STEEL TECHNOLOGIES INC.
00000 Xxxxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
REQUEST FOR CONSENT TO SECOND AMENDMENT OF
NOTE AGREEMENT
Re: $40,000,000 8.52% Senior Notes
Due March 1, 2005
To the Holders named on Schedule I
to this Request for Consent
THIS REQUEST FOR CONSENT TO SECOND AMENDMENT OF NOTE
AGREEMENT (the "Second Request for Consent") is submitted by
STEEL TECHNOLOGIES INC., a Kentucky corporation (the "Company"),
as of the 9th day of October, 1997, pursuant to Section 7 of that
certain Note Agreement dated as of March 1, 1995 (as previously
amended, the "Note Agreement") by and among the Company and the
Purchasers named on Schedule I attached thereto regarding the
$40,000,000 8.52% Senior Notes due March 1, 2005. To the extent
not otherwise defined herein, all capitalized terms used herein
shall have the meanings assigned them in the Note Agreement.
The Purchasers represent and warrant that each holds the
Notes in the principal amount as set forth on Schedule I.
The Company hereby requests that the Note Agreement be
amended in the following respects:
a. Section 5.7(i) of the Note Agreement. The Company
requests that Section 5.7(i) be amended so as to change the
initial date from March 31, 1995, to September 30, 1997, and
to change the initial amount from $78,000,000 to
$95,000,000;
b. Section 5.8 of the Note Agreement. The Company
requests that (i) Section 5.8 be amended so as to convert
the covenant from a restriction upon the incurrence of
additional indebtedness to a restriction upon the existence
of outstanding indebtedness, (ii) Section 5.8(a)(3)(i) be
amended so as to reduce the minimum ratio of Net Income
Available for Fixed Charges to Fixed Charges from 300% to
200%, and (iii) Section 5.8(a)(3)(ii) be amended so as to
increase the maximum ratio of Consolidated Indebtedness to
Consolidated Total Capitalization from 50% to 55%;
c. Section 5.11(i) of the Note Agreement. The
Company requests that Section 5.11(i) be amended so as to
increase the permitted other Investments from 10% of
Consolidated Net Worth to the greater of (i) Fifteen Million
Dollars ($15,000,000), or (ii) ten percent (10%) of
Consolidated Net Worth.
In consideration of, and subject to, your agreement to the
foregoing amendments, the Company is willing to agree to amend
the Note Agreement and each of the Notes issued pursuant thereto
so as to change the due dates for each installment of interest on
the Notes from semiannually on the first day of each March and
September to monthly on the first day of each calendar month.
By execution and delivery to the Company of a counterpart of
this letter, you agree as follows:
2. Section 1.1 of the Note Agreement is hereby
modified and amended so that, as modified and amended, it shall
provide in its entirety as follows:
"Section 1.1. Description of Notes. The Company
will authorize the issue and sale of $40,000,000
aggregate principal amount of its 8.52% Senior Notes
(the "Notes"), to be dated the date of issue, to bear
interest from such date at the rate of 8.52% per annum,
payable semiannually on the first day of each March and
September of each year (commencing September 1, 1995)
until October 31, 1997, and thereafter monthly on the
first day of each calendar month (commencing November
1, 1997), and at maturity and to bear interest on
overdue principal (including any overdue required or
optional prepayment of principal) and premium, if any,
and (to the extent legally enforceable) on any overdue
installment of interest at the rate of 10.52% per annum
after the due date, whether by acceleration or
otherwise, until paid, to be expressed to mature on
March 1, 2005, and to be substantially in the form
attached hereto as Exhibit A. Interest on the Notes
shall be computed on the basis of a 360-day year of
twelve 30-day months. The Notes are not subject to
prepayment or redemption at the option of the Company
prior to their expressed maturity dates except on the
terms and conditions and in the amounts and with the
premium, if any, set forth in 2 of this Agreement.
The term "Notes" as used herein shall include each Note
delivered pursuant to this Agreement."
3. Section 5.7 of the Note Agreement shall be, and it
hereby is, amended and modified so that, as amended and modified,
it shall read in its entirety as follows:
"5.7. Consolidated Net Worth. The
Company will at all times keep and maintain
Consolidated Net Worth at an amount not less
than (i) for the fiscal quarter of the
Company ending September 30, 1997,
$95,000,000, and (ii) for each fiscal quarter
thereafter, the sum of the Consolidated Net
Worth required to be maintained during the
immediately preceding fiscal quarter of the
Company plus an amount equal to 50% of
Consolidated Net Income for such preceding
fiscal quarter (but without deduction in the
case of a deficit in Consolidated Net
Income)."
4. Section 5.8 of the Note Agreement shall be, and it
hereby is, amended and modified so that, as amended and modified,
it shall read in its entirety as follows:
"5.8. Limitations on Indebtedness. (a) The Company
will not, and will not permit any Subsidiary to, at any
time be or become liable in respect of any
Indebtedness, except:
(1) Indebtedness evidenced by the Notes;
(2) Indebtedness of the Company and its
Subsidiaries outstanding as of the date of this
Agreement and reflected in Annex B to Exhibit C,
less amounts required to be paid from the proceeds
of the Notes;
(3) additional Indebtedness of the Company and
its Subsidiaries, provided that at the time of
incurrence thereof and after giving effect thereto
and to the application of the proceeds thereof the
Company remains in compliance with Section 5.8A.
of this Agreement; and
(4) Indebtedness of a Subsidiary to the Company
or to a Wholly-owned Subsidiary."
5. A new Section 5.8A. is hereby added to the Note
Agreement, which Section 5.8A shall provide in its entirety as
follows:
"5.8A. Certain Financial Covenants.
(a) The Company will at all times keep and
maintain a ratio of Net Income Available for Fixed
Charges for the period of the four consecutive fiscal
quarters then most recently ended to Fixed Charges for
such period of at least 200%.
(b) The Company will at all times keep and
maintain a ratio of Consolidated Indebtedness to
Consolidated Total Capitalization as at the end of the
fiscal quarter of the Company most recently ended not
to exceed 55%.
(c) The Company will at all times keep and
maintain a ratio of Priority Debt to Consolidated Net
Worth not to exceed 5%."
6. Section 5.11(i) of the Note Agreement is hereby
modified and amended so that, as modified and amended, it shall
read in its entirety as follows:
"(i) other Investments of the Company and its
Subsidiaries (in addition to those permitted by the
foregoing provisions of this 5.11) not to exceed the
greater of 10% of Consolidated Net Worth, or
$15,000,000."
7. That this Second Request for Consent satisfies the
requirements of Section 7 of the Note Agreement and, upon
execution of this Second Request for Consent by the Holders of
all of the outstanding Notes, shall be binding upon the Holders
and the Company. Except as expressly set forth in this Second
Request for Consent and in the Request for Consent to Amendment
of Note Agreement previously granted by the Holders, the Note
Agreement has not been amended and remains and continues in full
force and effect.
8. This Second Request for Consent may be executed in
any number of counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute one and
the same instrument. This Second Request for Consent may be
executed by each party upon separate copies, which copies, when
combined so as to include the signatures of all parties, shall
constitute a single counterpart of this Second Request for
Consent.
STEEL TECHNOLOGIES INC.
By: /s/ Xxxxxxx X. Xxxxx
Its: Chief Financial Officer
ACKNOWLEDGED AND AGREED:
PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY
By: /s/ Xxxxx X. Xxxxx
Its: Its:
By: /s/ Xxxxxxxxx X. Xxxx
Its:
ACKNOWLEDGED AND AGREED:
THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By: Lincoln Investment Management,
Inc., its Attorney-in-Fact
By: /s/ Xxxxxxx X. Xxxxxx
Its:
ACKNOWLEDGED AND AGREED:
FIRST PENN-PACIFIC LIFE INSURANCE
COMPANY
By: Lincoln Investment Management,
Inc., its Attorney-in-Fact
By: /s/ Xxxxxxx X. Xxxxxx
Its:
ACKNOWLEDGED AND AGREED:
LINCOLN NATIONAL LIFE REINSURANCE
COMPANY
By: Lincoln Investment Management,
Inc., its Attorney-in-Fact
By: /s/ Xxxxxxx X. Xxxxxx
Its:
ACKNOWLEDGED AND AGREED:
LINCOLN NATIONAL INCOME FUND, INC.
By: /s/ Xxx X. Xxxxxx
Its:
ACKNOWLEDGED AND AGREED:
AMERICAN STATES LIFE INSURANCE
COMPANY
By: Lincoln Investment Management,
Inc., its Attorney-in-Fact
By: /s/ Xxxx Xxxxxx
Its:
ACKNOWLEDGED AND AGREED:
JEFFERSON-PILOT LIFE INSURANCE
COMPANY
By: /s/ Xxxxxx X. Xxxxxxx, XX
Its:
ACKNOWLEDGED AND AGREED:
NORTHERN LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx
Its:
ACKNOWLEDGED AND AGREED:
RELIASTAR LIFE INSURANCE COMPANY,
as successor to Northwestern
National Life Insurance Company
By: /s/ Xxxxx X. Xxxxxxx
Its:
Schedule 1
PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY
THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
FIRST PENN-PACIFIC LIFE INSURANCE
COMPANY
LINCOLN NATIONAL LIFE REINSURANCE
COMPANY
LINCOLN NATIONAL INCOME FUND, INC.
AMERICAN STATES LIFE INSURANCE
COMPANY
JEFFERSON-PILOT LIFE INSURANCE
COMPANY
NORTHERN LIFE INSURANCE COMPANY
RELIASTAR LIFE INSURANCE COMPANY,
as successor to Northwestern
National Life Insurance Company
84647:Lou3
