TO LOAN AND SECURITY AGREEMENT
TENTH
AMENDMENT
TENTH
AMENDMENT, dated as of March 21, 2007 (the "Amendment"), to the Loan and
Security Agreement dated as of April 13, 2001, as amended by the First Amendment
dated as of August 3, 2001, the Second Amendment dated as of May 24, 2002,
the
Third Amendment dated as of November 18, 2002, the Fourth Amendment dated as
of
March 3, 2003, the Fifth Amendment dated as of December 31, 2003, the Sixth
Amendment dated as of June 29, 2004, the Seventh Amendment dated as of September
15, 2004, the Eighth Amendment dated as of February 28, 2005, and the Ninth
Amendment dated as of February 22, 2006 (the "Loan Agreement"), by and among
(i)
LSB INDUSTRIES, INC., a Delaware corporation (the "Parent"), THERMACLIME, INC.,
an Oklahoma corporation formerly known as ClimaChem, Inc. ("ThermaClime"),
and
each of the Subsidiaries of ThermaClime identified on the signature pages
thereof (such Subsidiaries, together with ThermaClime, each a "Borrower", and
collectively, the "Borrowers"), (ii) the lenders identified on the signature
pages thereof (each a "Lender" and collectively the "Lenders") and (iii) XXXXX
FARGO FOOTHILL, INC., a California corporation formerly known as Foothill
Capital Corporation, as the arranger and administrative agent for the Lenders
(the "Agent").
WHEREAS,
the Borrowers have requested that the Loan Agreement be amended and modified
to
(i) modify the minimum EBITDA covenants and (ii) modify the maximum Capital
Expenditures covenant, and the Agent and the Lenders have agreed to such
amendments subject to the terms and conditions set forth herein..
NOW
THEREFORE, in consideration of the premises and other good and valuable
consideration, the parties hereto hereby agree as follows:
1.
Capitalized Terms. All capitalized terms used in this Amendment (including,
without limitation, in the recitals hereto) and not otherwise defined shall
have
their respective meanings set forth in the Loan Agreement.
2.
Financial
Covenants.
Section
7.20 of the Loan Agreement is hereby amended as follows:
(a)
Minimum EBITDA. Section 7.20(a)(i) is hereby amended as follows:
"(i)
Minimum
EBITDA.
EBITDA,
measured on a fiscal quarter-end basis, of not less than the required amount
set
forth in the following table for the applicable period set forth opposite
thereto;
|
Applicable
Amount
|
Applicable
Period
|
|
$22,000,000
|
For
the 12 month period ending March 31, 2007
|
|
$22,000,000
|
For
the 12 month period ending June 30, 2007
|
|
$22,000,000
|
For
the 12 month period ending September 30, 2007
|
|
$22,000,000
|
For
the 12 month period ending December 31, 2007
|
Borrowers'
EBITDA for the 12 month period ending each fiscal quarter after December 31,
2007 shall not be less than the greater of (x) $22,000,000 and (y) 85% of
Borrowers' projected EBITDA for such period as set forth in the Projections
delivered to Agent in accordance with Section 6.3(c), which Projections are
in
form and substance acceptable to Agent; provided,
that if
Agent and Borrowers cannot agree on the EBITDA covenant number based upon
Borrowers' projected EBITDA, for purposes of this Section 7.20(a)(i), Borrowers'
EBITDA for such 12 month period shall be determined by Agent in its Permitted
Discretion and shall not be less than $22,000,000."
(b)
Minimum EBITDA for the Climate Control Business. Section 7.20(a)(ii) is hereby
amended as follows:
"(ii)
Minimum
EBITDA for the Climate Control Business.
EBITDA
of the Borrowers comprising the Climate Control Business, measured on a fiscal
quarter-end basis, of not less than the required amount set forth in the
following table for the applicable period set forth opposite thereto;
|
Applicable
Amount
|
Applicable
Period
|
|
$16,000,000
|
For
the 12 month period ending March 31, 2007
|
|
$16,000,000
|
For
the 12 month period ending June 30, 2007
|
|
$16,000,000
|
For
the 12 month period ending September 30, 2007
|
|
$16,000,000
|
For
the 12 month period ending each fiscal quarter thereafter”
|
(c)
Capital Expenditures. Section 7.20(b)(i) is hereby amended in its entirety
to
read as follows:
"(i)
Capital
Expenditures.
Capital
Expenditures, measured on a fiscal quarter-end basis, in excess of $16,000,000
for the trailing twelve (12) month period."
3.
Conditions Precedent. The effectiveness of this Amendment is subject to the
fulfillment, in a manner satisfactory to the Agent, of each of the following
conditions precedent (the first date upon which all such conditions shall have
been satisfied being herein called the "Tenth Amendment Effective Date"):
(a)
Representations and Warranties; No Event of Default. The representations and
warranties contained herein, in Section 5 of the Loan Agreement and in each
other Loan Document and certificate or other writing delivered to the Agent
or
any Lender pursuant hereto on or prior to the Tenth Amendment Effective Date
shall be correct in all material respects on and as of the Tenth Amendment
Effective Date as though made on and as of such date, except to the extent
that
such representations and warranties (or any schedules related thereto) expressly
relate solely to an earlier date (in which case such representations and
warranties shall be true and correct in all material respects on and as of
such
date); and no Default or Event of Default shall have occurred and be continuing
on the Tenth Amendment Effective Date or would result from this Amendment
becoming effective in accordance with its terms.
(b)
Delivery of Documents. The Agent shall have received on or before the Tenth
Amendment Effective Date the following, each in form and substance satisfactory
to the Agent and, unless indicated otherwise, dated the Tenth Amendment
Effective Date:
(i)
counterparts of this Amendment duly executed by the Borrowers, the Agent and
the
Lenders; and
(ii)
such
other agreements, instruments, approvals, opinions and other documents as the
Agent may reasonably request from the Borrowers.
(c)
Amendment Fee. The Borrowers shall have paid to the Agent, for the benefit
of
the Lenders, in immediately available funds, a fully earned and nonrefundable
amendment fee equal to $10,000 the payment of which shall be effected by Agent
charging such fee to Borrowers' Loan Account.
(d)
Proceedings. All proceedings in connection with the transactions contemplated
by
this Amendment, and all documents incidental thereto, shall be satisfactory
to
the Agent and its special counsel, and the Agent and such special counsel shall
have received from the Borrowers all such information and such counterpart
originals or certified copies of documents, and such other agreements,
instruments, approvals, opinions and other documents, as the Agent or such
special counsel may reasonably request.
4.
Representations and Warranties. Each Borrower hereby represents and warrants
to
the Agent and the Lenders as follows:
(a)
Representations and Warranties; No Event of Default. The representations and
warranties herein, in Section 5 of the Loan Agreement and in each other Loan
Document and certificate or other writing delivered to the Agent or any Lender
pursuant hereto on or prior to the Tenth Amendment Effective Date are correct
in
all material respects on and as of the Tenth Amendment Effective Date as though
made on and as of such date, except to the extent that such representations
and
warranties (or any schedules related thereto) expressly relate solely to an
earlier date (in which case such representations and warranties are true and
correct in all material respects on and as of such date); and no Default or
Event of Default has occurred and is continuing on the Tenth Amendment Effective
Date or would result from this Amendment becoming effective in accordance with
its terms.
(b)
Organization, Good Standing, Etc. Each Borrower (i) is a corporation duly
organized, validly existing and in good standing under the laws of the state
of
its organization, (ii) has all requisite power and authority to execute, deliver
and perform this Amendment and the other Loan Documents to which it is a party
being executed in connection with this Amendment, and to perform the Loan
Agreement, as amended hereby, and (iii) is duly qualified to do business and
is
in good standing in each jurisdiction in which the character of the properties
owned or leased by it or in which the transaction of its business makes such
qualification necessary except where the failure to be so qualified reasonably
could not be expected to have a Material Adverse Change.
(c)
Authorization, Etc. The execution, delivery and performance by each Borrower
of
this Amendment, and the performance by each Borrower of the Loan Agreement,
as
amended hereby, (i) have been duly authorized by all necessary action on the
part of such Borrower, (ii) do not and will not contravene such Borrower's
charter or by-laws, any applicable law or any material contractual restriction
binding on or otherwise affecting it or any of its properties, (iii) do not
and
will not result in or require the creation of any Lien (other than pursuant
to
any Loan Document) upon or with respect to any of its properties, and (iv)
do
not and will not result in any suspension, revocation, impairment, forfeiture
or
nonrenewal of any permit, license, authorization or approval applicable to
its
operations or any of its properties.
5.
Miscellaneous.
(a)
Continued Effectiveness of the Loan Agreement. Except as otherwise expressly
provided herein, the Loan Agreement and the other Loan Documents are, and shall
continue to be, in full force and effect and are hereby ratified and confirmed
in all respects, except that on and after the Tenth Amendment Effective Date
(i)
all references in the Loan Agreement to "this Agreement", "hereto", "hereof",
"hereunder" or words of like import referring to the Loan Agreement shall mean
the Loan Agreement as amended by this Amendment, and (ii) all references in
the
other Loan Documents to which any Borrower is a party to the "Loan Agreement",
"thereto", "thereof", "thereunder" or words of like import referring to the
Loan
Agreement shall mean the Loan Agreement as amended by this Amendment. Except
as
expressly provided herein, the execution, delivery and effectiveness of this
Amendment shall not operate as an amendment of any right, power or remedy of
the
Lender under the Loan Agreement or any other Loan Document, nor constitute
an
amendment of any provision of the Loan Agreement or any other Loan Document.
(b)
Counterparts. This Amendment may be executed in any number of counterparts
and
by different parties hereto in separate counterparts, each of which shall be
deemed to be an original, but all of which taken together shall constitute
one
and the same agreement.
(c)
Headings. Section headings herein are included for convenience of reference
only
and shall not constitute a part of this Amendment for any other purpose.
(d)
Governing Law. This Amendment shall be governed by, and construed in accordance
with, the law of the State of New York.
(e)
Costs
and Expenses. The Borrowers jointly and severally agree to pay on demand all
reasonable fees, costs and expenses of the Agent and each Lender in connection
with the preparation, execution and delivery of this Amendment and the other
related agreements, instruments and documents.
(f)
Amendment as Loan Document. Each Borrower hereby acknowledges and agrees that
this Amendment constitutes a "Loan Document" under the Loan Agreement.
Accordingly, it shall be an Event of Default under the Loan Agreement (i) if
any
representation or warranty made by a Borrower under or in connection with this
Amendment shall have been untrue, false or misleading in any material respect
when made or (ii) if Borrowers fail to perform, keep, or observe any term,
provision, condition, covenant, or agreement contained in this Amendment.
(g)
Waiver of Jury Trial. EACH BORROWER, THE AGENT AND THE LENDERS HEREBY
IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF THIS AMENDMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered as of the date first above written.
Borrowers:
THERMACLIME,
INC. (formerly known as ClimaChem, Inc.), an Oklahoma corporation
By:
___________________________
Title:
_______________________
CHEROKEE
NITROGEN COMPANY,
a
Oklahoma corporation
By:
___________________________
Title:
_______________________
CLIMATE
MASTER, INC.,
a
Delaware corporation
By:
___________________________
Title:
_______________________
CLIMATECRAFT,
INC.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
CLIMACOOL,
CORP.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
INTERNATIONAL
ENVIRONMENTAL CORPORATION, an Oklahoma corporation
By:
___________________________
Title:
_______________________
THERMACLIME
TECHNOLOGIES, INC., an Oklahoma corporation
By:
___________________________
Title:
_______________________
KOAX
CORP., an Oklahoma corporation
By:
___________________________
Title:
_______________________
LSB
CHEMICAL CORP.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
XPEDIAIR,
INC.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
EL
DORADO
CHEMICAL COMPANY,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
CHEMEX
I
CORP.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
TRISON
CONSTRUCTION, INC.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
CHEMEX
II
CORP.,
an
Oklahoma corporation
By:
___________________________
Title:
_______________________
Agent
and
Lender:
XXXXX
FARGO FOOTHILL, INC.,
a
California corporation
By:
___________________________
Title:
_______________________
Lender:
CONGRESS
FINANCIAL CORPORATION (SOUTHWEST),
a
Texas
corporation
By:
___________________________
Title:_______________________
