1
Exhibit 10.9
FOURTH AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT
-----------------------------
THIS FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT, dated as
of November 10, 1997 (this "Amendment"), is by and among MONARCH MACHINE TOOL
COMPANY, an Ohio corporation (the "Company"), the BANKS identified on the
signature pages hereof (collectively the "Banks" and individually a "Bank"), and
NBD BANK, N.A., a national banking association, as successor by assignment to
NBD Bank, a Michigan banking corporation, as agent (in such capacity, the
"Agent") for the Banks.
INTRODUCTION
------------
The Company, the Banks and the Agent are parties to the Amended and
Restated Credit Agreement, dated as of June 9, 1995, as amended by the First
Amendment to Amended and Restated Credit Agreement, dated as of July 11, 1995,
the Second Amendment to Amended and Restated Credit Agreement, dated as of July
31, 1996, and the Third Amendment to Amended and Restated Credit Agreement,
dated as of March 19, 1997 (the "Credit Agreement"). The parties now desire to
further amend the Credit Agreement on the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein and in the Credit Agreement contained, the parties hereto
agree as follows:
ARTICLE 1. AMENDMENT TO CREDIT AGREEMENT
----------------------------------------
The Credit Agreement hereby is amended, retroactively effective as of
September 30, 1997. as follows:
1.1 Section 5.2(b) is amended to read in full as follows:
(b) TANGIBLE NET WORTH. Permit or suffer (i) Consolidated Tangible
Net Worth of the Company and its Subsidiaries to be less than (ii)
the sum of (A) $44,000,000 plus (B) 50% of Consolidated Cumulative
Net Income of the Company and its Subsidiaries after December 31,
1996 plus (C) for each fiscal year end of the Company, the amount if
any by which $500,000 exceeds the aggregate amount added pursuant to
the foregoing clause (B) attributable to each such fiscal year; such
covenant to be tested as of the end of each fiscal quarter of the
Company.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES
-----------------------------------------
In order to induce the Agent and the Banks to enter into this Amendment,
the Company represents and warrants that:
2.1 The execution, delivery and performance by the Company of this
Amendment are within its corporate powers, have been duly authorized by all
necessary corporate action and are not in contravention of any law, rule or
regulation, or any judgment, decree, writ, injunction, order
2
or award of any arbitrator, court or governmental authority, or of the terms of
the Company's charter or by-laws, or of any contract or undertaking to which the
Company is a party or by which the Company or its property is or may be bound or
affected.
2.2 This Amendment is a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
2.3 No consent, approval or authorization of or declaration,
registration or filing with any governmental authority or any nongovernmental
person or entity, including without limitation any creditor or stockholder of
the Company, is required on the part of the Company in connection with the
execution, delivery and performance of this Amendment or the transactions
contemplated hereby or as a condition to the legality, validity or
enforceability of this Amendment.
2.4 After giving effect to the amendments contained in Article 1 of this
Amendment, the representations and warranties contained in Article IV of the
Credit Agreement are true on and as of the date hereof with the same force and
effect as if made on and as of the date hereof.
ARTICLE 3. WAIVER OF CERTAIN DEFAULTS
-------------------------------------
3.1 The Company has advised the Agent and the Banks that for the period
from and including July 31, 1997 through the date of this Amendment the Company
failed to comply with the covenant set forth in Section 5.2(b) of the Credit
Agreement, and the Company has asked the Banks to waive the Events of Default
caused by such failure. Based upon such request, the Banks hereby waive each
such Event of Default, including, without limitation, any such Event of Default
pursuant to Section 6.1(e) of the Credit Agreement caused by the occurrence of
an event of default under the Company's credit facilities with The Fifth Third
Bank due to the Company's failure to so comply with Section 5.2(b) of the Credit
Agreement (the "Fifth Third Cross Default"); PROVIDED that (a) such waiver shall
be limited to those Events of Default, including, without limitation, the Fifth
Third Cross Default, caused by such covenant compliance failure occurring during
the period from and including July 31, 1997 through the date of this Amendment
that are known to the Banks as of the date of this Amendment, and (b) such
waiver shall not be deemed to (i) be a waiver of or consent or agreement to any
other action or omission in violation of the Credit Agreement or any other
instrument, agreement or document referred to therein or executed in connection
therewith, (ii) be a waiver or modification of any provision of the Credit
Agreement or of any instrument, agreement or document referred to therein or
executed in connection therewith, or (iii) prejudice any other right or rights
which the Banks may now have or have in the future under or in connection with
the Credit Agreement or any instrument, agreement or document referred to
therein or executed in connection therewith.
ARTICLE 4. MISCELLANEOUS
------------------------
4.1 If the Company shall fail to perform or observe any term, covenant
or agreement in this Amendment, or any representation or warranty made by the
Company in this Amendment shall prove to have been incorrect in any material
respect when made, such occurrence shall be deemed to constitute an Event of
Default.
4.2 All references to the Credit Agreement in any other document,
instrument or
-2-
[Fourth Amendment to Amended and Restated Credit Agreement]
3
certificate referred to in the Credit Agreement or delivered in connection with
or pursuant thereto, hereafter shall be deemed references to the Credit
Agreement, as amended hereby.
4.3 Subject to the amendments herein provided, the Credit Agreement
shall in all respects continue in full force and effect.
4.4 Capitalized terms used but not defined herein shall have the
respective meanings ascribed thereto in the Credit Agreement.
4.5 This Amendment shall be governed by and construed in accordance with
the laws of the State of Michigan.
4.6 The Company agrees to pay the reasonable fees and expenses of
Dickinson, Wright, Moon, Van Dusen & Xxxxxxx, counsel for the Agent, in
connection with the negotiation and preparation of this Amendment and the
consummation of the transactions contemplated hereby, and in connection with
advising the Agent as to its rights and responsibilities with respect thereto.
4.7 This Amendment may be executed upon any number of counterparts with
the same effect as if the signatures thereto were upon the same instrument.
[THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK.]
-3-
[Fourth Amendment to Amended and Restated Credit Agreement]
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered as of the day and year first-above written.
THE MONARCH MACHINE TOOL COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Its: Chief Financial Officer
----------------------------
NBD BANK, N.A., as a Bank and as the Agent
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Its: First Vice President
----------------------------
STAR BANK, N.A., as a Bank
By: /s/ Xxxx Xxxxxxx
------------------------------------
Its: Vice President
----------------------------
-4-
[Fourth Amendment to Amended and Restated Credit Agreement]
