EXHIBIT 10.21
FIFTH AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT
This Fifth Amendment to Amended and Restated Credit Agreement ("Fifth
Amendment") is dated effective December 1, 1995 among NBD BANK, formerly NBD
Bank N.A., successor by merger to National Bank of Detroit ("NBD" or "Bank"),
as lender, with its main offices at 000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000, and Secom General Corporation, a Delaware corporation ("Secom"), whose
address is 00000 Xxxxx Xxxxx Xxx., Xxxx, Xxxxxxxx 00000; Uniflow Corporation,
a Michigan corporation ("Uniflow"), whose address is 00000 Xxxx Xxxxx, Xxxx,
Xxxxxxxx 00000; Triple Tool, Inc., a Michigan corporation ("Triple Tool")
whose address is 0000 Xxxxx Xxxxx, Xxxx, Xxxxxxxx 00000; Micanol, Inc., a
Michigan corporation ("Micanol") whose address is X.X. Xxx 000, 00000 Xxxxx
Xxxxx, Xxxx, Xxxxxxxx 00000; L&H Die, Inc., a Michigan corporation ("L&H"),
whose address is 00000 Xxxxxx Xxxx, Xxxxxxx, Xxxxxxxx 00000; Form Flow, Inc.,
a Michigan corporation ("Form Flow"), whose address is 6901 Xxxxxxxx, Xxxxxxx,
Xxxxxxxx 00000; and Tri-Tec Plastics Corporation, a Michigan corporation
("Tri-Tec"), whose address is 00000 Xxxxx Xxxxx Xxx., Xxxx, Xxxxxxxx 00000
(such corporations being sometimes collectively referred to as the "Borrowers"
and individually as a "Borrower"), as borrowers.
This Fifth Amendment amends the Amended and Restated Credit Agreement
dated December 15, 1993, among NBD and the Borrowers, as amended by (i) the
First Amendment to Amended and Restated Credit Agreement dated July 19, 1994,
(ii) the letter dated August 19, 1994 from NBD to Secom, (iii) the Third
Amendment to Amended and Restated Loan Agreement dated December 28, 1994 and
(iv) the Fourth Amendment to Amended and Restated Loan Agreement dated
February 17, 1995 (as so amended, the "Credit Agreement" or "Agreement").
Capitalized terms not otherwise defined herein shall have the meanings given
to them in the Credit Agreement.
Recitals
A. NBD has made available to the Borrowers revolving credit loans and
term loans as more fully described in the Credit Agreement.
B. The Borrowers have requested that NBD provide a new term loan to
Secom in the original principal amount of $800,000, a portion of which will be
used to fund the purchase price of certain real estate currently being leased
by Secom and a portion of which will be used to refinance the obligations of
Secom to NBD under the $500,582.78 Secom Note and the $109,322.08 Triple Tool
Note.
C. The Borrowers have also requested that NBD provide them with up to
$1,000,000 in term loans to allow the various Borrowers to purchase equipment.
D. NBD is willing to provide such financing on the terms and conditions
set forth in this Fifth Amendment.
E. The Borrowers have determined that it is in their best interest to
guaranty the new term loan to Secom and Uniflow and the loans under the
proposed equipment line in order to induce NBD to provide such financing,
since Secom provides many services to the other Borrowers, the current
obligations will be extended, a portion of the financing will reduce the
outstandings under the Line of Credit and the equipment to be purchased will
help increase the revenues and profitability of the respective Borrowers.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:
1. Amended Term Loans. A new Section 1.2C is hereby added to the Credit
Agreement to read as follows:
1.2C Amended Term Loans.
Prior to December 31, 1995 and subject to meeting all conditions for
funding, NBD will provide a term loan to Secom in the original principal
amount of $800,000, a portion of which will refinance (but not repay) the
$500,582.78 Secom Note and the $109,322.08 Triple Tool Note and also to
purchase the real property commonly known as 6999 Cogswell, Romulus, Michigan,
and more fully described on Exhibit 1.2C(i) ("Purchased Property"). Such loan
will be evidenced by an Installment Business Loan Note substantially in the
form of Exhibit 1.2C(ii) attached to the Fifth Amendment (together with any
amendments, extensions, renewals or restatements, the "$800,000 Secom Note").
In addition to the existing Secom Mortgages and the other collateral granted
to NBD to secure the Obligations, Secom will deliver a mortgage on the
Purchased Property to secure the $800,000 Secom Note and the other
Obligations.
2. New Equipment Line. A new Section 1.2D is hereby added to the Credit
Agreement to read as follows:
1.2D $1,000,000 Equipment Line. NBD agrees to consider from time to
time prior to December 31, 1995 ("Equipment Line Expiration Date"),
granting term loans to any Borrower (jointly and severally with Secom)
not to exceed $1,000,000 in the aggregate original principal amounts
(the "Equipment Line"), the proceeds of which must be used by the
requesting Borrower to finance no more than 80% of the purchase price
of the equipment being acquired for use in such Borrower's business.
Each loan will be made at NBD's discretion and will be subject to the
conditions set forth in Section 9 of the Fifth Amendment. Such loans
shall be evidenced by Installment Business Loan Notes in the forms
provided
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by NBD (all such notes, together with any amendments, extensions,
renewals or restatements, are referred to as the "1995 Equipment Line
Notes").
3. Revised Covenants. Sections 5.1B and 5.1C of the Credit Agreement are
hereby amended in their entirety to read as follows:
B. Tangible Capital Funds. Maintain Tangible Capital Funds as follows:
from June 30, 1995 and thereafter of at least $9,000,000.
C. Total Liabilities to Tangible Capital Funds. Maintain the following
ratios of total liabilities minus deferred tax liabilities as shown on
the consolidated balance sheet of Borrowers as determined and prepared
in accordance with generally accepted accounting principles
consistently applied ("Total Liabilities") to Tangible Capital Funds
of no more than 2.2 to 1.0 from June 30, 1995 and thereafter.
4. Definitions. All references in the Credit Agreement to the "Notes"
and the "Term Notes" shall hereafter include the $800,000 Secom Note and the
1995 Equipment Line Notes. All references to the "Obligations" in the Credit
Agreement shall hereafter include the liabilities and obligations under the
$800,000 Secom Note and the 1995 Equipment Line Notes. All references to the
$500,582.78 Secom Note and the $109,322.08 Triple Tool Note shall hereafter
refer to the $800,000 Secom Note. All references in the Credit Agreement to
the "Loan Documents" shall include the documents and instruments executed
pursuant to this Fifth Amendment.
5. Interest Rate on Line of Credit Note and Term Notes. Borrowers and
the Bank agree that notwithstanding anything to the contrary contained in the
Credit Agreement, the Line of Credit Note or any of the Term Notes, beginning
on and after December 1, 1995, interest shall accrue and be payable on the
Line of Credit Note and each of the Term Notes (except any 1995 Equipment Line
Note which specifically references a fixed interest rate, if any) at a per
annum rate equal to the Applicable Margin (defined below) for the type of note
plus the rate announced from time to time by the Bank as its "prime rate" (the
"Note Rate"), which prime rate may not be the lowest rate charged by the Bank
to any of its customers. Each change in the prime rate will immediately result
in a change of the Note Rate. After maturity, or from and after an Event of
Default as defined in the Credit Agreement, the outstanding principal balance
under the Line of Credit Note and the Term Notes shall bear additional
interest from and after such maturity date or the occurrence of the Event of
Default, at a rate of three (3%) percentage points per annum above the
applicable Note Rate until such note is fully paid or the Event of Default is
fully cured (the "Default Rate"). Interest shall be computed on the basis of
actual days elapsed over a period of a 360-day year.
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The "Applicable Margin" will be determined according to the following
table:
Total Liabilities to
Tangible Capital Funds
(determined under Applicable Margin Applicable Margin
Section 5.1C) is: for Term Notes for Line of Credit Note
----------------- -------------- -----------------------
Greater than or equal to 1.75% 1.25%
2.0 to 1.0
from 1.75 to 1.0 up to and 1.50% 1.00%
including 1.99 to 1.0
from 1.50 to 1.0 up to and 1.25% .75%
including 1.74 to 1.0
from 1.25 to 1.0 up to and 1.00% .50%
including 1.49 to 1.0
less than 1.25 to 1.0 .75% .25%
The Applicable Margin will be adjusted effective on the first day of the next
fiscal quarter after receipt of the quarterly financial statements delivered
to the Bank pursuant to Section 5.4. If such quarterly financial statements
are not delivered by the end of the quarter in which they are due, the ratio
of Total Liabilities to Tangible Capital Funds will be deemed to be greater
than 2.0 to 1.0 until quarterly financial statements are delivered to the
Bank. Any appropriate adjustments to the Applicable Margin will be effective
upon the date of receipt by the Bank of the overdue financial statements.
6. SWAP Transactions. NBD may from time to time enter into interest rate
or currency swap agreements or future rate agreements or forward exchange
contracts or interest rate protection or cap agreements with one or more of
the Borrowers ("Swap Transactions"). Any telex, telecopy or other document
evidencing any Swap Transaction and any agreement entered into by any Borrower
and NBD pursuant to or in connection with a Swap Transaction will be
considered part of the "Loan Documents" under the Credit Agreement. Any
obligations of any Borrower to NBD under or in connection with a Swap
Transaction will be considered part of the "Obligations" under the Credit
Agreement.
7. Conditions Precedent. NBD shall not be required to make the loan
described in Sections 1.2C and 1.2D of the Credit Agreement unless and until
all of the terms and conditions of Article II of the Credit Agreement have
been and continue to be met, and, in addition:
(a) NBD shall have received this Fifth Amendment, executed and
delivered by each of the Borrowers;
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(b) NBD shall have received a commitment for title insurance in
the amount of $800,000, covering the 1995 Mortgage of the Purchased
Property and the property commonly known as 0000 Xxxxxxxx and 38200
Ecorse, Romulus, Michigan, and subject only to encumbrances and
exceptions consented to by NBD;
(c) NBD shall have received an officers certificate from each
Borrower in form and substance satisfactory to NBD; and
(d) NBD shall have received simultaneously with the execution of
this Fifth Amendment a closing fee of 1% of the principal amount of the
loans extended under Section 1.2C from the Borrowers.
8. Additional Conditions For Mortgage Loan. NBD shall not be required to
make the loan described in Section 1.2C of the Credit Agreement unless and
until all of the terms and conditions of Section 7 of this Fifth Amendment and
in Article II of the Credit Agreement have been and continue to be met, and,
in addition:
(a) NBD shall have received the $800,000 Secom Note, and an
environmental certification in the form provided by NBD, executed and
delivered by Secom;
(b) NBD shall have received frown Secom executed copies of the
Amended and Restated Mortgage ("1995 Mortgage") in the form of Exhibit 7
attached to this Fifth Amendment, which amends and restates the existing
Mortgage dated June 1, 1990 covering the real property commonly known as
0000 Xxxxxxxx and 38200 Ecorse, Romulus, Michigan, and grants a mortgage
on the Purchased Property;
(c) On or before December 31, 1995, Secom shall deliver to NBD a
mortgage survey of the Purchased Property and the property commonly
known as 0000 Xxxxxxxx and 38200 Ecorse, Romulus, Michigan, certified to
NBD; and
(d) The Borrowers will take all reasonable steps necessary to
insure that the title policy issued from the commitment required above
is issued without standard exceptions, at the Borrower's expense.
9. Conditions to Equipment Line. NBD shall not consider making any loan
described in Section 1.2D of the Credit Agreement unless and until all of the
conditions in Section 7 of this Fifth Amendment and in Article II of the
Credit Agreement have been and continue to be met, and, in addition, NBD shall
have received:
(a) A 1995 Equipment Line Note, appropriately completed to
represent the advance and the agreed upon repayment terms;
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(b) Appropriate evidence of the purchase and delivery of the
equipment which is being financed (or binding contracts for such
purchase and delivery);
(c) UCC financing statements executed by the requesting Borrower
and filed in the appropriate jurisdictions and evidencing NBD's purchase
money security interest in such equipment;
(d) A fee of 1% of the requested advance under the Equipment Line;
and
(e) Such other information or documents as NBD shall request in
connection with such loan.
10. Additional Defaults. NBD may fund any loan without waiving any of
the conditions set forth in Sections 7, 8 or 9 of this Fifth Amendment. Unless
otherwise agreed to in writing by NBD, if the Borrowers fail to comply with
any condition in this Fifth Amendment within 15 days after a written request
for compliance is sent by NBD to Secom, NBD may consider such failure an Event
of Default under the Credit Agreement.
11. Expenses. Borrowers acknowledge and agree that the Borrowers will
pay reasonable attorneys' fees and out of pocket costs of NBD in connection
with or with respect to this Fifth Amendment and the loans funded pursuant
hereto.
12. Ratification. The parties hereto acknowledge and agree that the
terms and provisions of this Fifth Amendment amend, add to and constitute a
part of the Credit Agreement. Except as expressly modified and amended by the
terms of this Fifth Amendment, all of the other terms and conditions of the
Credit Agreement and all of the documents executed in connection therewith or
referred to or incorporated therein (including, without limitation, the
Restated Guaranties), remain in full force and effect and are hereby ratified,
confirmed and approved.
13. Express Conflicts. If there is an express conflict between the terms
of this Fifth Amendment and the terms of the Credit Agreement, or any of the
other agreements or documents executed in connection therewith or referred to
or incorporated therein, the terms of this Fifth Amendment shall govern and
control.
IN WITNESS WHEREOF, the parties have executed this Fifth Amendment to
Amended and Restated Credit Agreement effective as of the date noted above.
SECOM GENERAL CORPORATION
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Chief Financial Officer
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UNIFLOW CORPORATION
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Vice President
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TRI-TEC PLASTICS CORPORATION
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: President
--------------------------------
TRIPLE TOOL, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Vice President
--------------------------------
MICANOL, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Vice President
--------------------------------
L&H DIE, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Vice President
--------------------------------
FORM FLOW, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Its: Vice President
--------------------------------
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NBD BANK
By: /s/ Xxxxxxx X'Xxxxxx
--------------------------------
Its: Vice President
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EXHIBITS
Exhibit 1.2C(i) Legal Description
Exhibit 1.2C(ii) $800,000 Secom Note
Exhibit 7 Amendment and Restated Mortgage
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