇▇▇▇ Bank, in immediately available funds, at the principal
office of ▇▇▇▇▇▇ Bank in Chicago, Illinois, before 11:00 a.m.
(Chicago time) on the Business Day following the day such
notice is given. The proceeds of such Revolving Loans shall
be immediately applied to repay the outstanding Swing Line
Loans.
(f) Participations. If any Lender refuses or
otherwise fails to make a Revolving Loan when requested by
▇▇▇▇▇▇ Bank pursuant to Section 1.2-A(e) above (because the
conditions in Section 6 are not satisfied or otherwise), such
Lender will, by the time and in the manner such Revolving Loan
was to have been funded to ▇▇▇▇▇▇ Bank, purchase from ▇▇▇▇▇▇
Bank an undivided participating interest in the outstanding
Swing Line Loans in an amount equal to its pro rata share of
the aggregate principal amount of Swing Line Loans that were
to have been repaid with such Revolving Loans. Each Lender
that so purchases a participation in a Swing Line Loan shall
thereafter be entitled to receive its pro rata share of each
payment of principal received on the Swing Line Loan and of
interest received thereon accruing from the date such Lender
funded to ▇▇▇▇▇▇ Bank its participation in such Loan. The
obligation of the Lenders to ▇▇▇▇▇▇ Bank shall be absolute and
unconditional and shall not be affected or impaired by any
Default or Event of Default which may then be continuing
hereunder."
(c) The first sentence of Section 1.3(a) of the Credit
Agreement shall be amended and as so amended shall be restated in its
entirety to read as follows:
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"Subject to the terms and conditions hereof, as part of the
Revolving Credit, the Agent shall issue standby or commercial
letters of credit (each a "Letter of Credit") for the account
of any one or more of the Borrowers in U.S. Dollars in an
aggregate undrawn face amount up to the amount of the L/C
Commitment; provided, however, that the aggregate L/C
Obligations at any time outstanding shall not exceed the
difference between the Commitments in effect at such time and
the aggregate principal amount of Revolving Credit Loans and
Swing Line Loans then outstanding; provided further, however,
that the aggregate amount outstanding at any time on Revolving
Loans and Swing Line Loans made to each Borrower, and L/C
Obligations in respect of Letters of Credit issued for such
Borrower's account, shall not exceed such Borrower's Available
Borrowing Base as then determined and computed."
(d) The heading for Section 2 of the Credit Agreement
shall be amended and as so amended shall be restated in its entirety
to read as follows: SECTION 2. INTEREST ON REVOLVING CREDIT NOTES."
(e) Section 3.1 of the Credit Agreement shall be amended
by deleting the phrase "1/2 of 1% per annum" appearing therein and
substituting therefor the phrase "3/8 of 1% per annum". Section 3.1
of the Credit Agreement shall be further amended by inserting the
following new sentence immediately at the end thereof:
"Solely for purposes of this Section 3.1 and determining each
Lender's pro rata share of the commitment fee, outstanding
Swing Line Loans shall be deemed to utilize ▇▇▇▇▇▇ Bank's
Commitment so that the unused portion of each other Lender's
Commitment remains the same whether or not Swing Line Loans
are outstanding."
(f) Section 3.5 of the Credit Agreement shall be amended
by inserting the following new sentence immediately at the end
thereof:
"The Borrowers may voluntarily prepay any Swing Line Loan
bearing interest at the Domestic Rate before its maturity at
any time upon notice to the Agent prior to 2:00 p.m. (Chicago
time) on the date fixed for prepayment, each such prepayment
to be made by the payment of the principal amount to be
prepaid and accrued
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interest thereon to the date of prepayment; however, the
Borrowers may not voluntarily prepay any Swing Line Loan
bearing interest at ▇▇▇▇▇▇ Bank's Quoted Rate before its
maturity."
(g) Section 3.6 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
"Section 3.6. Mandatory Prepayment upon Borrowing Base
Deficiency. In the event that the aggregate amount
outstanding on the Revolving Loans and Swing Line Loans to a
Borrower, and the L/C Obligations in respect of Letters of
Credit issued for such Borrower's sole or joint account, shall
at any time and for any reason exceed such Borrower's
Available Borrowing Base as then determined and computed, the
Borrowers shall immediately and without notice or demand pay
over the amount of the excess to the Agent to be applied as a
mandatory prepayment on the Revolving Credit Notes until such
Revolving Loans have been prepaid in full, then applied to the
Swing Line Loans until payment in full thereof and if L /C
Obligations are outstanding, then and in any such event, such
remainder shall be paid over to the Agent to be applied
against, or held as collateral security for, as applicable,
such L/C Obligations. Each such repayment shall be
accompanied by accrued interest on the amount prepaid to the
date of such prepayment together with any amount due the
Lenders under Section 2.8 hereof."
(h) Section 3.7 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
"Section 3.7. Voluntary Terminations. The Borrowers shall
have the privilege upon notice from the Company (which need
not be joined in by any Borrower) to the Agent (which shall
promptly notify the Lenders) received on or before 10:00 a.m.
Chicago time at least five Business Days before the
Termination Date to ratably terminate the Commitments in whole
or in part (but if in part then in the amount of $5,000,000 or
such greater amount which is an integral multiple of
$500,000). All partial terminations of the Commitments
hereunder shall automatically reduce the L/C Commitment and
the Swing Line Commitment, in each case as from time to time
in effect hereunder, by the same percentage as
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the percentage termination in the Commitments. Not later than
the termination date stated in such notice, there shall be
made such payments to the Agent as may be necessary to reduce
the sum of the aggregate outstanding principal amount of the
Revolving Loans, Swing Line Loans and L/C Obligations to the
amount to which the Commitments have been reduced, together
with (x) any amount due the Lenders under Section 2.8 hereof
and (y) in the case of a termination in whole, all interest,
fees and other amounts due on the Obligations. The foregoing
to the contrary notwithstanding, (i) no termination of the
Revolving Credit may be effected hereunder if as a result
thereof the outstanding aggregate amount of Letters of Credit
would exceed the L/C Commitment as reduced by such
termination, (ii) no termination of the Revolving Credit may
be effected hereunder if as a result thereof the outstanding
aggregate amount of Swing Line Loans would exceed the Swing
Line Commitment as reduced by such termination and (iii) the
Commitments may not be terminated below $100,000 except
concurrently with their termination in whole. No termination
of the Commitments may be reinstated."
(i) Sections 5.2 and 5.5 of the Credit Agreement shall be
amended by deleting the phrases "Revolving Credit" and "(when
issued)" wherever appearing therein.
(j) Section 6.1 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
"Section 6.1. All Advances. The obligation of the Lenders
to make any Loan or other financial accommodation to a
Borrower hereunder (including the first such accommodation)
shall also be subject to the conditions precedent that as of
the time of the making of each such Loan or other
accommodation hereunder:
(a) each of the representations and
warranties set forth herein and in the other Loan
Documents shall be and remain true and correct as of
said time, except to the extent the same expressly
relate to an earlier date;
(b) the Acme Group shall be in
compliance with all of the terms and conditions
hereof and of the other Loan
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Documents, and no Default or Event of Default shall
have occurred and be continuing;
(c) after giving effect to such
extension of credit to the relevant Borrower, (i) the
aggregate principal amount of all Revolving Loans,
Swing Line Loans and L/C Obligations shall not exceed
the lesser of (x) the Commitments then in effect and
(y) the Available Borrowing Base of all the Borrowers
as then determined and computed and (ii) the
aggregate principal amount of the Revolving Loans and
Swing Line Loans made to such Borrower and the L/C
Obligations in respect of Letters of Credit issued
for such Borrower's account shall not exceed such
Borrower's Available Borrowing Base as then
determined and computed;
(d) such extension of credit shall not
violate any order, judgment or decree of any court or
other authority or any provision of law or regulation
applicable to the Agent or any Lender (including,
without limitation, Regulation U of the Board of
Governors of the Federal Reserve System) as then in
effect; and
(e) in the case of the issuance of any
Letter of Credit, the Agent shall have received a
properly completed Application therefor and, in the
case of an extension or increase in the amount of the
Letter of Credit, the Agent shall have received a
written request therefor, in a form acceptable to the
Agent, with such Application or written request, in
each case to be accompanied by the fees required by
this Agreement.
Any request made by the Acme Group to the Agent for credit
hereunder shall be deemed to constitute a representation and
warranty that the foregoing statements are true and correct."
(k) Section 7.7 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
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"Section 7.7. Consolidated Tangible Net Worth. The Acme
Group will at all times maintain a Consolidated Tangible Net
Worth of not less than (a) $210,000,000 during the period from
September 28, 1997 through September 27, 1998, (b)
$220,000,000 during the period from September 28, 1998 through
March 27, 1999 and (c) $230,000,000 on March 28, 1999 and at
all times thereafter."
(l) Section 7.8 of the Credit Agreement shall be amended
and as so amended shall be restated in its entirety to read as
follows:
"Section 7.8. Leverage. For the period from and including
September 29, 1997 through and including June 28, 1998, the
Acme Group will at all times maintain a Consolidated Leverage
Ratio of not more than 0.70 to 1.0; provided, however, that as
of the last day of each fiscal quarter ending during such
period, the Acme Group will maintain a Consolidated Leverage
Ratio of not more than 0.65 to 1.0. On June 29, 1998 and at
all times thereafter, the Acme Group will at all times
maintain a Consolidated Leverage Ratio of not more than 0.65
to 1.0."
(m) Section 7.11(d) of the Credit Agreement shall be
amended and as so amended shall be restated in its entirety to read as
follows:
"(d) indebtedness not otherwise permitted by this Section
aggregating not more than $30,000,000 at any one time
outstanding."
(n) Section 7.12(i) of the Credit Agreement shall be
amended and as so amended shall be restated in its entirety to read as
follows:
"(i) loans and advances by (A) Subsidiaries to the Company of
their surplus cash which are repayable on demand and advanced
to the Company as part of the centralized cash management
system of the Acme Group in the ordinary course of its
business as presently conducted, the proceeds of which are
used by the Company to make Permitted Investments for the
benefit of such lending Subsidiary and (B) any Borrower to any
other Borrower so long as such loans and advances are
evidenced by a note which is pledged to the Agent for the
benefit of the Lenders;"
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(o) Section 7.13(b) of the Credit Agreement shall be
amended by inserting the following new sentence immediately at the end
thereof:
"The parties hereto further acknowledge and agree that this
subsection (b) shall in no event apply to nor operate to
prevent any Borrower's repayment of loans and advances made by
another Borrower to it to the extent such loans and advances
are permitted by Section 7.12(i)(B) hereof."
(p) Section 8.1(a) of the Credit Agreement shall be
amended and as so amended shall be restated in its entirety to read as
follows:
"(a) default for a period of five days in the payment when
due of all or any part of the principal of or interest on any
Note (whether at the stated maturity thereof or at any other
time provided for in this Agreement) or of any Reimbursement
Obligation or of any fee or other amount payable hereunder or
under any other Loan Document;"
(q) Sections 8.2 and 8.3 of the Credit Agreement shall be
amended by deleting the phrase "Revolving Credit" wherever appearing
therein.
(r) The definition of the term "Consolidated Cash Flow
Coverage Ratio" appearing in Section 9.1 of the Credit Agreement shall
be amended by deleting the percentage "30%" appearing therein and
substituting therefor the percentage "20%".
(s) The definition of the term "Domestic Rate Margin"
appearing in Section 9.1 of the Credit Agreement shall be amended and
as so amended shall be restated in its entirety to read as follows:
""Domestic Rate Margin" means 0%."
(t) The definition of the term "Interest Period"
appearing in Section 9.1 of the Credit Agreement shall be amended and
as so amended shall be restated in its entirety to read as follows:
""Interest Period" shall mean (i) with respect to any Swing
Line Loan, the period commencing on the date such Swing Line
Loan is made and ending 1-7 days thereafter as selected by the
Company in
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its notice as provided herein and (ii) with respect to any
LIBOR Portion:
(a) initially, the period commencing on,
as the case may be, the creation or conversion date
with respect to such LIBOR Portion and ending one,
two, three or six months thereafter as selected by
the Company in its notice as provided herein; and
(b) thereafter, each period commencing
on the last day of the next preceding Interest Period
applicable to such LIBOR Portion and ending one, two,
three or six months thereafter as selected by the
Company in its notice as provided herein;
provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(i) if any Interest Period would
otherwise end on a day which is not a Business Day,
that Interest Period shall be extended to the next
succeeding Business Day, unless the result of such
extension would be to carry such Interest Period into
another calendar month in which event such Interest
Period shall end on the immediately preceding
Business Day;
(ii) no Interest Period may extend beyond
the final maturity date of the relevant Notes; and
(iii) the interest rate to be applicable
to each Portion for each Interest Period shall apply
from and including the first day of such Interest
Period to but excluding the last day thereof.
For purposes of determining an Interest Period, a month means
a period starting on one day in a calendar month and ending on
a numerically corresponding day in the next calendar month,
provided, however, if there is no numerically corresponding
day in the month in which an Interest Period is to end, then
such Interest Period shall end on the last Business Day of
such month."
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(u) The definition of the term "LIBOR Margin" appearing
in Section 9.1 of the Credit Agreement shall be amended and as so
amended shall be restated in its entirety to read as follows:
""LIBOR Margin" shall mean initially mean 2.00%; provided,
however, that such LIBOR Margin shall be subject to quarterly
adjustment as follows:
If the Consolidated Leverage Ratio as of LIBOR Margin
the close of any fiscal quarter is: shall be:
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Greater than or equal to 60% 2.00%
Greater than or equal to 50% but less
than 60% 1.85%
Greater than or equal to 40% but less
than 50% 1.60%
Less than 40% 1.35%
On the date that is ten (10) days after the date on which the
Acme Group delivers to the Lenders the quarterly financial
statements pursuant to Sections 7.5(a)(ii) hereof for a given
fiscal quarter (commencing with the fiscal quarter ending
September 28, 1997) and the compliance certificate required
for such period pursuant to Section 7.5 hereof, the Agent
shall determine whether such financial information indicates
such a change in the Consolidated Leverage Ratio (the
Consolidated Leverage Ratio to be computed as of the close of
such fiscal quarter (such date that is ten days after the date
on which the Acme Group delivers such compliance certificate
being hereinafter referred to as a "Test Date")) as would
justify a change in the LIBOR Margin and shall then notify the
Acme Group and the Lenders of such determination and of any
change in the LIBOR Margin resulting therefrom. Any change in
the LIBOR Margin shall be effective as of the related Test
Date and with such new LIBOR Margin to continue in effect
until the effectiveness of the next redetermination thereof.
Any determination by the Agent of the Consolidated Leverage
Ratio shall be conclusive and binding upon the Acme Group
provided
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that it has been made reasonably and in good faith. Anything
contained herein to the contrary notwithstanding, the LIBOR
Margin shall be the highest Margin set forth herein during the
continuance of: (x) any Event of Default, (y) any Default
(whether or not any grace period applicable thereto has
passed) in the payment of any principal or interest on any
Note or any fee or other amount payable by the Acme Group
hereunder or (z) any Default by the Acme Group in supplying
the financial statements required by Sections 7.5(a)(ii)
hereof or the compliance certificate required by Section
7.5(b) hereof, in each case by the deadlines expressed in such
Sections."
(v) The definition of the term "Loan Documents" appearing
in Section 9.1 of the Credit Agreement shall be amended and as so
amended shall be restated in its entirety to read as follows:
""Loan Documents" shall mean this Agreement, the Notes, the
L/C Documents and the Collateral Documents and each other
instrument or document to be delivered hereunder or thereunder
or otherwise in connection therewith."
(w) The definition of the term "Termination Date"
appearing in Section 9.1 of the Credit Agreement shall be amended and
as so amended shall be restated in its entirety to read as follows:
""Termination Date" shall mean August 11, 2000 or such earlier
date on which the Commitments are terminated in whole pursuant
to Sections 3.7, 8.2 or 8.3 hereof or such later date to which
the Commitments are extended pursuant to Section 12.16
hereof."
(x) Section 9.1 of the Credit Agreement shall be amended
by deleting the definition of the term "Utilization Ratio" appearing
therein.
(y) Section 9.1 of the Credit Agreement shall be further
amended by inserting the following new definitions in the appropriate
alphabetical order:
""Loans" means and includes Revolving Loans and the Swing Line
Loans unless the context shall otherwise require.
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"Notes" means and includes Revolving Credit Notes and the
Swing Line Note unless the context shall otherwise require.
"Swing Line Commitment" means the commitment of ▇▇▇▇▇▇ Bank to
make Swing Line Loans in the amount of $5,000,000.
"Swing Line Note" means the promissory note of the Borrowers
payable jointly and severally to the order of ▇▇▇▇▇▇ Bank in
the principal amount of its Swing Line Commitment and
otherwise in the form of Exhibit A-1 hereto.
"Swing Line Loans" is defined in Section 1.2-A(a) hereof."
(z) Sections 10.2, 10.3, 11.1, 11.2(g), 11.3, 12.2, 12.14
of the Credit Agreement shall be amended by deleting the phrase
"Revolving Credit" wherever appearing therein.
(aa) Section 12.4 of the Credit Agreement shall be amended
by deleting the phrase "Revolving Credit" wherever appearing therein
and by inserting the phrase "(or, if relevant, Swing Line Commitment)"
immediately after the phrase "such Lender's Commitment" appearing in
the sixth line thereof.
(bb) Section 12.16 of the Credit Agreement shall be
amended and as so amended shall be restated in its entirety to read as
follows:
"Section 12.16. Extensions of the Commitments. Not less than
60 days or more than 120 days prior to the one-year, two-year
and three-year anniversaries of the date hereof, the Company
(acting on behalf of the Borrowers pursuant to Section 1.5
hereof) may advise the Agent in writing of its desire to
extend the Termination Date for an additional 12 months (but
not beyond August 11, 2002) and the Agent shall promptly
notify the Lenders of each such request; provided not more
than one such request for the extension of the Termination
Date may be made in any one calendar year. In the event that
the Lenders are agreeable to such extension (it being
understood that any Lender may accept or decline such a
request in its sole discretion), the Acme Group, the Lenders
and the Agent shall enter into such documents as the Agent may
reasonably deem necessary or appropriate to reflect such
extension and to assure that all extensions of credit pursuant
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to the Commitments and the Swing Line Commitment as so
extended are secured by the Liens created by the Collateral
Documents in favor of the Agent, all costs and expenses
incurred by the Agent in connection therewith to be paid by
the Borrowers. In the event that some, but not all, of the
Lenders are agreeable to an extension, the Company may
(provided that no Default or Event of Default has occurred and
is then continuing) terminate the Commitment (and, if
relevant, the Swing Line Commitment) of the Lender or Lenders
declining to extend and repay all borrowings outstanding
against the Revolving Credit Note (and, if relevant, the Swing
Line Note) held by such Lender or Lenders and upon such
repayment the Commitment (and, if relevant, the Swing Line
Commitment) of such Lender or Lenders shall be canceled or, at
the option of the Company, the Acme Group may obtain a new
Lender or Lenders reasonably acceptable to the Agent and the
Required Lenders to replace the Commitment (and, if relevant,
the Swing Line Commitment) of the Lender or Lenders declining
to extend and in such event the Commitment (and, if relevant,
the Swing Line Commitment) of the Lender or Lenders not
desiring to extend shall be canceled. In the event a Lender
elects not to extend, all amounts outstanding under its
Revolving Credit Note (and, if relevant, its Swing Line Note)
shall be paid to it no later than the then current Termination
Date to which it has agreed. The Acme Group, the Agent and
the new Lender shall thereupon execute such instruments and
documents as shall in the opinion of the Agent be reasonably
necessary or appropriate to substitute the new approved Lender
under the Revolving Credit and, if relevant, the Swing Line
(including without limitation the issuance of a new Revolving
Credit Note (and, if relevant, Swing Line Note) to the
substitute Lender, the execution of an amendment making the
new Lender a party hereto and such amendments to the
Collateral Documents as may be necessary or appropriate to
assure the credit extended by the new Lender is secured and/or
supported by the Collateral Documents). The new Lender shall
make an initial Revolving Loan under its Revolving Credit Note
in the amount necessary to retire the indebtedness evidenced
by the Revolving Credit Note held by the declining Lender
(and, if relevant, make an initial Swing Line Loan under its
Swing Line in the amount necessary to retire the indebtedness
evidenced by the Swing Line Note held by the declining Lender)
and all reasonable expenses of
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the Agent incurred in connection with the foregoing shall be
paid by the Acme Group."
(cc) Section 12.18 of the Credit Agreement shall be
amended and as so amended shall be restated in its entirety to read as
follows:
"Section 12.18. Assignment Agreements. Each Lender may, from
time to time upon at least five Business Days' notice to the
Agent, assign to other financial institutions all or part of
its rights and obligations under this Agreement (including
without limitation the indebtedness evidenced by the Notes
then owned by such assigning Lender, together with an
equivalent proportion of its obligation to make loans and
advances and participate in Letters of Credit hereunder)
pursuant to an Assignment Agreement; provided, however, that
(i) except with respect to the Swing Line Loans which must be
assigned in whole, each such assignment shall be of a
constant, and not a varying, percentage of the assigning
Lender's rights and obligations under this Agreement and the
assignment shall cover the same percentage of such Lender's
Commitment, Revolving Loans, Revolving Credit Note and
interests in Letters of Credit; (ii) unless the Agent
otherwise consents, each such assignment (determined as of the
effective date of the relevant Assignment Agreement) shall in
no event be in an aggregate amount of less than $5,000,000 and
shall be in integral multiples of $1,000,000; (iii) unless the
Company otherwise consents, each Lender (other than the
Lenders party hereto as of the date hereof) shall maintain for
its own account at least 50% of its original Commitment; (iv)
the Agent and the Company (which is acting on its own behalf
and pursuant to Section 1.5 hereof on behalf of the Borrowers
as well) must each consent, which consent shall not be
unreasonably withheld and shall be evidenced by execution of a
counterpart of the relevant Assignment Agreement in the space
provided thereon for such acceptance, to each such assignment
to a party which was not an original signatory of this
Agreement (it being understood and agreed the Company may
condition its acceptance of an assignment on payment by the
assigning or assignee Lender of the Security Assignment Costs
referred to in Section 12.5 hereof) and (v) the assigning
Lender (other than the Lenders party hereto as of the date
hereof) must pay to the Agent a processing and recordation fee
of $3,000 and any
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reasonable out-of-pocket attorney's fees incurred by the Agent
in connection with such Assignment Agreement. Upon the
execution of each Assignment Agreement by the assigning Lender
thereunder, the assignee lender thereunder, the Company and
the Agent and payment to such assigning Lender by such
assignee lender of the purchase price for the portion of the
indebtedness of the Acme Group being acquired by it, (i) such
assignee lender shall thereupon become a "Lender" for all
purposes of this Agreement and the other Loan Documents (and,
if relevant, shall be deemed to be ▇▇▇▇▇▇ Bank for purposes of
Swing Line Loans) with a Commitment (and, if relevant, a Swing
Line Commitment) in the amount set forth in such Assignment
Agreement and with all the rights, powers and obligations
afforded a Lender hereunder, (ii) such assigning Lender shall
have no further liability for funding the portion of its
Commitment (and, if relevant, Swing Line Commitment) assumed
by such other Lender and (iii) the address for notices to such
assignee Lender shall be as specified in the Assignment
Agreement executed by it. Concurrently with the execution and
delivery of such Assignment Agreement, the Borrowers shall
execute and deliver a Revolving Credit Note (and, if relevant,
a Swing Line Note) to the assignee Lender in the amount of its
Commitment (and, if relevant, Swing Line Commitment) and a new
Revolving Credit Note to the assigning Lender in the amount of
its Commitment after giving effect to the reduction occasioned
by such assignment, all such Revolving Credit Notes to
constitute "Revolving Credit Notes" for all purposes of the
Loan Documents and such new Swing Line Note to constitute the
"Swing Line Note" for all purposes of the Loan Documents.
Upon completion of the foregoing, the assigning Lender shall
surrender to the Company its old Revolving Credit Note (and,
if relevant, Swing Line Note)."
(dd) Exhibit A-1 is hereby added to the Credit Agreement
in the form attached to this Amendment as Annex A.
SECTION 2. CONDITIONS PRECEDENT.
The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:
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(a) The Borrowers and the Lenders shall have executed and
delivered this Amendment.
(b) The Agent shall have received copies (executed or
certified, as may be appropriate) of all legal documents or
proceedings taken in connection with the execution and delivery of
this Amendment to the extent the Agent or its counsel may reasonably
request.
(c) Legal matters incident to the execution and delivery
of this Amendment shall be satisfactory to the Lenders and their
counsel.
(d) The Agent shall have received, for the ratable
benefit of the Lenders, an amendment fee in the amount of $80,000.
SECTION 3. REPRESENTATIONS.
In order to induce the Lenders to execute and deliver this Amendment,
the Borrowers hereby represent to the Agent and the Lenders that as of the date
hereof, the representations and warranties set forth in Section 5 of the Credit
Agreement are and shall be and remain true and correct (except that the
representations contained in Section 5.6 shall be deemed to refer to the most
recent financial statements of the Company delivered to the Lenders) and the
Borrowers are in full compliance with all of the terms and conditions of the
Credit Agreement and no Default or Event of Default has occurred and is
continuing under the Credit Agreement or shall result after giving effect to
this Amendment.
SECTION 4. MISCELLANEOUS.
(a) The Borrowers have heretofore executed and delivered to the
Agent certain Collateral Documents and each Borrower hereby acknowledges and
agrees that, notwithstanding the execution and delivery of this Amendment, the
Collateral Documents to which it is a party remain in full force and effect and
the rights and remedies of the Agent and Lenders thereunder, the obligations of
such Borrower thereunder and the liens and security interests created and
provided for thereunder remain in full force and effect and shall not be
affected, impaired or discharged hereby. Nothing herein contained shall in any
manner affect or impair the priority of the liens and security interests
created and provided for by the Collateral Documents as to the indebtedness
which would be secured thereby prior to giving effect to this Amendment.
(b) Except as specifically amended herein, the Credit Agreement
shall continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Credit Agreement,
or any other instrument or document executed in
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connection therewith, or in any certificate, letter or communication issued or
made pursuant to or with respect to the Credit Agreement, any reference in any
of such items to the Credit Agreement being sufficient to refer to the Credit
Agreement as amended hereby.
(c) The Borrowers agree to pay on demand all costs and expenses of
or incurred by the Agent in connection with the negotiation, preparation,
execution and delivery of this Amendment, including the fees and expenses of
counsel for the Agent.
(d) This Amendment may be executed in any number of counterparts,
and by the different parties on different counterpart signature pages, all of
which taken together shall constitute one and the same agreement. Any of the
parties hereto may execute this Amendment by signing any such counterpart and
each of such counterparts shall for all purposes be deemed to be an original.
This Amendment shall be governed by the internal laws of the State of Illinois.
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Dated as of this 15th day of October, 1997 (but effective as of September 27,
1997).
ACME STEEL COMPANY
By
Its
----------------------------------
ACME PACKAGING CORPORATION
By
Its
----------------------------------
ALPHA TUBE CORPORATION
By
Its
----------------------------------
UNIVERSAL TOOL & STAMPING COMPANY, INC.
By
Its
----------------------------------
ACME METALS INCORPORATED
By
Its
----------------------------------
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Accepted and agreed to as of the date and year last above written.
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By
Its Vice PRESIDENT
NBD BANK
By
Its
----------------------------------
MERCANTILE BANK NATIONAL ASSOCIATION
By
Its
----------------------------------
NATIONAL CITY BANK
By
Its
----------------------------------
GENERAL ELECTRIC CAPITAL CORPORATION
By
Its
----------------------------------
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ANNEX A TO FIFTH AMENDMENT TO CREDIT AGREEMENT
EXHIBIT A-1
ACME GROUP
SWING LINE NOTE
Chicago, Illinois
$5,000,000.00 October 15, 1997
On the Termination Date, for value received, the undersigned, Acme
Steel Company, a Delaware corporation ("Acme Steel"), Acme Packaging
Corporation, a Delaware corporation ("Acme Packaging"), Alpha Tube Corporation,
an Indiana corporation, ("Alpha Tube"), and Universal Tool & Stamping Company,
Inc., an Indiana corporation ("Universal Tool") (Acme Steel, Acme Packaging,
Alpha Tube and Universal Tool are being hereinafter referred to collectively as
the "Borrowers") hereby jointly and severally promise to pay to the order of
▇▇▇▇▇▇ Trust and Savings Bank (the "Lender"), at the principal office of ▇▇▇▇▇▇
Trust and Savings Bank in Chicago, Illinois, the principal sum of (i) Five
Million and 00/100 Dollars ($5,000,000.00), or (ii) such lesser amount as may
at the time of the maturity hereof, whether by acceleration or otherwise, be
the aggregate unpaid principal amount of all Swing Line Loans owing from the
Borrowers to the Lender under the Swing Line Commitment provided for in the
Credit Agreement hereinafter mentioned.
This Note evidences Swing Line Loans made and to be made to the
Borrowers by the Lender under the Swing Line Commitment provided for under that
certain Credit Agreement dated as of August 11, 1994, by and among the
Borrowers, Acme Metals Incorporated, ▇▇▇▇▇▇ Trust and Savings Bank,
individually and as Agent thereunder, and the other Lenders which are now or
may from time to time hereafter become parties thereto (said Credit Agreement,
as the same may from time to time be modified, amended or restated being
referred to herein as the "Credit Agreement"), and the Borrowers hereby jointly
and severally promise to pay interest at the office described above on each
Swing Line Loan evidenced hereby at the rates and at the times and in the
manner specified therefor in the Credit Agreement.
Each Swing Line Loan made under the Swing Line Commitment provided for
in the Credit Agreement by the Lender to the Borrowers against this Note, any
repayment of principal hereon and the interest rates applicable thereto shall
be endorsed by the holder hereof on a schedule to this Note or recorded on the
books and records of the holder hereof (provided that
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24
such entries shall be endorsed on a schedule to this Note prior to any
negotiation hereof). The Borrowers agree that in any action or proceeding
instituted to collect or enforce collection of this Note, the entries so
endorsed a schedule to this Note or recorded on the books and records of the
holder hereof shall be prima facie evidence of the unpaid principal balance of
this Note and the interest rates applicable thereto.
This Note is issued by the Borrowers under the terms and provisions of
the Credit Agreement and is secured by the Collateral Documents, and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, to which reference is hereby made for a
statement thereof. This Note may be declared to be, or be and become, due
prior to its expressed maturity, voluntary prepayments may be made hereon, and
certain prepayments are required to be made hereon, all in the events, on the
terms and with the effects provided in the Credit Agreement. All capitalized
terms used herein without definition shall have the same meanings herein as
such terms have in the Credit Agreement.
This Note shall be construed in accordance with, and governed by, the
internal laws of the State of Illinois without regard to principles of conflict
of law.
The Borrowers hereby jointly and severally promise to pay all
reasonable costs and expenses (including attorneys' fees) suffered or incurred
by the holder hereof in collecting this Note or enforcing any rights in any
collateral therefor. The Borrowers hereby waive presentment for payment and
demand.
ACME STEEL COMPANY
By
Its
----------------------------------
ACME PACKAGING CORPORATION
By
Its
----------------------------------
ALPHA TUBE CORPORATION
By
Its
----------------------------------
UNIVERSAL TOOL & STAMPING COMPANY, INC.
By
Its
----------------------------------
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