Exhibit 10.2

 

THIRD AMENDMENT TO

UNCOMMITTED CREDIT AGREEMENT

 

This THIRD AMENDMENT TO UNCOMMITTED CREDIT AGREEMENT (this “Third Amendment”)
dated as of June 14, 2016 is among EMPIRE RESOURCES, INC., a Delaware
corporation (the “Company”), the undersigned Banks and COÖPERATIEVE RABOBANK U.A
(formerly known as Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A.,
“Rabobank Nederland”), NEW YORK BRANCH, as Agent (the “Agent”). Capitalized
terms used herein and not otherwise defined herein shall have the meanings given
to them in the Credit Agreement (as defined below).

 

WITNESSETH:

 

WHEREAS, the Company, the Banks, the Syndication Agent, the Agent, the Issuing
Bank and the Lead Arranger are parties to the Uncommitted Credit Agreement dated
as of June 19, 2014 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”); and

 

WHEREAS, the Company has requested certain amendments to the Credit Agreement
and the Banks and the Agent are willing to agree to such amendments on the terms
and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

 

SECTION 1.          Amendments.

 

The Credit Agreement is hereby amended, upon the occurrence of the Effective
Date (as defined in Section 3 below), as follows:

 

(a)          Section 1.01 is amended as follows:

 

(i)          The definition of “Defaulting Bank” is amended by (x) deleting “or”
at the end of clause (c)(v) therein and replacing it with “,” and (y) inserting
the following immediately after clause (c)(vi) therein (before the “;”): “or
(vii) become the subject of a Bail-In Action”.

 

(ii)         The definition of “Eligible Inventory” in Section 1.01 is amended
as follows:

 

(A)         clause (e) is amended and restated in its entirety as follows:

 

“(e) in respect of such Inventory either (i) (A) one or more customers of the
Company has contracted to purchase such Inventory at a predetermined fixed price
under sales contracts entered into by the Company in the ordinary course of
business and (B) upon such delivery an Eligible Receivable will arise or (ii)
such Inventory is hedged by futures contracts (in a manner acceptable to the
Required Banks) in a futures account maintained with a broker acceptable to the
Agent, which futures account shall be subject to no rights of any third party
other than the Agent and customary setoff rights of the applicable broker,”; and

 

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(B)         the proviso (after clause (l)) is amended by deleting “65%” and
replacing it with “75%”.

 

(iii)        The definition of “Monthly Date” is inserted in its proper
alphabetical place as follows:

 

““Monthly Date” means the last Business Day of each month.”

 

(iv)        The definition of “Quarterly Date” is deleted.

 

(v)         The definition of "Revolving Credit Line Termination Date" is
amended by deleting "June 18, 2016" and replacing it with "June 19, 2017".

 

(vi)        The definition of Revolving Loan Line Portion is amended and
restated in its entirety as follows:

 

““Revolving Loan Line Portion” means, as to each Bank, the obligation of such
Bank to consider requests to make Loans and to acquire a participation in
Letters of Credit 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 “Revolving Loan Line Portion” on Schedule A attached hereto
and incorporated herein by reference (as the same may be reduced or increased
from time to time in connection with a Declining Bank election pursuant to
Section 2.12 hereof). As of June __, 2016, the aggregate amount of the Revolving
Loan Line Portions is $50,000,000.”

 

(vii)       The following definitions are hereby inserted in their proper
alphabetical places:

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

 

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

 

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“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

 

“Sanctions” means any sanctions imposed or administered by or enforced by OFAC,
the U.S. Department of State, the United Nations Security Council, the European
Union, Her Majesty’s Treasury, the Netherlands, the French Republic or other
relevant sanctions authority.

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

 

(b)          Section 2.03 is amended as follows:

 

(i)          clause (ii) of the first proviso in the first paragraph is amended
by deleting “$35,000,000” and replacing it with “$20,000,000”; and

 

(ii)         clause (g) is amended and restated in its entirety as follows:

 

“(g) (i)         Letter of Credit Fees. The Company shall pay to the Agent for
the pro rata account of the L/C Participants (other than Defaulting Banks) in
accordance with their respective Revolving Loan Line Portion Percentages), the
following fees:

 

(A)         Commercial Letters of Credit. For each commercial Letter of Credit,
a letter of credit fee in an amount equal to 0.125% flat for each 90 day period
or part thereof between the date of issuance and the expiration date thereof, on
the face amount of such Letter of Credit, such letter of credit fee accrued
through and including each Monthly Date to be due and payable no later than the
date which is ten (10) Business Days after delivery by the Agent to the Company
of a monthly invoice therefor;

 

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(B)         Standby Letters of Credit. For each standby Letter of Credit, a
letter of credit fee at a rate per annum equal to 1.75% on the average daily
undrawn amount of such standby Letter of Credit during the period from the date
of issuance through and including the date of drawing of the entire amount or
expiration or termination thereof, such letter of credit fee accrued through and
including each Monthly Date to be due and payable no later than the date which
is ten (10) Business Days after delivery by the Agent to the Company of a
monthly invoice therefor;

 

provided that such letter of credit commissions with respect to each Letter of
Credit set forth in clauses (A) and (B) above shall be non-refundable and shall
not be less than $500, and

 

(ii)         Letter of Credit Fronting Fees. The Company shall pay to each
Issuing Bank a fronting fee with respect to each Letter of Credit issued by such
Issuing Bank, which shall accrue at the rate or rates per annum separately
agreed upon between the Company and the applicable Issuing Bank on the daily
amount of the Letter of Credit Liabilities (excluding any portion thereof
attributable to unreimbursed Reimbursement Obligations) during the period from
and including the Closing Date to but excluding the later of the date of
termination of the Revolving Loan Line Portions and the date on which there
ceases to be any Letter of Credit Liabilities with respect to such Issuing Bank,
such fronting fees accrued through and including each Monthly Date to be due and
payable no later than the date which is ten (10) Business Days after delivery by
the Agent to the Company of a monthly invoice therefor;

 

provided that all such fees (under clauses (i) and (ii) above) shall also be
payable (to the extent accrued and not yet paid) on the date on which the
Revolving Loan Line Portions terminate and any such fees accruing after the date
on which the Revolving Loan Line Portions terminate shall be payable upon the
expiration of the applicable Letter of Credit or, if earlier, the date on which
the Revolving Loan Line Portions terminate.

 

In addition, the Company shall pay to the Agent for account of the applicable
Issuing Bank, such Issuing Bank’s standard fees with respect to the amendment or
negotiation of any Letter of Credit or processing of drawings thereunder. Any
other fees payable to an Issuing Bank pursuant to this paragraph shall be
payable within 10 Business Days after demand.”

 

(c)          Section 7.16 is amended and restated in its entirety as follows:

 

“7.16         OFAC/Money Laundering/Corruption Representations. No Obligor nor,
to the knowledge of any Obligor, any of its employees, directors, officers or
Affiliates is in violation of any Laws relating to Sanctions, bribery,
corruption, terrorism or money laundering (collectively, “Anti-Terrorism Laws”),
including regulations administered by the United States Treasury Department’s
Office of Foreign Asset Control (“OFAC”) and the Executive Order No. 13224 on
Terrorist Financing, effective September 24, 2001 (the “Executive Order”), and
the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56. No Obligor nor,
to the knowledge of any Obligor, any of its employees, directors, officers or
Affiliates, or their respective brokers or other agents acting or benefiting in
any capacity in connection with the Loans or Letters of Credit, is any of the
following (each such Person, a “Sanctioned Person”):

 

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(a)          a Person or country that is listed in the annex to, or is otherwise
subject in the prohibitions contained in, the Executive Order or the OFAC
regulations, or that is subject to or the target of any Sanctions;

 

(b)          a Person owned or controlled by, or acting for or on the behalf of,
any Person that is listed in the annex to, or is otherwise subject to the
prohibitions contained in, the Executive Order or the OFAC regulations or other
Anti-Terrorism Laws or similar Laws promulgated by the United Nations or Her
Majesty’s Treasury;

 

(c)          a Person with which the Agent or any Bank is prohibited from
dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;

 

(d)          a Person that commits, threatens or conspires to commit or supports
“terrorism” as defined in the Executive Order or the OFAC regulations;

 

(e)          a Person that is (i) named on the most current list of “Specially
Designated Nationals and Blocked Persons” published by OFAC at its official
website or any replacement website or other replacement official publication
list or (ii) similarly designated in any comparable list published by the United
Nations or any Governmental Authority of the European Union, the Netherlands,
the United Kingdom or the French Republic; or

 

(f)          a Person located, organized or resident in a country or territory
that is, or whose government is, the subject of Sanctions including, without
limitation, Cuba, Iran, North Korea, Sudan and Syria.

 

No Obligor nor any of its brokers or other agents acting in any capacity in
connection with the Loans or Letters of Credit (x) conducts any business or
engages in making or receiving any contribution of funds, goods or services to
or for the benefit of any Sanctioned Person, (y) deals in, or otherwise engages
in any transaction relating to, any property or interests in property blocked
pursuant to the Executive Order or the OFAC regulations, or (z) engages in or
conspires to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set
forth in any Anti-Terrorism Law.

 

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No part of the proceeds of the Loans or Letters of Credit will be used, directly
or indirectly, (x) for any payments to any Sanctioned Person, governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, (i) in
order to obtain, retain or direct business or obtain any improper advantage, in
violation of OFAC, Anti-Terrorism Laws, regulations of the European Union or the
United States Foreign Corrupt Practices Act of 1977, as amended or (ii) which
could result in the imposition of Sanctions against any Person (including any
Bank) or (y) to fund any activities or business of or with any Person that, at
the time of funding, is a Person described in any of clauses (a) - (f) above.”

 

(d)          Section 8.10 is amended by deleting “$42,500,000” and replacing it
with “$37,500,000”.

 

(e)          New Section 11.20 is hereby inserted after Section 11.19 as
follows:

 

“11.20 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
Notwithstanding anything to the contrary in any Basic Document or in any other
agreement, arrangement or understanding among any of the parties thereto, each
of the Company and the Secured Parties acknowledges that any liability of any
EEA Financial Institution arising under any Basic Document, to the extent such
liability is unsecured, may be subject to the write-down and conversion powers
of an EEA Resolution Authority and agrees and consents to, and acknowledges and
agrees to be bound by:

 

(a)the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any party hereto that is an EEA Financial Institution; and

 

(b)the effects of any Bail-in Action on any such liability, including, if
applicable:

 

(i)          a reduction in full or in part or cancellation of any such
liability;

 

(ii)         a conversion of all, or a portion of, such liability into shares or
other instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Basic Document; or

 

(iii)         the variation of the terms of such liability in connection with
the exercise of the write-down and conversion powers of any EEA Resolution
Authority.”

 

(f)          Schedule A is amended and restated in its entirety as set forth on
Annex I hereto.

 

(g)          Footnote 4 on Schedule 1 to Exhibit B is amended by deleting "65%"
and replacing it with "75%".

 

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(h)          Line (a) in Section 8 of Exhibit G is hereby deleted and replaced
with the following:

 

"(a)          Base Amount                   $37,500,000".

 

SECTION 2.          Reallocation

 

(a)          On the date hereof, the Agent shall reallocate, if necessary, the
Loans and other Loan Obligations of all Banks such that after giving effect
thereto, each bank shall have Loans and other Loan Obligations in accordance
with its Revolving Loan Line Portion Percentage (after giving effect to this
Third Amendment). Each Bank hereby agrees that in connection with such
reallocation it shall be deemed to have purchased and/or sold, as applicable, by
assignment (without recourse) to or from such other Banks such amounts as
necessary to effect the reallocation set forth above.

 

(b)          The Company hereby agrees that, in connection with the reallocation
set forth in clause (a) above, the Company shall compensate each Bank for any
loss, cost or expense attributable to such reallocation as required by Section
5.04 of the Credit Agreement.

 

SECTION 3.          Effectiveness of Amendment.

 

This Third Amendment shall become effective on the date (the “Effective Date”)
on which the Agent shall have received:

 

(a)          this Third Amendment duly executed by each of the Company, the
Agent and the Banks, and duly acknowledged by the Guarantor;

 

(b)          such corporate authorization documents and opinions of counsel as
the Banks shall require; and

   

(c)          payment from the Company, in immediately available funds, of an
amendment fee for the account of each Bank in the amount of 0.05% of the amount
of such Bank's Revolving Loan Line Portion (after giving effect to this Third
Amendment), an arranging fee for the sole account of the Agent in an amount as
set forth in that certain Fee Letter dated May 11, 2016 executed by the Company
and the Agent  and the reasonable fees of counsel to the Agent for which an
invoice shall have been provided.

 

SECTION 4.          Effect of Amendment; Ratification; Representations; etc.

 

(a)          On and after the Effective Date, this Third Amendment shall be a
part of the Credit Agreement, all references to the Credit Agreement in the
Credit Agreement and the other Basic Documents shall be deemed to refer to the
Credit Agreement as amended by this Third Amendment, and the term “this
Agreement”, and the words “hereof”, “herein”, “hereunder” and words of similar
import, as used in the Credit Agreement, shall mean the Credit Agreement as
amended hereby.

 

(b)          Except as expressly set forth herein, this Third Amendment shall
not constitute an amendment, waiver or consent with respect to any provision of
the Credit Agreement and the Credit Agreement is hereby ratified, approved and
confirmed in all respects and remains in full force and effect.

 

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(c)          In order to induce the Agent and the Banks to enter into this Third
Amendment, each Company represents and warrants to the Agent and the Banks that
before and after giving effect to the execution and delivery of this Third
Amendment:

 

(i)          the representations and warranties of such Company set forth in the
Credit Agreement and in the other Basic Documents are true and correct in all
material respects as if made on and as of the date hereof, except for those
representations and warranties that by their terms were made as of a specified
date which were true and correct on and as of such date; and

 

(ii)         no Default or Event of Default has occurred and is continuing.

 

(d)          This Third Amendment shall be a Basic Document.

 

SECTION 5.          Counterparts.

 

This Third Amendment may be executed by one or more of the parties to this Third
Amendment on any number of separate counterparts (including by facsimile or
email transmission of signature pages hereto), and all of said counterparts
taken together shall be deemed to constitute one and the same agreement. A set
of the copies of this Third Amendment signed by all the parties shall be lodged
with the Company and the Agent.

 

SECTION 6.          Severability.

 

Any provision of this Third Amendment which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

SECTION 7.          GOVERNING LAW.

 

THIS THIRD AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

 

SECTION 8.          WAIVERS OF JURY TRIAL.

 

EACH OF THE COMPANY, THE AGENT AND THE BANKS HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS THIRD AMENDMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

[Remainder of Page Intentionally Left Blank; Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be
duly executed as of the day and year first above written.

 

  EMPIRE RESOURCES, INC.         By: /s/ Sandra Kahn     Name: Sandra Kahn    
Title: Vice President

 

 

 

  

  COÖPERATIEVE RABOBANK, U.A. (formerly known as Coöperatieve
Centrale  Raiffeisen-Boerenleenbank B.A., “Rabobank Nederland”), NEW YORK
BRANCH, as Agent and as a Bank         By: /s/ Paul Moisselin     Name: Paul
Moisselin     Title: Vice President         By: /s/ Jan Hendrik de Graaff    
Name:  Jan Hendrik de Graaff     Title: Managing Director

 

 

 

 

  BNP PARIBAS, as a Bank         By: /s/ Bradley Dingwall     Name:  Bradley
Dingwall     Title: Director         By: /s/ Deborah P. Whittle     Name:
Deborah P. Whittle     Title: Director

 

 

 

 

  SOCIÉTÉ GÉNÉRALE S.A., as a Bank         By: /s/ Barbara Paulsen     Name:
Barbara Paulsen     Title: Managing Director

 

 

 

 

ACKNOWLEDGED AND AGREED:       EMPIRE RESOURCES PACIFIC, LTD.         By: /s/
Sandra R. Kahn     Name: Sandra R. Kahn     Title: Vice President  

 

 

 

 

Annex I to Third Amendment

to Uncommitted Credit Agreement

 

SCHEDULE A

TO

EMPIRE RESOURCES, INC.

CREDIT AGREEMENT

 

Revolving Loan Line Portions

 

Banks  Revolving Loan Line Portion   Revolving Loan Line
Portion Percentage  Coöperatieve  Rabobank U.A., New York Branch  $19,000,000  
 38.0000% BNP Paribas  $17,250,000    34.5000% Société Générale S.A. 
$13,750,000    27.5000% Total  $50,000,000    100.0000%