THIRD AMENDMENT TO AMENDED AND RESTATED
REVOLVING LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO AMENDED AND RESTATED REVOLVING LOAN AND SECURITY
AGREEMENT (the "Third Amendment") is entered into as of May 14, 1999, by and
between KEYSTONE CONSOLIDATED INDUSTRIES, INC., a Delaware corporation
("Borrower"), and CONGRESS FINANCIAL CORPORATION (CENTRAL), an Illinois
corporation ("Lender"). Except for terms which are expressly defined herein, all
capitalized terms used herein shall have the meaning subscribed to them in the
Loan Agreement (as defined below).
RECITALS
WHEREAS, Borrower and Lender are parties to that certain Amended and
Restated Revolving Loan and Security Agreement dated as of December 29, 1995, as
amended by that certain First Amendment to Amended and Restated Revolving Loan
and Security Agreement dated as of September 27, 1996 and that certain Second
Amendment to Amended and Restated Revolving Loan and Security Agreement and
Release of Term Loan and Security Agreement dated as of August 4, 1997
(collectively, the "Loan Agreement").
WHEREAS, Borrower desires to amend the terms of the Loan Agreement to
reflect the disposition by Borrower of certain of DeSoto's laundry facility
assets in Joliet, Illinois and to permit Borrower to, among other things, enter
into a joint venture with Spartanburg Forest Products, Inc., a South Carolina
corporation, and Gossling Consulting L.L.C., a Delaware limited liability
company, and guarantee certain obligations of the joint venture.
WHEREAS, Lender is willing to amend the Loan Agreement on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual conditions and agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Amendments to the Loan Agreement
A. The definition of "Inventory Cap Adjustment" in Section 1 of the
Loan Agreement is hereby amended and restated in its entirety to read as
follows:
"Inventory Cap Adjustment" shall mean, at any time, the amount,
if any, by which the Inventory Utilization exceeds $25,000,000.
B. Section 9.10 of the Loan Agreement is hereby amended and restated
in its entirety to read as follows:
Revolving Loans, Investments, Guarantees, Etc. Borrower shall
not, directly or indirectly, make any loans or advance money or
property to any person, or invest in (by capital contribution,
dividend or otherwise) or purchase or repurchase the stock or
indebtedness or all or a substantial part of the assets or
property of any person, or guarantee, assume, endorse, or
otherwise become responsible for (directly or indirectly) the
indebtedness, performance, obligations or dividends of any Person
or agree to do any of the foregoing, except: (a) the endorsement
of instruments for collection or deposit in the ordinary course
of business; (b) loans or investments which result from the
conversion of past due accounts receivable into notes or stock,
which notes or stock are delivered and pledged to Lender; (c)
investments in: (i) short-term direct obligations of the United
States Government, (ii) negotiable certificates of deposit issued
by any bank satisfactory to Lender, payable to the order of the
Borrower or to bearer and delivered to Lender, (iii) commercial
paper rated A1 or P1, (iv) the advances and investments as of
December 31, 1995 in Engineered Wire Products, Inc., an Ohio
corporation, and (v) loans or investments of no greater than (A)
$3,000,000 to Fox Valley made available on a revolving credit
basis and evidenced by a subordinated demand note, provided that
Fox Valley is Solvent at the time of such loans or investments,
(B) $5,000,000 to Xxxxxxxx made available on a revolving credit
basis and evidenced by a subordinated demand note, provided that
Xxxxxxxx is Solvent at the time of such loans or investments, (C)
$10,000,000 to DeSoto, Inc. (excluding the initial investment of
approximately $70,000,000 made to initially capitalize DSO
Acquisition Corporation with the contribution of the Xxxxxxx Wire
assets plus (x) the value of Borrower's stock issued in
connection with the DeSoto Acquisition and (y) all transaction
costs related to DeSoto Acquisition) made available on a
revolving credit basis and evidenced by a subordinated demand
note, provided that DeSoto, Inc. is Solvent at the time of such
loans or investments, (D) $8,800,000 to DeSoto, Inc. made
available as a term loan on or about August 7, 1997 to be
evidenced by a subordinated demand note, and (E) an investment of
$102,000 made to initially capitalize Garden Zone, LLC, a
Delaware limited liability company ("Garden Zone"); provided,
that, as to any of the foregoing, unless waived in writing by
Lender, Borrower shall take such actions as are deemed necessary
by Lender to perfect the security interest of Lender in such
investments; and (d) the guarantee(s) (i) by Borrower of the
obligations owing to Lender by Joint Venture, (ii) by Borrower of
up to $2,040,000 of the obligations owing to National Bank of
South Carolina by Garden Zone and (iii) set forth in the
Information Certificate.
B. The Information Certificate attached as Exhibit A to the Loan
Agreement is hereby amended to delete "DSO Acquisition Corporation" under
the section entitled "Subsidiaries (Section 8.1)" and to insert "Garden
Zone, LLC" in place thereof.
II. Conditions to Effectiveness of Third Amendment. This Third Amendment
shall become effective on the date (the "Effective Date") when Borrower shall
satisfy all of the following conditions:
A. Third Amendment. Borrower and Lender shall have duly executed and
delivered this Third Amendment.
B. Additional Matters. Lender shall have received such other
certificates, opinions, UCC financing statements, documents and instruments
relating to the obligations or the transactions contemplated hereby as may
have been reasonably requested by Lender, and all corporate and other
proceedings and all other documents and all legal matters in connection
with the transactions contemplated hereby shall be reasonably satisfactory
in form and substance to Lender.
IV. Representations and Warranties. In order to induce Lender to enter into
this Third Amendment, Borrower represents and warrants to Lender, upon the
effectiveness of this Third Amendment, which representations and warranties
shall survive the execution and delivery of this Third Amendment, that:
A. Borrower is a corporation duly organized, validly existing and in
good standing under the laws of the state of its incorporation;
B. the execution, delivery and performance of this Third Amendment by
Borrower are within its corporate powers and have been duly authorized by
all necessary corporate action;
C. this Third Amendment constitutes a legal, valid and binding
obligation of Borrower, enforceable against Borrower in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity; and
D. all of the representations and warranties contained in the Loan
Agreement and in the other Financing Agreements (other, than those which
speak expressly only as of a different date) are true and correct as of the
date of this Third Amendment after giving effect to this Third Amendment.
V. Miscellaneous.
A. Effect; Ratification. The amendments set forth herein are effective
solely for the purpose set forth herein and shall be limited precisely as
written, and shall not be deemed to (i) be a consent to any amendment,
waiver or modification of any other term or condition of the Loan Agreement
or of any other Financing Agreements or (ii) prejudice any right or rights
that Lender may now have or may have in the future under or in connection
with the Loan Agreement or any other Financing Agreements. Each reference
in the Loan Agreement to "this Agreement", "herein", "hereof" and words of
like import and each reference in the other Financing Agreements to the
Loan Agreement shall mean the Loan Agreement as amended hereby. This Third
Amendment shall be construed in connection with and as part of the Loan
Agreement and all terms, conditions, representations, warranties, covenants
and agreements set forth in the Loan Agreement and each other Financing
Agreement, except as herein amended or waived, are hereby ratified and
confirmed and shall remain in full force and effect.
B. Costs and Expenses. Borrower shall pay to Lender on demand all
reasonable out-of-pocket costs, expenses, title fees, filing fees and taxes
paid or payable in connection with the preparation, negotiation, execution,
delivery, recording, administration, collection, liquidation, enforcement
and defense of the Obligations, Lender's rights in the Collateral, this
Third Amendment, the Loan Agreement, the other Financing Agreements and all
other documents related hereto or thereto, including any amendments,
supplements or consents which may hereafter be contemplated (whether or not
executed) or entered into in respect hereof and thereof, including, but not
limited to: (a) all costs and expenses of filing or recording (including
Uniform Commercial Code financing statement filing taxes and fees,
documentary taxes, intangibles taxes and mortgage recording and title
insurance taxes and fees, if applicable); (b) costs and expenses and fees
for title insurance and other insurance premiums, environmental audits,
surveys, assessments, engineering reports and inspections, appraisal fees
and search fees; (c) costs and expenses of remitting loan proceeds,
collecting checks and other items of payment; (d) charges, fees or expenses
charged by any bank or issuer in connection with the Letter of Credit
Accommodations; (e) costs and expenses of preserving and protecting the
Collateral; (f) costs and expenses paid or incurred in connection with
obtaining payment of the Obligations, enforcing the security interests and
liens of Lender, selling or otherwise realizing upon the Collateral, and
otherwise enforcing the provisions of this Third Amendment, the Loan
Agreement and the other Financing Agreements or defending any claims made
or threatened against Lender arising out of the transactions contemplated
hereby and thereby (including, without limitation, preparations for and
consultations concerning any such matters); and (g) the fees and
disbursements of counsel (including legal assistants) to Lender in
connection with the foregoing.
C. Certain Waivers; Release. Although Borrower does not believe that
it has any claims against Lender, it is willing to provide Lender with a
general and total release of all such claims in consideration of the
benefits which Borrower will receive pursuant to this Third Amendment.
Accordingly, Borrower for itself and any successor of Borrower hereby
knowingly, voluntarily, intentionally and irrevocably releases and
discharges Lender and its respective officers, directors, agents and
counsel (each a "Releasee") from any and all actions, causes of action,
suits, sums of money, accounts, reckonings, bonds, bills, specialties,
covenants, contracts, controversies, agreements, promises, variances,
trespasses, damages, judgments, extents, executions, losses, liabilities,
costs, expenses, debts, dues, demands, obligations or other claims of any
kind whatsoever, in law, admiralty or equity, which Borrower ever had, now
has or hereafter can, shall or may have against any Releasee for, upon or
by reason of any matter, cause or thing whatsoever from the beginning of
the world to the date of this Third Amendment.
D. Counterparts. This Third Amendment may be executed in any number of
counterparts, each such counterpart constituting an original but all
together constituting one and the same instrument.
E. Severability. Any provision contained in this Third Amendment that
is held to be inoperative, unenforceable or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable or invalid
without affecting the remaining provisions of this Third Amendment in that
jurisdiction or the operation, enforceability or validity of that provision
in any other jurisdiction.
F. GOVERNING LAW. THIS THIRD AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
ILLINOIS.
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IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment
as of the date first above written.
CONGRESS FINANCIAL CORPORATION (CENTRAL)
By:
Name:
Title:
KEYSTONE CONSOLIDATED INDUSTRIES, INC.
By:
Name:
Title:
