Exhibit 4
May 1, 2002
Xxxxxxxx Casting Corporation
000 Xxxxx 0xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000-0188
Attention: Chief Financial Officer
Re: Atchison Casting Corporation (the "Company") April 3, 1998 Amended and
Restated Credit Agreement by and among the Company, Xxxxxx Trust and
Savings Bank, as Agent and the Banks party thereto (as heretofore
amended, the "Credit Agreement")
Ladies and Gentlemen:
Pursuant to the Twelfth Amendment and Forbearance Agreement dated as of
December 18, 2001 (the "Twelfth Amendment") the Bank Group agreed to temporarily
forbear from enforcing its rights and remedies with respect to the Credit
Agreement through June 30, 2002. Paragraph 7 of the Twelfth Amendment provides
that a portion of the proceeds from the liquidation of the Company's assets will
be used to permanently reduce the Commitments, and the balance of such proceeds
("Excess Funds") shall be deposited with Collateral Agent and be disbursed
pursuant to the Cash Collateral Use Agreement, subject to certain conditions.
The Company and the Bank hereby agree to amend Paragraph 7 of the Twelfth
Amendment to revise the conditions applicable to the Company's use of the Excess
Funds.
The Company acknowledges and confirms the Collateral Agent has a first,
valid, superior, enforceable and fully perfected lien on the tax refund received
in April 2002 in the amount of approximately $5.5 million ("April Tax
Refund"). The company desires the April Tax Refund be treated pursuant to
Paragraph 7 of the Twelfth Amendment subject to the changes set forth below.
Accordingly, effective upon the execution of this letter by the Required
Banks, the Company and Guarantors in the spaces provided for that purpose below
(which execution may be on separate counterparts of this letter, all of which
are to constitute one and the same instrument), (i) the last paragraph of
Paragraph 7 of the Twelfth Amendment is hereby amended and restated in its
entirety to read as follows:
The Borrower covenants and agrees to enter into an amendment and
forbearance agreement with TIAA containing provisions in which it
agrees to repay TIAA a portion of the Teacher's Note in an amount not
in excess of that percentage of such proceeds as set forth above next
to the applicable category.
In addition, the Borrower covenants and agrees not to amend or
otherwise modify such provision with TIAA without the prior written
consent of the Required Banks. The balance of any such proceeds (after
giving effect to the repayment of the Obligations owing the Bank Group
and the Teacher's Note as required above) (the "Excess Funds") shall
be deposited with the Collateral Agent under the Cash Collateral Use
Agreement and held in a separate Cash Collateral Account (as defined
in the Cash Collateral Use Agreement). The Borrower and Guarantors
agree that the Collateral Agent is authorized to transfer the Excess
Funds from the Cash Collateral Account only pursuant to the written
authorization of the Required Lenders. On the Standstill Expiration
Date or, if earlier on the last day of the Standstill Period, a
portion of the Commitments shall terminate by an amount equal to
87.12% of Excess Funds then on deposit in the Cash Collateral Account
and the Collateral Agent is directed to repay the Obligations in an
amount equal to 87.12% of the Excess Funds then on deposit in the Cash
Collateral Account.
and (ii) the Required Banks consent to the execution of a letter agreement by
the Company and Guarantors with TIAA on the same terms as this letter agreement.
For the purposes of the April Tax Refund and solely for that purpose and no
other purposes the Required Lenders: (a) waive the last sentence of the last
paragraph of Paragraph 7 of the Twelfth Amendment, (b) agree that sentence shall
be deleted therefrom solely for the purposes of the April Tax Refund, and (c)
agree the second to the last sentence of the last paragraph of Paragraph 7 of
the Twelfth Amendment shall read, solely for the purposes of the April Tax
Refund, as follows:
The Borrower and Guarantors agree that 50% of the April Tax
Refund which are Excess Funds shall remain in the Cash Collateral
Account and the Collateral Agent is authorized to transfer the Excess
Funds (solely as such relate to the April Tax Refund) from the Cash
Collateral Account only pursuant to the written authorization of the
Required Lenders and TIAA.
The Company, Guarantors and Xxxxx acknowledge and agree that subject to the
terms of the Credit Agreement, the Commitments of the Banks on the date hereof
are as set forth on Schedule I hereto.
Except as specifically modified hereby, all of the terms and conditions of
the Credit Agreement shall remain in full force and effect. Without limiting the
generality of the foregoing, this letter does not waive any of the other
Defaults or Events of Default that now exist.
All defined terms used herein and not defined herein shall have the same
meaning herein as in the Twelfth Amendment. This letter agreement shall be
governed and construed in accordance with the laws of the State of Illinois. All
capitalized terms used herein without definition shall have the same meaning
herein as such terms have in the Credit Agreement.
Very truly yours,
XXXXXX TRUST AND SAVINGS BANK, in its individual
capacity as a Bank and as Agent
By: /s/ Xxxxxxxx Xxxxxxx
Title: Vice President
COMMERCE BANK, N.A.
By: /s/ Xxxxxx X. Xxxxx
Title: Senior Vice President
US BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxx
Title: Vice President
KEY BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx Xxxxxxx
Title: Vice President
COMERICA BANK
By: /s/ Xxxxxx X. Xxxxx
Title: Vice President
HIBERNIA NATIONAL BANK
By: ____________________________________________________
Title:___________________________________________________
NATIONAL WESTMINSTER BANK PLC
Nassau Branch
By: /s/ Xxxx Xxxxxxx
Title: Head of Mid Corporate Team
Corporate Restructuring Unit
New York Branch
By: /s/ Xxxx Xxxxxxx
Title: Head of Mid Corporate Team
Corporate Restructuring Unit
XXXXX FARGO BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxx
Title: Vice President
Agreed and Accepted:
XXXXXXXX CASTING CORPORATION
By: /s/ Xxxxx X. XxXxxxxx
Title: VP & Treasurer
AMITE FOUNDRY AND MACHINE, INC.
PROSPECT FOUNDRY, INC.
QUAKER ALLOY, INC.
CANADIAN STEEL FOUNDRIES, LTD.
3210863 CANADA INC.
XXXXXX INTERNATIONAL, INC.
EMPIRE STEEL CASTINGS, INC.
LAGRANGE FOUNDRY INC.
THE G&C FOUNDRY COMPANY
LOS ANGELES DIE CASTING INC.
CASTCAN STEEL LTD.
CANADA ALLOY CASTINGS, LTD.
PENNSYLVANIA STEEL FOUNDRY & MACHINE COMPANY
SPRINGFIELD IRON CORP.
INVERNESS CASTINGS GROUP, INC.
DU-WEL PRODUCTS, INC.
XXXXX CASTING AND ASSEMBLY, INC.
CLAREMONT FOUNDRY, INC.
LONDON PRECISION MACHINE & TOOL LTD.
By: /s/ Xxxxx X. XxXxxxxx
Title: Vice President
XXXXXXX INDUSTRIES, INC.
By: /s/ Xxxx X. Xxxxxx
Title: President
SCHEDULE I
COMMITMENTS
Commitments
Xxxxxx Trust and Savings Bank $17,430,297.74
Commerce Bank, N.A. 9,507,435.14
US Bank National Association 9,507,435.14
Key Bank National Association 9,507,435.14
Comerica Bank 6,338,290.09
Hibernia National Bank 6,338,290.09
National Westminster Bank Plc 6,338,290.09
Xxxxx Fargo Bank, National Association $ 4,753,717.56
---------------
Total $69,721,190.99
