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EXHIBIT 10.1
AMENDMENT NO. 3A
TO
CREDIT AGREEMENT
THIS AMENDMENT NO. 3A TO CREDIT AGREEMENT ("AMENDMENT") is dated as of
September 30, 1998, by and among METAL MANAGEMENT, INC., a Delaware corporation
("MTLM"), each of the corporations and other entities set forth on ANNEX 1
hereto (MTLM and each of such corporations and other entities sometimes
hereinafter are referred to individually as a "BORROWER" and collectively as
"BORROWERS"); MTLM, acting in its capacity as funds administrator for itself and
the other Borrowers (in such capacity, the "FUNDS ADMINISTRATOR"); BT COMMERCIAL
CORPORATION, a Delaware corporation (in its individual capacity, hereinafter
referred to as "BTCC") and the other financial institutions signatories hereto
as lenders (BTCC and each of such other financial institutions hereinafter are
referred to individually as a "LENDER" and collectively as "LENDERS"); and BTCC,
acting in its capacity as agent (in such capacity, hereinafter referred to as
the "AGENT") for itself and the other Lenders. Capitalized terms used herein but
not otherwise defined herein shall have the respective meanings assigned to such
terms in the Credit Agreement.
WITNESSETH:
WHEREAS, the Borrowers, the Funds Administrator, the Agent and the
Lenders have entered into that certain Credit Agreement dated as of March 31,
1998, as amended (the "CREDIT AGREEMENT"), pursuant to which the Lenders have
agreed to make certain loans and other financial accommodations to or for the
account of the Borrowers;
WHEREAS, the Borrowers, the Funds Administrator, the Agent and the
Lenders have entered into that certain Amendment No. 3 to Credit Agreement dated
as of August 7, 1998 (the "THIRD AMENDMENT");
WHEREAS, certain conditions precedent to effectiveness of the Third
Amendment were not satisfied, including, without limitation, consummation of the
"Xxxxxx Stock Purchase" and the "Xxxxxxx Stock Purchase" (in each case as
defined in the Third Amendment) no later than September 30, 1998, the Third
Amendment did not become effective; and
WHEREAS, the Borrowers, the Agent and the Lenders have agreed to
further amend the Credit Agreement, on the terms and subject to the conditions
hereinafter set forth;
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NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
respective parties hereto hereby agree as follows:
1. AMENDMENT TO CREDIT AGREEMENT. Effective as of the date hereof, upon
satisfaction of the conditions precedent set forth in SECTION 2 below, and in
reliance upon the representations and warranties of the respective Borrowers and
the Funds Administrator set forth herein, the Credit Agreement is hereby amended
as follows:
1.1 The Credit Agreement is hereby amended by inserting
therein the following language immediately following SECTION 6.23
thereof:
6.24 YEAR 2000. The Borrowers have reviewed the areas
within their respective businesses and operations which could
be adversely affected by, and have developed or are developing
a program to address on a timely basis, the "Year 2000
Problem" (that is, the risk that computer applications and
embedded microchips in non-computing devices used by the
Borrowers may be unable to recognize and perform properly
date-sensitive functions involving certain dates prior to and
any date after December 31, 1999). Based on such review and
program, the Borrowers reasonably believe that the "Year 2000
Problem" will not have a Material Adverse Effect.
1.2 The Credit Agreement is hereby amended by inserting
therein the following language immediately following SECTION 7.15
thereof:
7.16 YEAR 2000. The Borrowers shall provide the Agent
with the such information about its year 2000 computer
readiness (including, without limitation, information as to
contingency plans, budgets and testing results) as the Agent
shall reasonably request.
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1.3 SECTION 8.1 of the Credit Agreement is hereby deleted in
its entirety and the following language is hereby substituted therefor:
8.1 FINANCIAL COVENANTS.
(A) MINIMUM EBITDA. The Borrowers shall not permit
EBITDA, (I) determined as of September 30, 1998, for the six
(6) month period ending as of such date, to be less than
$1,500,000, and (II) determined as of December 31, 1998, for
the nine (9) month period ending as of such date, to be less
than $6,000,000.
(B) MINIMUM INTEREST COVERAGE RATIO. The Borrowers
shall not permit the Interest Coverage Ratio to be less than
1.0 to 1.0, as determined as of: (I) March 31, 1999, for the
six (6) month period ending as of such date; (II) June 30,
1999, for the nine (9) month period ending as of such date;
and (III) September 30, 1999 and the end of each fiscal
quarter of the Consolidated Entity ending thereafter, in each
case for the twelve (12) month period ending as of such date.
1.4 SECTION 8.7(V) of the Credit Agreement is hereby deleted
in its entirety and the following language is hereby substituted
therefor:
(V) so long as, in each case, before and after giving
effect to each such repurchase or redemption, no Default or
Event of Default shall have occurred and be continuing, MTLM
may repurchase or redeem shares of its capital stock and/or
Subordinated Notes (including refinancings thereof) at any
time with Equity Offering Proceeds constituting Unallocated
Equity Offering Proceeds at such time; PROVIDED, that,
concurrently with the making of any repurchase or redemption
with Unallocated Equity Offering Proceeds, the Funds
Administrator shall have delivered to the Agent an Equity
Offering Proceeds Allocation Certificate with respect thereto.
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2. CONDITIONS PRECEDENT. This Amendment shall become effective as of
the date hereof, upon satisfaction of each of the following conditions:
(A) the Agent shall have received six (6) copies of this
Amendment, duly executed by the Majority Lenders, each of the Borrowers
and the Funds Administrator; and
(B) the Agent shall have received in immediately available
funds for the ratable account of the Lenders a fee in the amount of
$100,000.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS.
3.1 Each of the Borrowers and the Funds Administrator
hereby represents and warrants to the Agent and each of the Lenders
that, after giving effect to this Amendment:
(A) All representations and warranties contained in
the Credit Agreement and the other Credit Documents are true
and correct in all material respects on and as of the date of
this Amendment, in each case as if then made, other than
representations and warranties that expressly relate solely to
an earlier date (in which case such representations and
warranties remain true and accurate on and as of such earlier
date);
(B) No Default or Event of Default has occurred which
is continuing;
(C) This Amendment, and the Credit Agreement, as
amended hereby, constitute legal, valid and binding
obligations of the Borrowers and the Funds Administrator,
respectively, and are enforceable against each of the
Borrowers and the Funds Administrator in accordance with their
respective terms; and
(D) The execution and delivery by the Borrowers and
the Funds Administrator of this Amendment does not require the
consent or approval of any Person, except such consents and
approvals as have been obtained.
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4. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER CREDIT
DOCUMENTS.
4.1 Upon the effectiveness of this Amendment, each
reference in the Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein" or words of like import, and each reference in each
of the other Credit Documents to the "Credit Agreement" shall in each
case mean and be a reference to the Credit Agreement as amended hereby.
4.2 Except as expressly set forth herein, (I) the
execution and delivery of this Amendment shall in no way affect any of
the respective rights, powers or remedies of the Agent or any of the
Lenders with respect to any Event of Default nor constitute a waiver of
any provision of the Credit Agreement or any of the other Credit
Documents and (II) all of the respective terms and provisions of the
Credit Agreement, the other Credit Documents and all other documents,
instruments, amendments and agreements executed and/or delivered by any
of the Borrowers and/or the Funds Administrator pursuant thereto or in
connection therewith shall remain in full force and effect and are
hereby ratified and confirmed in all respects. The execution and
delivery of this Amendment by the Agent and each of the Lenders shall
in no way obligate the Agent or any of the Lenders, at any time
hereafter, to consent to any other amendment or modification of any
term or provision of the Credit Agreement or any of the other Credit
Documents, whether of a similar or different nature.
5. GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL
LAWS AND DECISIONS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.
6. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
7. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. Any such counterpart
which may be delivered by facsimile transmission shall be deemed the equivalent
of an originally signed counterpart and shall be fully admissible in any
enforcement proceedings regarding this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their proper and duly authorized officers as of
the date first set forth above.
BT COMMERCIAL CORPORATION, in its
individual capacity as a
Lender and in its capacity as Agent
By: __________________________
Name: ____________________________
Title: ____________________________
XXXXXX FINANCIAL, INC.
By: __________________________
Name: ____________________________
Title: ____________________________
SANWA BUSINESS CREDIT CORPORATION
By: __________________________
Name: ____________________________
Title: ____________________________
FLEET CAPITAL CORPORATION
By: __________________________
Name: ____________________________
Title: ____________________________
LASALLE NATIONAL BANK
By: __________________________
Name: ____________________________
Title: ____________________________
CONGRESS FINANCIAL CORP. (CENTRAL)
By: __________________________
Name: ____________________________
Title: ____________________________
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FINOVA CAPITAL CORPORATION
By: __________________________
Name: ____________________________
Title: ____________________________
NATIONAL CITY COMMERCIAL FINANCE,
INC.
By: __________________________
Name: ____________________________
Title: ____________________________
PNC BUSINESS CREDIT
By: __________________________
Name: ____________________________
Title: ____________________________
IBJ XXXXXXXX BUSINESS CREDIT
CORPORATION
By: __________________________
Name: ____________________________
Title: ____________________________
NATIONAL BANK OF CANADA
By: __________________________
Name: ____________________________
Title: ____________________________
BANKBOSTON, N.A.
By: __________________________
Name: ____________________________
Title: ____________________________
METAL MANAGEMENT, INC., a Delaware
corporation, in its individual
capacity as a Borrower and in its
capacity as Funds Administrator
By: _______________________________
Name: _____________________________
Title: ____________________________
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AEROSPACE METALS, INC.
AMERICAN SCRAP PROCESSING, INC.
BRIQUETTING CORPORATION OF AMERICA
C SHREDDING CORP.
CALIFORNIA METALS RECYCLING, INC.
CIM TRUCKING, INC.
COMETCO CORP.
XXXXX BUILDING CORPORATION
XXXXX IRON & METAL, INC.
EMCO TRADING, INC.
FERREX TRADING CORPORATION
FIRMA, INC.
FIRMA PLASTIC CO., INC.
HOUSTON COMPRESSED STEEL CORP.
HOUTEX METALS COMPANY, INC.
THE XXXXX CORPORATION
X. XXXXXX IRON & METAL, INC.
KANKAKEE SCRAP CORPORATION
MAC LEOD METALS CO.
METAL MANAGEMENT ARIZONA, INC.
METAL MANAGEMENT REALTY, INC.
PAULDING RECYCLING,INC.
PROLER SOUTHWEST INC.
PROLER STEELWORKS L.L.C.
SALT RIVER RECYCLING, L.L.C.
SCRAP PROCESSING, INC.
SUPERIOR FORGE, INC.
TROJAN TRADING CO.
USA SOUTHWESTERN CARRIER, INC.
138 SCRAP ACQUISITION CORP.
R & P HOLDINGS, INC.
R & P REAL ESTATE, INC.
XXXXXXX XXXXXXXXX COMPANY
METAL MANAGEMENT GULF COAST, INC.
XXXXXX RECYCLING WEST, INC..
NAPORANO IRON & METAL CO.
NIMCO SHREDDING CO.
XXXXXXX XXXXXXXXX & SONS, INC.
TORRINGTON SCRAP COMPANY
XXXXXXXXX ACQUISITION CORP.
NICROLOY ACQUISITION CORP.
By: __________________________
Name: _________________________
Title: ________________________
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RESERVE IRON & METAL LIMITED
PARTNERSHIP
By: X. XXXXXX IRON & METAL, INC., its
general partner
By: __________________________
Name: _________________________
Title: ________________________
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XXXXX 0
XX
XXXXXXXXX XX. 0X
DATED AS OF SEPTEMBER 30, 1998
OTHER BORROWERS
1. AEROSPACE METALS, INC.
2. AMERICAN SCRAP PROCESSING, INC.
3. BRIQUETTING CORPORATION OF AMERICA
4. C SHREDDING CORP.
5. CALIFORNIA METALS RECYCLING, INC.
6. CIM TRUCKING, INC.
7. COMETCO CORP.
8. XXXXX BUILDING CORPORATION
9. XXXXX IRON & METAL, INC.
10. EMCO TRADING, INC.
11. FERREX TRADING CORPORATION
12. FIRMA, INC.
13. FIRMA PLASTIC CO., INC.
14. HOUSTON COMPRESSED STEEL CORP.
15. HOUTEX METALS COMPANY, INC.
16. THE XXXXX CORPORATION
17. X. XXXXXX IRON & METAL, INC.
18. KANKAKEE SCRAP CORPORATION
19. MAC LEOD METALS CO.
20. METAL MANAGEMENT ARIZONA, INC.
21. METAL MANAGEMENT REALTY, INC.
22. PAULDING RECYCLING,INC.
23. PROLER SOUTHWEST INC.
24. PROLER STEELWORKS L.L.C.
25. SALT RIVER RECYCLING, L.L.C.
26. SCRAP PROCESSING, INC.
27. SUPERIOR FORGE, INC.
28. TROJAN TRADING CO.
29. USA SOUTHWESTERN CARRIER, INC.
30. RESERVE IRON & METAL LIMITED PARTNERSHIP
31. 138 SCRAP ACQUISITION CORP.
32. R & P HOLDINGS, INC.
33. R & P REAL ESTATE, INC.
34. XXXXXXX XXXXXXXXX COMPANY
35. METAL MANAGEMENT GULF COAST, INC.
36. XXXXXX RECYCLING WEST, INC..
37. NAPORANO IRON & METAL CO.
38. NIMCO SHREDDING CO.
39. XXXXXXX XXXXXXXXX & SONS, INC.
40. TORRINGTON SCRAP COMPANY
41. XXXXXXXXX ACQUISITION CORP.
42. NICROLOY ACQUISITION CORP.