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EXHIBIT 10.36
FIRST AMENDMENT TO LOAN AGREEMENT
BETWEEN
STANDARD FEDERAL BANK
AND
XXXXXXX INDUSTRIES, INC., XXXXXXX OF GEORGIA, INC.,
SHELBY STEEL PROCESSING COMPANY,
XXXXXXX TUBE COMPANY d/b/a QUALITY TUBE AND
XXXXXXX INDUSTRIES OF OHIO, INC.
THIS AMENDMENT AGREEMENT made and delivered this 16th day of
February, 1995, by and between XxXxxxx Industries, Inc., a Michigan
corporation, XxXxxxx of Georgia, Inc., a Georgia corporation, Shelby Steel
Processing Company, a Michigan corporation, XxXxxxx Tube Company d/b/a Quality
Tube, a Michigan corporation, and XxXxxxx Industries of Ohio, Inc., a Michigan
corporation (collectively, "Borrower"), whose address/principal office is 6200
Elmridge, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, and Standard Federal Bank, a
federal savings bank ("Standard Federal"), whose address is 0000 Xxxx Xxx
Xxxxxx Xxxx, Xxxx, Xxxxxxxx 00000.
RECITALS:
A. On September 15, 1994, the Borrower and Standard Federal
entered into a Loan Agreement (the "Loan Agreement"), pursuant to which the
Borrower opened a revolving line of credit facility with Standard Federal, Loan
No. 0250006199, with a credit limit of up to $5,000,000.00 (the "Line of
Credit"), as evidenced by a Promissory Note (Line of Credit), dated September
15, 1994, in the principal amount of $5,000,000.00 (the "Note"), secured by a
Security Agreement dated September 15, 1994 (the "Security Agreement").
B. The Borrower has requested an increase in the credit limit of
the Line of Credit, as herein provided, and Standard Federal is willing to
supply such financing subject to the terms and conditions set forth in this
Amendment Agreement.
NOW, THEREFORE, in reliance upon the representations herein provided
and in consideration of the premises and the mutual promises herein contained,
the Borrower and Standard Federal hereby agree as follows:
1. The Borrower is a Michigan corporation in good standing. All
corporate resolutions heretofore delivered to Standard Federal relative to
borrowing money and granting security interests remain in full force and
effect. Borrower has duly authorized and validly executed and delivered this
Amendment Agreement and such Amendment Agreement and the Loan Agreement (as
hereby amended) are valid and enforceable according to their terms and do not
conflict with or
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violate Borrower's corporate charter or by-laws or any agreement or covenants
to which Borrower is a party.
2. The Security Agreement is valid and enforceable in accordance
with its terms. Standard Federal's security interest in the collateral
described in the Security Agreement is valid and perfected and Borrower is
aware of no claims or interests in such collateral prior or paramount to
Standard Federal's.
3. Section 1.1 of the Loan Agreement is hereby deleted in its
entirety and replaced by the following new Section 1.1:
1.1 Standard Federal hereby extends to the Borrower a
revolving line of credit (the "Line of Credit") which shall not exceed
at any one time outstanding the Credit Limit as hereafter defined.
The term "Credit Limit" shall mean the lesser of: (a) Nine Million
Five Hundred Thousand and 00/100 Dollars ($9,500,000.00), or (b) an
amount equal to the sum of: (i) an amount equal to 80% of Eligible
Accounts Receivable, plus (ii) an amount equal to the lesser of: (1)
Six Million and 00/100 Dollars ($6,000,000.00), or (2) an amount equal
to 40% of Qualified Inventory. As used herein, the term "Eligible
Accounts Receivable" shall mean accounts receivable of the Borrower
less than 90 days old, not doubtful as to collectibility or disputed
as to existence or amount or subject to offset, contra-indebtedness or
return and not intra-company or owing from any affiliated or related
company or other entity, exclusive of any account receivable arising
under a government contract, the assignment of which is subject to the
Assignment of Claims Act of 1940, as amended, or any other similar
federal or state statute or regulation governing the assignment of
contracts with a governmental agency. The term "Qualified Inventory"
shall mean the inventory of Borrower in which Standard Federal holds a
perfected first security interest exclusive of any returned or damaged
items and work-in-process.
4. Simultaneously with the execution of this Amendment Agreement,
the Borrower shall execute and deliver to Standard Federal an Amended and
Restated Promissory Note (Line of Credit) in the stated principal amount of
$9,500,000.00 (the "Amended Note") to evidence the Line of Credit as hereby
amended and to replace the Note. The "Line of Credit Note" referred to in the
Loan Agreement shall hereafter be deemed to refer to the Amended Note.
5. Except as herein amended, the Loan Agreement and Security
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the Borrower and Standard Federal have caused this
Amendment Agreement to be executed as of the day and year first written above.
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BORROWER:
XXXXXXX INDUSTRIES, INC., a Michigan
corporation
By:
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E. Xxxxx Xxxxxxxx
Its: Treasurer
-----------------------
00-0000000
Taxpayer Identification Number
XXXXXXX OF GEORGIA, INC., a Georgia
corporation
By:
----------------------- -----------------------------
Xxxx X. Xxxxxxxx
Its: Secretary
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00-0000000
Taxpayer Identification Number
SHELBY STEEL PROCESSING COMPANY, a
Michigan corporation
By:
------------------------ -----------------------------
Xxxx X. Xxxxxxxx
Its: Secretary
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00-0000000
Taxpayer Identification Number
XXXXXXX TUBE COMPANY d/b/a QUALITY
TUBE, a Michigan corporation
By:
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E. Xxxxx Xxxxxxxx
Its: Treasurer
-----------------------
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--------------------------------
Taxpayer Identification Number
XXXXXXX INDUSTRIES OF OHIO, INC., a
Michigan corporation
By:
---------------------------- -----------------------------
E. Xxxxx Xxxxxxxx
Its: Treasurer
-----------------------
--------------------------------
Taxpayer Identification Number
STANDARD FEDERAL BANK, a
federal savings bank
By:
----------------------------
Its:
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