SIXTH AMENDMENT TO CREDIT AGREEMENT
Exhibit 10.1
EXECUTION VERSION
SIXTH AMENDMENT TO CREDIT AGREEMENT
This SIXTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made as of April 25, 2022, by and among SIGMATRON INTERNATIONAL, INC., a Delaware corporation (“Borrower”), the other Loan Parties party hereto, and JPMORGAN CHASE BANK, N.A. (“Lender”).
RECITALS :
A. The Loan Parties and the Lender have heretofore entered into a Credit Agreement dated as of January 29, 2021 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement.
B. The Loan Parties and the Lender have agreed to make certain amendments to the Credit Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties hereto hereby agree as follows:
SECTION 1. AMENDMENTS.
Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Credit Agreement shall be and hereby is amended as follows:
1.1. The following new defined terms are added to the Definitions Schedule to the Credit Agreement in their appropriate alphabetical position, each to read as follows:
“FILO Expiration Date” means the date that is one hundred twenty (120) days after the Sixth Amendment Effective Date.
“FILO Term Loan” have the meanings assigned to such term in the FILO Term Loan Rider.
“Sixth Amendment Effective Date” means April 25, 2022.
1.2. A new FILO Term Loan Rider is added to the Credit Agreement immediately following the Term Loan Rider to read as set forth the the FILO Term Loan Rider attached hereto and made a part hereof.
SECTION 2. CONDITIONS TO EFFECTIVENESS.
The effectiveness of this Amendment is subject to the satisfaction of all of the following conditions precedent:
2.1. Xxxxxx shall have received duly executed copies of this Amendment from Borrower.
2.2. Xxxxxx shall have received a duly executed legal opinion from counsel to Borrower in respect of this Amendment (including the Revolving Commitment increase), which opinion shall be in form and substance reasonably acceptable to Lender.
2.3. Legal matters incident to the execution and delivery of this Amendment shall be reasonably satisfactory to Lender and its counsel.
SECTION 3. REPRESENTATIONS, WARRANTIES AND COVENANTS.
In order to induce Xxxxxx to enter into this Amendment, each Loan Party hereby jointly and severally represents, warrants and covenants to Lender, as of the date hereof that:
3.1. Representations, Warranties and Covenants. (i) After giving effect to this Amendment, no representation or warranty of any Loan Party contained in the Credit Agreement or any of the Loan Documents, including this Amendment, shall be untrue or incorrect in any material respect as of the date hereof, except to the extent that such representation or warranty expressly relates to an earlier date and (ii) no Default has occurred or is continuing, or would result after giving effect hereto.
3.2. Authorization, Etc. Each Loan Party has the corporate or limited liability company power, as applicable, and authority to execute, deliver and perform this Amendment. Since the Effective Date, there has been no amendment, modification, restatement or supplement to (a) any Loan Party’s organizational documents (i.e., articles of incorporation or organization and by-laws or operating agreement) (the “Organizational Documents”) or (b) the resolutions that were delivered to the Lender (i) with respect to the Borrower, on January 29, 2021 and (ii) with respect to Wagz, Inc., on December 31, 2021, and such Organizational Documents and resolutions are in full force and effect as of the date hereof. Each Loan Party has taken all necessary corporate or limited liability company action (including, without limitation, obtaining approval of its stockholders or members, if necessary) to authorize its execution, delivery and performance of this Amendment. No consent, approval or authorization of, or declaration or filing with, any Governmental Authority, and no consent of any other Person, is required in connection with any Loan Party’s execution, delivery and performance of this Amendment, except for those already duly obtained. This Amendment has been duly executed and delivered by each Loan Party and constitutes the legal, valid and binding obligation of each Loan Party, enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditor rights generally or by equitable principles relating to enforceability. No Loan Party’s execution, delivery or performance of this Amendment (x) contravenes the terms of any of such Loan Party’s Organizational Documents; (y) conflicts with or constitutes a violation or breach of, or constitutes a default under, or results in the creation or imposition of any Lien (other than pursuant to the Collateral Documents) upon the property of any Loan Party by reason of the terms of any material contractual obligation (including without limitation contractual obligations arising from any Material Agreements to which any Loan Party is a party or which is binding upon it); or (z) violates any Requirement of Law in any material respect.
SECTION 4. REFERENCE TO AND EFFECT ON LOAN DOCUMENTS.
4.1. Ratification. Except as specifically provided in this Amendment, the Credit Agreement and the Loan Documents shall remain in full force and effect and each Loan Party hereby ratifies and reaffirms each term and condition set forth in the Credit Agreement and in the other Loan Documents, effective as of the date hereof.
4.2 No Waiver. This Amendment is only applicable and shall only be effective in the specific instances and for the specific purposes for which made or given. Except as specifically provided in this Amendment, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver or forbearance of any right, power or remedy of Lender under the Credit Agreement or any of the Loan Documents, or constitute a consent, waiver or modification with respect to any provision of the Credit Agreement or any of the Loan Documents which shall remain in full force and effect. Upon the effectiveness of this Agreement each reference in (i) the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” or words of similar import and (ii) any Loan Document to “the Agreement” shall, in each case and except as otherwise specifically stated therein, mean and be a reference to the Credit Agreement as amended hereby.
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4.3. Collateral. The Loan Parties heretofore executed and delivered to Lender the Collateral Documents. The Loan Parties hereby acknowledge and agree that the Liens created and provided for by the Collateral Documents continue to secure, among other things, the Secured Obligations arising under the Credit Agreement as amended hereby; and the Collateral Documents and the rights and remedies of Lender thereunder, the obligations of the Loan Parties thereunder, and the Liens 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.
SECTION 5. AFFIRMATION OF GUARANTORS.
5.1. Each Loan Guarantor hereby acknowledges that it has reviewed the terms and provisions of this Amendment and consents to any modification of the Credit Agreement effected pursuant to this Amendment. Each Loan Guarantor hereby confirms to Lender that, after giving effect to the foregoing Amendment, the Loan Guaranty of such Loan Guarantor and each other Loan Document to which such Loan Guarantor is a party continues in full force and effect and is the legal, valid and binding obligation of such Loan Guarantor, enforceable against such Loan Guarantor in accordance with its terms except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability.
5.2. Each Loan Guarantor acknowledges and agrees that (i) notwithstanding the conditions to effectiveness set forth in this Amendment, such Loan Guarantor is not required by the terms of the Credit Agreement or any other Loan Document to consent to the waivers or modifications to the Credit Agreement effected pursuant to this Amendment and (ii) nothing in the Credit Agreement, this Amendment or any other Loan Document shall be deemed to require the consent of such Loan Guarantor to any future waivers or modifications to the Credit Agreement.
SECTION 6. MISCELLANEOUS.
6.1. Successors and Assigns. This Amendment shall be binding on and shall inure to the benefit of the Loan Parties and Xxxxxx and their respective successors and assigns, except as otherwise provided herein. No Loan Party may assign, transfer, hypothecate or otherwise convey its rights, benefits, obligations or duties hereunder without the prior written consent of Xxxxxx. The terms and provisions of this Amendment are for the purpose of defining the relative rights and obligations of the Loan Parties and Lender with respect to the transactions contemplated hereby and there shall be no third party beneficiaries of any of the terms and provisions of this Agreement.
6.2. Entire Agreement. This Amendment, including all schedules and other documents attached hereto or incorporated by reference herein or delivered in connection herewith, constitutes the entire agreement of the parties with respect to the subject matter hereof and supersedes all other understandings, oral or written, with respect to the subject matter hereof.
6.3. Expenses. As provided in Section 8.03 (Expenses; Limitation of Liability; Indemnity, Etc.) of the Credit Agreement, Xxxxxxxx agrees to pay promptly on demand all reasonable and documented out- of-pocket expenses incurred by Xxxxxx in connection with the preparation, execution and delivery of this Amendment.
6.4. 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.
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6.5. Severability. Wherever possible, each provision of this Amendment shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Amendment shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Amendment.
6.6. Conflict of Terms. Except as otherwise provided in this Amendment, if any provision contained in this Amendment is in conflict with, or inconsistent with, any provision in any of the Loan Documents, the provision contained in this Amendment shall govern and control.
6.7. Counterparts. This Amendment may be executed in any number of separate counterparts, each of which shall collectively and separately constitute one agreement. Delivery of an executed signature page to this Amendment by facsimile or electronic transmission shall be effective as delivery of a manually executed signature page to this Amendment.
6.8 Incorporation of Credit Agreement. The provisions contained in Sections 8.09 (Governing Law; Jurisdiction; Consent to Service of Process) and 8.10 (Waiver of Jury Trial) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in their entirety, except with reference to this Amendment rather than the Credit Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Amendment to be duly executed and delivered as of the date first above written.
| BORROWER: | ||
| SIGMATRON INTERNATIONAL, INC. | ||
| By: | /s/ Xxxx X. Xxxxxxxx | |
| Name: | Xxxx X. Xxxxxxxx | |
| Title: | CEO | |
| OTHER LOAN PARTIES: | ||
| WAGZ, INC. | ||
| By: | /s/ Xxxx X. Xxxxxxxx | |
| Name: | Xxxx X. Xxxxxxxx | |
| Title: | Chairman of the Board | |
[Signature Page to Sixth Amendment to Credit Agreement (SigmaTron International, Inc.)]
| LENDER: | ||
| JPMORGAN CHASE BANK, N.A. | ||
| By: | /s/ Xxxx Xxxxxxxxx | |
| Name: | Xxxx Xxxxxxxxx | |
| Title: | Authorized Officer | |
[Signature Page to Sixth Amendment to Credit Agreement (SigmaTron International, Inc.)]
FILO TERM LOAN RIDER
This FILO Term Loan Rider (this “Rider”), dated as of the Sixth Amendment Effective Date, is hereby made a part of and incorporated into that certain Credit Agreement dated as of January 29, 2021, by and among SigmaTron International, Inc., a Delaware corporation (the “Borrower”), the other Loan Parties party thereto, and JPMORGAN CHASE BANK, N.A. (the “Lender”) (as it may be amended or modified from time to time, together with all Exhibits, Schedules and Riders annexed thereto from time to time, the “Agreement”).
1. FILO Term Loan. Subject to the terms and conditions of the Agreement and this Rider, Xxxxxx agrees to make a term loan to the Borrower on the Sixth Amendment Effective Date in the principal amount of $5,000,000 (the “FILO Term Loan”), which FILO Term Loan shall constitute a “Loan” for all purposes under the Agreement. The Borrower shall not be entitled to borrow under the FILO Term Loan after the Sixth Amendment Effective Date or to reborrow any amounts repaid with respect to the FILO Term Loan.
2. Interest. The principal balance of the FILO Term Loan outstanding from time to time shall bear interest in accordance with Section 2.12 of the Agreement; provided, that the Applicable Margin with respect to any Borrowing under the FILO Term Loan shall be the applicable rate per annum set forth under the applicable caption below:
| CBFR Spread REVSOFR30 |
CBFR Spread CB Floating Rate | Term SOFR Spread | ||||||
| 4.00% |
2.00 | % | 4.00 | % | ||||
Without limiting the foregoing, the parties hereto agree that, until otherwise modified in accordance with the terms of the Agreement, the Borrowing of the FILO Term Loan on the Sixth Amendment Effective Date shall bear interest at the Adjusted Term SOFR Rate for a one-month Interest Period plus the Applicable Margin of 4.00% (as set forth above), with interest for the FILO Term Loan payable in arrears at the times set forth in Section 2.12(e) of the Agreement.
3. Payments and Prepayments. (a) Payments with respect to the FILO Term Loan shall be made in dollars and in immediately available funds, without any offset or counterclaim. To the extent not previously paid, the unpaid balance of the FILO Term Loan (whether principal or interest) shall be paid in full in cash by the Borrower on the FILO Expiration Date.
(b) The Borrower may make voluntary prepayments of the FILO Term Loan without premium or penalty in accordance with Section 2.10(a) of the Agreement. Notwithstanding Section 2.10(d) of the Agreement, all such voluntary prepayments of the FILO Term Loan shall be applied pro rata to the unpaid balance of the FILO Term Loan.
(c) The Borrower shall use the proceeds of any subordinated debt and/or capital call issuance made after the Sixth Amendment Effective Date, but prior to the FILO Expiration Date (a “Contemplated Issuance”), to prepay the FILO Term Loan in full, with any proceeds in excess thereof, unless otherwise modified in accordance with the terms of the Agreement, to be applied to prepay the other Loans in accordance with the terms of Section 2.10 of the Agreement. For the avoidance of doubt, proceeds of any prepayment (other than a Contemplated Issuance) made pursuant to Section 2.10(c) of the Agreement shall be applied to prepay all Loans other than the FILO Term Loan in accordance with the terms of Section 2.10 of the Agreement.
4. Definitions. Capitalized terms contained in this Rider, unless otherwise defined herein, shall have the meanings attributable to such terms under the Agreement.
5. Incorporation by Reference. The terms, covenants and conditions of the Agreement are incorporated into and made a part of this Rider. This Rider shall form a part of the Agreement and shall constitute a part of the Loan Documents.
[Signature Page to Sixth Amendment to Credit Agreement (SigmaTron International, Inc.)]
