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Exhibit 10.1(d)
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (herein called the "AMENDMENT")
made as of the 31st day of October, 1996, by and among HECLA MINING COMPANY, a
Delaware corporation (herein called "BORROWER"), Colorado Aggregate Company of
New Mexico, Inc., a New Mexico corporation, Kentucky-Tennessee Clay Company, a
Delaware corporation, K-T Feldspar Corporation, a North Carolina corporation,
Mountain West Products, inc., an Idaho corporation (collectively, the
"SUBSIDIARY GUARANTORS"), and NATIONSBANK OF TEXAS, N.A., a national banking
association (in its capacity as Agent under the Original Agreement, herein
called "AGENT"), and Lenders named in the Original Agreement referred to below
("LENDERS"),
W I T N E S S E T H:
WHEREAS, Borrower, the Subsidiary Guarantors, Agent and Lenders have
entered into that certain Credit Agreement dated as of August 30, 1994, as
amended by a First Amendment to Credit Agreement dated as of October 1, 1995 and
a Second Amendment to Credit Agreement dated as of February 7, 1996 (as amended,
the "ORIGINAL AGREEMENT"), for the purpose and consideration therein expressed,
whereby Lenders became obligated to make and made loans to Borrower as therein
provided;
WHEREAS, Bank of America, Idaho, N.A. merged with and into Bank of America
N W, N.A. (formerly known as First-Seattle National Bank) and the Percentage
Share of the Loans and the Loan Documents previously owned by Bank of America,
Idaho, N.A. are now owned by Bank of America N W, N.A.;
WHEREAS, Borrower has agreed to execute and deliver a new promissory note
of even date herewith payable to the order of Bank of America N W, N.A. (the
"RENEWAL NOTE"), which renews the promissory notes made by Borrower and payable
to the order of Bank of America, Idaho, N.A. and Seattle-First National Bank;
WHEREAS, Borrower, the Subsidiary Guarantors, Agent and Lenders desire to
amend the Original Agreement to provide for the purposes and consideration set
forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein and in the Original Agreement and in
consideration of the loans which may hereafter be made by Lenders to Borrower,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto do hereby agree as follows:
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ARTICLE I.
DEFINITIONS AND REFERENCES
SECTION 1.1. TERMS DEFINED IN THE ORIGINAL AGREEMENT. Unless the context
otherwise requires or unless otherwise expressly defined herein, the terms
defined in the Original Agreement shall have the same meanings whenever used in
this Amendment.
SECTION 1.2. OTHER DEFINED TERMS. Unless the context otherwise requires,
the following terms when used in this Amendment shall have the meanings assigned
to them in this Section 1.2.
"AMENDMENT" shall mean this Third Amendment to Credit Agreement.
"AMENDMENT DOCUMENTS" shall mean the Amendment, the Consent to Pledge,
the LLC Pledge Agreement and the Renewal Note.
"CONSENT TO PLEDGE" shall mean the Consent to Pledge of even date
herewith delivered by Borrower and accepted by the Rosebud Company, L.L.C.,
substantially in the form of Exhibit A hereto.
"CREDIT AGREEMENT" shall mean the Original Agreement as amended
hereby.
"LLC PLEDGE AGREEMENT" shall mean the LLC Pledge Agreement of even
date herewith made by Borrower in favor of Agent, substantially in the form
of Exhibit B hereto.
ARTICLE II.
AMENDMENTS TO ORIGINAL AGREEMENT
SECTION 2.1. DEFINED TERMS. (a) The definition of "LLC" is hereby added
to Section 1.1 of the Original Agreement immediately following the definition of
"LIEN" to read as follows:
"LLC" has the meaning given to it in the LLC Pledge Agreement.
(b) The definition of "LLC AGREEMENT" is hereby added to Section 1.1 of
the Original Agreement immediately following the definition of "LLC" to read as
follows:
"LLC AGREEMENT" has the meaning given to it in the LLC Pledge
Agreement.
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(c) The definition of "SUBJECT PROPERTIES" is hereby added to Section 1.1
of the Original Agreement immediately following the definition of "SPREAD" to
read as follows:
"SUBJECT PROPERTIES" means all of the properties identified in
subparagraph 1.1 of Exhibit A of the LLC Agreement.
(d) The definition of "SUBORDINATION AGREEMENT" is hereby added to Section
1.1 of the Original Agreement immediately following the definition of "SUBJECT
PROPERTIES" to read as follows:
"SUBORDINATION AGREEMENT" means the Subordination Agreement by and
among Borrower, Agent, and the Surety, substantially in the form of Exhibit
H hereto.
(e) The definition of "SURETY" is hereby added to Section 1.1 of the
Original Agreement immediately following the definition of "SUBORDINATION
AGREEMENT" to read as follows:
"SURETY" means, collectively, Van American Insurance Company, United
States Fidelity & Guaranty Company and American International Company.
(f) The definition of "SURETY AGREEMENT" is hereby added to Section 1.1 of
the Original Agreement immediately following the definition of "SURETY" to read
as follows:
"SURETY AGREEMENT" means, collectively, the agreements between
Borrower and the Surety, substantially in the form of Exhibit H hereto.
SECTION 2.2. LIMITATION ON LIENS. New clauses (vii) and (viii) are hereby
added to subsection (b) of Section 5.2 of the Original Agreement to read as
follows:
(vii) Liens granted by Borrower pursuant to the Surety Agreement
in favor of the Surety on cash collateral held by the Surety in an
aggregate amount not to exceed $10,000,000 at any time, so long as the
Surety has executed and delivered the Subordination Agreement.
(viii) subordinated Liens granted by Related Persons pursuant to
the Surety Agreement in favor of the Surety, so long as the Surety has
executed and delivered the Subordination Agreement and such Related Person
has granted to Agent a first priority Lien in the property to be encumbered
by the subordinated Lien.
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SECTION 2.3. LIMITATION ON SALES OF PROPERTY. A new clause (iv) is hereby
added to subparagraph (d) of Section 5.2 of the Original Agreement to read as
follows:
(iv) the transfer of the Subject Properties from Borrower to the LLC.
SECTION 2.4. TANGIBLE NET WORTH. Subsection (m) of Section 5.2 of the
Original Agreement is hereby amended in its entirety to read as follows:
(m) TANGIBLE NET WORTH.
(i) Borrower's Consolidated Tangible Net Worth as of the end of any
Fiscal quarter ending after December 31, 1995 will not be less than (A) the
sum of (1) $150,000,000, plus (2) 50% of Borrower's Adjusted Consolidated
Net Income earned during the period from January 1, 1996 to the end of such
Fiscal Quarter, if positive, or zero, if negative, plus (3) 100% of the net
proceeds from the issuance of equity securities of Borrower during the
period from January 1, 1996 to the end of such Fiscal Quarter;
(ii) As used in this subsection (m), the following terms shall have
the meanings set forth below:
(A) "Additional Special Charges" means (i) the amount of the
Star Phoenix Judgment, but only for 180 days after the date that such
judgment is entered, and (ii) all reclamation or other non-cash
charges relating to the Grouse Creek Mine or the American Girl Mine
which are not Anticipated Special Charges, but only for 180 days after
the date that such deduction is recognized.
(B) "Anticipated Special Charges" means all reclamation or other
non-cash charges relating to either the Grouse Creek Mine or the
American Girl Mine that are deducted in determining Borrower's
Consolidated net income for any period, provided that (i) only such
charges relating to the Grouse Creek Mine that accrue between the
Fiscal Quarters ending June 30, 1996 and March 31, 1997 shall be
deducted and (ii) the aggregate amount of all such charges deducted
after the Fiscal Quarter ending June 30, 1996 does not exceed
$50,000,000 (meaning that all such charges deducted prior to June 30,
1996 shall not be counted for purposes of this clause (ii)).
(C) "Borrower's Adjusted Consolidated Net Income" means, for any
period, the sum of (i) Borrower's Consolidated net income for such
period, (ii) PLUS all
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Anticipated Special Charges, and (iii) PLUS any Additional Special
Charges.
(D) "Borrower's Consolidated Debt" means all Consolidated
liabilities and similar balance sheet items of Borrower, together with
all Funded Debt of any Related Person.
(E) "Borrower's Consolidated Tangible Net Worth" means the
remainder of (x) all Consolidated Assets of Borrower, other than
intangible assets (including without limitation as intangible assets
such assets as patents, copyrights, licenses, franchises, goodwill,
trade names, trade secrets and leases other than oil, gas or mineral
leases or leases required to be capitalized under GAAP), minus (y)
Borrower's Consolidated Debt.
(F) "Star Phoenix Judgment" means a judgment adverse to Borrower
entered by the Supreme Court of Idaho in that certain case styled STAR
PHOENIX MINING COMPANY V. HECLA MINING COMPANY, Case Nos. 29020 &
29023 (consolidated), original filed in the First Judicial District
Court in and for the county of Shoshone.
SECTION 2.5. SECURITY SCHEDULE. A new Schedule 5 is hereby added to the
Original Agreement to read as set forth in Schedule 5 attached hereto.
SECTION 2.6. FORM OF SUBORDINATION AGREEMENT. New Exhibits G and H are
hereby added to the Original Agreement to read as set forth in Exhibits G and H,
respectively, attached hereto.
ARTICLE III.
CONDITIONS OF EFFECTIVENESS
SECTION 3.1. EFFECTIVE DATE. This Amendment shall become effective as of
the date first above written upon the delivery of the following (there are no
other conditions to its effectiveness):
(a) Agent shall have received each of the Amendment Documents duly
executed and delivered by each Person which is a party thereto;
(b) Agent shall have received an amendment fee of $55,000 payable to Agent
for the account of Lenders in accordance with their Percentage Shares; and
(c) Agent shall have additionally received all of the following documents,
each document (unless otherwise indicated) being dated the date of receipt
thereof by Agent, duly authorized,
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executed and delivered, and in form and substance satisfactory to Agent:
(i) certificates of duly authorized officers of Borrower and each
Subsidiary Guarantor to the effect that all of the representations and
warranties set forth in Article IV hereof are true and correct at and as of
the time of such effectiveness;
(ii) certificates of the Secretaries or Assistant Secretaries of
Borrower and each Subsidiary Guarantor dated the date of the Amendment
Documents certifying that attached thereto is a true and complete copy of
resolutions adopted by the Board of Directors of such corporation
authorizing the execution, delivery and performance of the Amendment
Documents and certifying the names and true signatures of the officers of
such corporation authorized to sign the Amendment Documents;
(iii) an opinion of Borrower's General or Corporate Counsel in
form and substance satisfactory to Agent; and
(iv) such supporting documents as Agent may reasonably request.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
SECTION 4.1. REPRESENTATIONS AND WARRANTIES OF BORROWER. In order to
induce each Lender to enter into the Amendment Documents, each of Borrower and
the Subsidiary Guarantors represents and warrants to each Lender that:
(a) The representations and warranties contained in Section 4.1 of the
Original Agreement are true and correct at and as of the time of the
effectiveness hereof.
(b) Each of Borrower and the Subsidiary Guarantors is duly authorized to
execute and deliver the Amendment Documents and is and will continue to be duly
authorized to borrow monies and to perform its obligations under the Credit
Agreement. Each of Borrower and the Subsidiary Guarantors has duly taken all
corporate action necessary to authorize the execution and delivery of the
Amendment Documents and to authorize the performance of its obligations
hereunder.
(c) The execution and delivery by each of Borrower and the Subsidiary
Guarantors of the Amendment Documents, the performance by each of Borrower and
the Subsidiary Guarantors of its obligations thereunder and the consummation of
the transactions contemplated thereby do not and will not conflict with any
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provision of law, statute, rule or regulation or of the certificate or articles
of incorporation and bylaws of Borrower and each Subsidiary Guarantor, or of any
material agreement, judgment, license, order or permit applicable to or binding
upon Borrower or any Subsidiary Guarantor, or result in the creation of any
lien, charge or encumbrance upon any assets or properties of Borrower or any
Subsidiary Guarantor. Except for those which have been obtained, no consent,
approval, authorization or order of any court or governmental authority or third
party is required in connection with the execution and delivery by Borrower or
any Subsidiary Guarantor of the Amended Documents.
(d) When duly executed and delivered, each of the Amendment Documents and
the Credit Agreement will be a legal and binding obligation of each of Borrower
and the Subsidiary Guarantors, enforceable in accordance with its terms, except
as limited by bankruptcy, insolvency or similar laws of general application
relating to the enforcement of creditors' rights and by equitable principles of
general application.
(e) The audited annual Consolidated financial statements of Borrower dated
as of December 31, 1995 and the unaudited quarterly Consolidated financial
statements of Borrower dated as of June 30, 1996 fairly present the Consolidated
financial position at such dates and the Consolidated statement of operations
and the changes in Consolidated financial position for the periods ending on
such dates for Borrower. Copies of such financial statements have heretofore
been delivered to each Lender. Since June 30, 1996, no material adverse change
has occurred in the financial condition or businesses or in the Consolidated
financial condition or businesses of Borrower.
ARTICLE V.
MISCELLANEOUS
SECTION 5.1. RATIFICATION OF AGREEMENTS. The Original Agreement as hereby
amended is hereby ratified and confirmed in all respects. The Loan Documents,
as they may be amended or affected by the various Amendment Documents, are
hereby ratified and confirmed in all respects. Any reference to the Credit
Agreement in any Loan Document shall be deemed to refer to this Amendment also
and any reference in any Loan Document to any other document or instrument
amended, renewed, extended or otherwise affected by any Amendment Document shall
also refer to such Amendment Document. The execution, delivery and
effectiveness of the other Amendment Documents shall not, except as expressly
provided herein or therein, operate as a waiver of any right, power or remedy of
Lender under the Credit Agreement or any other Loan Document nor constitute a
waiver of any provision of the Credit Agreement or any other Loan Document.
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SECTION 5.2. SURVIVAL OF AGREEMENTS. All representations, warranties,
covenants and agreements of Borrower herein shall survive the execution and
delivery of the Amendment Documents and the performance hereof and shall further
survive until all of the Obligations are paid in full. All statements and
agreements contained in any certificate or instrument delivered by Borrower or
any Related Person hereunder or under the Credit Agreement to any Lender shall
be deemed to constitute representations and warranties by, and/or agreements and
covenants of, Borrower under the Amendment Documents and under the Credit
Agreement.
SECTION 5.3. GOVERNING LAW. The Amendment Documents shall be governed by
and construed in accordance with the laws of the State of Texas and any
applicable laws of the United States of America in all respects, including
construction, validity and performances.
SECTION 5.4. COUNTERPARTS. This Amendment may be separately executed in
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed shall be deemed to constitute one and the same
Amendment.
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IN WITNESS HEREOF, this Amendment is executed as of the date first above
written.
HECLA MINING COMPANY, Borrower
By: /s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
Vice President-Finance and
Treasurer
COLORADO AGGREGATE COMPANY OF NEW
MEXICO, INC., Subsidiary Guarantor
By: /s/ J. Gary Childress
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J. Gary Childress
Vice President
KENTUCKY-TENNESSEE CLAY COMPANY,
Subsidiary Guarantor
By: /s/ J. Gary Childress
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J. Gary Childress
Vice President
K-T FELDSPAR CORPORATION,
Subsidiary Guarantor
By: /s/ J. Gary Childress
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J. Gary Childress
Vice President
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MOUNTAIN WEST PRODUCTS, INC.,
Subsidiary Guarantor
By: /s/ J. Gary Childress
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J. Gary Childress
Vice President
NATIONSBANK OF TEXAS, N.A.,
Agent and Lender
By: /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
Senior Vice President
BANK OF AMERICA N W, N.A. (formerly
known as Seattle-First National
Bank), as successor by merger to
Bank of America Idaho N.A., Lender
By: /s/ Xxx Xxxxx
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Xxx Xxxxx
Vice President
FIRST SECURITY BANK OF IDAHO, N.A.,
Lender
By: /s/ Xxxxx Xxxx
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Xxxxx Xxxx
Vice President
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