EXHIBIT 10.1
CONSENT AND SIXTH AMENDMENT
This CONSENT AND SIXTH AMENDMENT (this "Consent") is
entered into as of March 24, 1997, by and among XXXXXX
MANUFACTURING AND TECHNOLOGY, INC., a Delaware corporation (the
"Borrower"), XXXXXX CANADA INC., an Ontario, Canada corporation
("Xxxxxx Canada"), the lenders parties to the Loan Agreement
referred to below (the "Lenders"), and TRANSAMERICA BUSINESS CREDIT
CORPORATION, a Delaware corporation, as agent (the "Agent") for the
Lenders.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have
heretofore entered into a Loan and Security Agreement dated October
22, 1993, as amended (the "Loan Agreement");
WHEREAS, pursuant to a Continuing Guaranty and Security
Agreement, dated October 22, 1993, as amended (the "Xxxxxx Canada
Guaranty") executed by Xxxxxx Canada in favor of the Agent, Xxxxxx
Canada has guaranteed to the Agent and the Lenders under the Loan
Agreement certain indebtedness, obligations and liabilities of the
Borrower;
WHEREAS, Xxxxxx Canada and the Borrower have heretofore
entered into a Subsidiary Loan and Security Agreement dated October
22, 1993, as amended (the "Xxxxxx Canada Loan Agreement") pursuant
to which Xxxxxx Canada has executed in favor of the Borrower a
Revolving Note (as defined in the Xxxxxx Canada Loan Agreement and
hereinafter referred to as the "Xxxxxx Canada Revolving Note") and
has granted to the Borrower a Lien upon all of Xxxxxx Canada's
Collateral (as defined in the Xxxxxx Canada Loan Agreement and
hereinafter referred to as the "Xxxxxx Canada Collateral");
WHEREAS, pursuant to the Collateral Assignment Agreement, the
Borrower has collaterally assigned to the Agent and the Lenders all
of the Borrower's rights and Liens under or relating to the Xxxxxx
Canada Loan Agreement;
WHEREAS, Xxxxxx Canada owns and operates a service center
specializing in stainless steel sheet, bar, plate and angle iron
(collectively, the "Business");
WHEREAS, the Borrower, Xxxxxx Canada, Xxxxxxx of Canada, Inc.
(the "Buyer") and Xxxxxxx Stainless Steels and Special Metals, Inc.
propose to enter into an Assets Purchase Agreement (the "Purchase
Agreement") pursuant to which Xxxxxx Canada agrees to sell and the
Buyer agrees to purchase all of the assets of the Business, both
tangible and intangible, as more fully set forth in the Purchase
Agreement (but excluding the Excluded Assets, as defined in the
Purchase Agreement) (the "Purchase and Sale Transaction");
WHEREAS, in connection with the Purchase and Sale Transaction,
the Borrower and Xxxxxx Canada have requested that the Agent and
the Lenders agree to release the Xxxxxx Canada Guaranty (the
"Xxxxxx Canada Guaranty Release");
WHEREAS, the Borrower desires to terminate the Xxxxxx Canada
Loan Agreement (the "Xxxxxx Canada Loan Termination") and all Loan
Documents (as defined therein and hereinafter referred to as the
"Xxxxxx Canada Loan Documents") and to release the Xxxxxx Canada
Collateral (the "Xxxxxx Canada Collateral Release");
WHEREAS, the Purchase and Sale Transaction, the Xxxxxx Canada
Guaranty Release, the Xxxxxx Canada Loan Termination and the Xxxxxx
Canada Collateral Release (each, individually, a "Proposed
Transaction" and, collectively, the "Proposed Transactions")
require the written consent of the Agent and the Lenders, and the
Borrower and Xxxxxx Canada have requested that the Agent and
Lenders so consent; and
WHEREAS, the Agent and the Lenders are willing to consent to
the Proposed Transactions on the terms and conditions herein set
forth;
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NOW, THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
legally bound, the parties hereto hereby agree as follows:
1. Definitions. Capitalized terms used but not defined
herein shall have the respective meanings ascribed to such terms in
the Loan Agreement.
2. Consent to Proposed Transactions.
2.1. Consent. The Agent and the Lenders hereby consent
to the Proposed Transactions; provided, however, that such consent
is subject to conditions set forth in Section 2.2 of this Consent.
2.2. Conditions to Consent. The consent provided for in
Section 2.1 of this Consent is subject to the following conditions:
(a) Each Proposed Transaction shall be consummated and
become effective simultaneously with the consummation and
effectiveness of all of the other Proposed Transactions (the
date of the consummation of the Proposed Transactions being
hereinafter referred to as the "Transaction Closing Date");
(b) No Term Loan (as defined in the Xxxxxx Canada Loan
Agreement) has been made by the Borrower to Xxxxxx Canada
pursuant to the Xxxxxx Canada Loan Agreement and, as of the
date hereof, the outstanding principal balance of the Xxxxxx
Canada Revolving Note is zero;
(c) The Agent shall have reviewed and approved all
documents and instruments to be executed and delivered in
connection with the Xxxxxx Canada Loan Termination, and such
Proposed Transactions shall be consummated in accordance
therewith;
(d) The Purchase and Sale Transaction shall be
consummated strictly in accordance with the terms of the
Purchase and Sale Agreement substantially in the form
transmitted from Xxxxxx X. Xxxx, under cover of letter dated
March 12, 1997, to Xxxx X. Xxxxxxxxxxxx, with material changes
to such form as may have been approved by the Lenders;
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(e) The Agent shall have received a copy of the
resolutions of the Board of Directors of the Borrower and the
resolutions of the sole shareholder of Xxxxxx Canada (each in
form and substance reasonably satisfactory to the Agent)
authorizing (i) the execution, delivery and performance of
this Consent, the documents referred to herein, and the other
Loan Documents contemplated hereby and thereby, and (ii) the
consummation of the Proposed Transactions and the other
transactions contemplated hereby and thereby, all certified by
the Secretary or an Assistant Secretary of each of the
Borrower and Xxxxxx Canada on the date hereof. Such
certificates shall state that the resolutions set forth
therein have not been amended, modified, revoked or rescinded
as of the date of such certificate;
(f) No Default, Event of Default or Subsidiary Event of
Default shall have occurred and be existing either on the date
hereof, immediately after giving effect to this Consent, or on
the Transaction Closing Date;
(g) The representations and warranties contained herein,
in the Loan Agreement and in all other Loan Documents (other
than representations and warranties that expressly speak only
as of a specified different date) shall be true and correct as
of the date hereof, immediately after giving effect to this
Consent, and on the Transaction Closing Date;
(h) The Agent shall have received a certificate, in form
and substance satisfactory to the Agent, dated the date of the
effectiveness of this Consent and signed by the President or
a Vice President and the Treasurer or Controller of the
Borrower certifying that the conditions set forth in this
Section 2.2 have been fulfilled and as to such other matters
as the Agent shall reasonably require;
(i) The Agent shall have received such other agreements,
opinions, certificates, representations, instruments and other
documents as it may reasonably require, all in form and
substance satisfactory to the Agent;
(j) Such consent is strictly limited to the facts set
forth herein; and
(k) All other conditions set forth in Section 6 hereof
shall have been satisfied.
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3. Representations and Warranties. The Borrower and Xxxxxx
Canada hereby represent and warrant to the Agent and the Lenders
that (a) the execution, delivery and performance of the this
Consent, and the other documents and instruments to be executed and
delivered in connection herewith by the Borrower and Xxxxxx Canada
are within their respective corporate powers and have been duly
authorized by all necessary corporate action, (b) no consent,
approval, authorization of, or declaration or filing with, any
governmental or public authority, and no consent of any other
Person, is required in connection with the execution, delivery and
performance of the this Consent and the other documents and
instruments to be executed and delivered in connection herewith by
the Borrower and Xxxxxx Canada, except for this Consent and those
others already duly obtained, (c) this Consent has been duly
executed by the Borrower and Xxxxxx Canada and constitutes the
legal, valid and binding obligation of the Borrower and Xxxxxx
Canada, enforceable against them in accordance with its terms, (d)
the execution, delivery and performance by the Borrower and Xxxxxx
Canada of this Consent and the other documents and instruments to
be executed and delivered in connection herewith by the Borrower
and Xxxxxx Canada do not and will not conflict with, or constitute
a violation or breach of, or constitute a default under, or result
in the creation or imposition of any Lien upon the property of the
Borrower or Xxxxxx Canada (other than Liens the creation of which
are expressly contemplated hereunder) by reason of the terms of (i)
any contract, mortgage, Lien, lease, agreement, indenture, or
instrument to which the Borrower or Xxxxxx Canada is a party or
which is binding upon it, (ii) any requirement of law applicable to
the Borrower or Xxxxxx Canada or (iii) the Certificate or Articles
of Incorporation or By-Laws of the Borrower or Xxxxxx Canada, (e)
no event has occurred and is continuing which constitutes a
Default, an Event of Default or a Subsidiary Event of Default, and
(f) after giving effect to the Proposed Transactions, Xxxxxx Canada
will have no material assets other than the Excluded Assets and no
material liabilities.
4. Covenants by Borrower and Xxxxxx Canada.
(a) The Borrower hereby covenants that, from and after
the Transaction Closing Date, it will not allow Xxxxxx Canada to,
and Xxxxxx Canada hereby covenants that, from and after the
Transaction Closing Date, it will not, possess or acquire any
material assets other than the Excluded Assets, have or incur any
material liabilities or conduct any material business.
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(b) The Borrower and Xxxxxx Canada each hereby covenant
that, within 10 Business Days after the Transaction Closing Date,
they shall deliver to the Agent a true and correct copy of the
Purchase Agreement certified as such by the President or a Vice
President and the Secretary or an Assistant Secretary of each of
the Borrower and Xxxxxx Canada.
5. Amendments to Loan Agreement. Effective as of the
Transaction Closing Date immediately after the consummation of the
Proposed Transactions, the Loan Agreement shall be amended in the
following respects:
5.1. The definition of the term "Non-Operating
Subsidiaries" set forth in Section 1.1 of the Loan Agreement shall
be amended in its entirety to read as follows:
"Non-Operating Subsidiaries" shall mean individually
and in the aggregate Xxxxxxx Corporation, Xxxxxxx Aero
Engineering Corporation, The Waterbury Button Company,
Xxxxxx International Investment Corporation, Xxxxxx
Automotive Products, Inc., XxXxxxxx Industries, Inc.,
Dimetrics International Inc., WDC, Inc. and Xxxxxx Canada
Inc.
5.2. The words "Xxxxxx Canada, Inc., an Ontario, Canada
corporation" set forth in Schedule 1.3 of the Loan Agreement shall
be deleted.
5.3. The row beginning with the words "Xxxxxx Canada,
Inc." in the column entitled "Name of Sub," and all information in
such row, shall be deleted from Schedule 2.1 of the Loan Agreement.
6. Conditions to Effectiveness. This Consent shall be
effective as of the date first above written upon satisfaction of
the following conditions precedent:
6.1. Execution of this Consent. The Agent shall have
received a copy of this Consent duly executed by the Borrower,
Xxxxxx Canada and the Lenders.
6.2. Confirmation of Loan Documents. Each Subsidiary
shall have executed the Confirmation of Loan Documents set forth
below.
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7. Authorization to Sign Releases and Other Documents. By
their signatures below, the Lenders hereby authorize Transamerica
Business Credit Corporation, as Agent (a) to execute and deliver
such documents and instruments as are necessary or appropriate, in
the Agent's judgment, to effectuate, on and after the Transaction
Closing Date, the Xxxxxx Canada Guaranty Release, the Xxxxxx Canada
Loan Termination and the Xxxxxx Canada Collateral Release; (b) to
consent to the delivery of such other documents and instruments in
connection with the Proposed Transactions as the Agent shall
require, each in form and substance satisfactory to the Agent; and
(c) to execute and deliver such written consents, releases,
terminations and other documents and instruments, and to take such
other action, in connection with the Proposed Transactions as the
Agent shall deem appropriate.
8. Reference to and Effect on Loan Documents.
8.1. Except as specifically modified herein, all of the
terms of the Loan Agreement and the Xxxxxx Canada Loan Agreement
shall remain unchanged and in full force and effect.
8.2. Except as expressly set forth herein, the execution,
delivery and effectiveness of this Consent shall not operate as a
waiver of any right, power or remedy of any Lender or the Agent
under the Loan Agreement, the Xxxxxx Canada Loan Agreement or any
of the other Loan Documents, nor constitute a waiver of any
Default, Event of Default or Subsidiary Event of Default, or a
consent to any noncompliance with any provision of the Loan
Agreement, the Xxxxxx Canada Loan Agreement or any of the other
Loan Documents.
9. Execution in Counterparts. This Consent may be executed
in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered
(including delivery by telecopier) shall be deemed to be an
original and all of which taken together shall constitute one and
the same instrument.
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10. GOVERNING LAW. THIS CONSENT SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
11. Headings. Section headings in this Consent are included
herein for convenience of reference only and shall not constitute
a part of this Consent or be given any substantive effect.
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IN WITNESS WHEREOF, the parties hereto have caused this
Consent to be executed and delivered by their proper and duly
authorized officers as of the date set forth above.
BORROWER:
--------
XXXXXX MANUFACTURING AND TECHNOLOGY, INC.
By: Xxxx X. Xxxxxxxxx
------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
XXXXXX CANADA:
-------------
XXXXXX CANADA, INC.
By: Xxxx X. Xxxxxxxxx
------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
AGENT:
-----
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: Xxxxxxx Xxxxx
------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
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LENDERS:
-------
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: Xxxxxxx Xxxxx
------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO
By: Xxxxxx X. Xxxxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
NATIONAL BANK OF CANADA
By: Xxxxxx X. Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
By: Xxxx Xxxxx
------------------------------
Name: Xxxx Xxxxx
Title: Vice President
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CONFIRMATION OF LOAN DOCUMENTS
Each of the undersigned hereby consents to the execution
and delivery of the foregoing Consent and the consummation of the
Proposed Transactions. Each of the undersigned hereby confirms
that each of the Loan Documents to which it is a party shall remain
in full force and effect on the terms provided therein and that
each reference in the Loan Documents to the "Loan Agreement" shall
be a reference to the Loan Agreement as modified by the Consent.
Each of the undersigned further confirms that there exists no
Default or Event of Default (as defined in the Subsidiary Loan
Agreement to which it is a party) and that all representations and
warranties made by it in the Loan Documents to which it is a party
are true and correct as though made on and as of the date hereof
(other than representations and warranties that expressly speak
only as of a specified different date).
Dated: As of March 24, 1997
AMCAN SPECIALTY STEELS, INC.;
DIMETRICS, INC.; ELECTRODYNAMICS,
INC.; XXXX X. XxXXXXXX ASSOCIATES,
INC.; PORCELAIN PRODUCTS CO.; XXXX
INDUSTRIES, INC.; XXXXXX AUTOMOTIVE
PRODUCTS, INC.; XXXXXX CANADA,
INC.; XXXXXX DEFENSE SYSTEMS, INC.;
XXXXXX INTERNATIONAL INVESTMENT
CORPORATION; XXXXXX METALS
TECHNOLOGY, INC.; XXXXXX
TECHNOLOGY, INC.; UNIVERSAL
PROPULSION COMPANY; WATERBURY
COMPANIES, INC.; WDC, INC.;
By: Xxxx X. Xxxxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Secretary
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