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EXHIBIT (4) (d)
AMENDMENT NO. 3
TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NO. 3 dated as of December 17, 1999 (this "Amendment") is
entered into among BANK OF AMERICA, NATIONAL ASSOCIATION ("B of A"), as
successor to BankAmerica Business Credit, Inc., Bank of America, National Trust
and Savings Association and NationsBank, N.A., and GMAC COMMERCIAL CREDIT LLC, a
New York limited liability company ("GMAC"), as successor to BNY Financial
Corporation, formerly known as Bank of New York Commercial Corporation, (B of A
and GMAC and their respective successors and assigns being sometimes hereinafter
referred to collectively as the "Lenders" and each of B of A and GMAC and its
successors and assigns being sometimes hereinafter referred to individually as a
"Lender"), B of A (as successor to BankAmerica Business Credit, Inc. and Bank of
America, National Trust and Savings Association), as agent for the Lenders (in
such capacity as agent, the "Agent"), LACLEDE STEEL COMPANY, a Delaware
corporation, as debtor and debtor-in-possession (the "Parent"), LACLEDE CHAIN
MANUFACTURING COMPANY, a Delaware corporation, as debtor and
debtor-in-possession ("Laclede Chain"), and LACLEDE MID AMERICA INC., an Indiana
corporation, as debtor and debtor-in-possession ("Laclede Mid America") (the
Parent, Laclede Chain and Laclede Mid America being sometimes hereinafter
referred to collectively as the "Borrowers" and each of the Parent, Laclede
Chain and Laclede Mid America being sometimes hereinafter referred to
individually as a "Borrower").
W I T N E S S E T H:
WHEREAS, the Borrowers, the Lenders and the Agent are parties to a certain
Loan and Security Agreement dated as of December 1, 1998, as amended by
Amendment No. 1 dated as of December 23, 1998 and Amendment No. 2 dated as of
July 1, 1999 (such Loan and Security Agreement, as so amended, the "Loan
Agreement," capitalized terms used herein without definition having the meanings
given such terms in the Loan Agreement, as amended by this Amendment); and
WHEREAS, the Borrowers, the Lenders and the Agent have agreed to amend the
Loan Agreement on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth above, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Borrowers, the Lenders and the Agent hereby agree as
follows:
Section 1. Amendment of the Loan Agreement. Subject to the fulfillment of
the conditions precedent set forth in Section 4 below, the Loan Agreement is
amended as follows:
(a) Section 1.1 is amended by deleting the definitions of "Agreed
Pre-Petition Outstanding Balance" and "Inventory Sublimit Amount."
(b) Section 1.1 is further amended by amending and restating the definition
of "Bank of America" as follows:
"Bank of America" means Bank of America, National Association, a national
banking association, or any successor entity thereto.
(c) Section 1.1 is further amended by amending and restating the definition
of "Base Rate Loan" as follows:
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"Base Rate Loan" means a Post-Petition Revolving Loan or Post-Petition
Term Loan during any period in which it bears interest at the rate provided
in Section 3.1(i).
(d) Section 1.1 is further amended by amending and restating the definition
of "LIBOR Loan" as follows:
"LIBOR Loan" means a Post-Petition Revolving Loan or Post-Petition
Term Loan during any period in which it bears interest at the rate provided
in Section 3.1(ii).
(e) Section 1.1 is further amended by amending and restating clause (a) of
the definition of "Maximum Revolver Amount" as follows:
(a) the lesser of
(i) the Revolver Facility minus the amount of Term Loans outstanding
at such time and the amount of any Pre-Petition Obligations
outstanding at such time; or
(ii) (A) eighty-five percent (85.0%) of the Net Amount of the Eligible
Accounts; plus (B) the lesser of (1) sixty-five percent (65.0%) of the
value of Net Eligible Inventory; and (2) $38,500,000; provided, that
the amount of Revolving Loans based upon Eligible Inventory consisting
of supplies shall be limited to the Supplies Inventory Sublimit
Amount; plus (C) the amount of the Additional Facility at such time
minus (D) the amount of Pre-Petition Revolving Loans outstanding at
such time;
(f) Section 1.1 is further amended by adding the following definitions in
alphabetical order:
"Post-Petition Term Loans" means Term Loans made pursuant to this
Agreement.
"Pre-Petition Term Loans" means Term Loans made pursuant to the
Original Agreement.
"Supplies Inventory Sublimit Amount" means the amount set forth below
for the period indicated:
Period Amount
------ ------
Effective date of Amendment
No. 3 hereto through
December 31, 1999 $ 6,000,000
January 2000 6,000,000
February 2000 5,750,000
March 2000 5,500,000
April 2000 5,250,000
May 2000 5,000,000
June 2000 4,750,000
In determining the Eligibility Inventory that is subject to the Supplies
Inventory Sublimit Amount, zinc and pipe couplings will be treated as raw
materials rather than supplies.
(g) Section 1.1 is further amended by amending and restating the definition
of "Stated Termination Date" as follows:
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"Stated Termination Date" means June 30, 2000.
(h) Section 1.1 is further amended by amending and restating the
definition of "Term Loans" as follows:
"Term Loans" means, collectively, Pre-Petition Term Loans and
Post-Petition Term Loans.
(i) Section 3.1 is amended and restated as follows:
3.1 Interest Rates. All outstanding Post-Petition Obligations shall
bear interest on the unpaid principal amount thereof (including, to the
extent permitted by law, on interest thereon not paid when due) from the
date made until paid in full in cash at a rate determined by reference to
the Base Rate or the LIBO Rate and Sections 3.1(i) or (ii), as applicable,
but not to exceed the Maximum Rate described in Section 3.4. Subject to the
provisions of Section 3.2, any of the Post-Petition Revolving Loans or
Post-Petition Term Loans may be converted into, or continued as, Base Rate
Loans or LIBOR Loans in the manner provided in Section 3.2. If at any time
Post-Petition Revolving Loans or Post-Petition Term Loans are outstanding
with respect to which notice has not been delivered to the Agent in
accordance with the terms of this Agreement specifying the basis for
determining the interest rate applicable thereto, then those Post-Petition
Revolving Loans or Post-Petition Term Loans shall be Base Rate Loans and
shall bear interest at a rate determined by reference to the Base Rate
until notice to the contrary has been given to the Agent and such notice
has become effective. Except as otherwise provided herein, the outstanding
Post-Petition Obligations shall bear interest as follows:
(i) For all Post-Petition Revolving Loans, Post-Petition Term Loans
and other Post-Petition Obligations which are not LIBOR Loans, then at a
fluctuating per annum rate to two percent (2.00%) plus the Base Rate;
(ii) For all Post-Petition Revolving Loans and Post-Petition Term
Loans which are LIBOR Loans, then at a per annum rate equal to four percent
(4.00%) plus the LIBO Rate determined for the applicable Interest Period.
Each change in the Base Rate shall be reflected in the interest rate
described in (i) above as of the effective date of such change. All
interest charges shall be computed on the basis of a year of 360 days and
actual days elapsed. Except as otherwise provided herein, (a) interest
accrued on each LIBOR Loan shall be payable in arrears on the first day of
each month hereafter, and (b) interest accrued on the Base Rate Loans will
be payable in arrears on the first day of each month hereafter.
(j) Subsection (a) of Section 3.2 is amended and restated as follows:
(a) Subject to the provisions of Section 3.3, (i) the Borrowers shall
have the option to convert all or any part of the outstanding Post-Petition
Revolving Loans or Post-Petition Term Loans, in a minimum amount of
$5,000,000 and integral multiples of $5,000,000 in excess of that amount,
from Base Rate Loans to LIBOR Loans at any time; (ii) the Borrowers shall
have the option to convert all or any part of the outstanding Post-Petition
Revolving Loans or Post-Petition Term Loans from LIBOR Loans to Base Rate
Loans on the expiration of the Interest Period applicable thereto; and
(iii) the Borrowers shall have the option, on the expiration of the
Interest Period applicable to any outstanding LIBOR Loan, to continue all
or any portion of such LIBOR Loan equal to $5,000,000 and integral
multiples of $5,000,000 in excess of that amount, as a LIBOR Loan;
provided, however, that no outstanding Loans may be converted into or
continued as LIBOR Loans when any Default or Event of Default has occurred
and is continuing. Any
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conversion or continuation made with respect to less than the entire
outstanding balance of the Post-Petition Revolving Loans or
Post-Petition Term Loans must be applied pro rata to the Revolving
Loans or Term Loans, as applicable, according to the outstanding
principal balance of each Revolving Loan or each Term Loan.
(k) Section 4.2 is amended and restated as follows:
4.2 Scheduled Payments and Mandatory Prepayments of the Term
Loans. The Borrowers shall make monthly principal payments on the
Post-Petition Term Loans in the aggregate amount of $70,000, due and
payable on the first day of each calendar month, commencing on January
1, 2000, until the earlier of (a) the Stated Termination Date, or (b)
the payment in full of the Post-Petition Term Loans. In addition,
prepayments on the Term Loans shall be required to be made as provided
in Sections 5.11(c), 8.5(c), 8.6(b) and 8.9(b). In addition, after the
Additional Facility has been reduced to zero, (1) if any amounts are
received with respect to items (a), (b), or (f) on Exhibit D, then 50%
of such amounts shall be applied to the prepayment of the Term Loans,
applying such amounts ratably to the installments of the Term Loans in
the inverse order of maturity, and (2) if any Net Proceeds of the
Electrode Settlement are received such that the amount of all Net
Proceeds of the Electrode Settlement at such time is in excess of
$2,500,000, then 100% of such excess Net Proceeds shall be applied to
the prepayment of the Term Loans, applying such amounts ratably to the
installments of the Term Loans in the inverse order of maturity.
(l) Section 4.5 is amended by amending and restating clause
"second" as follows:
second, from and after the entry of the Final Order, through and
including December 31, 1999, to make Adequate Protection Payments;
(m) Section 4.5 is further amended by amending and restating
clause "fourth" as follows:
fourth, until the outstanding Pre-Petition Obligations have been paid
in full, to pay the principal of the Pre-Petition Revolving Loans;
(n) The last sentence of Section 8.9(b) is amended and restated
as follows:
Upon any such sale or other disposition, the entire amount of Net
Proceeds shall be applied on the date of such sale or disposition to
the repayment of the Term Loans, and if the Term Loans have been
repaid in full, to any other Post-Petition Obligations then
outstanding.
(o) Section 8.24 is amended and restated as follows:
8.24 Cash Available for Fixed Charges. The Borrowers will
maintain Cash Available for Fixed Charges, determined as of the end of
each period listed below for the period indicated, of not less than
the following:
Cash Available for
Period Fixed Charges
------ -------------
Ten month period ending 9/30/99 $ (100,000)
Thirteen month period ending 12/31/99 $ 1,400,000
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Cash Available for
Period Fixed Charges
------ -------------
Sixteen month period ending 3/31/00 $ 2,100,000
Nineteen month period ending 6/30/00 $ 2,900,000
In determining Cash Available for Fixed Charges, non-cash pension
expense other than service costs will not be deducted from net
earnings.
(p) Section 8.25 is amended and restated as follows:
8.25 Direct Contribution. The Direct Contribution of the Xxxxx
Steel Operations will not be less than the following amounts for the
following periods:
Period Amount
------ ------
Nine months ending 9/30/99 $ (1,500,000)
Twelve months ending 12/31/99 $ (1,700,000)
Fifteen months ending 3/31/00 $ 1,000,000
Eighteen months ending 6/30/00 $ 1,500,000
In determining Direct Contribution, non-cash pension expense other
than service costs will not be deducted from net income.
(q) Section 13.11 is amended to delete the wire transfer
instructions for NB, and Section 14.7 is amended to delete the address
provision for NB.
Section 2. Bank of America Reorganization. As a result of the
distribution of the assets of BankAmerica Business Credit, Inc. to
Bank of America National Trust and Savings Association (the name of
which was subsequently changed to Bank of America, National
Association), and the merger of NationsBank, N.A. with and into Bank
of America, National Association with the surviving entity in such
merger being Bank of America, National Association, all references to
BankAmerica Business Credit, Inc., BABC, Bank of America National
Trust and Savings Association, Bank of America, NationsBank, N.A. and
NB contained in the Loan Agreement shall hereafter be deemed to be
references to Bank of America, National Association.
Section 3. Pre-Petition Revolving Loans, Pre-Petition Term Loans
and Adequate Protection Payments. The Agent, the Lenders and the
Borrowers hereby agree that on the date upon which this Amendment
shall become effective, the Borrowers shall borrow (a) Post-Petition
Revolving Loans to repay in full the Pre-Petition Revolving Loans, and
(b) Post-Petition Term Loans to repay in full the Pre-Petition Term
Loans, so that as of such date, the balance of the Pre-Petition
Obligations shall be zero, and the Borrowers hereby direct the Lenders
to advance such Post-Petition Revolving Loans and Post-Petition Term
Loans on such effective date. In addition, the Agent, the Lenders and
the Borrowers agree that any Adequate Protection Payments received by
the Agent or the Lenders pursuant to the Loan Agreement shall be
applied first, to pay any interest due on the Pre-Petition
Obligations, including interest accrued after the Petition Date at the
rates set forth under the Loan Agreement and second, to reduce the
principal amount due on the Term Loans. The Borrowers shall make the
final Adequate Protection Payment on December 31, 1999, after which
date the Borrowers shall not be required to make any further Adequate
Protection Payments; provided, that the right of the Borrowers to
cease making Adequate Protection Payments is without prejudice to, and
does not constitute a waiver of, expressly or implicitly,
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the right of the Lenders hereafter to request additional adequate protection of
their interests in the Collateral or relief from or modification of the
automatic stay under Section 362 of the Bankruptcy Code. The Borrowers shall
make monthly principal payments on the Post-Petition Term Loans in the aggregate
amount of $70,000, due and payable on the first day of each calendar month,
commencing on January 1, 2000, until the earlier of (a) the Stated Termination
Date, or (b) the payment in full of the Post-Petition Term Loans.
Section 4. Conditions to Amendment. This Amendment shall become effective
upon (a) the receipt by the Agent by facsimile transmission of a counterpart of
this Amendment executed by each Borrower and each Lender, and execution of this
Amendment by the Agent (provided, that each Borrower and each Lender shall
promptly execute six applicable signature pages hereof and deliver such pages to
the Agent), and (b) entry by the Bankruptcy Court of a final order acceptable to
the Agent approving the terms hereof, and such order being in full force and
effect and (unless waived by the Agent) not subject to reversal, stay,
modification, amendment or appeal.
Section 5. Representations and Warranties. Each Borrower hereby represents
and warrants that (i) this Amendment constitutes a legal, valid and binding
obligation of such Borrower, enforceable against such Borrower in accordance
with its terms, (ii) the representations and warranties contained in the Loan
Agreement are correct in all material respects as though made on and as of the
date of this Amendment, and (iii) no Event of Default has occurred and is
continuing.
Section 6. Reference to and Effect on the Loan Agreement.
(a) Upon the effectiveness of this Amendment, each reference in the Loan
Agreement to "this Agreement", "hereunder", "hereof", "herein", or words of like
import shall mean and be a reference to the Loan Agreement, as amended hereby,
and each reference to the Loan Agreement in any other document, instrument or
agreement executed and/or delivered in connection with the Loan Agreement shall
mean and be a reference to the Loan Agreement, as amended hereby.
(b) Except as specifically amended above, the Loan Agreement and all other
documents, instruments and agreements executed and/or delivered in connection
therewith shall remain in full force and effect and are hereby ratified and
confirmed.
(c) The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of the Agent or the Lenders
under the Loan Agreement, nor constitute a waiver of any provision of the Loan
Agreement, except as specifically set forth herein.
Section 7. Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original
and all of which taken together shall constitute but one and the same
instrument.
Section 8. Governing Law. This Amendment shall be governed by and construed
in accordance with the internal laws (as opposed to the conflicts of laws
provisions) of the State of Illinois.
Section 9. Section Titles. The section titles contained in this Amendment
are and shall be without substance, meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
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Section 10. Parties, Successors and Assigns. This Amendment shall be
binding upon and shall inure to the benefit of the Borrowers, the Agent, each
Lender, and their respective successors and assigns.
Section 11. Severability. To the extent any provision of this Amendment is
not enforceable under applicable law, such provision shall be deemed null and
void and shall have no effect on the remaining portions of the Amendment.
Section 12. Construction of Amendment. Each party hereto has cooperated in
the drafting and preparation of this Amendment and, as a result, this Amendment
shall not be construed against any party. This Amendment may be amended or
modified only by a written agreement signed by the parties hereto. This
Amendment may be executed in counterparts, each of which when so executed and
delivered shall be deemed an original but all such counterparts together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered as of December 17, 1999.
LACLEDE STEEL COMPANY, as
Debtor and Debtor-in-Possession
By:_______________________________
Vice President
LACLEDE CHAIN MANUFACTURING COMPANY, as
Debtor and Debtor-in-Possession
By:________________________________
Vice President
LACLEDE MID AMERICA INC., as
Debtor and Debtor-in-Possession
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By:________________________________
Vice President
BANK OF AMERICA, NATIONAL ASSOCIATION,
(as successor to BankAmerica Business
Credit, Inc. and Bank of America National
Trust and Savings Association), as the
Agent
By:________________________________
Vice President
BANK OF AMERICA, NATIONAL ASSOCIATION,
(as successor to BankAmerica Business
Credit, Inc., Bank of America National
Trust and Savings Association and
NationsBank, N.A.), as a Lender
By:________________________________
Vice President
GMAC COMMERCIAL CREDIT LLC, (as successor
to BNY Financial Corporation, formerly
known as The Bank of New York Commercial
Corporation), as a Lender
By:________________________________
Vice President
