AMENDMENT NO. 4
Exhibit
10.28
AMENDMENT
XX. 0
XXXXXXXXX
XX. 0, dated as of January 30, 2008, among EMPIRE RESOURCES, INC., a corporation
duly organized and validly existing under the laws of the State of Delaware (the
“Company”);
each of the lenders that is a signatory hereto (individually, a “Bank” and,
collectively, the “Banks”); and JPMORGAN
CHASE BANK, N.A., as agent for the Banks (in such capacity, together with its
successors in such capacity, the “Agent”).
The
Company, the Banks and the Agent are parties to an Amended and Restated Credit
Agreement, dated as of June 13, 2006 (as heretofore modified and supplemented
and in effect on the date hereof, the “Credit Agreement”),
providing, subject to the terms and conditions thereof, for extensions of credit
(by making loans and issuing letters of credit) to be made by said Banks to the
Company in an aggregate principal amount not to exceed
$150,000,000. The Company, the Banks and the Agent now wish to amend
the Credit Agreement to increase the aggregate amount of the Commitments of the
Banks to extend credit to the Company to $175,000,000 and to amend the Credit
Agreement in certain other respects and, accordingly, the parties hereto hereby
agree as follows:
Section
1. Definitions. Except
as otherwise defined in this Amendment No. 4, terms defined in the Credit
Agreement are used herein as defined therein.
Section
2. Amendments. Subject
to the occurrence of the Amendment Effective Date and effective on such date,
the Credit Agreement shall be amended as follows:
2.01. New
Definitions. Section 1.01 of the Credit Agreement
(Definitions) shall be amended by inserting the following definitions in the
appropriate alphabetical sequence:
“Amendment No. 4”
shall mean Amendment No. 4 to this Credit Agreement,dated as of January 30, 2008
among the Company, the Banks party thereto and theAgent.
“ASIC” means, as at
the date of Amendment No. 4, the Australian government authority known as the
“Australian Securities & Investments Commission”.
“Australian
Registered” means registered as a foreign company under the Corporations
Xxx 0000 (Cth), or any successor legislation of the parliament of the
Commonwealth of Australia.
2.02. Definition of “Australian
Effective Date”. The definition of “Australian Effective Date” in Section
1.01 of the Credit Agreement (Definitions) shall be amended in its entirety to
read as follows:
“‘Australian Effective
Date’ shall mean, with respect to any Australian State or Territory, the
date on which each of the following conditions shall have been
satisfied:
(a) a
Floating Charge with respect to all Receivables located in such State or
Territory, shall have been duly executed and delivered by the Company
and the Agent;
(b) a
duly executed and undated Australian ASIC Form 309 to enable ASIC registration
of the Floating Charge in Australia if the Company is, or becomes at any time,
Australian Registered, shall have been delivered by the Company to the Agent’s
Australian counsel;
(c) the
Floating Charge has been stamped in the relevant State or Territory (if
applicable) or arrangements for stamping acceptable to the Agent are in place,
and that all other fees, costs and expenses with respect to the execution and
delivery of such Floating Charge shall have been paid;
(d) evidence
that the Company is not, and does not intend to become, Australian Registered
(or that it has been so registered and has complied with its obligations under
Section 8.19(a) hereof); and
(e) the
Company’s Australian counsel (such counsel being acceptable to the Agent) shall
have furnished to the Agent and the Banks a legal opinion (in form satisfactory
to the Agent) with respect to the enforceability and priority under Australian
law of the Floating Charge over the Receivables purported to be covered
thereby.”
2.03. Definition of “Borrowing
Base”. Clauses (d), (g) and (h) of the definition of
“Borrowing Base” in Section 1.01 of the Credit Agreement (Definitions) shall be
amended in their entirety to read as follows:
“(d) 70%
of the aggregate amount of Australian Receivables at said date, provided
that
(i) no
Australian Receivable shall be included in the Borrowing Base unless the
Australian Effective Date has occurred with respect to the State or Territory in
which the account debtor of such Australian Receivables is located,
and
(ii) in
no event shall the portion of the Borrowing Base attributable to Australian
Receivables exceed 10% of the Borrowing Base after giving effect to the 70%
limitation referenced to in this clause (d) (calculated before the inclusion of
any Australian Receivables therein), plus”
“(g) 75%
of the aggregate value of Eligible Inventory at said date, provided, that in no
event shall the portion of the Borrowing Base attributable to Eligible Inventory
pursuant to this clause (g), together with inventory included in the Borrowing
Base pursuant to clause (h) below, constitute more than 65% of the Borrowing
Base, plus
(h) without
duplication of clauses (e) and (f) above, 65% of the aggregate amount of unsold
aluminum billet, sheet and coil (which, but for clause (e)(i) of the definition
of “Eligible Inventory”, would constitute Eligible Inventory), provided that in no
event shall the aggregate amount of such unsold aluminum billet, sheet and coil
exceed $7,500,000, provided further, that in no
event shall the inventory included in the Borrowing Base pursuant to this clause
(h), together with the portion of the Borrowing Base attributable to Eligible
Inventory pursuant to clause (g) above, constitute more than 65% of the
Borrowing Base, plus”
2.04. Definition of “Eligible
Inventory”. Each reference to “Eligible Inventory” in the
Credit Agreement shall be deemed to be a reference to “Eligible Warehouse
Inventory”.
2.05. Definition of “Eligible
Warehouse Inventory”. The definition of “Eligible Warehouse
Inventory” in Section 1.01 of the Credit Agreement (Definitions) (which, prior
to giving effect to this Amendment No. 4 was the definition of “Eligible
Inventory”) shall be amended by deleting the word “and” at the end of clause
(d), replacing the period at the end of clause (e) with “; and” and adding the
following new clause (f) immediately after clause (e) therein:
“(f) that
for Inventory that is in the possession or control of a warehouseman, the Agent
shall have received evidence that such warehouseman has been notified of the
security interest created in favor of the Agent, and that the Company has used
commercially reasonable efforts to obtain an authenticated record from such
warehouseman acknowledging that it holds possession of such Inventory subject to
a Lien in favor of the Agent and waives any Lien held by it against such
Inventory.”
2.06. Definition of “Floating
Charge”. The definition of “Floating Charge” in Section 1.01 of the
Credit Agreement (Definitions) shall be amended in its entirety to read as
follows:
“‘Floating Charge’
shall mean a Deed of Charge, in form and substance satisfactory to the Banks,
that creates a charge under Australian law with respect to the Company’s present
and future, right, title and interest in specified Receivables.”
2.07. Definition of “Revolving
Loan Commitment”. The definition of “Revolving Loan Commitment” in
Section 1.01 of the Credit Agreement (Definitions) shall be amended in its
entirety to read as follows:
“‘Revolving Loan
Commitment’ shall mean, as to each Bank, the obligation of such Bank to
make Loans and to acquire a participation in Letters of Credit and Acceptances
in an aggregate principal or face amount at any one time outstanding up to but
not exceeding the amount set opposite such Bank’s name under the caption
“Commitment” on the signature page of Amendment No. 4 (as the same may be
reduced from time to time pursuant to Section 2.05 hereof and increased pursuant
to Section 2.01(b) hereof). The aggregate amount of the Revolving
Loan Commitments on the Amendment Effective Date (as that term is defined in
Amendment No. 4) is $175,000,000.”
2.08. Borrowing Base
Certificate. The form of Borrowing Base Certificate set forth
as Exhibit B to the Credit Agreement, shall be amended and restated in its
entirety to read as Exhibit B to this Amendment No. 4.
2.09. Financial Statements
Etc. Section 8.01 of the Credit Agreement (Financial
Statements Etc.) is hereby amended by deleting the final paragraph of that
section and inserting the following new paragraph therein:
“The
Company will furnish to each Bank, at the time it furnishes each set of
financial statements pursuant to paragraph (a) or (b) above, a
certificate of a senior financial officer of the Company (the “Compliance
Certificate”) (i) to the effect that no Default has occurred and is
continuing (or, if any Default has occurred and is continuing, describing the
same in reasonable detail and describing the action that the Company has taken
or proposes to take with respect thereto) and (ii) setting forth in
reasonable detail the computations necessary to determine whether the Company is
in compliance with Sections 8.07, 8.08(d), 8.09, 8.10 and 8.11 hereof as of the
end of the respective quarterly fiscal period or fiscal year, and (iii)
certifying that the Company has not been Australian Registered (or that it has
been so registered and complied with its obligations under Section 8.19(a)
hereof).”
2.10.
Additional
Covenant. Section 8 of the Credit Agreement (Covenants of the
Company) is hereby amended by inserting new clause 8.19 immediately after clause
8.18 therein:
“8.19.
Australian
Matters. The Company agrees that:
(a) if
it becomes, or takes steps towards becoming, Australian Registered, it will
promptly notify the Agent and will do all things necessary (including the due
execution (or re-execution as the case may be) of all required ASIC Forms 309
and 350 (or such other applicable ASIC Forms at that time)) to enable the Agent
to immediately register each existing Floating Charge with ASIC (as contemplated
by the definition of Australian Effective Date in Section 1.01 hereof) and,
thereafter, do all things necessary to enable each new Floating Charge entered
into by it (as so contemplated) to be immediately registered with the Australian
Securities Commission, and
(b) it
will, at the request of the Required Banks, (i) promptly become Australian
Registered, (ii) furnish to the Agent evidence of such registration and (iii)
thereafter, comply with the provisions of the foregoing
clause (a).”
2.11.
Events of
Default. Section 9(d) of the Credit Agreement (Events of Default) is
hereby amended by replacing the phrase “or 8.15” with the phrase “, 8.15 or
8.19.”
Section
3. Representations and
Warranties. The Company represents and warrants to the Banks
as of the Amendment Effective Date that (x) the representations and warranties
set forth in Section 7 of the Credit Agreement and in Article III of the
Amended and Restated Security Agreement are true and complete on the date hereof
as if made on and as of the date hereof and as if each reference in said
Section 7 to “this Agreement” included reference to this Amendment No. 4
except (i) changes resulting from transactions contemplated by or permitted by
the Credit Agreement, and (ii) those applicable to a specific date or period (in
which case such representations and warranties shall be true and complete as of
such specific date or period) and (y) no Default has occurred and is
continuing.
Section
4. Conditions
Precedent. As provided in Section 2 above, the amendments to
the Credit Agreement set forth in said Section 2 shall become effective, as of
the date hereof (the “Amendment Effective
Date”), upon the satisfaction of the following conditions:
(a) the
execution of this Amendment No. 4 by the Company, the Banks and the
Agent,
(b) each
Bank increasing its Commitment pursuant to this Amendment No. 4 shall have
received from the Company a Note, dated the date hereof, payable to such Bank in
a principal amount equal to the amount of the Commitment set opposite such
Bank’s name under the caption “Commitment” on the signature page of this
Amendment No. 4,
(c) the
Agent shall have received from the Company for the account of each Bank an
amendment fee in an amount equal to $1,250,
(d) the
Agent shall have received from the Company for the account of each Bank
increasing its Commitment pursuant to this Amendment No. 4 a fee in an amount
equal to 17.5 basis points of the amount by which such Bank’s Commitment is
increased, and
(e) the
Company shall have borrowed from each of the Banks increasing its Commitment
pursuant to this Amendment No. 4 and (notwithstanding the provisions of Section
2.11 of the Credit Agreement requiring that prepayments be made ratably in
accordance with the principal amounts of the Loans held by the Banks) the
Company shall have prepaid Loans made by the other Banks, together with accrued
interest and any amounts payable under Section 2.11 of the Credit Agreement, in
such amounts as shall be necessary so that after giving effect to such Loans and
prepayments, the Loans and all other Obligations of the Borrower under the
Credit Agreement shall be held by the Banks pro rata in accordance with the
respective amounts of their Commitments (as increased hereby).
Section
5. Miscellaneous. Except
as herein provided, the Credit Agreement shall remain unchanged and in full
force and effect. This Amendment No. 4 may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
amendatory instrument and any of the parties hereto may execute this Amendment
No. 4 by signing any such counterpart. This Amendment No. 4 shall be
governed by, and construed in accordance with, the law of the State of New
York.
IN WITNESS WHEREOF, the parties hereto
have caused this Amendment No. 4 to be duly executed and delivered as of the day
and year first above written.
EMPIRE
RESOURCES, INC.
/s/
Xxxxxx X. Xxxx
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By:Xxxxxx
X. Xxxx
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Vice
President
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BANKS
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Commitment JPMORGAN
CHASE BANK, N.A.
$55,000,000
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By
/s/Xxxxxxx X. XxXxxxx
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Xxxxxxx
X. XxXxxxx
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Vice
President
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Lending
Office for all Loans:
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JPMorgan
Chase Bank, N.A.
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000
Xxxx Xxxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices:
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JPMorgan
Chase Bank, N.A.
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1166
Avenue of the Xxxxxxxx, 00xx
Xxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Attention: Xxxxxxx
X. XxXxxxx
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Facsimile
No.: (000) 000-0000
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Telephone
No.: (000) 000-0000
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Email:
xxxxxxx.xxxxxxx@xxxxxxxx.xxx
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BANKS
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Commitment XXXXX
BROTHERS XXXXXXXX & CO.
$15,000,000
By /s/ Xxxxxxx X.
Xxxxxxxx
Name: Xxxxxxx
X. Xxxxxxxx
Title: Senior
Vice President
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Lending
Office for all Loans:
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000
Xxxxxxxx
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Xxx
Xxxx, XX 00000
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Address
for Notices:
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000
Xxxxxxxx
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Xxx
Xxxx, XX 00000
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Attention: Xxxxxxx
Xxxxxxxx
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Facsimile
No.: 000-000-0000
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Telephone
No.: 000-000-0000
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Email:
xxxxxxx.xxxxxxxx@xxx.xxx
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BANKS
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Commitment CITICORP
USA, INC.
$35,000,000
By /s/ Xxxxx Xxxxxxx
Name: Xxxxx
Xxxxxxxx
Title: Vice
President
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Lending
Office for all Loans:
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Global
Wealth Management
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000
0xx
Xxxxxx – 0xx
Xxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices:
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Global
Wealth Management
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000
0xx
Xxxxxx – 0xx
Xxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Attention: Xxxxx
Xxxxxxxx
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Facsimile
No.: 000-000-0000
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Telephone
No.: 000-000-0000
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Email:
xxxxx.xxxxxxxx@xxxx.xxx
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BANKS
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Commitment COOPERATIEVE
CENTRALE RAIFFEISEN-$45,000,000BOERENLEENBANK B.A., “RABOBANK
INTERNATIONAL”,
NEW YORK BRANCH
By /s/ Xxx Xxxxxxxxxx
Name: Xxx
Xxxxxxxxxx
Title: Executive
Director
By /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx
X. Xxxxxx
Title: Executive
Director
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Lending
Office for all Loans:
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000
Xxxx Xxxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices:
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000
Xxxx Xxxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Attention: Xxx
Xxxxxxxxxx
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Facsimile
No.: 000-000-0000
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Telephone
No.: 000-000-0000
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Email:
xxx.xxxxxxxxxx@xxxxxxxx.xxx
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BANKS
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Commitment FORTIS
CAPITAL CORP.
$25,000,000
By /s/ Xxxxxxxx Xxxxx
Name: Xxxxxxxx
Xxxxx
Title: Vice
President
By /s/
Xxxx X. Xxxxx
Name: Xxxx
X. Xxxxx
Title: Director
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Lending
Office for all Loans:
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000
Xxxxxxx Xxxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices:
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000
Xxxxxxx Xxxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Attention: Xxxxxxxx
Xxxxx
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Facsimile
No.: 000-000-0000
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Telephone
No.: 000-000-0000
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Email:
xxxxxxxx.xxxxx@xx.xxxxxx.xxx
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JPMORGAN
CHASE BANK, N.A., as Agent and as the Swing Line
Bank
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By
/s/ Xxxxxxx X. XxXxxxx
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Xxxxxxx
X. XxXxxxx
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Vice
President
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Address
for Notices:
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JPMorgan
Chase Bank, N.A.
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1166
Avenue of the Xxxxxxxx, 00xx
Xxxxx
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Xxx
Xxxx, Xxx Xxxx 00000
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Attention: Xxxxxxx
X. XxXxxxx
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Facsimile
No.: (000) 000-0000
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Telephone
No.: (000) 000-0000
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Email:
xxxxxxx.xxxxxxx@xxxxxxxx.xxx
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EXHIBIT
B
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Form of
Borrowing Base Certificate
EMPIRE
RESOURCES, INC.
Borrowing
Base
As of
, 20__
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Empire
Resources, Inc.
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Insured
Eligible Receivables
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$
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(x
0.90 =) $
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Eligible
Receivables (other than (i) Australian Receivables, Eligible Long
Receivables and Insured Eligible Receivables and (ii) Uninsured Eligible
Receivables from any one account debtor in excess of
$2,500,000)
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$
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(x
0.80 =) $
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The
lesser of (i) $1,000,000 and (ii) 80% of the aggregate amount of Eligible
Long Receivables (other than Australian Receivables and Insured Eligible
Receivables)
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$
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$1,000,000
(x
0.80 = ) $
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Australian
Receivables
(only
after the Australian Effective Date and not to exceed 10% of the Borrowing
Base)
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$
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(x
0.70 = ) $
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Inventory
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$
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(a) Eligible
In-transitInventory
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$
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(x
0.80 = ) $
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(b) Eligible
InventoryOrdered Under L/C
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$
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(x
0.80 = ) $
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(c) Eligible
WarehouseInventory
((c)
and (d) not to exceed65% of the BorrowingBase)
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$
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(x
0.75 = ) $
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(d) Unsold
Aluminum Billet,Sheet and Coil
(not
to
exceed $7,500,000)
((c)
and (d) not to exceed65% of the BorrowingBase)
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$
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(x
0.65 = ) $
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Pledged
Securities:
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$
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(x
0.80 = ) $
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Pledged
Cash:
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$
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$
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TOTAL
(A):
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$
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***
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Loans:
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$
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Letter
of Credit Liabilities
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Letters
of Credit:
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$
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Letters
of Indemnity:
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$
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Acceptances:
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$
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Credit
Reserves:
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$
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TOTAL
(B):
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$
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***
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Surplus
(Deficit) is the sum of (i) the lesser of the amount of the Revolving Loan
Commitments and Total (A) minus (ii)
Total (B):
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$
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EMPIRE
RESOURCES, INC.
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By:
________________________
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Name:
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Title:
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Date:
, 20__
