1
EXHIBIT 10.7
SIXTH AMENDMENT TO CREDIT AGREEMENT
THIS SIXTH AMENDMENT TO CREDIT AGREEMENT, dated as of March 1, 2001
(this "Sixth Amendment"), is among ROUGE INDUSTRIES, INC., a Delaware
corporation ("Holdings"), ROUGE STEEL COMPANY, a Delaware corporation (the
"Borrower"), the financial institutions party hereto (collectively with the
Agent (defined below), the "Banks") and BANK ONE, MICHIGAN, a Michigan banking
corporation, as agent for the Banks (in such capacity, the "Agent").
RECITALS
A. Holdings, the Borrower, the Agent and the Banks are parties to a
Credit Agreement dated as of December 16, 1997, as amended by the First
Amendment to Credit Agreement dated July 23, 1999, the Second Amendment to
Credit Agreement dated as of April 21, 2000, the Third Amendment to Credit
Agreement dated as of January 18, 2001, the Fourth Amendment to Credit Agreement
dated as of February 2, 2001, and as further amended by the Fifth Amendment to
Credit Agreement dated as of February 26, 2001 (as amended, and as may be
further amended, modified, or restated from time to time, the "Credit
Agreement").
B. Holdings and the Borrower desire to amend the Credit Agreement, and
the Agent and the Banks are willing to do so strictly in accordance with the
terms hereof.
TERMS
In consideration of the premises and of the mutual agreements herein
contained, the parties agree as follows:
ARTICLE 1
AMENDMENT
The number "$75,000,000" appearing in the definition of Borrowing Base
is amended to read "$100,000,000".
ARTICLE 2
REPRESENTATIONS
Each of Holdings and Borrower represents and warrants to the Agent
and the Banks that:
2.1 The execution, delivery and performance of this Sixth Amendment are
within its powers, have been duly authorized and are not in contravention with
any law, of the terms of its Articles of Incorporation or By-Laws, or any
undertaking to which it is a party or by which it is bound.
2
2.2 This Sixth Amendment is the legal, valid and binding obligation of
it, enforceable against it in accordance with the terms hereof.
2.3 After giving effect to the amendments herein contained, the
representations and warranties contained in Section 4 of the Credit Agreement
and the representations and warranties contained in the other Loan Documents 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.
2.4 Each of Borrower, Holdings, and QS Steel is, and after giving
effect to the incurrence of all indebtedness and obligations being incurred in
connection herewith and will be and will continue to be, Solvent.
ARTICLE 3
CONDITIONS OF EFFECTIVENESS
This Sixth Amendment shall become effective on the date that each of
the following has been satisfied to Agent's satisfaction:
3.1 This Sixth Amendment shall be signed by Holdings, the Borrower,
Agent, and the Required Banks.
3.2 Holdings, QS Steel, and Borrower have delivered such additional
documents, instruments, resolutions, etc., as Agent may reasonably require.
ARTICLE 4
MISCELLANEOUS
4.1 References in any Loan Document to the Credit Agreement shall be
deemed to be references to the Credit Agreement as amended hereby and as further
amended from time to time.
4.2 Holdings and Borrower, jointly and severally, agree to pay and to
save the Agent harmless for the payment of all costs and expenses arising in
connection with the transactions contemplated by this Sixth Amendment, including
the reasonable fees of counsel to the Agent (Xxxxxxxx Xxxxxx Xxxxxxxx and Xxxx
LLP), consultants and advisers, and the fees, costs and expenses associated with
any appraisals conducted by the Agent or its agents. Holdings and Borrower agree
to cooperate, and to cause its Subsidiaries to cooperate, in all respects with
the Agent's consultants, advisers, appraisers, and their respective agents.
4.3 Each of Holdings and Borrower acknowledge and agree that (i) the
Agent and the Banks have fully performed all of their obligations under the Loan
Documents and all documents executed in connection with the Loan Documents and
(ii) all actions taken by the Agent and the Banks are reasonable and appropriate
under the circumstances and within their rights under the Loan Documents.
3
4.4. Each of Holdings and Borrower acknowledge that neither the Banks
nor their affiliates will, under any circumstances, be obligated to honor any
checks or other items presented to Banks or their affiliates for payment for
which there are insufficient available funds in the respective Borrower's
account, and Banks or their affiliates may return any such items so presented.
4.5 Except as expressly amended hereby, each of Holdings and Borrower
agree that the Loan Documents are ratified and confirmed and shall remain in
full force and effect and that it has no set off, counterclaim or defense with
respect to any of the foregoing. Terms used but not defined herein shall have
the respective meanings ascribed thereto in the Credit Agreement.
4.6 (a) This Sixth Amendment constitutes each of Holdings', the
Borrower's and the Banks' entire understanding with respect to the subject
matter hereof. Modifications or amendments to this Sixth Amendment must be in
writing and comply with Section 9.5 of the Credit Agreement in order to be
effective. This Sixth Amendment is governed by the internal laws of the State of
Michigan (without regard to conflicts of law principles). This Sixth Amendment
is binding on each of Holdings and Borrower and their respective successors,
assigns, heirs, and personal representatives and inures to Banks' benefit and
the benefit of its successors and assigns. If any provision of this Sixth
Amendment conflicts with any applicable statute or law, or is otherwise
unenforceable, such offending provision is null and void only to the extent of
such conflict or unenforceability, and is deemed separate from and does not
invalidate any other provision of this Sixth Amendment.
(b) This Sixth Amendment is being entered into among competent persons,
who are experienced in business and represented by counsel (or who have had the
opportunity to be represented by counsel), and has been reviewed by each of
Holdings and Borrower and their counsel, if any. Therefore, any ambiguous
language in this Sixth Amendment will not necessarily be construed against any
particular party as the drafter of such language.
4.7 This Sixth Amendment may be signed upon any number of counterparts
with the same effect as if the signatures thereto and hereto were upon the same
instrument.
IN WITNESS WHEREOF, the parties signing this Sixth Amendment have
caused this Sixth Amendment to be executed and delivered as of the day and year
first above written.
ROUGE INDUSTRIES, INC.
By: /s/ Xxxx X. Xxxxxxxxxxx
--------------------------------------------
Xxxx X. Xxxxxxxxxxx
Vice Chairman And Chief Financial Officer
ROUGE STEEL COMPANY
3
4
By: /s/ Xxxx X. Xxxxxxxxxxx
--------------------------------------------
Xxxx X. Xxxxxxxxxxx
Vice Chairman And Chief Financial Officer
[Signatures continued
on following page]
4
5
[Signatures continued
from preceding page]
BANK ONE, MICHIGAN, as Agent, as Issuing
Bank and as a Bank
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxx, Xx.
First Vice President
COMERICA BANK
By: /s/ Xxxxxx X. XxXxxxxxx
--------------------------------------
Name: Xxxxxx X. XxXxxxxxx
--------------------------------
Title: Asst Vice President
-------------------------
NATIONAL CITY BANK
By: /s/ Xxxx X. XxXxxxxxxxx
--------------------------------------
Name: Xxxx X. XxXxxxxxxxx
--------------------------------
Title Vice President
--------------------------
REAFFIRMATION OF AGREEMENTS
The undersigned, while not a party to this Sixth Amendment, is a party
to various other guaranties, security agreements, documents, instruments, and
agreements with or in favor of Agent, for the benefit of the Banks (each, a
"Related Agreement" and collectively, the "Related Agreements"). In order to
induce Agent and the Banks to enter into the Sixth Amendment set forth above,
the undersigned (1) acknowledges and agrees that all of its respective Related
Agreements remain in full force and effect and are hereby ratified, confirmed,
approved and, extend to and cover all of the obligations described in the Sixth
Amendment; (2) consents to all of the terms and conditions of the Sixth
Amendment; (3) if it has executed a guaranty in Lender's favor, it acknowledges
and agrees that its guaranty (and the collateral security therefor) extends
5
6
to and covers all of Borrower's obligations to Agent and the Banks, including
those arising under, in connection with, or described in the Sixth Amendment;
(4) it acknowledges and agrees that the fact that Agent has sought this
reaffirmation does not create any obligation, right, or expectation that Agent
will seek its consent to or reaffirmation with respect to any other or further
amendments or modifications to the relationship between it, the Banks and
Borrower or any other party; and (5) acknowledges and agrees that the references
to it in the Related Agreements (including in its Guaranty) as being a Delaware
corporation are amended to read that it is a Michigan corporation.
QS STEEL INC.
By: /s/ Xxxx X. Xxxxxxxxxxx
--------------------------------------------------
Xxxx X. Xxxxxxxxxxx
President
6
