Exhibit 10.1

 

[Execution]

 

AMENDMENT NO. 1 TO

THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

 

AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT, dated
September 17, 2013 (this “Amendment No. 1”), is by and among Wells Fargo Capital
Finance, LLC, successor by merger to Wachovia Capital Finance Corporation
(Central), formerly known as Congress Financial Corporation (Central), in its
capacity as agent pursuant to the Loan Agreement (as hereinafter defined) acting
for and on behalf of the parties thereto as lenders (in such capacity, “Agent”),
the parties to the Loan Agreement as lenders (individually, each a “Lender” and
collectively, “Lenders”), Haynes International, Inc., a Delaware corporation
(“Haynes Parent”) and Haynes Wire Company, a Delaware corporation (“Haynes Wire”
and together with Haynes Parent, each individually, a “Borrower” and
collectively, “Borrowers”).

 

W I T N E S S E T H :

 

WHEREAS, Agent, Lenders and Borrowers have entered into financing arrangements
pursuant to which Lenders (or Agent on behalf of Lenders) have made and may make
loans and advances and provide other financial accommodations to Borrowers as
set forth in the Third Amended and Restated Loan and Security Agreement, dated
July 14, 2011, by and among Agent, Lenders and Borrowers (as the same now exists
and is amended and supplemented pursuant hereto and may hereafter be further
amended, modified, supplemented, extended, renewed, restated or replaced, the
“Loan Agreement”) and the other Financing Agreements;

 

WHEREAS, Borrowers desire to amend certain provisions of the Loan Agreement as
set forth herein, and Agent and Lenders are willing to agree to such amendments
on the terms and subject to the conditions set forth herein;

 

WHEREAS, by this Amendment No. 1, Agent, Lenders, Borrowers desire and intend to
evidence such amendments;

 

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

 

1.              Definitions.

 

(a)                                 Additional Definition.  As used herein,
“Amendment No. 1” shall mean Amendment No. 1 to Third Amended and Restated Loan
and Security Agreement, dated September 17, 2013, by and among Agent, Lenders
and Borrowers, as the same now exists or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced, and the Loan Agreement
and the other Financing Agreements are hereby amended to include, in addition
and not in limitation, such definition.

 

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(b)                                 Interpretation.  For purposes of this
Amendment No. 1, all terms used herein which are not otherwise defined herein,
including but not limited to, those terms used in the recitals hereto, shall
have the respective meanings assigned thereto in the Loan Agreement as amended
by this Amendment No. 1.

 

2.                                      Collateral
Reporting.  Section 7.1(a)(i) of the Loan Agreement is hereby deleted in its
entirety and replaced with the following:

 

“(i) as soon as possible after the end of each month (but in any event by the
close of business on the fourth (4th) Business Day after the end thereof), on a
monthly basis, provided, that, at any time that Excess Availability is less than
an amount equal to fifteen (15%) percent of the Maximum Credit, as soon as
possible after the end of each week (but in any event by the close of business
on the fourth (4th) Business Day after the end thereof), or more frequently as
Agent may request at any time that a Default or Event of Default exists or has
occurred and is continuing, a Borrowing Base Certificate setting forth the
calculation of the Borrowing Base as of the last Business Day of the immediately
preceding period, duly completed and executed by the vice president-finance,
chief financial officer, treasurer, assistant treasurer, controller or other
financial or senior officer of Haynes Parent, together with all schedules
required pursuant to the terms of the Borrowing Base Certificate duly completed
(including a schedule of all Accounts created, collections received and credit
memos issued for each day of the immediately preceding period); “

 

3.                                      Dividends and Redemptions. 
Section 9.11(d) is hereby deleted in its entirety and replaced with the
following:

 

“(d)  Borrowers may pay cash dividends in respect of its Capital Stock or
purchase its Capital Stock; provided, that, each of the following conditions is
satisfied as determined by Agent, (i) Agent shall have received from
Administrative Borrower not less than ten (10) Business Days’ written notice
prior to the date of the payment of any dividends or purchase of Capital Stock
(specifying the amount to be paid by Borrowers), (ii) such dividends and
purchases shall be paid with funds legally available therefor, (iii) such
dividends and purchase shall not violate any law or regulation or the terms of
any indenture, agreement or undertaking to which such Borrower is a party or by
which such Borrower or its or their property are bound, (iv) as of the date of
such dividend payment or purchase and after giving effect thereto, Excess
Availability shall be not less than an amount equal to fifteen (15%) percent of
the Maximum Credit, (v) with respect to any such purchase or any such dividend
payment (other than quarterly dividends paid by Haynes Parent in respect of its
fiscal quarters ending on each of December 31, March 31, June 30 and
September 30 of each year), the Fixed Charge Coverage Ratio of Borrowers and
their Subsidiaries (on a consolidated basis) as of the end of the fiscal month
most recently ended prior to such payment or purchase for which financial
statements of Borrowers and their

 

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Subsidiaries have been received by Agent shall be not less than 1.0 to 1.0 for
the period of the immediately preceding twelve (12) consecutive fiscal months
ending on the last day of such fiscal month, (vi) only with respect to the
payment of any quarterly dividends paid by Haynes Parent in respect of its
fiscal quarters ending on each of December 31, March 31, June 30 and
September 30 of each year, the aggregate amount of all such dividends paid in
cash in any fiscal year shall not exceed $20,000,000, and (vi) as of the date of
any such payment or purchase and after giving effect thereto, no Default or
Event of Default shall exist or have occurred and be continuing.

 

4.                                      Share Repurchases.  Effective as of and
after December 1, 2012, notwithstanding anything to the contrary set forth in
the Loan Agreement or in any of the other Financing Agreements, in connection
with the existing restricted stock plan of Haynes Parent in favor of certain of
its employees or non-employee directors, Agent and Lenders hereby consent to
Haynes Parent, upon the vesting of such shares of restricted stock, repurchasing
from the applicable employee or non-employee director a number of shares (which
repurchased shares shall be held by Haynes Parent as treasury stock) having a
value equal to the amount of the withholding tax (or, in the case of
non-employee directors, income tax) associated with the vesting of such stock
(which amount of tax or withholding tax shall be based on the closing price of
Haynes Parent stock on the day prior to the vesting of such shares of restricted
stock).

 

5.                                      Representations and Warranties.
 Borrowers, jointly and severally, represent and warrant with and to Agent and
Lenders as follows, which representations and warranties shall survive the
execution and delivery hereof, the truth and accuracy of, or compliance with
each, together with the representations, warranties and covenants in the other
Financing Agreements, being a continuing condition of the making of Loans and
providing Letters of Credit to Borrowers:

 

(a)                                 no Default or Event of Default exists or has
occurred and is continuing as of the date of this Amendment No. 1;

 

(b)                                 this Amendment No. 1 and each other
agreement to be executed and delivered by Borrowers in connection herewith
(together with this Amendment No. 1, the “Amendment Documents”) has been duly
authorized, executed and delivered by all necessary action on the part of each
Borrower which is a party hereto and, if necessary, their respective equity
holders and is in full force and effect as of the date hereof, as the case may
be, and the agreements and obligations of each of the Borrowers, as the case may
be, contained herein and therein constitute legal, valid and binding obligations
of each of the Borrowers, enforceable against them in accordance with their
terms, except as enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors’ rights;

 

(c)                                  the execution, delivery and performance of
this Amendment No. 1 and the other Amendment Documents (i) are all within each
Borrower’s corporate powers and (ii) are not in contravention of law or the
terms of any Borrower’s certificate of incorporation, by laws, or

 

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other organizational documentation, or any indenture, agreement or undertaking
to which any Borrower is a party or by which any Borrower or its property are
bound; and

 

(d)                                 all of the representations and warranties
set forth in the Loan Agreement and the other Financing Agreements, each as
amended hereby, are true and correct in all material respects on and as of the
date hereof, as if made on the date hereof, except to the extent any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct as of such date.

 

6.                                      Conditions Precedent. The amendments
contained herein shall only be effective upon the satisfaction of each of the
following conditions precedent in a manner satisfactory to Agent:

 

(a)                                 Agent shall have received counterparts of
this Amendment No. 1, duly authorized, executed and delivered by Borrowers;

 

(b)                                 Agent shall have received the consent or
authorization from such Lenders as are required for the amendments provided for
herein to execute this Amendment No. 1 on behalf of the Lenders;

 

(c)                                  Agent shall have received a true and
correct copy of each consent, waiver or approval (if any) to or of this
Amendment No. 1, which Borrowers are required to obtain from any other Person,
and such consent, approval or waiver (if any) shall be in form and substance
reasonably satisfactory to Agent; and

 

(d)                                 No Default or Event of Default shall exist
or have occurred and be continuing.

 

7.                                      Effect of this Amendment.  Except as
expressly set forth herein, no other amendments, changes, consents or
modifications to the Financing Agreements are intended or implied, and in all
other respects the Financing Agreements are hereby specifically ratified,
restated and confirmed by all parties hereto as of the effective date hereof and
Borrowers shall not be entitled to any other or further amendment or consent by
virtue of the provisions of this Amendment No. 1 or with respect to the subject
matter of this Amendment No. 1.  To the extent of conflict between the terms of
this Amendment No. 1 and the other Financing Agreements, the terms of this
Amendment No. 1 shall control.  The Loan Agreement and this Amendment No. 1
shall be read and construed as one agreement.

 

8.                                      Governing Law.  The validity,
interpretation and enforcement of this Amendment No. 1 and any dispute arising
out of the relationship between the parties hereto whether in contract, tort,
equity or otherwise, shall be governed by the internal laws of the State of
Illinois but excluding any principles of conflicts of law or other rule of law
that would cause the application of the law of any jurisdiction other than the
laws of the State of Illinois.

 

9.                                      Binding Effect.  This Amendment No. 1
shall be binding upon and inure to the benefit of each of the parties hereto and
their respective successors and assigns.

 

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10.                               Further Assurances.  Borrowers shall execute
and deliver such additional documents and take such additional action as may be
reasonably requested by Agent to effectuate the provisions and purposes of this
Amendment No. 1.

 

11.                               Entire Agreement.  This Amendment No. 1
represents the entire agreement and understanding concerning the subject matter
hereof among the parties hereto, and supersedes all other prior agreements,
understandings, negotiations and discussions, representations, warranties,
commitments, proposals, offers and contracts concerning the subject matter
hereof, whether oral or written.

 

12.                               Headings.  The headings listed herein are for
convenience only and do not constitute matters to be construed in interpreting
this Amendment No. 1.

 

13.                               Counterparts.  This Amendment No. 1 may be
executed in any number of counterparts, each of which shall be an original, but
all of which taken together shall constitute one and the same agreement. 
Delivery of an executed counterpart of this Amendment No. 1 by telefacsimile or
other electronic method of transmission shall have the same force and effect as
delivery of an original executed counterpart of this Amendment No. 1.  Any party
delivering an executed counterpart of this Amendment No. 1 by telefacsimile or
other electronic method of transmission shall also deliver an original executed
counterpart of this Amendment No. 1, but the failure to do so shall not affect
the validity, enforceability, and binding effect of this Amendment No. 1.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be
duly executed and delivered by their authorized officers as of the day and year
first above written.

 

 

WELLS FARGO CAPITAL FINANCE, LLC, as Agent and a Lender

 

 

By:

/s/ Vicky Geist

 

 

 

 

Title:

Vice President

 

 

 

 

 

JPMORGAN CHASE BANK N.A., as a Lender

 

 

 

By:

/s/ Lynne Ciaccia

 

 

 

 

Title:

Authorized Officer

 

 

 

 

 

 

HAYNES INTERNATIONAL, INC.

 

 

 

By:

/s/ Mark Comerford

 

 

 

 

Title:

President & CEO

 

 

 

 

 

HAYNES WIRE COMPANY

 

 

 

By:

/s/ Mark Comerford

 

 

 

 

Title:

President and CEO

 

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