Exhibit 10.1
BB&T
THIRD AMENDED AND RESTATED LOAN AGREEMENT

 
9520406872
 
 
BB&T Account Number
 

This Third Amended and Restated Loan Agreement (the “Agreement”) is made this
30th day of October, 2017 by and between BRANCH BANKING AND TRUST COMPANY, a
North Carolina banking corporation (“Bank”), and Synalloy Corporation, a
Delaware corporation, Synalloy Fabrication, LLC, a South Carolina limited
liability company, Synalloy Metals, Inc., a Tennessee corporation, Bristol
Metals, LLC, a Tennessee limited liability company, Manufacturers Soap &
Chemical Company, a Tennessee corporation, Manufacturers Chemicals, LLC, a
Tennessee limited liability company, Palmer of Texas Tanks, Inc., a Texas
corporation, CRI Tolling, LLC, a South Carolina limited liability company, and
Specialty Pipe & Tube, Inc., a Delaware corporation (sometimes individually a
“Borrower” and collectively, the “Borrowers”).

This Agreement is entered into for purposes of amending and restating, in full,
the provisions of the Second Amended and Restated Loan Agreement dated August
31, 2016 (the “Second Amended and Restated Loan Agreement”), as amended, by and
among the parties hereto. Capitalized terms used in this Agreement without
definition retain the meanings respectfully assigned to such terms in the Second
Amended and Restated Loan Agreement.

The Borrowers have applied to Bank for and Bank has agreed to make, subject to
the terms of and upon the reliance of Borrowers’s representations, warranties
and agreements made in this Agreement, the following loan and/or line of credit
(hereinafter sometimes referred to, singularly or collectively, if more than
one, as “Loan(s)”):

Line of Credit (“Line of Credit”) in the maximum principal amount not to exceed
$65,000,000.00 at any one time outstanding for the purpose of working capital
and refinance of an existing line of credit which shall be evidenced by the
Borrowers’ Promissory Note dated on or after the date hereof which shall bear
interest at the rate set forth in such note, the terms of which are incorporated
herein by reference (the “Line Note”). The Line of Credit shall mature on
October 30, 2020, when the entire unpaid principal balance then outstanding plus
accrued interest thereon shall be paid in full. Prior to maturity or the
occurrence of any Event of Default hereunder and subject to Availability, as
applicable, the Borrowers may borrow, repay, and reborrow under the Line of
Credit through the Maturity Date. The principal balance from time to time
outstanding under the Line of Credit shall bear interest at the rate set forth
in the Line Note. Bank shall make advances under the Line of Credit into the
Borrowers’ designated operating account or other designated deposit account
maintained with Bank upon receipt of the written or oral request (thereafter
confirmed in writing) of Borrowers provided that Bank shall not be required to
make any advance which would cause Borrowers to exceed Availability (as defined
in section 10 hereof), if applicable. If at any time the aggregate principal
balance outstanding under the Line of Credit shall exceed Availability,
Borrowers shall immediately upon demand pay the amount necessary to bring the
outstanding balance thereunder within Availability. Unused Line Fee: Borrowers
shall pay Bank, quarterly in arrears on the last day of each calendar quarter,
an unused fee equal to 0.125% per annum on the average daily unused amount of
the Line of Credit for such calendar quarter calculated on the basis of a year
of 360 days for the actual number of days elapsed.

The Line of Credit shall be secured by a first and prior lien and security
interest in the Borrowers’ existing and hereafter acquired personal property and
business assets including Equipment, Inventory, Accounts, Goods, and General
Intangibles pursuant to the terms of applicable security instruments listed
below.

Yield Protection. If at any time a change in any law or regulation (including
without limitation the Dodd-Frank Wall Street Reform and Consumer Protection Act
and all rules, guidelines, or directives promulgated by Bank for International
Settlements, the Basel Committee on Banking Supervision or other U.S. or foreign
regulatory authorities pursuant to Basel III) or in the interpretation thereof
by any governmental authority having the authority to interpret or enforce the
same shall make it unlawful for Bank to make or maintain the Loan(s) under the
terms of this Agreement, Bank shall have the right to convert the applicable
interest rate on the Loan(s)s to a rate based on the Prime Rate. Similarly,
should Bank incur increased costs or a reduction in the amounts received or
receivable on the Loan(s) because of any change in any applicable law,
regulation, rule, guideline or order, including without limitation the
imposition, modification or applicability of any reserves, deposits or capital
adequacy then Borrowers shall pay to Bank within ten (10) business days of
demand, which demand shall contain the basis and calculations supporting such
demand, as may be required

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to compensate Bank for such increased costs or reductions in amounts to be
received hereunder. Each determination and calculation made by Bank shall,
absent manifest error, be binding and conclusive on the parties hereto. All
payments made by Borrowers hereunder or the other Loan Documents shall be made
free and clear and without deduction of any present or future taxes, levies,
imposts, charges or withholdings other than taxes based on net income and
franchise taxes imposed on Bank by the law of the jurisdiction in which Bank is
organized or transacting business.

Additional terms, conditions and covenants of this Agreement are described in
Schedule DD or other schedule attached hereto, the terms of which are
incorporated herein by reference. The Line of Credit is sometimes referred to
herein as the “Loan.” The Line Note is sometimes referred to herein as the
“Note(s)” and shall include all extensions, renewals, modifications and
substitutions thereof. Bank may, at its sole discretion, effect payment of any
sums past due under the Note(s) and any fees or reimbursable expenses due by
debiting Borrowers’s operating or other deposit account maintained with Bank.

Section 1 Conditions Precedent

Bank shall not be obligated to make any disbursement of loan proceeds until all
of the following conditions have been satisfied by proper evidence, execution,
and/or delivery to Bank of the following documents and items in addition to this
Agreement, all in form and substance satisfactory to Bank and Bank’s counsel in
their sole discretion:
USA Patriot Act Verification Information: Information or documentation,
including but not limited to the legal name, address, tax identification number,
driver’s license, and date of birth (if any of the Borrowers are individuals) of
the Borrowers sufficient for Bank to verify the identity of the Borrowers in
accordance with the USA Patriot Act. Borrowers shall notify Bank promptly of any
change in such information.
Note(s): The Promissory Note, with addendum, duly executed by the Borrowers.
Security Agreement(s): An Amended and Restated Security Agreement in which
Borrowers (each a “Debtor”) of personal property collateral shall grant to Bank
a first priority security interest in the personal property specified therein.
(If Bank has or will have a security interest in any collateral which is
inferior to the security interest of another creditor, Borrowers must fully
disclose to Bank any and all prior security interests, and Bank must
specifically approve any such security interest which will continue during the
term of the Loan(s)).
UCC Financing Statements: Copies of UCC Financing Statements duly filed in
Borrowers’ state of incorporation, organization or residence, and in all
jurisdictions necessary, or in the opinion of Bank desirable, to perfect the
security interests granted in the Security Agreement, and certified copies of
Information Requests identifying all previous financing statements on record for
Borrowers, as appropriate from all jurisdictions indicating that no security
interest has previously been granted in any of the collateral described in the
Security Agreement, unless prior approval has been given by Bank.
Stock and LLC Interest Pledge Agreement: An Amended and Restated Stock and LLC
Interest Pledge Agreement duly executed by Borrowers.
Commitment Fee: A commitment fee of $162,500.00 payable to Bank on the date of
execution of the     Loan Documents.
Corporate Resolution: A Certificate of Corporate Resolutions signed by the
corporate secretary or certified officer containing resolutions duly adopted by
the Board of Directors of all Borrowers incorporated as corporations authorizing
the execution, delivery, and performance of the Loan Documents on or in a form
provided by or acceptable to Bank.
Articles of Incorporation: A copy of the Articles of Incorporation and all other
charter documents of all Borrowers incorporated as corporations, all filed with
the Secretary of State of the state/commonwealth of Borrowers’s incorporation.
By-Laws: A copy of the By-Laws of all Borrowers incorporated as corporations,
certified by the Secretary of Borrowers as to their completeness and accuracy.
Certificate of Incumbency: A certificate of the Secretary or Member or other
certified officer of Borrowers certifying the names and true signatures of the
officers each of the Borrowers authorized to sign the Loan Documents.
Certificate of Existence: A certification of the Secretary of State (or other
government authority) of the state/commonwealth of each Borrowers’ incorporation
or organization as to the existence or good standing of each of the Borrowers
and its charter documents on file.
Opinion of Counsel: An opinion of counsel for Borrowers satisfactory to Bank and
Bank’s counsel.

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Limited Liability Company Operating Agreement: A copy of all Borrowers’
organized as a limited liability company Operating Agreement, certified by such
Borrowers’ manager(s) and/or members, as applicable as to its completeness and
accuracy.
Declaration of Limited Liability Company: A declaration or resolution from all
Borrowers’ organized as a limited liability company authorizing the execution,
delivery, and performance of the Loan Documents on a form provided by or
acceptable to Bank.
Limited Liability Company Articles of Organization: A copy of the Articles of
Organization and all other organizational documents of all Borrowers organized
as a limited liability company, all filed with the Secretary of State of the
state/commonwealth of Borrowers’ organization.
Inventory Appraisal: An appraisal of the Inventory (as defined in Schedule DD to
this Agreement) addressed to Bank and in form and substance acceptable to Bank.
Additional Documents: Receipt by Bank of other approvals, opinions, or documents
as Bank may reasonably request.

Section 2 Representations and Warranties

Borrowers represent and warrant to Bank that:

2.01.    Financial Statements. The balance sheet of Borrowers and any
subsidiaries, if any, and the related Statements of Income and Retained Earnings
of Borrowers and any subsidiaries, the accompanying footnotes together with the
accountant’s opinion thereon, and all other financial information previously
furnished to Bank, accurately, completely and fairly reflect the financial
condition of Borrowers and any subsidiaries as of the dates thereof, including
all contingent liabilities of every type, and the financial condition of
Borrowers and any subsidiaries as stated therein has not changed materially and
adversely since the date thereof.
2.02.    Name, Capacity and Standing. Borrowers’ exact legal names are correctly
stated in the initial paragraph of the Agreement and each is duly organized and
validly existing under the laws of its respective state of incorporation or
organization; that it and/or its subsidiaries, if any, are duly qualified and in
good standing in every other state in which the nature of their business shall
require such qualification, and are each duly authorized by their board of
directors, general partners or member/manager(s), respectively, to enter into
and perform the obligations under the Loan Documents.
2.03.    No Violation of Other Agreements. The execution and delivery of the
Loan Documents, and the performance by Borrowers, by any and all pledgors
(whether Borrowers or other owners of collateral property securing payment of
the Loan(s) (hereinafter sometimes referred to as the “Pledgor”)) thereunder
will not violate any provision, as applicable, of its articles of incorporation,
by-laws, articles of organization, operating agreement, agreement of
partnership, limited partnership or limited liability partnership, or, of any
law, other agreement, indenture, note, or other instrument binding upon any
Borrowers or any Pledgor, or give cause for the acceleration of any of the
respective obligations of any of the Borrowers.
2.04.    Authority. The execution, delivery and performance of this Agreement,
the Note(s) and the other Loan Documents have been duly authorized by all
necessary and proper corporate or equivalent action. All authority from and
approval by any federal, state, or local governmental body, commission or agency
necessary to the making, validity, or enforceability of this Agreement and the
other Loan Documents has been obtained.
2.05.    Asset Ownership. Borrowers and each Pledgor has good and marketable
title to all of the properties and assets reflected on the balance sheets and
financial statements furnished to Bank, and all such properties and assets are
free and clear of mortgages, deeds of trust, pledges, liens, security interests,
and all other encumbrances except as otherwise disclosed by such financial
statements or otherwise in writing.
2.06.    Discharge of Liens and Taxes. Borrowers and any subsidiaries, if any,
have filed, paid, and/or discharged all taxes or other claims which may become a
lien on any of their respective properties or assets, excepting to the extent
that such items are being appropriately contested in good faith and for which an
adequate reserve (in an amount acceptable to Bank) for the payment thereof is
being maintained.
2.07.    Regulations U and X. None of the Loan(s) proceeds shall be used
directly or indirectly for the purpose of purchasing or carrying any margin
stock in violation of the provisions of Regulation U and Regulation X of the
Board of Governors of the Federal Reserve System.
2.08.    ERISA. Each employee benefit plan, as defined by the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), maintained by
Borrowers or by any subsidiary of Borrowers meets, as of the date hereof, the
minimum funding standards of Section 302 of ERISA, all applicable requirements
of ERISA and of the Internal

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Revenue Code of 1986, as amended, and no “Reportable Event” nor “Prohibited
Transaction” (as defined by ERISA) has occurred with respect to any such plan.
2.09.    Litigation. There is no claim, action, suit or proceeding pending, or
to the knowledge of Borrowers, threatened or reasonably anticipated before any
court, commission, administrative agency, whether State or Federal, or
arbitration which will materially adversely affect the financial condition,
operations, properties, or business of Borrowers, its subsidiaries, if any, any
Guarantor, or any Pledgor, or affect, in any material respects, the ability of
Borrowers or any Guarantor or any Pledgor to perform its obligations under the
Loan Documents.
2.10.    Other Agreements. The representations and warranties made by Borrowers
to Bank in the other Loan Documents are true and correct in all respects on the
date hereof
2.11.    Binding and Enforceable. The Loan Documents, when executed, shall
constitute valid and binding obligations of Borrowers and Guarantors
respectively, and are enforceable in accordance with their terms, except as may
be limited by bankruptcy, insolvency, moratorium, or similar laws affecting
creditors’ rights generally.
2.12.    Commercial Purpose. The Loan(s) are not “consumer transactions”, as
defined in the South Carolina Uniform Commercial Code, and none of the
collateral was or will be purchased or held primarily for personal, family or
household purposes.
2.13.    Foreign Assets Control Regulations. It is not in violation of (i) the
Trading with the Enemy Act (50 U.S.C. App. Sec. 1 et seq), as amended, (ii) any
of the foreign assets control regulations issued by the Office of Foreign Assets
Control of the United States Treasury Department (“OFAC”) and any executive
order related thereto, or (iii) the U.S. Patriot Act, and further that it (a) is
not subject to sanctions administered by OFAC or the U.S. Department of State or
(b) has not engaged in any dealing or transactions with, or is otherwise
associated with, any person subject to such sanctions.
2.14.    Survival of Representations and Warranties. Borrowers agree that in
extending loan advances, Bank is relying on all representations, warranties, and
covenants made by Borrowers in this Agreement or in any certificate or other
instrument delivered by Borrowers to Bank under this Agreement or the other Loan
Documents. Borrowers further agree that regardless of any investigation made by
Bank, all such representations, warranties and covenants will survive the making
of each advance under the Loan(s) and delivery to Bank of the Loan Documents,
shall be continuing in nature, shall be deemed made and reaffirmed by Borrowers
at the time each advance is made, and shall remain in full force and effect
until such time as Borrowers’s indebtedness shall be paid in full, or until this
Agreement shall be terminated in the manner provided herein, whichever is the
last to occur.

Section 3 Affirmative Covenants

Borrowers covenant and agree that from the date hereof and until payment in full
of all indebtedness and performance of all obligations owed under the Loan
Documents, Borrowers shall:
3.01.    Maintain Existence and Current Legal Form of Business. (a) Maintain
their existence and good standing in the state of their incorporation or
organization, (b) maintain their current legal form of business indicated above,
and, (c), as applicable, qualify and remain qualified as a foreign corporation,
general partnership, limited partnership, limited liability partnership or
limited liability company in each jurisdiction in which such qualification is
required. Notwithstanding the foregoing, Bank acknowledges that Borrower intends
to terminate the existence of SynTrans, LLC, as a Texas limited liability
company, after Closing.
3.02.    Maintain Records. Keep adequate records and books of account, in which
complete entries will be made in accordance with GAAP consistently applied,
reflecting all financial transactions of Borrowers. If Borrowers now or
hereafter maintains any business records in the possession of a third party, at
the request of Bank, Borrowers shall notify such third party to permit Bank free
access to such records at all reasonable times and to provide Bank with copies
of any records it may request, all at Borrowers’s expense.
3.03.    Maintain Properties. Except as contemplated by Section 3.14 of this
Agreement and other sales in the ordinary course of business, maintain, keep,
and preserve all of its properties (tangible and intangible) including the
collateral necessary or useful in the conduct of its business in good working
order and condition, ordinary wear and tear excepted.
3.04.    Conduct of Business. Continue to engage in an efficient, prudent, and
economical manner in a business of the same general type as now conducted.
3.05.    Maintain Insurance. Maintain fire and other risk insurance, public
liability insurance, and such other insurance as Bank may require with respect
to Borrowers’ properties and operations, in form, amounts, and coverages and
with insurance companies reasonably acceptable to Bank. Borrowers, upon request
of Bank, will

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deliver to Bank from time to time the policies or certificates of insurance in
form satisfactory to Bank, including stipulations that coverages will not be
cancelled or diminished without at least thirty (30) days prior written notice
to Bank. Each insurance policy also shall include an endorsement (NY long form)
providing that coverage in favor of Bank will not be impaired in any way by any
act, omission or default of Borrowers or any other person. In connection with
all policies covering the Collateral, Borrowers shall provide Bank with such
Bank’s loss payable or other endorsements as Bank may reasonably require, and
shall furnish to Bank upon request, reports on each existing insurance policy
showing such information as Bank may reasonably request, including without
limitation the following: (1) the name of the insurer; (2) the risks insured;
(3) the amount of the policy; (4) the properties and assets insured; (5) the
current property values on the basis of which insurance has been obtained, and
the manner of determining those values; and (6) the expiration date of the
policy. In addition, upon request of Bank (however not more often than
annually), Bank may require that an independent appraiser satisfactory to Bank
determine, as applicable, the actual cash value or replacement cost of any
Collateral. The cost of such appraisal shall be paid by Borrowers. Should any or
all of the Collateral become uninsured for any reason, Borrowers shall have ten
(10) days after receipt of notice from Bank to obtain replacement insurance on
the Collateral satisfactory to Bank and, should Borrowers fail to obtain such
insurance, Bank may purchase insurance covering the Collateral, the cost of
which shall be paid by Borrowers on demand. Notwithstanding the foregoing, Bank
and Borrowers acknowledge that Borrowers do not insure finished goods inventory
of pipe situated in open yard inventory locations at Bristol Metals, LLC
(Tennessee) and Specialty Pipe & Tube, Inc. (Ohio and Texas) because the risk of
loss for this finished goods inventory is deemed to be zero.
3.06.    Comply With Laws. Comply in all material respects with all applicable
laws, rules, regulations, ordinances and orders applicable to each Borrowers’s
business, operations and properties including without limitation, the Americans
with Disabilities Act, paying before the delinquency thereof all taxes,
assessments, and governmental charges imposed upon it or upon its income,
profits or property, and all Environmental Laws.
3.07.    Right of Inspection. Permit the officers and authorized agents of Bank,
at any reasonable time or times in Bank’s sole discretion, to examine and make
copies of the records and books of account of, to visit the properties of any of
the Borrowers, and to discuss such matters with any officers, directors,
managers, members or partners, limited or general, of such Borrowers, and with
Borrowers’s independent accountant as Bank deems necessary and proper.
3.08.    Reporting Requirements. Furnish to Bank:
Monthly Financial Statements: As soon as available and not more than forty-five
(45) days after the end of each month on a consolidated basis for all Borrowers,
balance sheets, statements of income, cash flow, and retained earnings for the
period ended, all in reasonable detail and all prepared in accordance with GAAP
consistently applied and certified as true and correct by an officer of Synalloy
Corporation; provided, however, that for each year during the term of the
Loan(s), Borrower shall not be required to furnish a Monthly Financial Statement
hereunder for the calendar month ending on December 31.
Annual Financial Statements: As soon as available and not more than ninety (90)
days after the end of each fiscal year, balance sheets, statements of income,
and retained earnings for the period ended and a statement of changes in the
financial position, all in reasonable detail, and all prepared in accordance
with GAAP consistently applied. The financial statements must be of the
following quality or better: Audited with an unqualified opinion.
Monthly Loan Base Report: On or before the Fifteenth (15th) day of each Month,
or as provided and/or required in accordance with Schedule DD a Loan Base Report
in a form acceptable to Bank signed by the President, chief financial officer,
or chief accounting officer of Borrowers, as appropriate.
Quarterly Officer Compliance Certificate: An Officer’s Compliance Certificate
(“OCC”) with respect to Borrowers’ compliance with the Affirmative, Financial
and Negative Covenants set forth in Sections 3, 5, and 6 of this Agreement. The
OCC will be in the form of Schedule EE or other form acceptable to Bank,
properly executed by an authorized officer of Borrowers, including calculations
to support all Financial Covenants, and set forth any corrective action taken or
proposed to be taken with respect to any Default or Event of Default under such
covenants. The OCC is due within the same number of days required for the
delivery of Financial Statements for each fiscal quarter’s end and for the
fiscal year end. The OCC furnished by Borrowers for the fiscal year end shall
include a reconciliation of all adjustments, if any, by Borrowers to the fourth
quarter’s certification.
Notice of Litigation: Promptly after the receipt by Borrowers, or by any
Guarantor of which Borrowers has knowledge, notice of any complaint, action,
suit or proceeding before any court or administrative agency

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or body of any type which, if determined adversely, could have a material
adverse effect on the financial condition, properties, or operations of any
Borrowers or any Guarantor, as applicable.
Notice of Default: Promptly upon discovery or knowledge thereof, notice of the
existence of any event of default under this Agreement or any other Loan
Documents.
USA Patriot Act Verification Information: Information or documentation,
including but not limited to the legal name, address, tax identification number,
driver’s license, and date of birth (if Borrowers is an individual) of Borrowers
sufficient for Bank to verify the identity of Borrowers in accordance with the
USA Patriot Act. Borrowers shall notify Bank promptly of any change in such
information.
Other Information: Such other information as Bank may from time to time
reasonably request.
3.09.    Deposit Accounts. Maintain substantially all of its primary operating
accounts and treasury management accounts with Bank.
3.10.    Inventory Appraisals. Upon request by Bank not to exceed two (2)
requests per calendar year during the term of the Loan(s), furnish at
Borrowers’s expense an independent appraisal or update by an appraiser
satisfactory to Bank of the Inventory.
3.11.    Affirmative Covenants from other Loan Documents. All affirmative
covenants contained in any other Loan Documents are hereby incorporated by
reference herein.
3.12.    Management. Maintain executive and management personnel with
substantially the same qualifications and experience as the current executive
and management personnel and promptly provide written notice to Bank of any
change in such executive or management personnel.
3.13    Intellectual Properties. Provide the Bank with at least fifteen (15)
business days’ prior written notice of the filing for registration of any
Intellectual Properties (or the obtaining of any registered Intellectual
Properties by acquisition, assignment of otherwise) which notice shall contain a
copy of each such item of registration and related information as may be
requested by Bank. In connection with any such registration, the Borrowers shall
take such actions and make and cooperate in such filings and actions as the Bank
may reasonably request in order to assure the perfection and security to the
Bank as to its lien and security interest on all Intellectual Properties.

Section 4 Guarantor(s) Covenants: Intentionally Deleted

Section 5 Financial Covenants

Borrowers covenant and agree that from the date hereof until payment in full of
the Loan(s) and the performance of all obligations under the Loan Documents,
Borrowers shall at all times maintain the following financial covenants and
ratios all in accordance with GAAP unless otherwise specified:

Fixed Charge Coverage Ratio. Minimum fixed charge coverage ratio of not less
than 1.25, with the first test beginning December 31, 2017 and continuing each
quarter thereafter all to be tested on a rolling four quarter basis. The fixed
charge coverage numerator is defined as the sum of pre-tax net income or pre-tax
net loss plus depreciation and amortization plus interest expense plus
rent/lease expense plus goodwill impairment expense plus stock option expense,
minus dividends. The denominator would be the sum of interest expense, plus
current maturities of long term debt plus rent/lease expense.

Section 6 Negative Covenants

Each Borrower covenants and agrees that from the date hereof and until payment
in full of all indebtedness and performance of all obligations under the Loan
Documents, Borrowers shall not, without the prior written consent of Bank:
6.01.     Liens. Create, incur, assume, or suffer to exist any lien or security
interest upon or in Collateral, any of Borrowers’ other properties, or the
properties of any Pledgor securing payment of the Loan(s), whether now owned or
hereafter acquired, except Permitted Liens.
6.02.
Debt. Incur, assume, or suffer to exist any debt, except:

(a)
Debt to Bank;

(b)
Debt outstanding on the date hereof and shown on the most recent financial
statements submitted to Bank;

(c)
Amounts payable pursuant to any Leases approved by Bank pursuant to Section
3.14;

(d)
Accounts payable to trade creditors incurred in the ordinary course of business;

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(e)
Debt secured by purchase money security interests only in the property or assets
acquired; and

(f)
Additional debt not to exceed $500,000 in the aggregate at any time.

6.03.    Capital Expenditures. Expenditures for fixed assets in any fiscal year
shall not exceed in the aggregate as to all Borrowers the sum of $8,000,000.00.
6.04.    Change of Legal Form of Business; Purchase of Assets. Change any
Borrowers’ names or the legal form of Borrowers’ businesses as shown above,
whether by merger, consolidation, conversion or otherwise, and Borrowers shall
not purchase all or substantially all of the assets or business of any Person,
or enter into any partnership with a third party.
6.05.    Intentionally deleted.
6.06.    Intentionally deleted.
6.07.    Intentionally deleted.
6.08.    Guaranties. Assume, guarantee, endorse, or otherwise be or become
directly or contingently liable for obligations of any Person, except guaranties
by endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business.
6.09.    Loans to Insiders and Affiliates. Make any loans to directors,
officers, partners, members, shareholders, subsidiaries or affiliates.
6.10.    Disposition of Assets. Sell, lease, or otherwise dispose of any of its
assets or properties except in the ordinary and usual course of its business, or
as permitted under Section 3.14 of this Agreement, subject to the terms and
conditions set forth therein.
6.11.    Change in Control. Cause, permit or undergo a Change in Control. A
“Change in Control” shall mean (a) where Synalloy Corporation shall at any time
cease to be a publicly held company and/or shall cease to have its capital stock
traded on an exchange, or (b) a transaction or series of related transactions
pursuant to which (i) at least fifty-one percent (51%) of the outstanding shares
of stock of Synalloy Corporation, on a fully diluted basis, shall be owned by
any Person which is not an Affiliate, or (ii) Synalloy Corporation merges into
or with, consolidates with or effects any plan of share exchange or other
combination with any Person which is not an Affiliate.
6.12.    Negative Covenants from Loan Documents. All negative covenants
contained in any Loan Document are hereby incorporated by reference herein.
6.13.    Transactions with Affiliates. Directly or indirectly, sell, lease,
transfer, or otherwise dispose of any of its property to, or purchase any
property from, or enter into any contract, agreement, understanding, loan,
advance, guarantee or transaction (including the rendering of services) with or
for the benefit of, any Affiliate (each of the foregoing, an “Affiliate
Transaction”), unless (a) such Affiliate Transaction or series of Affiliate
Transactions is (i) in the best interest of Borrowers and (ii) on terms that are
no less favorable to Borrowers than those what would have been obtained in a
comparable arm’s-length transaction by Borrowers with a person that is not an
Affiliate. For purposes of this section, “Affiliate” shall mean any Borrowers,
any relative of any Borrowers, of any Guarantor, or of an entity which is a
parent, subsidiary or any person or entity controlled by, or under the common
control of, any Borrowers, any Guarantor, Borrowers’s parent or subsidiary, or
Guarantor’s parent or subsidiary.

Section 7 Hazardous Substances and Compliance with Environmental Laws

7.01.    Investigation. Borrowers hereby certify that each has exercised due
diligence to ascertain whether its real property, including without limitation
the Mortgaged Property, is or has been affected by the presence of asbestos,
oil, petroleum or other hydrocarbons, urea formaldehyde, PCBs, hazardous or
nuclear waste, toxic chemicals and substances, or other hazardous materials, as
defined in applicable Environmental Laws (collectively, “Hazardous Substances”).
Borrowers represent and warrant that there are no Hazardous Substances
contaminating their real property, nor have any such materials been released on
or stored on or improperly disposed of on its real property during its
ownership, occupancy or operation thereof except in strict compliance with
Environmental Laws and any applicable permits. Borrowers hereby agree that,
except in strict compliance with applicable Environmental Laws, none shall
knowingly permit any release, storage or contamination of their properties as
long as any indebtedness or obligations to Bank under the Loan Documents remains
unpaid or unfulfilled. In addition, Borrowers do not have or use any underground
storage tanks on any of their real property, including the Mortgaged Property,
which are not registered with the appropriate Federal and/or State agencies and
which are not properly equipped and maintained in accordance with all
Environmental Laws. If requested by Bank, Borrowers shall provide Bank with all
necessary and reasonable assistance required for purposes of determining the
existence of Hazardous Substances on the Mortgaged Property, including allowing
Bank access to the Mortgaged Property, to

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Borrowers’ employees having knowledge of, and to its files and records within
Borrowers’ control relating to the existence, storage, or release of Hazardous
Substances on the Mortgaged Property.
7.02.    Compliance. Borrowers agree to comply with all applicable Environmental
Laws, including, without limitation, all those relating to Hazardous Substances.
Borrowers further agree to provide Bank, and all appropriate Federal and State
authorities, with immediate notice in writing of any release of Hazardous
Substances on the Mortgaged Property and to pursue diligently to completion all
appropriate and/or required remedial action in the event of such release. In
addition, Borrowers shall within fifteen (15) days after receipt thereof, a
complete copy of any notice, summons, lien, citation, letter or other
communication from any governmental agency concerning any action or omission of
Borrowers in connection with any environmental activity or issue.
7.03.    Remedial Action; Indemnity: Bank shall have the right, but not the
obligation, to undertake all or any part of such remedial action in the event of
a release of Hazardous Substances on the Mortgaged Property and to add any
expenditures so made to the principal indebtedness secured by the Deed(s) of
Trust or other security instruments. Borrowers agree to indemnify and hold Bank
harmless from any and all loss or liability arising out of any violation of the
representations, covenants, and obligations contained in this Section 7, or
resulting from the recording of the Deeds of Trust, Mortgages, or other security
instruments. In addition, Bank shall have all rights and remedies provided in
other Loan Documents with respect to Hazardous Substances and violations of
Environmental Laws.

Section 8 Events of Default

The following shall be “Events of Default” by Borrowers:

8.01.    Should Borrowers fail to make payment of any installment of principal
or interest on any of the Note(s) when due.
8.02.    Should any representation or warranty made in the Loan Documents prove
to be false or misleading in any material respect when made.
8.03.    Should any report, certificate, financial statement, or other document
furnished prior to the execution of or pursuant to the terms of this Agreement
prove to be false, incomplete or misleading in any material respect when
delivered or made.
8.04.    Should Borrowers default in the payment or performance of any other
loan, line of credit, indenture, mortgage instrument, security agreement or
other agreement with Bank or with another creditor or Person that may materially
affect any Borrowers’ property or ability to perform their respective
obligations under this Agreement or the other Loan Documents.
8.05.    Should any Borrower or any Pledgor breach any covenant, condition, or
agreement made under any of the Loan Documents to which it is a party, unless
such breach is of a nature that it cannot be immediately cured, in which case no
Event of Default shall occur so long as the applicable Borrower(s) shall
commence within twenty (20) days and thereafter diligently proceed to cure or
remedy the default and shall complete such cure no more than ninety (90) days
after the first occurrence of such breach.
8.06.    Should a custodian be appointed for or take possession of any or all of
the assets of any Borrowers; should any Borrower either voluntarily or
involuntarily become subject to any insolvency proceeding, including becoming a
debtor under the United States Bankruptcy Code, any proceeding to dissolve any
Borrower, any proceeding to have a receiver appointed, or should any Borrower
make an assignment for the benefit of creditors; or should there be an
attachment, execution, or other judicial seizure of all or any portion of any
Borrower’s assets, including an action or proceeding to seize any Collateral or
any funds on deposit with Bank, and such seizure is not discharged within 30
days.
8.07.    Should final, non-appealable judgment issued by a court of competent
jurisdiction for the payment of money be rendered against any Borrower which is
not covered by insurance and shall remain undischarged for a period of 30 days
unless such judgment or execution thereon is effectively stayed.
8.08.    Upon the death of, or termination of existence of, or dissolution of,
any Borrower or Pledgor.
8.09.    Should Bank determine that any Borrower has suffered a material adverse
change in its financial condition or its business operations.
8.10.    Should any lien or security interest in the Collateral terminate, fail
for any reason to have the priority agreed to by Bank on the date granted, or
become unenforceable, unperfected or invalid for any reason, should the
Collateral

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fail to be insured as required herein, or should the market value of the
Mortgaged Property or other Collateral decline below the value anticipated or
required in connection with the Loan(s).
8.11.    Should Borrowers commit a default under any Hedge Agreement, as defined
in Section 10.01.
8.12.    Should any Borrower assert for any reason that this Agreement or any
provision hereof or any other Loan Document is invalid or unenforceable.
8.13.    Should any Borrower or any officer, director or owner of 20% or more of
the outstanding ownership interests of any Borrower, be indicted for a felony
offense under state or federal law, including without limitation any violation
of any anti-money laundering, bribery, OFAC or bank fraud, or should any
Borrower employ an executive officer or manager, or elect a director, who has
been convicted of any such felony offense, or should any Person become an owner
of 20% or more of the outstanding ownership interests of any Borrower who has
been indicted or convicted of any such felony offense.

Section 9 Remedies Upon Default

Upon the occurrence of any of the above Events of Default, and subject to any
applicable notice and cure periods, if any, Bank may at any time thereafter, at
its option, take any or all of the following actions, at the same or at
different times:
9.01.    Declare the outstanding balance(s) of the Note(s) to be immediately due
and payable, both as to principal and interest, late fees, and all other
amounts/expenditures without presentment, demand, protest, or further notice of
any kind, all of which are hereby expressly waived by Borrowers, and such
balance(s) shall accrue interest at the Default Rate as provided herein until
paid in full;
9.02.    Require any Borrower to pledge additional collateral to Bank from such
Borrower’s assets and properties to secure the Loan(s), the acceptability and
sufficiency of such collateral to be determined in Bank’s sole discretion;
9.03.    Take immediate possession of and/or foreclose upon any or all
Collateral which may be granted to Bank as security for the indebtedness and
obligations of any Borrowers or any Guarantor under the Loan Documents;
9.04.    Exercise any and all other rights and remedies available to Bank under
the terms of the Loan Documents and applicable law, including the South Carolina
Uniform Commercial Code;
9.05.    Any obligation of Bank to advance funds to Borrowers or any other
Person under the terms of under the Loan Documents and all other obligations, if
any, of Bank under the Loan Documents shall immediately cease and terminate
unless and until Bank shall reinstate such obligation in writing.
9.06.    Obtain at the expense of Borrower independent appraisals or updates to
an existing appraisal by an appraiser satisfactory to Bank of all or any portion
of the Collateral.

Section 10 Miscellaneous Provisions

10.01.    Definitions.
“Availability” shall mean the lesser of (i) $65,000,000.00 or (ii) the
Collateral Loan Value shown on the Loan Base Report furnished by Borrowers to
Bank on or before the 15th day of each month as long as this Agreement shall
remain in force, or as provided and/or determined in accordance with Schedule
DD.
“Collateral” shall mean all property and assets granted as collateral security
for the Loan(s), whether real or personal property, whether granted directly or
indirectly, whether granted now or in the future, and whether granted in the
form of a security interest, mortgage, security deed, deed of trust, assignment,
pledge, crop pledge, chattel mortgage, chattel trust, factor’s lien, equipment
trust, conditional sale, trust receipt, lien, charge, lien or title retention
contract, lease or consignment intended as a security device, or any other
security or lien interest whatsoever, whether created by law, contract, or
otherwise.
“Default Rate” shall mean a rate of interest equal to the greater of: (i)
fifteen percent (15.0%) per annum; or (ii) a variable rate equal to five percent
(5.0%) per annum above the rate set forth in the Note(s) (not to exceed the
legal maximum rate) from and after the date of an Event of Default hereunder
which shall apply, in Bank’s sole discretion, to all amounts owing, on such
date, calculated on the basis of the actual number of days elapsed over a year
consisting of 360 days.
“Environmental Laws” shall mean all federal and state laws and regulations which
affect or may affect the Mortgaged Property, including without limitation the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
Sections 9601 et seq.), the Resource Conservation and Recovery Act (42 U.S.C.
Sections 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C.
Sections 1251 et seq.), the Clean Air

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Act (42 U.S.C. Section 7401 et seq.), the Toxic Substances Control Act (15
U.S.C. Section 2601 et seq.), and all applicable environmental laws and
regulations of the State of South Carolina, as such laws or regulations have
been amended or may be amended.
“Hedge Agreement” shall mean an agreement between Borrowers and Bank, now
existing or hereafter entered into, which provides for an interest rate, credit,
commodity, equity swap or other Swap Obligation, cap floor, collar, spot or
forward foreign exchange transaction, currency swap, cross-currency rate swap,
currency option or any similar transaction or any combination of, or option with
respect to, these or similar transactions, for the purpose of hedging
Borrowers’s exposure to fluctuations in interest or exchange rates, loan,
credit, exchange, security or currency valuations or currency prices.
“Loan Documents” shall mean this Agreement including any Schedule attached
hereto, the Note, the Security Agreement, the Stock and LLC Interest Pledge
Agreement, all UCC Financing Statements, and all other documents, certificates,
and instruments executed in connection therewith, and all renewals, extensions,
modifications, substitutions, and restatements thereof and therefore.
“Permitted Liens” shall mean (1) liens and security interest securing any
indebtedness owed by any Borrowers to Bank; (2) liens for taxes, assessments, or
similar charges either not yet due or being contested in good faith and for
which appropriate reserves are maintained; (3) liens of materialmen, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary course of
business and securing obligations which are not yet delinquent; (4) purchase
money liens or purchase money security interests upon or in any property
acquired or held by Borrowers in the ordinary course of business to secure
indebtedness outstanding on the date of this Agreement or permitted to be
incurred under Section 6.02; (5) liens and security interests which, as of the
date of this Agreement, have been disclosed to and approved by Bank in writing;
and (6) those liens and security interests which in the aggregate constitute an
immaterial and insignificant monetary amount with respect to the net value of
Borrowers’s assets.
“Person” shall mean an individual, partnership, corporation, trust,
unincorporated organization, limited liability company, limited liability
partnership, association, joint venture, or a government agency or political
subdivision thereof.
“GAAP” shall mean generally accepted accounting principles as established by the
Financial Accounting Standards Board or the American Institute of Certified
Public Accountants, as amended and supplemented from time to time.
“Prime Rate” shall mean the rate of interest per annum announced by Bank from
time to time and adopted as its Prime Rate, which is one of several rate indexes
employed by Bank when extending credit, and may not necessarily be Bank’s lowest
lending rate.
10.02.    Non-impairment. If any one or more provisions contained in the Loan
Documents shall be held invalid, illegal, or unenforceable in any respect, the
validity, legality, and enforceability of the remaining provisions contained
therein shall not in any way be affected or impaired thereby and shall otherwise
remain in full force and effect.
10.03.    Applicable Law. The Loan Documents shall be construed in accordance
with and governed by the laws of the State of South Carolina, except that the
provisions for the creation, perfection and enforcement of the lien(s) and
security interest(s) created under the Loan Documents shall be governed by the
jurisdiction in which the Collateral is located, and the Loan Documents shall
bind each Borrowers’ heirs, personal representatives, successors and assigns and
inure to the benefit of Bank’s successors and assigns.
10.04.    Waiver. Neither the failure nor any delay on the part of Bank in
exercising any right, power or privilege granted in the Loan Documents shall
operate as a waiver thereof, nor shall any single or partial exercise thereof
preclude any other or further exercise of any other right, power, or privilege
which may be provided by law. A waiver by Bank of a provision of this Agreement
shall not prejudice or constitute a waiver of Bank’s right otherwise to demand
strict compliance with that provision or any other provision of this Agreement.
No prior waiver by Bank, nor any course of dealing between Bank and Borrowers,
shall constitute a waiver of any of Bank’s rights or of any of Borrowers’
obligations as to any future transaction. Whenever the consent of Bank is
required under this Agreement, the granting of such consent by Bank in any
instance shall not constitute continuing consent to subsequent instances where
such consent is required and in all cases such consent may be granted or
withheld in the sole discretion of Bank.
10.05.    Modification. No modification, amendment, or waiver of any provision
of any of the Loan Documents shall be effective unless in writing and signed by
Borrowers and Bank.
10.06.    Payment Amount Adjustment. In the event that any Loan(s) referenced
herein has a fixed payment with a variable (floating) interest rate and, as a
result of an increase in such interest rate, accruals of interest are not

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fully paid, Bank, in its sole discretion, may at any time adjust Borrowers’s
fixed payment amount(s) to prevent the amount of interest accrued in a given
period exceeding the periodic payment amount or to cause the affected Loan(s) to
be repaid within the same period of time as originally agreed upon.
10.07        Stamps and Other Fees. Borrowers shall pay all federal or state
stamp and recording taxes, or other fees or charges, if any are payable or are
determined to be payable by reason of the execution, delivery, or issuance of
the Loan Documents or any security granted to Bank; and Borrowers agree to
indemnify and hold harmless Bank against any and all liability in respect
thereof. Borrowers shall pay all fees incurred by Bank for the appraisal of the
Mortgaged Property obtained at any time after the date of this Agreement which
Bank requires pursuant to federal or state regulations, in connection with any
event of default under the Loan Documents or restructure of the Loan(s), any
material damage to or condemnation of the Mortgaged Property, or in connection
with any foreclosure or forbearance. Such appraisal fees shall be payable on
demand, shall accrue interest at the default rate set forth in the Note(s)
following demand and shall be secured by the security documents executed by
Borrowers or Pledgor.
10.08.    Attorneys’ Fees. In the event Borrowers or any Pledgor shall default
in any of its obligations hereunder and Bank finds it necessary to employ an
attorney to assist in the enforcement or collection of the indebtedness of
Borrowers to Bank, to enforce the terms and provisions of the Loan Documents, to
modify the Loan Documents, or in the event Bank voluntarily or otherwise should
become a party to any suit or legal proceeding (including a proceeding conducted
under the Bankruptcy Code), Borrowers, jointly and severally, agree to pay all
reasonable attorneys’ fees incurred by Bank and all related costs of collection
or enforcement that may be incurred by Bank.
10.09.    Bank Making Required Payments. In the event Borrowers shall fail to
maintain insurance, pay taxes or assessments, costs and expenses which Borrowers
is, under any of the terms hereof or of any Loan Documents, required to pay, or
fail to keep any of the properties and assets constituting collateral free from
new security interests, liens, or encumbrances, except as permitted herein, Bank
may at its election make expenditures for any or all such purposes and the
amounts expended together with interest thereon at the Default Rate, shall
become immediately due and payable to Bank, and shall have benefit of and be
secured by the collateral; provided, however, Bank shall be under no duty or
obligation to make any such payments or expenditures.
10.10.    Right of Offset. Any indebtedness owing from Bank to Borrowers may be
set off and applied by Bank on any indebtedness or liability of Borrowers to
Bank at any time and from time to time after maturity, whether by acceleration
or otherwise, and without demand or notice to Borrowers.
10.11.    UCC Authorization. Borrowers authorize Bank to file such UCC Financing
Statements describing the collateral in any location deemed necessary and
appropriate by Bank.
10.12.    Modification and Renewal Fees. Bank may, at its option, charge any
fees for modification, renewal, extension, or restatement of any terms of the
Note(s) and the other Loan Documents not prohibited by applicable law. Without
limiting the foregoing, upon any renewal of the Note(s) or a portion of the debt
evidenced thereby, Borrowers shall pay a renewal fee equal to 0.10% of the
maximum principal amount of the Line of Credit as of the date of the renewal.
10.13.    Conflicting Provisions. If provisions of this Agreement shall conflict
with any terms or provisions of any of the Note(s), security document(s) or any
schedule attached hereto, the provisions of such Note(s), security document(s)
or any Schedule attached hereto, as appropriate, shall take priority over any
provisions in this Agreement.
10.14.    Notices. Any notice permitted or required by the provisions of this
Agreement shall be deemed to have been given when delivered in writing to BB&T
Commercial Finance at PO Box 1245, Winston-Salem NC, 27012, Attention: ABL
Operations, and to the Chief Financial Officer of Synalloy Corporation at its
offices in Richmond, Virginia when sent by certified mail and return receipt
requested or by recognized courier. Unless otherwise required by law, if there
is more than one Borrowers, any notice given by Bank to any Borrowers shall be
deemed to be notice given to all Borrowers.
10.15.    Consent to Jurisdiction. Borrowers hereby irrevocably agree that any
legal action or proceeding arising out of or relating to this Agreement may be
instituted in any state or Federal court situated in the Commonwealth of
Virginia, or in any other jurisdiction in which any of Borrowers is domiciled,
or in any jurisdiction in which the Collateral is located, as Bank may choose in
its sole discretion.  Borrowers consent to the jurisdiction of such courts and
waives any objection relating to the basis for personal or in rem jurisdiction
or to venue which Borrowers may now or hereafter have in any such legal action
or proceedings.

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10.16.    Counterparts. This Agreement may be executed by one or more parties on
any number of separate counterparts and all of such counterparts taken together
shall be deemed to constitute one and the same instrument.
10.17.    Entire Agreement. The Loan Documents embody the entire agreement
between Borrowers and Bank with respect to the Loan(s), and there are no oral or
parole agreements existing between Bank and Borrowers with respect to the
Loan(s) which are not expressly set forth in the Loan Documents.
10.18.    Indemnity. Borrowers hereby jointly and severally agree to indemnify
and hold Bank, its affiliates, their successors and assigns and their respective
directors, officers, employees and shareholders harmless from and against, any
loss, damage, lawsuit, proceeding, judgment, cost, penalty, expense (including
all reasonable in-house and outside attorneys’ fees, whether or not suit is
brought, accountants’ fees and/or consultants’ fees) or liability whatsoever
arising from or otherwise relating to the closing, disbursement, administration
or repayment of the Loan(s), including without limitation: (i) Borrowers’
failure to comply with the terms of this Agreement and the other Loan Documents
(ii) the breach of any representation or warranty made to Bank in this Agreement
or in any other Loan Documents now or hereafter executed in connection with the
Loan(s); (iii) the violation of any covenant or agreement contained in this
Agreement or any of the other Loan Documents; provided, however, that the
foregoing indemnification shall not be deemed to cover any such loss, damage,
lawsuit, proceeding, cost, expense or liability which is finally determined by a
court of competent jurisdiction to result solely from Bank’s gross negligence or
willful misconduct. This indemnity obligation shall survive the payment of the
Loan(s) and the termination of this Agreement.
10.19.    WAIVER OF JURY TRIAL. UNLESS EXPRESSLY PROHIBITED BY APPLICABLE LAW,
THE UNDERSIGNED HEREBY WAIVE THE RIGHT TO TRIAL BY JURY OF ANY MATTERS OR CLAIMS
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR OUT OF THE
CONDUCT OF THE RELATIONSHIP BETWEEN THE UNDERSIGNED AND BANK, IN EACH CASE
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. BORROWERS AGREE AND CONSENT
THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT
TRIAL WITHOUT A JURY, AND THAT BANK MAY FILE AN ORIGINAL COUNTERPART OR A COPY
OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF BORROWERS
TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR BANK TO MAKE THE LOAN(S) AND ENTER INTO THIS AGREEMENT. FURTHER,
THE UNDERSIGNED HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR
BANK’S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT
SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. NO REPRESENTATIVE
OR AGENT OF BANK, NOR BANK’S COUNSEL, HAS THE AUTHORITY TO WAIVE, CONDITION OR
MODIFY THIS PROVISION. BORROWERS ACKNOWLEDGE THAT EACH HAS HAD THE OPPORTUNITY
TO CONSULT WITH COUNSEL REGARDING THIS PARAGRAPH, THAT IT FULLY UNDERSTANDS ITS
TERMS, CONTENT AND EFFECT, AND THAT IT VOLUNTARILY AND KNOWINGLY AGREES TO THE
TERMS OF THIS PARAGRAPH.
10.20.    Required Information for New Loan. To help the government fight the
funding of terrorism and money laundering activities, federal law requires Bank
to obtain, verify and record information that identifies each person or entity
obtaining a loan including Borrowers’ legal name, address, tax identification
number, date of birth, driver’s license, organizational documents or other
identifying documents. Failure to provide the required information will result
in a violation of the U.S. Patriot Act and will constitute a default under this
instrument or agreement. In addition, no Borrowers, any of its affiliates, or
any of their respective directors, officers, managers, partners, or any other
authorized representatives is named as a “Specially Designated National and
Blocked Person”, on the list published by the U.S. Department of the Treasury
Office of Foreign Assets Control (OFAC) at its official website.
10.21.    Correction of Errors; Further Assurances. Borrowers will and will
cause any Pledgor to cooperate with Bank to correct any errors in this
Agreement, the Note or other Loan Documents and shall execute such documentation
as is necessary to do so. In addition, Borrowers and Pledgor shall cooperate
fully with Bank and execute such further instruments, documents and agreements,
and shall do any and all such further acts, as may be reasonably requested by
Bank to better evidence and reflect the transactions described herein and
contemplated hereby and to carry into effect the intent purposes of this
Agreement, the Note and the other Loan Documents, including without limitation
the granting and/or perfecting of a security interest in the Collateral.

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10.22.    Consent to Loan Participation. Borrowers agrees and consents to Bank’s
sale or transfer, whether now or later, of one or more participation interests
in the Loan(s) to one or more purchasers, whether related or unrelated to Bank.
Bank may provide, without any limitation whatsoever, to any one or more
purchasers, or potential purchasers, any information or knowledge Bank may have
about Borrowers or about any other matter relating to the Loan(s), and Borrowers
hereby waive any rights to privacy Borrowers may have with respect to such
matters. Borrowers hereby waive any and all notices of sale of participation
interests, as well as all notices of any repurchase of such participation
interests. Borrowers agree that the purchasers of any such participation
interests will be considered as the absolute owners of such interests in the
Loan(s) and will have all the rights granted under the participation
agreement(s) governing the sale of such participation interests. Borrowers waive
all rights of offset or counterclaim, whether now existing or hereafter arising,
against Bank or against any purchaser of such a participation interest and
unconditionally agrees that either Bank or such purchaser may enforce
Borrowers’s obligation under the Loan(s) irrespective of the failure or
insolvency of any holder of any interest in the Loan(s). Borrowers agrees that
the purchaser of any such participation interest may enforce its interest
irrespective of any personal claims or defenses that Borrowers may have against
Bank. Any purchaser of a participation interest in the Loan(s) may exercise a
right of setoff against Borrowers to the same extent as Bank has such right.
10.23.    Severability. If a court of competent jurisdiction finds any provision
of this Agreement to be illegal, invalid, or unenforceable as to any
circumstance, such finding shall not make the offending provision illegal,
invalid, or unenforceable as to any other circumstance. If feasible, the
offending provision shall be considered modified so that it becomes legal, valid
and enforceable. If the offending provision cannot be so modified, it shall be
considered deleted from this Agreement. Unless otherwise required by law, the
illegality, invalidity, or unenforceability of any provision of this Agreement
shall not affect the legality, validity or enforceability of any other provision
of this Agreement.
10.24.    Construction. Each party hereto hereby acknowledges that all parties
hereto participated equally in the drafting and/or negotiation of this Agreement
and that, accordingly, no court when interpreting this Agreement shall construe
it more stringently against one party than the other.
10.25.    Time of the Essence. Time is of the essence in the performance of this
Agreement and the other Loan Documents.
10.26.    Matters as to Amendment and Restatement. This Agreement constitutes an
amendment and consolidated restatement in full of the Second Amended and
Restated Loan Agreement dated August 31, 2016 (including all amendments thereto
entered prior to the date hereof). Except for the effect of any matters
expressly set forth in this Agreement, this Agreement and each of the Loan
Documents is, and shall continue to be following the effectiveness of this
Agreement, in full force and effect in accordance with the terms thereof, as
amended, and nothing in this Agreement shall otherwise be deemed to amend or
modify any provision of the Loan Documents, each of which shall remain in full
force and effect except as otherwise expressly provided herein or therein. This
Agreement is not intended to be, nor shall it be construed to create, a novation
or accord and satisfaction. This Agreement does not effect the release of any
collateral, does not disturb the perfection or priority of any existing liens,
and does not effect the release of any obligor or other party from its
obligations.

[SIGNATURES ON FOLLOWING PAGE]

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SIGNATURE PAGE

IN WITNESS WHEREOF, the Bank and Borrowers have caused this Agreement to be duly
executed all as of the date first above written.

Witness (as to the Borrowers):

______________________________
SYNALLOY CORPORATION
SYNALLOY FABRICATION, LLC
SYNALLOY METALS, INC.
BRISTOL METALS, LLC
MANUFACTURERS SOAP & CHEMICAL
    COMPANY
MANUFACTURERS CHEMICALS, LLC
PALMER OF TEXAS TANKS, INC.
CRI TOLLING, LLC
SPECIALTY PIPE & TUBE, INC.

By:                                                                    (SEAL)
         Dennis M. Loughran
         Senior Vice President and CFO or Senior Vice President, Finance of and
on behalf of the above-named entity

 
 
 
 

Witness (as to BB&T):

______________________________
BRANCH BANKING AND TRUST COMPANY

By: ________________________________________
         Stan W. Parker
         Senior Vice President

 

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