Exhibit 10.1

 

FOURTH AMENDMENT TO CREDIT AGREEMENT

 

THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of
December 31, 2010, is entered into by and among CONTINENTAL MATERIALS
CORPORATION, a Delaware corporation (the “Company”), the financial institutions
that are or may from time to time become parties to the Credit Agreement
referenced below (together with their respective successors and assigns, the
“Lenders” and each, a “Lender”) and THE PRIVATEBANK AND TRUST COMPANY, an
Illinois state chartered bank as Administrative Agent for each Lender (the
“Administrative Agent”).  Capitalized terms used herein and not otherwise
defined shall have the meanings given to such terms in the Credit Agreement
referenced below.

 

WHEREAS, the Lender previously made available to the Company a credit facility
pursuant to the terms and conditions of that certain Credit Agreement, dated as
of April 16, 2009, by and among the Company, the Lender and the Administrative
Agent, as amended by that certain First Amendment to Credit Agreement, dated as
of November 18, 2009, by and among the Company, the Lender and the
Administrative Agent (the “First Amendment”), as further amended by that certain
Waiver and Second Amendment to Credit Agreement, dated as of April 15, 2010, by
and among the Company, the Lender and the Administrative Agent (the “Second
Amendment”), and as further amended by that certain Third Amendment to Credit
Agreement, dated as of November 12, 2010, by and among the Company, the Lender
and the Administrative Agent (the “Third Amendment”) (as further amended,
restated or supplemented from time to time, the “Credit Agreement”);

 

WHEREAS, pursuant to the Credit Agreement, the Lender previously (i) made
available to the Company a revolving credit facility in the amount of
$20,000,000 (reduced to $13,500,000 from and after October 1, 2010 pursuant to
the Second Amendment), and (ii) funded a term loan in the original principal
amount of $10,000,000; and

 

WHEREAS, the parties to this Amendment desire to amend the Credit Agreement to,
among other things, permit the issuance of Letters of Credit with an expiration
date up to one year following the scheduled Termination Date so long as the
Company agrees to immediately Cash Collateralize each Letter of Credit that
remains outstanding from and after the Termination Date (whether the Termination
Date results from the occurrence of the scheduled maturity date, repayment in
full of the Obligations (other than Obligations in respect of outstanding
Letters of Credit), the acceleration of the Obligations or otherwise), on the
terms and conditions contained herein.

 

NOW, THEREFORE, in consideration of the premises, to induce the Lender and
Administrative Agent to enter into this Amendment, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed by the parties hereto as follows:

 

Section 1.  Incorporation of Recitals.  The foregoing recitals are hereby
incorporated into and made a part of this Amendment.

 

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Section 2.  Amendment of the Credit Agreement.  It is hereby agreed and
understood that, subject to the complete fulfillment and performance of the
conditions precedent set forth in Section 5 of this Amendment, Section 2.3.1 of
the Credit Agreement is hereby deleted in its entirety and replaced with the
following:

 

“2.3.1      L/C Applications.  The Company shall execute and deliver to the
Issuing Lender the Master Letter of Credit Agreement from time to time in
effect.  The Company shall give notice to the Administrative Agent and the
Issuing Lender of the proposed issuance of each Letter of Credit on a Business
Day which is at least three (3) Business Days (or such lesser number of days as
the Administrative Agent and the Issuing Lender shall agree in any particular
instance in their sole discretion) prior to the proposed date of issuance of
such Letter of Credit.  Each such notice shall be accompanied by an L/C
Application, duly executed by the Company and in all respects satisfactory to
the Administrative Agent and the Issuing Lender, together with such other
documentation as the Administrative Agent or the Issuing Lender may request in
support thereof, it being understood that each L/C Application shall specify,
among other things, the date on which the proposed Letter of Credit is to be
issued, the expiration date of such Letter of Credit (which shall not be later
than the scheduled Termination Date unless the expiration date of such Letter of
Credit is on or before the date that is one year following the scheduled
Termination Date) and whether such Letter of Credit is to be transferable in
whole or in part.  Any Letter of Credit outstanding from and after the
Termination Date (whether the Termination Date results from the occurrence of
the scheduled maturity date, repayment in full of the Obligations (other than
Obligations in respect of outstanding Letters of Credit), the acceleration of
the Obligations or otherwise) shall immediately be Cash Collateralized.  Any
Letter of Credit outstanding after the Termination Date which is Cash
Collateralized for the benefit of the Issuing Lender shall be the sole
responsibility of the Issuing Lender.  So long as the Issuing Lender has not
received written notice that the conditions precedent set forth in Section 12
with respect to the issuance of such Letter of Credit have not been satisfied,
the Issuing Lender shall issue such Letter of Credit on the requested issuance
date.  The Issuing Lender shall promptly advise the Administrative Agent of the
issuance of each Letter of Credit and of any amendment thereto, extension
thereof or event or circumstance changing the amount available for drawing
thereunder.  In the event of any inconsistency between the terms of the Master
Letter of Credit Agreement, any L/C Application and the terms of this Agreement,
the terms of this Agreement shall control.”

 

Section 3.  Revolving Loan Note and Term Loan Note.  It is hereby agreed and
understood that the Revolving Loan Note and the Term Loan Note remain in full
force and effect and that the Obligations evidenced thereby remain due and
payable on the terms set forth therein and in the Credit Agreement (as modified
by this Amendment).

 

Section 4.  Amendment of the Loan Documents.  It is hereby agreed and understood
by the Administrative Agent, each Lender and the Company that, subject to the
complete fulfillment and performance of the conditions precedent set forth in
Section 5 of this Amendment and

 

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effective as of the effective date of this Amendment, each reference to the
Credit Agreement, the Revolving Loan, the Term Loan, the Revolving Loan Note,
the Term Loan Note, and/or any other defined terms or any Loan Documents in any
Loan Documents shall be deemed to be a reference to any such defined terms or
such agreements as such terms or agreements are amended or modified by this
Amendment.  Any breach of any representation, warranty, covenant or agreement
contained in this Amendment shall be deemed to be an Event of Default for all
purposes of the Credit Agreement.

 

Section 5.  Conditions Precedent.  The effectiveness of this Amendment and the
obligations of the Administrative Agent and each Lender hereunder are subject to
the satisfaction, or waiver by the Administrative Agent, of the following
conditions precedent on or before the date hereof (unless otherwise provided or
agreed to by the Administrative Agent) in addition to the conditions precedent
specified in Section 12.2 of the Credit Agreement:

 

A.            The Company shall have paid and/or reimbursed all reasonable fees,
costs and expenses relating to this Amendment and owed to the Lender pursuant to
the Credit Agreement in connection with this Amendment.

 

B.            The Company shall have delivered, or caused to be delivered,
original fully completed, dated and executed originals of (i) this Amendment,
and (ii) such other certificates, instruments, agreements or documents as the
Administrative Agent may reasonably request (each of the foregoing certificates,
instruments, agreements and documents described in this Section 5(B) (other than
this Amendment) which constitute Loan Documents are hereinafter referred to
collectively as the “Other Documents”).

 

C.            The following statements shall be true and correct and the
Company, by executing and delivering this Amendment to the Lender and the
Administrative Agent, hereby certifies that the following statements are true
and correct as of the date hereof:

 

(1)           Other than as expressly contemplated by this Amendment, since the
date of the most recent financial statements furnished by the Company to the
Administrative Agent (which financial statements were true and correct in all
material respects and otherwise conformed to the requirements set forth in the
Credit Agreement for such financial statements), there shall have been no change
which has had or will have a material adverse effect on the business,
operations, properties or financial condition of the Loan Parties taken as a
whole;

 

(2)           The representations and warranties of the Company set forth in the
Credit Agreement and the other Loan Documents (as amended by this Amendment) are
true and correct in all respects on and as of the date of this Amendment with
the same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date, and no
Unmatured Event of Default or Event of Default has occurred and is continuing;
and

 

(3)           No consents, licenses or approvals are required in connection with
the execution, delivery and performance by the Company of this Amendment or

 

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the Other Documents or the validity or enforceability against the Company of
this Amendment or the Other Documents which have not been obtained and delivered
to the Lender.

 

Section 6.  Miscellaneous.

 

A.            Except as expressly amended and modified by this Amendment, the
Credit Agreement and the other Loan Documents are and shall continue to be in
full force and effect in accordance with the terms thereof.

 

B.            This Amendment may be executed by the parties hereto in
counterparts, and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.

 

C.            This Amendment shall be construed in accordance with and governed
by the internal laws, and not the laws of conflict, of the State of Illinois.

 

D.            The headings contained in this Amendment are for ease of reference
only and shall not be considered in construing this Amendment.

 

[SIGNATURE PAGES FOLLOW]

 

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

 

 

COMPANY:

 

 

 

CONTINENTAL MATERIALS CORPORATION

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Chief Financial Officer

 

 

 

 

 

ADMINISTRATIVE AGENT AND LENDER:

 

 

 

 

 

THE PRIVATEBANK AND TRUST COMPANY

 

 

 

 

By:

/s/ Steven M. Cohen

 

 

Steven M. Cohen

 

 

Managing Director & Senior Vice President

 

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ACKNOWLEDGMENT, AGREEMENT, CONSENT
AND REAFFIRMATION OF LOAN PARTIES

 

Each of the undersigned Loan Parties, for good and valuable consideration,
receipt of which is hereby acknowledged:  (a) hereby acknowledges receipt of a
copy of the foregoing Amendment, acknowledges that such Loan Party has read and
reviewed the terms thereof, and acknowledges that such Loan Party has been
afforded an adequate opportunity to have the foregoing Amendment reviewed by
such Loan Party’s counsel; (b) hereby consents to the terms and conditions of
the foregoing Amendment; and (c) hereby acknowledges and agrees that such Loan
Party’s duties, obligations and liabilities to the Administrative Agent and/or
the Lender under the Guaranty and Collateral Agreement shall be continuing and
shall remain in full force and effect against such Loan Party irrespective of
the amendments to the Credit Agreement contained in the foregoing Amendment or
any other amendments or modifications to any of the other Loan Documents.

 

In addition to the foregoing, each of the undersigned Loan Parties (i) hereby
ratifies, reaffirms and confirms its pledge, hypothecation, and grant of a
continuing lien and first priority security interest in favor of the
Administrative Agent in all of the assets of such Loan Party pledged to the
Administrative Agent under the Guaranty and Collateral Agreement (subject to the
terms and conditions set forth therein), and (ii) hereby acknowledges that such
pledge shall continue in full force and effect securing the Secured Obligations
under and as defined in the Guaranty and Collateral Agreement notwithstanding
the execution and delivery of the foregoing Amendment.

 

IN WITNESS WHEREOF, each of the undersigned Loan Parties has duly executed this
Acknowledgment, Agreement, Consent and Reaffirmation of Loan Parties to the
Fourth Amendment to Credit Agreement as of December 31, 2010.

 

 

MCKINNEY DOOR AND HARDWARE, INC.

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

 

 

TRANSIT MIX CONCRETE CO.

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

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TRANSIT MIX OF PUEBLO, INC.

 

 

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Chief Financial Officer

 

 

 

 

WILLIAMS FURNACE CO.

 

 

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

 

 

 

PHOENIX MANUFACTURING, INC.

 

 

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

 

 

 

CASTLE CONCRETE COMPANY

 

 

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

 

 

 

EDENS INDUSTRIAL PARK INC.

 

 

 

 

 

 

 

By:

/s/ Joseph J. Sum

 

 

Joseph J. Sum

 

 

Treasurer

 

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