THIRD AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT
This Third Amendment to the First Amended and Restated Credit Agreement (“Amendment”), dated as of June 17, 2021, is made by and among HSBC BANK USA, NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, “Agent”), the Lenders (as defined in the Credit Agreement, as defined below), and ALLIED MOTION TECHNOLOGIES INC. (“Allied Inc.”) and ALLIED MOTION TECHNOLOGIES B.V. (“Allied B.V.” and collectively with Allied Inc., the “Borrowers”).
The Agent, the Lenders, the Borrowers, and HSBC Securities (USA) Inc., KeyBank National Association and Xxxxx Fargo Bank, National Association, as joint lead arrangers, have previously entered into a First Amended and Restated Credit Agreement dated as of February 12, 2020, as amended by a First Amendment to First Amended and Restated Credit Agreement dated as of March 6, 2020 and a Consent and Second Amendment to First Amended and Restated Credit Agreement dated as of February 12, 2021 (the “Credit Agreement”). All capitalized terms not otherwise defined in this Amendment have the meanings given them in the Credit Agreement.
The Borrowers have requested that the Agent and the Lenders agree to amend certain terms set forth in the Credit Agreement.
The Agent and the Lenders have agreed to amend the Credit Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth herein, and of the loans or other extensions of credit heretofore, now or hereafter made by the Lenders to, or for the benefit of, the Borrowers, the parties hereto agree as follows:
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“Eurocurrency Rate Loan” means a Loan that bears interest at a rate based on the Eurocurrency Rate.
“Adjusted EURIBOR Rate” means, with respect to any Eurocurrency Rate Loan denominated in Euro for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the EURIBOR Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.
“EURIBOR Interpolated Rate” means, at any time, with respect to any Loan denominated in Euro and for any Interest Period, the rate per annum (rounded to the same number of decimal places as the EURIBOR Screen Rate) determined by Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between (a) the EURIBOR Screen Rate for the longest period (for which the EURIBOR Screen Rate is available for Euro) that is shorter than the Impacted EURIBOR Rate Interest Period and (b) the EURIBOR Screen Rate for the shortest period (for which the EURIBOR Screen Rate is available for Euro) that exceeds the Impacted EURIBOR Rate Interest Period, in each case, at such time; provided that, if any EURIBOR Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.
“EURIBOR Rate” means, with respect to any Loan denominated in Euro and for any Interest Period, the EURIBOR Screen Rate; provided that, if the EURIBOR Screen Rate shall not be available at such time for such Interest Period (an “Impacted EURIBOR Rate Interest Period”) with respect to Euro then the EURIBOR Rate shall be the EURIBOR Interpolated Rate.
“EURIBOR Screen Rate” means, for any day and time, with respect to any Loan denominated in Euro and for any Interest Period, the Euro Interbank Offered Rate administered by the European Money Markets Institute (or any other person which takes over the administration of that rate) for the relevant period displayed (before any correction, recalculation or republication by the administrator) on page EURIBOR01 of the Reuters screen (or any replacement Reuters page which
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displays that rate) or on the appropriate page of such other information service which publishes that rate from time to time in place of Reuters as of 11:00 a.m. (Brussels time) two (2) Business Days prior to the commencement of such Interest Period. If such page or service ceases to be available, Administrative Agent may specify another page or service displaying the relevant rate after consultation with Borrowers. If the EURIBOR Screen Rate shall be less than zero, the EURIBOR Screen Rate shall be deemed to be zero for purposes of this Agreement.
“Eurocurrency Rate” means for any Interest Period with respect to a Loan: (a) denominated in Dollars or an Alternative Currency (other than Euro), the rate per annum (rounded upwards, as necessary, to the nearest 1/100th of one percent (0.01%)) equal to the Libor Rate and (b) denominated in Euro, the rate per annum equal to the Adjusted EURIBOR Rate.
“Impacted EURIBOR Rate Interest Period” has the meaning given to such term in the definition of “EURIBOR Rate” set forth in this Section 1.01.
“Loan Party Notice” has the meaning specified in Section 2.16 of this Agreement.
“Non-Material Covenant Subsidiary” means a Non-Material Subsidiary that, as of the date of determination, (a) has been a Subsidiary for at least ninety (90) days, (b) is not a Loan Party, and (c) with respect to which no Loan Party Notice has been delivered by the Company within the past ninety (90) days.
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve, liquid asset, fees or similar requirements (including any marginal, special, emergency or supplemental reserves or other requirements) established by any central bank, monetary authority, the FRB, the FCA, the Prudential Regulation Authority, the European Central Bank or other Governmental Authority for any category of deposits or liabilities customarily used to fund loans in the applicable currency, expressed in the case of each such requirement as a decimal. Such reserve, liquid asset, fees or similar requirements shall include those imposed pursuant to Regulation D. Eurocurrency Rate Loans shall be deemed to be subject to such reserve, liquid asset, fee or similar requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under any applicable Law, including Regulation D. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve, liquid asset or similar requirement.
“Business Day” means (a) for all purposes other than as set forth in clause (b) and (c) below, any day excluding Saturday, Sunday, and any day in which banks in New York, New York are authorized or required by law or governmental action to
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close, (b) with respect to Eurocurrency Rate Loans, any day which is a Business Day described in clause (a) and which is also a day for trading by and between banks in U.S. dollar deposits in Brussels, Belgium, and (c) with respect to advances or payments of Loans or other matters relating to Loans denominated in Alternative Currency, such day shall be a day on which dealings in deposits in the relevant Alternative Currency are carried on in the relevant interbank market.”
“US Guarantors” means collectively, Allied Corp., Emoteq, MPC, Stature, Globe Inc., TCI and Allied Motion Twinsburg, LLC.
“1.11Additional Alternative Currencies.
(a)The Company may from time to time request that Eurocurrency Rate Loans be made and/or Letters of Credit be issued in a currency other than those specifically listed in the definition of “Alternative Currency”; provided that (i) such requested currency is a lawful currency that is readily available and freely transferable and convertible into Dollars and (ii) such requested currency shall only be treated as a “Libor Quoted Currency” to the extent that there is published Libor Rate for such currency (other than Euro). In the case of any such request with respect to the making of Eurocurrency Rate Loans, such request shall be subject to the approval of the Administrative Agent and each Lender; and in the case of any such request with respect to the issuance of Letters of Credit, such request shall be subject to the approval of the Administrative Agent and the L/C Issuer.
(b)Any such request shall be made to the Administrative Agent not later than 11:00 a.m., twenty (20) Business Days prior to the date of the desired Credit Extension (or such other time or date as may be agreed by the Administrative Agent and, in the case of any such request pertaining to Letters of Credit, the L/C Issuer, in its or their sole discretion). The Administrative Agent shall promptly notify each Lender of any such request; and in the case of any such request pertaining to Letters of Credit, the Administrative Agent shall promptly notify the L/C Issuer thereof. Each Lender or the L/C Issuer (in the case of a request pertaining to Letters of Credit) shall notify the Administrative Agent, not later than 11:00 a.m., ten (10) Business Days after receipt of such request whether it consents, in its sole discretion, to the making of Eurocurrency Rate Loans or the issuance of Letters of Credit, as the case may be, in such requested currency.
(c)Any failure by a Lender or the L/C Issuer, as the case may be, to respond to such request within the time period specified in the preceding sentence shall be deemed to be a refusal by such Lender or the L/C Issuer, as the case may be, to permit Eurocurrency Rate Loans to be made or Letters of Credit to be issued in such requested currency. If the Administrative Agent and all the Lenders consent to making Eurocurrency Rate Loans in such requested currency and the Administrative Agent and such Lenders reasonably determine that an appropriate
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interest rate is available to be used for such requested currency, the Administrative Agent shall so notify the Company and (i) the Administrative Agent and such Lenders may amend the definition of Eurocurrency to the extent necessary to add the applicable Eurocurrency Rate for such currency and (ii) to the extent the definition of Eurocurrency Rate reflects the appropriate interest rate for such currency or has been amended to reflect the appropriate rate for such currency, such currency shall thereupon be deemed for all purposes to be an Alternative Currency for purposes of any Borrowings of Eurocurrency Rate Loans. If the Administrative Agent and the L/C Issuer consent to the issuance of Letters of Credit in such requested currency, the Administrative Agent shall so notify the Company and (A) the Administrative Agent and the L/C Issuer may amend the definition of Eurocurrency Rate to the extent necessary to add the applicable Eurocurrency Rate for such currency and (B) to the extent the definition of Eurocurrency Rate reflects the appropriate interest rate for such currency or has been amended to reflect the appropriate rate for such currency, such currency shall thereupon be deemed for all purposes to be an Alternative Currency, for purposes of any Letter of Credit issuances. If the Administrative Agent shall fail to obtain consent to any request for an additional currency under this Section 1.11, the Administrative Agent shall promptly so notify the Company.”
“(a) Subject to the provisions of subsection (b) below, (i) each Eurocurrency Rate Loan denominated in Dollars or an Alternative Currency (other than Euro) shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Libor Rate for such Interest Period plus the Applicable Rate; (ii) each Eurocurrency Rate Loan denominated in Euro shall bear interest on the outstanding principal amount there for each Interest Period at a rate per annum equal to the Adjusted EURIBOR Rate for such Interest Period plus the Applicable Rate; and (iii) each ABR Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the ABR Rate plus the Applicable Rate.”
“(d)Upon the Company’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Company may revoke any request for a Eurocurrency Rate Loan denominated in Dollars or an Alternative Currency (other than Euros) or, conversion to or continuation of Eurocurrency Rate Loan denominated in Dollars or an Alternative Currency (other than Euros) to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Company will be deemed to have converted any such request into a request for a Loan of or conversion to ABR Loans. During any Benchmark Unavailability Period, the component of ABR based upon LIBOR will not be used in any determination of ABR.
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“2.16 Addition of Non-Material Subsidiaries as Loan Parties. The Borrowers may elect to add one or more Non-Material Subsidiaries as a Loan Party by written notice by the Company to the Administrative Agent of such election (a “Loan Party Notice”). Within ninety (90) days following delivery of a Loan Party Notice, the Borrower will cause the applicable Subsidiary to (a) guaranty all Obligations by executing and delivering to the Administrative Agent a Guaranty; (b) secure all of its Obligations as described in, but only to the extent required by, Section 2.12 by providing the Administrative Agent with a first priority perfected security interest (subject only to Liens permitted by Section 7.01) on its assets and by executing and delivering a security agreement and such other documents as the Administrative Agent shall deem appropriate for such purpose; (c) deliver to the Administrative Agent documents of the type referred to in clause (iii) and (iv) of Section 4.01(a) and opinions of counsel to such Subsidiary (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clauses (a) and (b), all in form, content and scope reasonably satisfactory to the Administrative Agent. During the ninety (90) days following the delivery by the Borrowers of a Loan Party Notice, the applicable Subsidiary identified in the Loan Party Notice shall not be considered a Non-Material Covenant Subsidiary for purposes of Subsection 7.10(c).”
“(a)Illegality. If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurocurrency Rate Loans (whether denominated in Dollars or Alternative Currency), or to determine or charge interest rates based upon the Libor Rate or the EURIBOR Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars or Alternative Currency in the applicable interbank market, then, on notice thereof by such Lender to the Company through the Administrative Agent, any obligation of such Lender to make or continue Eurocurrency Rate Loans in the affected currency or currencies or, in the case of Eurocurrency Rate Loans in Dollars, to convert ABR Loans to Eurocurrency Rate Loans, shall be suspended until such Lender notifies the Administrative Agent and the Company that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the applicable Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable and such Loans are denominated in Dollars, convert all such Eurocurrency Rate Loans of such Lender to ABR Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans. Upon any such
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prepayment or conversion, the applicable Borrower shall also pay accrued interest on the amount so prepaid or converted.”
“3.03 Inability to Determine Rates. If the Required Lenders determine that for any reason in connection with any request for a Eurocurrency Rate Loan or a conversion to or continuation thereof that (a) deposits (whether in Dollars or Alternative Currency) are not being offered to banks in the applicable offshore interbank market for such currency for the applicable amount and Interest Period of such Eurocurrency Rate Loan, (b) adequate and reasonable means do not exist for determining the Libor Rate or the EURIBOR Rate, as applicable, for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan (whether denominated in Dollars or an Alternative Currency), or (c) the Libor Rate or the EURIBOR Rate, as applicable, for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding such Eurocurrency Rate Loan, the Administrative Agent will promptly so notify the Company and each Lender. Thereafter, the obligation of the Lenders to make or maintain Eurocurrency Rate Loans in the affected currency or currencies shall be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, either Borrower, as applicable, may revoke any pending request for a Borrowing of, conversion to or continuation of Eurocurrency Rate Loans in the affected currency or currencies or, failing that, will be deemed to have converted such request into a request for a Borrowing of ABR Loans in the amount specified therein or to another type of loan at an alternate rate offered by the Administrative Agent. This Section 3.03 is subject in all respects to Section 2.13, and in the event of an inconsistency between this Section 3.03 and Section 2.13, Section 2.13 shall control.”
“(a)Increased Costs Generally. If any Change in Law shall:
(i)impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Libor Rate or the EURIBOR Rate, as applicable) or the L/C Issuer; or
(ii)impose on any Lender or the L/C Issuer or the applicable interbank market any other condition affecting this Agreement or Eurocurrency Rate Loans made by such Lender or any Letter of Credit or participation therein; or
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(iii)subject any Recipient to any Taxes (other than Excluded Taxes) on its loans, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer (whether of principal, interest or otherwise), then the applicable Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.
(iv)If any Lender or the L/C Issuer determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the L/C Issuer’s capital or on the capital of such Lender’s or the L/C Issuer’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer, to a level below that which such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the L/C Issuer’s policies and the policies of such Lender’s or the L/C Issuer’s holding company with respect to capital adequacy and liquidity, and provided such Change in Law has or would have a similar effect on Lender as a consequence of other similarly situated credits of Lender), then from time to time the applicable Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company for any such reduction suffered.
(v)A certificate of a Lender or the L/C Issuer setting forth the amount or amounts necessary to compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section 3.04 shall be delivered to the Company and shall be conclusive absent manifest error. The applicable Borrower shall pay such Lender or the L/C Issuer, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.”
(vi)Failure or delay on the part of any Lender or the L/C Issuer to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s right to demand such compensation; provided that the applicable Borrower shall not be required to compensate a Lender or the L/C Issuer pursuant to this Section for any increased costs or reductions incurred more than 270 days prior to the date that such Lender or the L/C Issuer, as the case may be, notifies the applicable Borrower of the
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Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 270-day period referred to above shall be extended to include the period of retroactive effect thereof.
“3.05Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the applicable Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:
(a)any continuation, conversion, payment or prepayment of any Loan other than a ABR Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);
(b)any failure by any Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than an ABR Loan on the date or in the amount notified by the Company or the applicable Borrower; or
(c)any failure by any Borrower to make payment of any Loan or drawing under any Letter of Credit (or interest due thereon) denominated in an Alternative Currency on its scheduled due date or any payment thereof in a different currency;
including any loss of anticipated profits, any foreign exchange losses and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan, from fees payable to terminate the deposits from which such funds were obtained or from the performance of any foreign exchange contract. The applicable Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.
For purposes of calculating amounts payable by Borrowers to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurocurrency Rate Loan made by it at the Libor Rate, or the EURIBOR Rate, as applicable, for such Loan by a matching deposit or other borrowing in the applicable offshore interbank market for such currency for a comparable amount and for a comparable period, whether or not such Eurocurrency Rate Loan was in fact so funded.”
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“(k) Liens on assets or deposit accounts to secure corporate credit card facilities in an aggregate amount not to exceed Two Hundred Fifty Thousand Dollars ($250,000) at one time outstanding.”
“(c) Consolidated Total Assets. Permit, as of the end of any fiscal quarter, Non-Material Covenant Subsidiaries to have an aggregate of over twenty-five percent (25%) of Consolidated Total Assets.”
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[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective representatives thereunto duly authorized, as of the date first above written.
ALLIED MOTION TECHNOLOGIES INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Chief Financial Officer
ALLIED MOTION TECHNOLOGIES B.V.
By: /s/ X.X. Xxxxxxxx
Name: X.X. Xxxxxxxx
Title: Director
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
ADMINISTRATIVE AGENT:
HSBC BANK USA, NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT
By: /s/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: Vice President
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
lenders:
hsbc bank usa, national association, as a Lender, L/C Issuer
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: Senior Vice President
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
xxxxx fargo bank, national association
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
citizens bank, n.a.
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
JPMORGAN CHASE BANK, NA, as a Lender
By: /s/ Xxxxxxxxx X. Xxxxxx
Name: Xxxxxxxxx X. Xxxxxx
Title: Authorized Officer
[Signature Page to Third Amendment to First Amended and Restated Credit Agreement]
EXHIBIT A-2
FOREIGN LOAN NOTICE
The undersigned hereby certifies to HSBC BANK USA, NATIONAL ASSOCIATION, as Administrative Agent under First Amended and Restated Credit Agreement dated as of February 12, 2020 (the “Credit Agreement”) among the undersigned, Allied Motion Technologies Inc. and Allied Motion Technologies B.V., the Lenders from time to time party thereto, the Administrative Agent, and L/C Issuer, and HSBC Securities (USA) INC., Keybank National Association, Xxxxx Fargo Bank, National Association, and Citizens Bank, N.A., as Joint Lead Arrangers, that:
The undersigned requests or has requested by telephone or facsimile notice a:
◻ Foreign Loan
(Check One)
[ ] new loan
[ ] conversion
[ ] continuation
of a
(Check One)
[ ] LIBOR Loan
[ ] EURIBOR Loan
to a or as a
(Check One)
[ ] LIBOR Loan
[ ] EURIBOR Loan
in the amount of _____________ for an Interest Period, of
(Check One if applicable)
[ ] one month.
[ ] three months.
[ ] six months.
The proposed loan/conversion/continuation is to be made on ____________, 20___ which is a Business Day.
The undersigned has made payments of principal of the Foreign Loans in the amount of ______________ since the date of the most recent Foreign Loan. The outstanding principal balance of the Foreign Loans is ______________.
WITNESS the signature of the undersigned authorized signatory of the Borrower this ____ day of _____________, 20___.
ALLIED MOTION TECHNOLOGIES B.V.
By:
Name:
Title:
