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EXHIBIT 4.10
SEVENTH AMENDMENT TO QUANEX CORPORATION
REVOLVING CREDIT AND LETTER OF CREDIT AGREEMENT
-----------------------------------------------
This Seventh Amendment to Quanex Corporation $48,000,000 Revolving
Credit and Letter of Credit Agreement (this "Seventh Amendment") made as of the
28th day of December, 1995 ("Amendment Effective Date"), among Comerica Bank
(successor in interest by reason of merger to Manufacturers Bank, N.A.,
formerly known as Manufacturers National Bank of Detroit), First Interstate
Bank of Texas, N.A., Xxxxxx Trust and Savings Bank and NationsBank of Texas,
N.A. (individually, "Bank" and collectively, "Banks"), Comerica Bank, as agent
for the Banks (in such capacity "Agent") and Quanex Corporation, a Delaware
corporation ("Company").
WITNESSETH:
WHEREAS, the Banks, the Agent and the Company have executed and
delivered that certain Quanex Corporation $40,000,000 Revolving Credit and
Letter of Credit Agreement dated as of December 4, 1990 as amended by a First
Amendment to Quanex Corporation $40,000,000 Revolving Credit and Letter of
Credit Agreement dated March 26, 1991, a Second Amendment to Quanex Corporation
$40,000,000 Revolving Credit and Letter of Credit Agreement dated April 15,
1992, a Third Amendment to Quanex Corporation $40,000,000 Revolving Credit and
Letter of Credit Agreement dated as of February 12, 1993, a Fourth Amendment to
Quanex Corporation $40,000,000 Revolving Credit and Letter of Credit Agreement
dated April 1, 1993, a Fifth Amendment to Quanex Corporation Revolving Credit
and Letter of Credit Agreement dated December 8, 1994 and a Sixth Amendment to
Quanex Corporation Revolving Credit and Letter of Credit Agreement dated June
26, 1995 (the "Original Agreement"); and
WHEREAS, the Company, the Banks and the Agent now desire to increase
the Revolving Credit Aggregate Commitment to $75,000,000 and desire to further
amend the Original Agreement as set forth herein;
NOW, THEREFORE, in consideration of the premises, the Banks, the Agent
and the Company hereby represent and agree as follows:
1. Section 1.67 of the Original Agreement is amended to read in
its entirety as follows:
"1.67 "Revolving Credit Aggregate Commitment" shall mean
Seventy Five Million Dollars ($75,000,000), subject to reduction or
termination pursuant to Section 2.6 hereof."
2. Exhibits "B", "D" and "E" to the Original Agreement are
deleted in their entirety and attached Exhibits "B", "D" and "E" shall be
substituted therefor.
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3. Company hereby represents and warrants that, after giving
effect to the amendments contained herein, (a) execution, delivery and
performance of this Seventh Amendment and any other documents and instruments
required by this Seventh Amendment or the Original Agreement are within
Company's corporate powers, have been duly authorized, are not in contravention
of law or the terms of Company's Certificate of Incorporation or Bylaws, and do
not require the consent or approval of any governmental body, agency, or
authority; and this Amendment and any other documents and instruments required
under this Seventh Amendment or the Original Agreement, will be valid and
binding in accordance with their terms; (b) the continuing representations and
warranties of Company set forth in Sections 8.1 through 8.16 of the Original
Agreement are true and correct on and as of the date hereof with the same force
and effect as made on and as of the date hereof; (c) the continuing
representations and warranties of Company set forth in section 8.17 of the
Original Agreement are true and correct as of the date hereof with respect to
the most recent financial statements furnished to the Banks by Company in
accordance with Section 9.3 of the Original Agreement; and (d) no Event of
Default, or condition or event which, with the giving of notice or the running
of time, or both, would constitute an Event of Default under the Original
Agreement, has occurred and is continuing as of the date hereof.
4. This Seventh Amendment shall be effective upon (a) execution
of this Seventh Amendment by Company, Agent and the Banks, (b) delivery by
Company to Agent of new Revolving Credit Notes for the Banks in the form of
Exhibit "A" attached hereto completed to reflect the commitments of each Bank
as modified hereby, (c) delivery by LaSalle, Xxxxxxx and Michigan Seamless Tube
Company to Agent of amended and restated guaranty agreements in the form of
attached Exhibit "E", and (d) payment to the Agent for pro rata distribution to
the Banks an amendment fee of $20,250. Company agrees to deliver to Agent on or
before January 22, 1996 an opinion of legal counsel to the Company and the
Guarantors in form and substance satisfactory to the Agent and the Banks.
5. All references to the term "Agreement" and to the terms
"hereof", "hereunder" and similar referential terms in the Original Agreement
shall be deemed to mean or refer to the Original Agreement as amended by this
Seventh Amendment.
6. Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the Original Agreement.
7. This Seventh Amendment may be executed in counterparts, in
accordance with Section 13.8 of the Original Agreement.
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IN WITNESS WHEREOF, the Banks, the Agent and the Company have caused
this Seventh Amendment to be executed by their respective, duly authorized
officers, all as of the date set forth above.
COMPANY:
QUANEX CORPORATION
By: /s/ XXXXX X. XXXX
-----------------------
Xxxxx X. Xxxx
Title: Vice President-Finance
AGENT:
COMERICA BANK (successor in
interest by reason of merger
to Manufacturers Bank, N.A.,
formerly known as
Manufacturers National Bank of
Detroit), as Agent
By: /s/ Ilegible Signature
-----------------------
Name:
Title: Vice President
BANKS:
COMERICA BANK (successor in
interest by reason of merger
to Manufacturers Bank, N.A.,
formerly known as
Manufacturers National Bank of
Detroit)
By: /s/ XXXXXXX X. XXXX
-------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President
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XXXXX XXXXXXXXXX XXXX XX XXXXX,
N.A.
By: /s/ XXXXXXXXXXX X. XXXX
------------------------
Name: Xxxxxxxxxxx X. Xxxx
Title: Banking Officer
XXXXXX TRUST AND SAVINGS BANK
By: /s/ XXXXX X. XXXXXX
------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
NATIONSBANK OF TEXAS, N.A.
By: /s/ F. XXXXX XXXXXXXX
------------------------
Name: F. Xxxxx Xxxxxxxx
Title: Senior Vice President
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EXHIBIT "A"
REVOLVING CREDIT NOTE
$27,000,000 Detroit, Michigan
December 28, 1995
On or before the Revolving Credit Maturity Date (initially March 31,
1997), FOR VALUE RECEIVED, Quanex Corporation, a Delaware corporation,
("Company") promises to pay to the order of Comerica Bank, a Michigan banking
corporation ("Bank") at Detroit, Michigan, care of Agent, in lawful money of
the United States of America the Indebtedness to Bank or so much of the sum of
Twenty Seven Million and no/100 Dollars ($27,000,000) as may from time to time
have been advanced and then be outstanding hereunder pursuant to the Quanex
Corporation Revolving Credit and Letter of Credit Agreement ("Agreement") dated
as of December 4, 1990, as amended, made by and between Company, certain banks
including the Bank, and Comerica Bank (successor in interest by reason of
merger to Manufacturers Bank, N.A., formerly known as Manufacturers National
Bank of Detroit) as agent for such banks, together with interest thereon as
hereinafter set forth. Capitalized terms used herein, unless defined to the
contrary, have the meanings given them in the Agreement.
Each of the Loans made hereunder shall bear interest at the
Eurodollar-based Rate, or the Prime-based Rate as elected by Company or as
otherwise determined under the Agreement. Provided, however, that: (a) in the
event and so long as there shall exist a default hereunder or an Event of
Default, Loans outstanding hereunder shall bear interest at the default rates
of interest described in Section 4.1 of the Agreement; and (b) any Advances
made hereunder pursuant to Sections 3.6 and 3.7 of the Agreement shall bear
interest until paid at a per annum rate equal to the Prime-based Rate plus
three percent (3%) whether or not any default hereunder or any Event of Default
shall then exist.
Interest on the unpaid balance of all Loans shall be calculated and
payable as set forth in the Agreement.
This Note is a note under which advances, repayments and readvances may
be made from time to time, but only in accordance with the terms and conditions
of the Agreement. This Note evidences borrowing under, is subject to, and may
be accelerated or matured under, the terms of the Agreement, to which reference
is hereby made.
Company agrees that in the event of a default hereunder or any default
or Event of Default under the Agreement, Bank shall be entitled to liquidate
and collect all property or assets (including deposits and other credits)
whether presently owned or hereafter
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acquired, of Company in possession or control of (or owing by) the Bank for
any purpose, and to apply the proceeds of such liquidations and collections,
and offset any amounts owing by Bank, against Company's obligations hereunder
and under the Agreement.
THIS NOTE SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE DETERMINED UNDER THE LAWS OF, AND ENFORCEABLE IN, THE STATE OF
MICHIGAN.
This Note replaces the Revolving Credit Note dated December 8, 1994 in
the principal amount of $18,000,000 by Company payable to Bank.
Company hereby waives presentment for payment, demand, protest and
notice of dishonor and nonpayment of this Note and agrees that no obligation
hereunder shall be discharged by reason of any extension, indulgence, release,
or forbearance granted by any holder of this Note to any party now or hereafter
liable hereon or any present or subsequent owner of any property, real or
personal, which is now or hereafter security for this Note. Any transferees of,
or endorser, guarantor or surety paying this Note in full shall succeed to all
rights of Bank, and Bank shall be under no further responsibility for the
exercise thereof or the loan evidenced hereby.
Nothing herein shall limit any right granted Bank by any other
instrument or by law.
QUANEX CORPORATION
By:
-------------------------
Its:
-------------------------
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EXHIBIT "A"
REVOLVING CREDIT NOTE
$16,000,000 Detroit, Michigan
December 28, 1995
On or before the Revolving Credit Maturity Date (initially March 31,
1997), FOR VALUE RECEIVED, Quanex Corporation, a Delaware corporation,
("Company") promises to pay to the order of Xxxxxx Trust and Savings Bank, a
state banking corporation ("Bank") at Detroit, Michigan, care of Agent, in
lawful money of the United States of America the Indebtedness to Bank or so
much of the sum of Sixteen Million and no/100 Dollars ($16,000,000) as may from
time to time have been advanced and then be outstanding hereunder pursuant to
the Quanex Corporation Revolving Credit and Letter of Credit Agreement
("Agreement") dated as of December 4, 1990, as amended, made by and between
Company, certain banks including the Bank, and Comerica Bank (successor in
interest by reason of merger to Manufacturers Bank, N.A., formerly known as
Manufacturers National Bank of Detroit) as agent for such banks, together with
interest thereon as hereinafter set forth. Capitalized terms used herein,
unless defined to the contrary, have the meanings given them in the Agreement.
Each of the Loans made hereunder shall bear interest at the
Eurodollar-based Rate, or the Prime-based Rate as elected by Company or as
otherwise determined under the Agreement. Provided, however, that: (a) in the
event and so long as there shall exist a default hereunder or an Event of
Default, Loans outstanding hereunder shall bear interest at the default rates
of interest described in Section 4.1 of the Agreement; and (b) any Advances
made hereunder pursuant to Sections 3.6 and 3.7 of the Agreement shall bear
interest until paid at a per annum rate equal to the Prime-based Rate plus
three percent (3%) whether or not any default hereunder or any Event of Default
shall then exist.
Interest on the unpaid balance of all Loans shall be calculated and
payable as set forth in the Agreement.
This Note is a note under which advances, repayments and readvances may
be made from time to time, but only in accordance with the terms and conditions
of the Agreement. This Note evidences borrowing under, is subject to, and may
be accelerated or matured under, the terms of the Agreement, to which reference
is hereby made.
Company agrees that in the event of a default hereunder or any default
or Event of Default under the Agreement, Bank shall be entitled to liquidate
and collect all property or assets (including deposits and other credits)
whether presently owned or hereafter
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acquired, of Company in possession or control of (or owing by) the Bank for any
purpose, and to apply the proceeds of such liquidations and collections, and
offset any amounts owing by Bank, against Company's obligations hereunder and
under the Agreement.
THIS NOTE SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE DETERMINED UNDER THE LAWS OF, AND ENFORCEABLE IN, THE STATE OF
MICHIGAN.
This Note replaces the Revolving Credit Note dated December 8, 1994 in
the principal amount of $10,000,000 by Company payable to Bank.
Company hereby waives presentment for payment, demand, protest and
notice of dishonor and nonpayment of this Note and agrees that no obligation
hereunder shall be discharged by reason of any extension, indulgence, release,
or forbearance granted by any holder of this Note to any party now or hereafter
liable hereon or any present or subsequent owner of any property, real or
personal, which is now or hereafter security for this Note. Any transferees of,
or endorser, guarantor or surety paying this Note in full shall succeed to all
rights of Bank, and Bank shall be under no further responsibility for the
exercise thereof or the loan evidenced hereby.
Nothing herein shall limit any right granted Bank by any other
instrument or by law.
QUANEX CORPORATION
By:
------------------------
Its: ------------------------
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EXHIBIT "A"
REVOLVING CREDIT NOTE
$16,000,000 Detroit, Michigan
December 28, 1995
On or before the Revolving Credit Maturity Date (initially March 31,
1997), FOR VALUE RECEIVED, Quanex Corporation, a Delaware corporation,
("Company") promises to pay to the order of NationsBank of Texas, N.A., a
national banking association ("Bank") at Detroit, Michigan, care of Agent, in
lawful money of the United States of America the Indebtedness to Bank or so
much of the sum of Sixteen Million and no/100 Dollars ($16,000,000) as may from
time to time have been advanced and then be outstanding hereunder pursuant to
the Quanex Corporation Revolving Credit and Letter of Credit Agreement
("Agreement") dated as of December 4, 1990, as amended, made by and between
Company, certain banks including the Bank, and Comerica Bank (successor in
interest by reason of merger to Manufacturers Bank, N.A., formerly known as
Manufacturers National Bank of Detroit) as agent for such banks, together with
interest thereon as hereinafter set forth. Capitalized terms used herein,
unless defined to the contrary, have the meanings given them in the Agreement.
Each of the Loans made hereunder shall bear interest at the
Eurodollar-based Rate, or the Prime-based Rate as elected by Company or as
otherwise determined under the Agreement. Provided, however, that: (a) in the
event and so long as there shall exist a default hereunder or an Event of
Default, Loans outstanding hereunder shall bear interest at the default rates
of interest described in Section 4.1 of the Agreement; and (b) any Advances
made hereunder pursuant to Sections 3.6 and 3.7 of the Agreement shall bear
interest until paid at a per annum rate equal to the Prime-based Rate plus
three percent (3%) whether or not any default hereunder or any Event of Default
shall then exist.
Interest on the unpaid balance of all Loans shall be calculated and
payable as set forth in the Agreement.
This Note is a note under which advances, repayments and readvances may
be made from time to time, but only in accordance with the terms and conditions
of the Agreement. This Note evidences borrowing under, is subject to, and may
be accelerated or matured under, the terms of the Agreement, to which reference
is hereby made.
Company agrees that in the event of a default hereunder or any default
or Event of Default under the Agreement, Bank shall be entitled to liquidate
and collect all property or assets (including deposits and other credits)
whether presently owned or hereafter
10
acquired, of Company in possession or control of (or owing by) the Bank for
any purpose, and to apply the proceeds of such liquidations and collections,
and offset any amounts owing by Bank, against Company's obligations hereunder
and under the Agreement.
THIS NOTE SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE DETERMINED UNDER THE LAWS OF, AND ENFORCEABLE IN, THE STATE OF
MICHIGAN.
This Note replaces the Revolving Credit Note dated December 8, 1994 in
the principal amount of $10,000,000 by Company payable to Bank.
Company hereby waives presentment for payment, demand, protest and
notice of dishonor and nonpayment of this Note and agrees that no obligation
hereunder shall be discharged by reason of any extension, indulgence, release,
or forbearance granted by any holder of this Note to any party now or hereafter
liable hereon or any present or subsequent owner of any property, real or
personal, which is now or hereafter security for this Note. Any transferees of,
or endorser, guarantor or surety paying this Note in full shall succeed to all
rights of Bank, and Bank shall be under no further responsibility for the
exercise thereof or the loan evidenced hereby.
Nothing herein shall limit any right granted Bank by any other
instrument or by law.
QUANEX CORPORATION
By:
------------------------
Its: ------------------------
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EXHIBIT "A"
REVOLVING CREDIT NOTE
$16,000,000 Detroit, Michigan
December 28, 1995
On or before the Revolving Credit Maturity Date (initially March 31,
1997), FOR VALUE RECEIVED, Quanex Corporation, a Delaware corporation,
("Company") promises to pay to the order of First Interstate Bank of Texas,
N.A., a national banking association ("Bank") at Detroit, Michigan, care of
Agent, in lawful money of the United States of America the Indebtedness to Bank
or so much of the sum of Sixteen Million and no/100 Dollars ($16,000,000) as
may from time to time have been advanced and then be outstanding hereunder
pursuant to the Quanex Corporation Revolving Credit and Letter of Credit
Agreement ("Agreement") dated as of December 4, 1990, as amended, made by and
between Company, certain banks including the Bank, and Comerica Bank (successor
in interest by reason of merger to Manufacturers Bank, N.A., formerly known as
Manufacturers National Bank of Detroit) as agent for such banks, together with
interest thereon as hereinafter set forth. Capitalized terms used herein,
unless defined to the contrary, have the meanings given them in the Agreement.
Each of the Loans made hereunder shall bear interest at the
Eurodollar-based Rate, or the Prime-based Rate as elected by Company or as
otherwise determined under the Agreement. Provided, however, that: (a) in the
event and so long as there shall exist a default hereunder or an Event of
Default, Loans outstanding hereunder shall bear interest at the default rates
of interest described in Section 4.1 of the Agreement; and (b) any Advances
made hereunder pursuant to Sections 3.6 and 3.7 of the Agreement shall bear
interest until paid at a per annum rate equal to the Prime-based Rate plus
three percent (3%) whether or not any default hereunder or any Event of Default
shall then exist.
Interest on the unpaid balance of all Loans shall be calculated and
payable as set forth in the Agreement.
This Note is a note under which advances, repayments and readvances may
be made from time to time, but only in accordance with the terms and conditions
of the Agreement. This Note evidences borrowing under, is subject to, and may be
accelerated or matured under, the terms of the Agreement, to which reference is
hereby made.
Company agrees that in the event of a default hereunder or any default
or Event of Default under the Agreement, Bank shall be entitled to liquidate
and collect all property or assets (including deposits and other credits)
whether presently owned or hereafter
12
acquired, of Company in possession or control of (or owing by) the Bank for
any purpose, and to apply the proceeds of such liquidations and collections,
and offset any amounts owing by Bank, against Company's obligations hereunder
and under the Agreement.
THIS NOTE SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE DETERMINED UNDER THE LAWS OF, AND ENFORCEABLE IN, THE STATE OF
MICHIGAN.
This Note replaces the Revolving Credit Note dated December 8, 1994 in
the principal amount of $10,000,000 by Company payable to Bank.
Company hereby waives presentment for payment, demand, protest and
notice of dishonor and nonpayment of this Note and agrees that no obligation
hereunder shall be discharged by reason of any extension, indulgence, release,
or forbearance granted by any holder of this Note to any party now or hereafter
liable hereon or any present or subsequent owner of any property, real or
personal, which is now or hereafter security for this Note. Any transferees of,
or endorser, guarantor or surety paying this Note in full shall succeed to all
rights of Bank, and Bank shall be under no further responsibility for the
exercise thereof or the loan evidenced hereby.
Nothing herein shall limit any right granted Bank by any other
instrument or by law.
QUANEX CORPORATION
By:
-----------------------
Its: -----------------------
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EXHIBIT "B"
REVOLVING CREDIT NOTE
$_____________ Detroit, Michigan
______________, 1995
On or before the Revolving Credit Maturity Date (initially March 31,
1997), FOR VALUE RECEIVED, Quanex Corporation, a Delaware corporation,
("Company") promises to pay to the order of
________________________________________ _____________________, a
_________________________________________ ("Bank") at Detroit, Michigan, care
of Agent, in lawful money of the United States of America the Indebtedness to
Bank or so much of the sum of ___________________ Million and no/100 Dollars
($__________________) as may from time to time have been advanced and then be
outstanding hereunder pursuant to the Quanex Corporation Revolving Credit and
Letter of Credit Agreement ("Agreement") dated as of December 4, 1990, as
amended, made by and between Company, certain banks including the Bank, and
Comerica Bank (successor in interest by reason of merger to Manufacturers Bank,
N.A., formerly known as Manufacturers National Bank of Detroit) as agent for
such banks, together with interest thereon as hereinafter set forth.
Capitalized terms used herein, unless defined to the contrary, have the
meanings given them in the Agreement.
Each of the Loans made hereunder shall bear interest at the
Eurodollar-based Rate, or the Prime-based Rate as elected by Company or as
otherwise determined under the Agreement. Provided, however, that: (a) in the
event and so long as there shall exist a default hereunder or an Event of
Default, Loans outstanding hereunder shall bear interest at the default rates
of interest described in Section 4.1 of the Agreement; and (b) any Advances
made hereunder pursuant to Sections 3.6 and 3.7 of the Agreement shall bear
interest until paid at a per annum rate equal to the Prime-based Rate plus
three percent (3%) whether or not any default hereunder or any Event of Default
shall then exist.
Interest on the unpaid balance of all Loans shall be calculated and
payable as set forth in the Agreement.
This Note is a note under which advances, repayments and readvances may
be made from time to time, but only in accordance with the terms and conditions
of the Agreement. This Note evidences borrowing under, is subject to, and may
be accelerated or matured under, the terms of the Agreement, to which reference
is hereby made.
Company agrees that in the event of a default hereunder or any default
or Event of Default under the Agreement, Bank shall be entitled to liquidate
and collect all property or assets (including
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deposits and other credits) whether presently owned or hereafter acquired, of
Company in possession or control of (or owing by) the Bank for any purpose, and
to apply the proceeds of such liquidations and collections, and offset any
amounts owing by Bank, against Company's obligations hereunder and under the
Agreement.
THIS NOTE SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE DETERMINED UNDER THE LAWS OF, AND ENFORCEABLE IN, THE STATE OF
MICHIGAN.
[This Note replaces the Revolving Credit Note dated
________________________, 1995 in the principal amount of $___________ by
Company payable to Bank.]
Company hereby waives presentment for payment, demand, protest and
notice of dishonor and nonpayment of this Note and agrees that no obligation
hereunder shall be discharged by reason of any extension, indulgence, release,
or forbearance granted by any holder of this Note to any party now or hereafter
liable hereon or any present or subsequent owner of any property, real or
personal, which is now or hereafter security for this Note. Any transferees of,
or endorser, guarantor or surety paying this Note in full shall succeed to all
rights of Bank, and Bank shall be under no further responsibility for the
exercise thereof or the loan evidenced hereby.
Nothing herein shall limit any right granted Bank by any other
instrument or by law.
QUANEX CORPORATION
By:
-------------------------
Its:
-------------------------
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EXHIBIT "D"
PERCENTAGES
Bank Percentage
---- ----------
Comerica Bank 36.0% $27,000,000
First Interstate Bank of Texas, N.A. 21.333333% $16,000,000
Xxxxxx Trust and Savings Bank 21.333333% $16,000,000
NationsBank of Texas, N.A. 21.333333% $16,000,000
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EXHIBIT "E"
[NAME OF GUARANTOR] GUARANTY
[Name of Guarantor], a ___________ corporation ("Guarantor") desires to
see the success of Quanex Corporation, a Delaware corporation ("Company") and
Account Parties (as defined below) and furthermore, Guarantor shall receive
direct and/or indirect benefits from loans and extensions of credit to Company
and Account Parties in connection with the transactions contemplated under the
Loan Agreement and the Loan Documents (as defined below).
To induce each of the Banks (as defined below), to enter into and
perform its obligations under that certain Revolving Credit and Letter of
Credit Agreement dated as of December 4, 1990, among Company, Comerica Bank, as
Agent, ("Agent") and the Banks, as amended from time to time (the "Loan
Agreement"), the Guarantor has executed and delivered this guaranty
("Guaranty").
1. Definitions. Unless otherwise provided herein, all capitalized
terms in this Guaranty shall have the meanings specified in the Loan Agreement.
The term "Banks" as used herein shall include any successors or assigns of the
Banks, in accordance with the Loan Agreement.
2. Guaranty. The Guarantor hereby guarantees to the Banks the due
and punctual payment to the Banks when due, whether by acceleration or
otherwise, of all amounts due and owing under:
(a) the Loan Agreement;
(b) the Notes executed by Company to the Banks in
the original aggregate principal amount of
$75,000,000 pursuant to the Loan Agreement; and
(c) all Letter of Credit Obligations and other amounts
owing under or in connection with Letters of Credit
issued for any Account Party from time to time
pursuant to the Loan Agreement;
all of the foregoing payable with interest thereon and otherwise in accordance
with the terms of such Notes and the Loan Agreement, as well as all extensions,
renewals, and amendments of or to the Loan Agreement, the Notes or Letters of
Credit or Letter of Credit Agreements or such other Indebtedness (as defined in
the Loan Agreement, or any replacements or substitutions therefor), and hereby
agrees that if the Company, any Account Party, or any other Person who is or
becomes primarily liable therefor, shall fail to pay any of such amounts when
and as the same shall be due and payable, or shall fail to perform and discharge
any covenant, representation or warranty in accordance with the terms of the
Notes, the Loan Agreement, the Letters of Credit, the Letter of
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Credit Agreements, or any of the other Loan Documents, the Guarantor will
forthwith pay to Agent on behalf of the Banks an amount equal to any such amount
or cause the Company and any other Person then primarily liable therefor to
perform and discharge any such covenant, representation or warranty, as the case
may be, and will pay any and all damages that may be incurred or suffered in
consequence thereof by Agent and all reasonable expenses, including reasonable
attorneys fees, that may be incurred by Agent in enforcing such covenant,
representation or warranty of the Company, and in enforcing the covenants and
agreements of this Guaranty.
3. Unconditional Character of Guaranty. The obligations of
Guarantor under this Guaranty shall be absolute and unconditional, and shall be
a guaranty of payment and not of collection, irrespective of the validity,
regularity or enforceability of the Notes, the Loan Agreement, the Letters of
Credit, the Letter of Credit Agreements, or any of the other Loan Documents, or
any provision thereof, the absence of any action to enforce the same, any
waiver or consent with respect to any provision thereof, the recovery of any
judgment against any person or action to enforce the same, any failure or delay
in the enforcement of the obligations of the Company under the Notes, the Loan
Agreement, or the obligations of Company or any other Account Party under the
Letters of Credit, the Letter of Credit Agreements, or of the obligations of
any Person under any of the other Loan Documents, or any setoff, counterclaim,
recoupment, limitation, defense or termination. Guarantor hereby waives
diligence, demand for payment, filing of claims with any court, any proceeding
to enforce any provision of the Notes, the Loan Agreement, the Letters of
Credit, the Letter of Credit Agreements, or any of the other Loan Documents,
any right to require a proceeding first against the Company, any Account Party,
or any other guarantor or surety, or to exhaust any security for the
performance of the obligations of the Company or any Account Party, any
protest, presentment, notice or demand whatsoever, and Guarantor hereby
covenants that this Guaranty shall not be terminated, discharged or released
except upon payment in full of all amounts due and to become due from the
Company and all Account Parties, as and to the extent described above, and only
to the extent of any such payment, performance and discharge or upon the
release of Guarantor pursuant to the terms of Section 5.6 hereof. Guarantor
further covenants that no security now or subsequently held by the Agent or the
Banks for the payment of the Indebtedness evidenced by the Notes, or incurred
under the Loan Agreement, the Letters of Credit, the Letter of Credit
Agreements, or otherwise evidenced or incurred, whether in the nature of a
security interest, pledge, lien, assignment, setoff, suretyship, guaranty,
indemnity, insurance or otherwise, and no act, omission or other conduct of
Agent or the Banks in respect of such security, shall affect in any manner
whatsoever the unconditional obligation of this Guaranty, and that the Agent
and each of the Banks, in their respective sole discretion and without notice
to Guarantor, may release, exchange, enforce, apply the
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proceeds of and otherwise deal with any such security without affecting in any
manner the unconditional obligation of this Guaranty. Notwithstanding anything
to the contrary contained in this Guaranty, Guarantor hereby irrevocably waives
any and all rights it may now or hereafter have under any agreement or at law or
in equity (including, without limitation, any law subrogating Guarantor to the
rights of Banks) to assert any claim against or seek contribution,
indemnification or any other form of reimbursement from the Company and the
Account Parties or any other party liable for payment of any or all of the
Indebtedness for any payment made by Guarantor under or in connection with this
Guaranty or otherwise.
Without limiting the generality of the foregoing, such obligations,
and the rights of the Agent on behalf of the Banks to enforce the same by
proceedings, whether by action at law, suit in equity or otherwise, shall not
be in any way affected by (i) any insolvency, bankruptcy, liquidation,
reorganization, readjustment, composition, dissolution, winding up or other
proceeding involving or affecting the Company, any Account Party, the Guarantor
or others or (ii) any change in the ownership of any of the capital stock of
the Company or any of the Company's Subsidiaries, or any of their respective
Affiliates.
Guarantor hereby waives:
(a) any defense based upon an election of remedies by the Agent or
the Banks, including, without limitation, an election to proceed by
non-judicial rather than judicial foreclosure, which destroys or otherwise
impairs the subrogation rights of the Guarantor or the right of the Guarantor
to proceed against the Company or any Account Party for reimbursement, or both;
(b) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor
in other respects more burdensome than that of the principal;
(c) any duty on the part of Agent or the Banks to disclose to the
Guarantor any facts Agent or the Banks may now or hereafter know about the
Company or any Account Party, regardless of whether the Agent or any Bank has
reason to believe that any such facts materially increase the risk beyond that
which the Guarantor intends to assume or has reason to believe that such facts
are unknown to the Guarantor or has a reasonable opportunity to communicate
such facts to the Guarantor, since the Guarantor acknowledges that it is fully
responsible for being and keeping informed of the financial condition of the
Company and Account Parties and of all circumstances bearing on the risk of
non-payment of any Indebtedness hereby guaranteed;
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(d) any defense arising because of the Agent's or the Banks'
election, in any proceeding instituted under the Federal Bankruptcy Code, of
the application of Section 1111(b)(2) of the Federal Bankruptcy Code;
(e) any other event or action (excluding Guarantor's compliance
with the provisions hereof) that would result in the discharge by operation of
law or otherwise of the Guarantor from the performance or observance of any
obligation, covenant or agreement contained in this Guaranty.
The Agent and any security held by them, for the obligations of the
Company or any Account Party (as aforesaid) in the same manner and as freely as
if this Guaranty did not exist and the Agent on behalf of the Banks shall be
entitled without notice to Guarantor, among other things, to grant to the
Company and Account Parties such extension or extensions of time to perform
any act or acts as may seem advisable to the Agent on behalf of the Banks at any
time and from time to time, and to permit the Company or any Account Party to
incur additional indebtedness to Agent, the Banks, or either or any of them,
without terminating, affecting or impairing the validity or enforceability of
this Guaranty or the obligations of Guarantor hereunder.
The Agent may proceed, either in its own name (on behalf of the Banks)
or in the name of the Guarantor, or otherwise, to protect and enforce any or
all of its rights under this Guaranty by suit in equity, action at law or by
other appropriate proceedings, or to take any action authorized or permitted
under applicable law, and shall be entitled to require and enforce the
performance of all acts and things required to be performed hereunder by the
Guarantor. Each and every remedy of the Agent on behalf of the Banks shall, to
the extent permitted by law, be cumulative and shall be in addition to any
other remedy given hereunder or now or hereafter existing at law or in equity.
No waiver or release shall be deemed to have been made by the Agent or
the Banks of any of its rights hereunder unless the same shall be in writing
and signed by or on behalf of the Banks, and any such waiver shall be a waiver
or release only with respect to the specific matter involved and shall in no
way impair the rights of the Agent or the Banks or the obligations of Guarantor
under this Guaranty in any other respect at any other time.
At the option of the Agent, Guarantor may be joined in any action or
proceeding commenced by the Agent against the Company, and/or any Account Party
or Account Parties, or any other Person in connection with or based upon the
Notes, the Loan Agreement, the Letters of Credit, the Letter of Credit
Agreements, or any of the other Loan Documents or other Indebtedness, or any
provision thereof, and recovery may be had against Guarantor in such action
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or proceeding or in any independent action or proceeding against Guarantor,
without any requirement that the Agent or the Banks first assert, prosecute or
exhaust any remedy or claim against the Company, any Account Party, or any
other Person.
4. Representations and Warranties. Guarantor represents, warrants
and agrees, and such representations and warranties shall be deemed to be
continuing representations and warranties during the entire life of this
Guaranty, that:
(a) Guarantor is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation and has all
requisite corporate power and authority to own, operate and lease its
properties and to carry on its business as now conducted. To the best of its
knowledge, Guarantor is duly qualified or licensed to do business as a foreign
corporation, and is in good standing in each jurisdiction where the nature of
the business conducted by it or the properties owned or leased by it makes such
qualification or licensing necessary and where failure to be so qualified would
have a material adverse effect on its business.
(b) Execution, delivery and performance of this Guaranty, all of
the other Loan Documents to which Guarantor is a party, and all other documents
and instruments executed and delivered under or in connection with this
Guaranty or the other Loan Documents by Guarantor (or to be so executed and
delivered) are within its corporate powers, have been duly authorized, are not
in contravention of law or the terms of Guarantor's articles of incorporation
or bylaws, and do not require the consent or approval, material to the
transactions contemplated by the Loan Documents, of any court, governmental
body, agency or authority not previously obtained and delivered to Agent under
the Loan Agreement.
(c) This Guaranty and each of the Loan Documents to which
Guarantor is a party and all other certificates, agreements, documents and
instruments executed and delivered by Guarantor under or in connection
therewith have each been duly executed and delivered by its duly authorized
officers and constitute the valid and binding obligations of Guarantor,
enforceable in accordance with their respective terms, except as the validity
or enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws affecting creditors' rights generally or
other equitable principles (regardless of whether enforcement is considered in
proceedings in law or equity).
(d) The execution, delivery and performance of the Guaranty and
each of the Loan Documents to which Guarantor is a party and any other
documents and instruments required under or in connection with this Guaranty by
Guarantor are not in contravention of the
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terms of any indenture, agreement or undertaking to which Guarantor is a
party or by which it is bound, except to the extent such terms have been waived
or are not material to the transactions contemplated by the Loan Documents.
(e) There is no suit, action, proceeding, including, without
limitation, any bankruptcy proceeding, or governmental investigation pending
against or affecting Guarantor or its Subsidiaries (other than any suit, action
or proceeding in which Guarantor or its Subsidiaries is the plaintiff and in
which no counterclaim or crossclaim against Guarantor or its Subsidiaries has
been filed) nor has Guarantor or its Subsidiaries or any of their respective
officers or directors been subject to any suit, action, proceeding or
governmental investigation as a result of which any such officer or director is
or may be entitled to indemnification by Guarantor or its Subsidiaries, except
as otherwise disclosed in the appropriate exhibit to the Loan Agreement and
except for miscellaneous suits, actions and proceedings (other than suits,
actions or proceedings commenced by any government or governmental authority or
seeking specific performance or other equitable or injunctive relief) involving
less than $100,000 which suits would not in the aggregate, if resolved
adversely to Guarantor, have a material adverse effect on Guarantor. Except as
so disclosed, there is not outstanding against Guarantor or its Subsidiaries
any judgment, decree, injunction, rule, or order of any court, government,
department, commission, agency, instrumentality or arbitrator nor is Guarantor
or its Subsidiaries in violation of any applicable law, regulation, ordinance,
order, injunction, decree or requirement of any governmental body or court
where such violation would have a material adverse effect on Guarantor.
(f) There are no security interests in, liens, mortgages, or other
encumbrances on any of the assets or properties of the Guarantor, that are
prohibited by the provisions of the Loan Agreement.
(g) All factual information heretofore or contemporaneously
furnished in writing by or on behalf of Guarantor to Agent or any Bank for
purposes of or in connection with this Agreement or any transaction
contemplated hereby is, and all other such factual information hereafter
furnished by or on behalf of Guarantor to Agent or any Bank will be, true and
accurate in every material respect on the date as of which such information is
dated or certified and, to the best of its knowledge, is not incomplete by
omitting to state any material fact necessary to make such information
not misleading.
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5. Miscellaneous.
5.1 Governing Law.
This Guaranty shall be deemed delivered in Michigan and shall be
interpreted and the rights of the parties hereunder shall be determined under
the laws of, and be enforceable in, the State of Michigan, Guarantor hereby
consenting to the jurisdiction of such state and all federal courts sitting in
such state.
5.2 Severability. If any term or provision of this
Guaranty or the application thereof to any circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Guaranty, or the application
of such term or provision to circumstances other than those as to which it is
held invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Guaranty shall be valid and enforceable to the fullest extent
permitted by law.
5.3 Notice. All notices and other communications to be
made or given pursuant to this Guaranty shall be sufficient if made or given in
writing and delivered by messenger or deposited in the U.S. mails, registered
or certified first class mail, addressed as follows:
AGENT: COMERICA BANK
000 Xxxxxxxx Xxxxxx
0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: U.S. Banking Department
BANKS: COMERICA BANK
000 Xxxxxxxx Xxxxxx
0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: U.S. Banking Department
FIRST INTERSTATE BANK OF TEXAS, N.A.
0000 Xxxxxxxxx
0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxx
XXXXXX TRUST AND SAVINGS BANK
000 X. Xxxxxx-0X
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
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NATIONSBANK OF TEXAS, N.A.
Corporate Banking, 8th Floor
000 Xxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: F. Xxxxx Xxxxxxxx
GUARANTOR: [NAME OF GUARANTOR]
c/o Quanex Corporation
0000 X. Xxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxx
or at such other addresses as directed by any of such parties to the others, as
applicable, in compliance with this paragraph.
5.4 Right of Offset. Guarantor acknowledges the rights of
the Agent and of each of the Banks to offset against the indebtedness of
Guarantor to the Banks under this Guaranty, any amount owing by the Agent or
the Banks, or either or any of them to the Guarantor, whether represented by
any deposit of Guarantor with the Agent or any of the Banks or otherwise.
5.5 Amendments. The terms of this Guaranty may not be
waived, altered, modified, amended, supplemented or terminated in any manner
whatsoever except as provided herein and in accordance with the Loan Agreement.
5.6 Release. Upon (a) the termination of the commitment
of the Banks to make Loans or Advances to Company and the satisfaction by
Guarantor of its obligations hereunder, or the time at which Guarantor is no
longer subject to any obligation hereunder or the time at which the Guarantor
is designated an Unrestricted Subsidiary pursuant to and in accordance with the
terms of the Loan Agreement, whichever first occurs, the Guarantor shall be
deemed released from this Guaranty and, the Agent shall deliver to Guarantor,
upon written request therefor, a written release of this Guaranty; provided
that, the effectiveness of this Guaranty shall continue or be reinstated, as
the case may be, in the event that any payment received or credit given by the
Agent or the Banks is returned, disgorged or rescinded as an avoidable
preference, impermissible setoff, fraudulent conveyance or otherwise under any
applicable state or federal law, including laws pertaining to bankruptcy or
insolvency, and this Guaranty shall thereafter be enforceable against Guarantor
as if such returned, disgorged or rescinded payment or credit had not been
received or given by the Agent or the Banks, and whether or not the Agent or
any Bank relied upon such payment or credit or changed its position as a
consequence thereof.
[This Guaranty amends and restates in its entirety the Guaranty dated
_________________, 199__ by the Guarantor in favor of the Agent and the Banks.]
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IN WITNESS WHEREOF, the undersigned Guarantor has executed this
Guaranty as of _______________, 199__.
[NAME OF GUARANTOR]
By:
-------------------------
Its:
-------------------------
ACCEPTED BY:
COMERICA BANK, As Agent,
on behalf of the Banks
By:
--------------------------
Its:
--------------------------
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