Exhibit 10.43
FIFTH AMENDMENT TO CREDIT AGREEMENT
This FIFTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made as of
the 27th day of March, 2002 by and among CECO GROUP, INC., CECO FILTERS,
INC., AIR PURATOR CORPORATION, NEW XXXXX CO., INC., THE XXXX & XXXX
MANUFACTURING COMPANY, KBD/TECHNIC, INC. and CECO ABATEMENT SYSTEMS, INC. (the
"Borrowers"), and PNC BANK, NATIONAL ASSOCIATION ("PNC"), individually and as
agent for itself and the other banks (collectively, the "Banks") which from time
to time are parties to the hereinafter defined Credit Agreement (in such
capacity, the "Agent").
BACKGROUND
A. The Agent, the Banks and the Borrowers are parties to a Credit
Agreement dated as of December 7, 1999 as amended by Amendment to Credit
Agreement, dated as of March 28, 2000, by Second Amendment to Credit Agreement
dated as of November 10, 2000, by Third Amendment to Credit Agreement dated as
of March 30, 2001 and by Fourth Amendment to Credit Agreement dated as of August
20, 2001(as amended, the "Credit Agreement").
B. The Borrowers have requested and the Agent and the Banks have agreed
to amend the Credit Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and for good and valuable
consideration, the legality and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound hereby, agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.
2. Amendments to Credit Agreement. The Credit Agreement is hereby
amended as follows:
(a) The provision in paragraph 2(m) of the Third Amendment to Credit
Agreement (as modified by paragraph 2(h) of the Fourth Amendment to Credit
Agreement), which modifies Section 6.1(a) Leverage Ratio of the Credit
Agreement, is hereby modified as follows:
(m) Section 6.1(a) Leverage Ratio of the Credit Agreement shall be
abated as it presently exists through January 1, 2002 and shall be modified
as follows:
(a) Leverage Ratio. Permit the Leverage Ratio, as of the end of any
fiscal quarter ending during the period specified below, for the prior
four consecutive fiscal quarters, to equal or exceed the amount set
forth opposite such period:
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Leverage Ratio Must Not Be
Last Day of Fiscal Quarter During Period Greater Than
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December 31, 2000 through March 30, 2001 5.50 to 1
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March 31, 2001 through June 29, 2001 6.30 to 1
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June 30, 2001 through September 29, 2001 6.70 to 1
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September 30, 2001 through December 30, 2001 5.50 to 1
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December 31, 2001 3.40 to 1
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provided, however, the abatement of Section 6.1(a) Leverage
Ratio of the Credit Agreement shall cease and such section
shall continue as provided in the Credit Agreement on January 2,
2002.
(b) The provision in paragraph 2(o) of the Third Amendment to Credit
Agreement (as modified by paragraph 2(j) of the Fourth Amendment to Credit
Agreement), which modifies Section 6.1(c) Interest Coverage Ratio of the
Credit Agreement, is hereby modified as follows:
(o) Section 6.1(c) Interest Coverage Ratio of the Credit
Agreement shall be abated in its entirety as it presently exists
through January 1, 2002 and shall be modified as follows:
(c) Interest Coverage Ratio. Permit the Interest Coverage Ratio,
as of the end of each fiscal quarter ending during the period
specified below, to be less than the amount set forth opposite such
period:
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Interest Coverage Ratio Must
Last Day of Fiscal Quarter During Period Not Be Less Than
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December 31, 2000 through March 30, 2001 1.40 to 1
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March 31, 2001 through June 29, 2001 1.10 to 1
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June 30, 2001 through September 29, 2001 1.00 to 1
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September 30, 2001 through December 30, 2001 1.25 to 1
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December 31, 2001 1.65 to 1
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provided, however, that Interest Coverage Ratio for September 30,
2001, shall be calculated on the basis of calendar year 2001 to
date, rather than a rolling twelve month basis, and further
provided, however, the abatement of Section 6.1(c) Interest
Coverage Ratio of the Credit Agreement shall cease on January 2,
2002, and such section shall continue as provided in the Credit
Agreement immediately before the effective date of this
Amendment, except that the words "equal or exceed" in the fifth
line of Section 6.1(c) shall be changed to "be less than".
3. Sale of Assets. The provisions of Section 2.10 (c) and Section 6.5 of
the Credit Agreement notwithstanding, Borrowers are permitted to sell the assets
described on Exhibit A-5
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attached hereto and by this reference incorporated herein, subject to
fulfillment, to the satisfaction of Agent and its counsel, of the following
terms:
(a) In addition to any other amounts due under the Credit Agreement,
Borrowers shall have paid to Agent, for the ratable benefit of the Banks, the
sum of Two Hundred Fifty Thousand Dollars ($250,000), on or prior to the date of
this Amendment. Such amount and all other amounts required to be paid hereunder
shall be applied as prepayment of the principal of Term Loan B. Such payments
shall be applied in the inverse order of maturity.
(b) In addition to any other amounts due under the Credit Agreement,
Borrowers shall pay to Agent, for the ratable benefit of the Banks, the sum of
One Hundred Twenty-Five Thousand Dollars ($125,000), on or prior to March 15,
2002, which amount shall be applied as a prepayment of the principal of Term
Loan B as provided in subparagraph 3 (a) above.
(c) In addition to any other amounts due under the Credit Agreement,
Borrowers shall pay to Agent, for the ratable benefit of the Banks, the sum of
Fifty Thousand Dollars ($50,000) each, on or prior to September 30, 2002 and
March 31, 2003, which amounts shall be applied as a prepayment of the principal
of Term Loan B as provided in subparagraph 3 (a) above.
(d) This authorization of sale of assets shall not be deemed to be a
waiver of the provisions of Section 2.10 (c) or Section 6.5 of the Credit
Agreement or any other provision thereof which prohibits or restricts sale of
any other assets of Borrowers.
4. Amendment to the Loan Documents. All references to the Credit Agreement
in the Loan Documents and in any documents executed in connection therewith
shall be deemed to refer to the Credit Agreement as amended by this Amendment.
5. Ratification of the Loan Documents. Notwithstanding anything to the
contrary herein contained or any claims of the parties to the contrary, the
Agent, the Banks and the Borrowers agree that the Loan Documents and each of the
documents executed in connection therewith are in full force and effect and each
such document shall remain in full force and effect, as further amended by this
Amendment, and each of the Borrowers hereby ratifies and confirms its
obligations thereunder.
6. Representations and Warranties.
(a) Each Borrower hereby certifies that (i) the representations and
warranties of such Borrower in the Credit Agreement as amended herein are true
and correct in all material respects as of the date hereof, as if made on the
date hereof, provided that, for purposes of this Amendment, only: (x) the
representations and warranties made in Section 3.1(a) and (b) and 3.21 of the
Credit Agreement shall relate to the most recent financial statements of the
type referred to therein which have been given by the Borrowers to the Banks
(but the foregoing shall not be a waiver of any Default or Event of Default
based on any representation or warranty made by the Borrowers in the Credit
Agreement or any amendment thereof, prior to this Amendment, being untrue at the
time made, or for any breach of any covenant contained in the Credit Agreement,
as
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amended prior to the date of this Amendment); (y) the representations and
warranties made in Section 3.1(c) of the Credit Agreement shall be made as of
the date of this Amendment and not as of the Closing Date; and (z) the
representations and warranties made in Section 3.2 of the Credit Agreement shall
refer to Material Adverse Effect since the last audited consolidated financial
statements of the Borrowers provided to the Banks by the Borrowers, instead of
since September 30, 1999 (but the foregoing shall not be a waiver of any Default
or Event of Default based on any representation or warranty made by the
Borrowers in the Credit Agreement or any amendment thereof, prior to this
Amendment, being untrue at the time made, or for any breach of any covenant
contained in the Credit Agreement, as amended prior to the date of this
Amendment); and (ii) no Event of Default and no event which could become an
Event of Default with the passage of time or the giving of notice, or both,
under the Credit Agreement or the other Loan Documents exists on the date
hereof.
(b) Each Borrower further represents that it has all the requisite power
and authority to enter into and to perform its obligations under this Amendment,
and that the execution, delivery and performance of this Amendment have been
duly authorized by all requisite action and will not violate or constitute a
default under any provision of any applicable law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award presently in effect
or of the Articles of Incorporation or by-laws of such Borrower, or of any
indenture, note, loan or credit agreement, license or any other agreement, lease
or instrument to which such Borrower is a party or by which such Borrower or any
of its properties are bound.
(c) Each Borrower also further represents that its obligation to repay
the Loans, together with all interest accrued thereon, is absolute and
unconditional, and there exists no right of set off or recoupment, counterclaim
or defense of any nature whatsoever to payment of the Loans, and each Borrower
further represents that the Agents and Banks have fully performed all of their
respective obligations under the Loan Documents through the date of this
Amendment.
(d) Each Borrower also further represents that there have been no
changes to the Articles of Incorporation, by-laws or other organizational
documents of each such Borrower since the most recent date true and correct
copies thereof were delivered to the Agent.
7. Conditions Precedent. The effectiveness of the amendments set forth
herein is subject to the fulfillment, to the satisfaction of the Agent and its
counsel, of the following conditions precedent:
(a) The Borrowers shall have delivered to the Agent the following, all
of which shall be in form and substance satisfactory to the Agent and shall be
duly completed and executed:
(i) This Amendment and the consents of the Guarantor and the
Subordinated Creditors as attached hereto; and
(ii) The Amendment to Security Agreement which adds CECO Abatement
Systems, Inc. as a Debtor; updates the representations and warranties
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set forth in the Security Agreement dated December 7, 1999 as to all
Debtors; and authorizes Agent to file such financing and continuation
statements as Agent deems necessary or appropriate in order to perfect
and continue the perfection of the security interests created by the
Security Agreement, without the signature of any Debtor, including,
without limitation, "in lieu of" filings.
(iii) Such additional documents, certificates and information as
the Agent may require pursuant to the terms hereof or otherwise
reasonably request.
(b) After giving effect to the amendments contained herein, the
representations and warranties set forth in the Credit Agreement shall be true
and correct on and as of the date hereof.
(c) After giving effect to the amendments contained herein, no Event
of Default hereunder, and no event which, with the passage of time or the giving
of notice, or both, would become such an Event of Default shall have occurred
and be continuing as of the date hereof.
(d) The Borrowers shall have paid the reasonable fees and
disbursements of the Agent's counsel incurred in connection with this Amendment.
8. No Waiver. Except as expressly provided herein, this Amendment does not
and shall not be deemed to constitute a waiver by the Agent or the Banks of any
Event of Default, or of any event which with the passage of time or the giving
of notice or both would constitute an Event of Default, nor does it obligate the
Agent or the Banks to agree to any further modifications to the Credit Agreement
or any other Loan Document or constitute a waiver of any of the Agent's or the
Banks' other rights or remedies.
9. Waiver and Release. The Borrowers each on behalf of themselves, their
agents, employees, officers, directors, successors and assigns, do hereby waive
and release Agent and Banks, their agents, employees, officers, directors,
affiliates, parents, successors and assigns, from any claims arising from or
related to administration of the Credit Agreement and Loan Document and any
course of dealing among the parties not in compliance with those agreements from
the inception of the Credit Agreement whether known or unknown through the date
of execution and delivery of this Amendment.
10. Effective Date. The parties hereto agree that the provisions of
paragraph 2 of this Amendment shall for all purposes be deemed to be effective
as of December 31, 2001and for all purposes the Credit Agreement shall be deemed
to have been amended as of such date to reflect the amendments to the Credit
Agreement set forth in such paragraph, even though this Amendment is executed
after such date.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the day and year first above written.
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CECO GROUP, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
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Name:
Title:
CECO FILTERS, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
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Name:
Title:
AIR PURATOR CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------------------
Name:
Title:
NEW XXXXX CO., INC.
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------------------
Name:
Title:
THE XXXX & XXXX MANUFACTURING COMPANY
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------------------
Name:
Title:
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KBD/TECHNIC, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------------------
Name:
Title:
CECO ABATEMENT SYSTEMS, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------------------
Name:
Title:
PNC BANK, NATIONAL ASSOCIATION, as
Agent and as a Bank
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------------------
Name: /s/ Xxxxxxx X. Xxxxx
Title: /s/ Vice President
FIFTH THIRD BANK, as a Bank
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------------------
Name: /s/ Xxxxx X. Xxxxxxxxx
Title: /s/ Assistant Vice President
BANK ONE, NA, as a Bank
By: /s/ Xxxx X. Xxxxx
------------------------------------------------
Name: /s/ Xxxx X. Xxxxx
Title: /V.P./
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GUARANTOR'S CONSENT
By Corporate Guaranty, dated December 7, 2000 (the "Guaranty"), the
undersigned (the "Guarantor") guaranteed to the Agent and the Banks, subject to
the terms and conditions set forth therein, the prompt payment and performance
of all of the Obligations (as defined therein). The Guarantor consents to the
Borrowers' execution of the foregoing Fifth Amendment to Credit Agreement. The
Guarantor hereby acknowledges and agrees that the Guaranty remains unaltered and
in full force and effect and is hereby ratified and confirmed in all respects.
CECO ENVIRONMENTAL CORP.
By:
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Name:
Title:
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SUBORDINATED CREDITOR'S CONSENT
The undersigned (the "Subordinated Creditor") is a party to the
Subordination Agreement with the Agent and the Banks and other subordinated
creditors, dated December 7, 2000 (the "Subordination Agreement"). The
Subordinated Creditor consents to the Borrowers' execution of the foregoing
Fifth Amendment to Credit Agreement. The Subordinated Creditor hereby
acknowledges and agrees that the Subordination Agreement remains unaltered and
in full force and effect and is hereby ratified and confirmed in all respects.
GREEN DIAMOND OIL CORP.
By:
------------------------------------
Name:
Title
9
SUBORDINATED CREDITOR'S CONSENT
The undersigned (the "Subordinated Creditor") is a party to the
Subordination Agreement with the Agent and the Banks and other subordinated
creditors, dated December 7, 2000 (the "Subordination Agreement"). The
Subordinated Creditor consents to the Borrowers' execution of the foregoing
Fifth Amendment to Credit Agreement. The Subordinated Creditor hereby
acknowledges and agrees that the Subordination Agreement remains unaltered and
in full force and effect and is hereby ratified and confirmed in all respects.
ICS TRUSTEE SERVICES, LTD.
By:
--------------------------------------
Name:
Title
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SUBORDINATED CREDITOR'S CONSENT
The undersigned (the "Subordinated Creditor") is a party to the
Subordination Agreement with the Agent and the Banks and other subordinated
creditors, dated December 7, 2000 (the "Subordination Agreement"). The
Subordinated Creditor consents to the Borrowers' execution of the foregoing
Fifth Amendment to Credit Agreement. The Subordinated Creditor hereby
acknowledges and agrees that the Subordination Agreement remains unaltered and
in full force and effect and is hereby ratified and confirmed in all respects.
XXXXXX XXXXXXX
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