Exhibit 10.47

 

EIGHT AMENDMENT TO CREDIT AGREEMENT

 

This EIGHTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made as of the
/13th/ day of November, 2003 by and among CECO GROUP, INC., CECO FILTERS, INC.,
AIR PURATOR CORPORATION, NEW BUSCH CO., INC., THE KIRK & BLUM MANUFACTURING
COMPANY, KBD/TECHNIC, INC. and CECO ABATEMENT SYSTEMS, INC. (the “Borrowers”),
and PNC BANK, NATIONAL ASSOCIATION (“PNC”), individually and as agent (in such
capacity, the “Agent”) and FIFTH THIRD BANK (“Fifth Third”) individually, and
BANK ONE, NA (“Bank One”), individually (PNC, Fifth Third and Bank One, and
their respective successors and assigns, collectively, the “Banks”).

 

BACKGROUND

 

A. The Agent, the Banks and the Borrowers are parties to a Credit Agreement
dated as of December 7, 1999 (“Credit Agreement”) as amended by Amendment to
Credit Agreement, dated as of March 28, 2000, by Second Amendment to Credit
Agreement dated as of November 10, 2000, by Third Amendment to Credit Agreement
dated as of March 30, 2001, by Fourth Amendment to Credit Agreement dated as of
August 20, 2001, by Fifth Amendment to Credit Agreement dated as of March 27,
2002, by Sixth Amendment to Credit Agreement dated as of May 14, 2002 and by
Seventh Amendment to Credit Agreement dated as of November 13, 2002 (as amended,
the “Amended Credit Agreement”).

 

B. The Banks by separate Intercreditor Agreement, dated as of the date hereof,
agree to modify their positions so that from and after the date hereof, Fifth
Third Bank will be solely responsible for the Revolving Credit Commitment and
will have no interest in the Term Loans (now only Term Loan A) and PNC and Bank
One will own, on an equal basis, the Term Loan and Fifth Third Bank will become
Agent for all purposes under the Credit Agreement, except for being the
mortgagee, pledgee or secured party under existing mortgages, pledges or
security agreements, given to secure the Loans made pursuant to the Amended
Credit Agreement.

 

C. Borrowers and Guarantors are willing to consent to the modification of
positions of the Bank as discussed in B. above and further wish to amend the
Amended Credit Agreement on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing and for good and valuable
consideration, the legality and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound hereby, agree as follows:

 

1. Definitions. Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the Amended Credit Agreement.

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2. Amendments to Credit Agreement. The Credit Agreement is hereby amended as
follows:

 

(a) Beginning on the date hereof, except as noted in the following sentence,
Fifth Third is substituted for PNC as Agent under the Amended Credit Agreement.
PNC will continue to act as Agent for the Banks with respect to the mortgages,
pledges, security agreements, financing statements and any other documents
involving collateral for the Loans. The parties to this Amendment consent to the
foregoing.

 

(b) The definitions of “Termination Date” as set forth in Section 1.1 of the
Credit Agreement and as revised in the Fourth Amendment to Credit Agreement and
the Seventh Amendment to Credit Agreement shall be deleted and shall be replaced
with the following:

 

“Termination Date”. January 1, 2005.

 

(c) From and after the date hereof all rights and obligations of the Banks with
respect to the Revolving Credit Loans shall be rights and obligations of Fifth
Third only and all rights and obligations of the Banks with respect to Term Loan
A (the one remaining of the Term Loans) shall be the rights and obligations of
PNC and Bank One, equally. At or prior to the date hereof, PNC and Bank One
shall each assign its respective Revolving Credit Note to Fifth Third, without
recourse, and Fifth Third shall assign equally to PNC and Bank One its Term Loan
A Note, without recourse. At or prior to the date hereof, the Banks shall pay to
each other or otherwise make financial adjustments with respect to the
assignments of interests in the Notes to each other. By executing this Amendment
each of the parties to this Amendment acknowledges that the Notes have been
assigned as provided above pursuant to Section 9.6 of the Credit Agreement and
each of the Banks acknowledges full financial settlement among the Banks with
respect to the assignments.

 

(d) Beginning at the end of the fiscal quarter ending December 31, 2003, Section
6.1(a) Leverage Ratio of the Credit Agreement, as previously modified in
paragraph 2(m) of the Third Amendment to Credit Agreement, paragraph 2(h) of the
Fourth Amendment to Credit Agreement, paragraph 2(a) of the Fifth Amendment to
Credit Agreement, paragraph 2(a) of the Sixth Amendment to Credit Agreement and
paragraph 2(b) of the Seventh Amendment to Credit Agreement, shall be modified
as follows:

 

(a) Leverage Ratio. Permit the Leverage Ratio, as of the end of the fiscal
quarter ending on the dates specified below, for the prior four consecutive
fiscal quarters, to equal or exceed the amount set forth opposite such period:

 

Last Day of Fiscal Quarter

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   Leverage Ratio Must Not
Be Greater Than

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December 31, 2003 through Termination Date

   3.20 to 1

 

(e) Beginning with the fiscal quarter ending December 31, 2003, Section 6.1(b)
of the Credit Agreement, as previously modified in paragraph 2(n) of the Third
Amendment to Credit Agreement, paragraph 2(i) of the Fourth Amendment to Credit
Agreement, paragraph 2(b) of the

 

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Sixth Amendment to Credit Agreement and paragraph 2(c) of the Seventh Amendment
to Credit Agreement, shall be as follows:

 

(b) Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio for each
four consecutive calendar quarter period ending on each December 31, March 31,
June 30 and September 30 thereafter through the Termination Date to be less than
1 to 1;

 

(f) Beginning with the four consecutive fiscal quarter period ending March 31,
2004, Section 6.1(c) Interest Coverage Ratio of the Credit Agreement, as
previously modified in paragraph 2(o) of the Third Amendment to Credit
Agreement, paragraph 2(j) of the Fourth Amendment to Credit Agreement, paragraph
2(b) of the Fifth Amendment to Credit Agreement, paragraph 2(c) of the Sixth
Amendment to Credit Agreement and paragraph 2(d) of the Seventh Amendment to
Credit Agreement, shall be modified as follows:

 

(c) Interest Coverage Ratio. Permit the Interest Coverage Ratio, as of the end
of each four consecutive fiscal quarter period ending on the dates specified
below, to be less than the amount set forth opposite such period:

 

Last Day of Fiscal Quarter

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   Interest Coverage Ratio
Must Not Be Less Than

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March 31, 2004 through the Termination

   2.1 to 1

 

(g) The Banks hereby agree that as security for the Term Loan A Notes, PNC and
Bank One shall have as collateral a first secured position as to the mortgages
and security interests in the real property and equipment of the Borrowers in
which the Banks have mortgages and security interests pursuant to the Amended
Credit Agreement (“Security Interests”) and a second secured position as to all
other assets of the Borrowers in which the Banks have Security Interests and
that as security for the Revolving Credit Notes, Fifth Third shall have a second
secured position as to the Security Interests in real property and equipment and
a first secured position in all other Security Interests. Upon any disposition
the real property and equipment collateral, whether before or after an Event of
Default under the Amended Credit Agreement, or upon realization on any
collateral after an Event of Default under the Amended Credit Agreement, PNC and
Bank One will receive all proceeds from the sale or realization on the real
property and equipment collateral until they are paid in full on amounts due
under Term Loan A and any balance shall be available, if necessary, for Fifth
Third to pay amounts due on the Revolving Credit Loan and Fifth Third will
receive all proceeds from the sale or realization on all other collateral until
it is paid in full on amounts due under the Revolving Credit Loan, and any
balance shall be available, if necessary, for PNC and Bank One to pay amounts
due on Term Loan A. As between Bank One and PNC, all proceeds will be shared
equally. To the extent that the foregoing is inconsistent with the Amended
Credit Agreement and particularly Section 7.2(d) and (e) thereof, the Amended
Credit Agreement is so amended. The foregoing shall only relate to the Banks and
their successors and assigns and does not create any rights in any third
parties.

 

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3. Term Loan Payments.

 

(a) The outstanding principal balance of Term Loan A on the date hereof is
$6,805,880. Principal payment on Term Loan A shall continue at $523,530.00 per
quarter due on November 30, 2003, February 28, 2004, May 31, 2004, August 31,
2004, and November 30, 2004. The final principal payment of $4,188,230 shall be
due on January 1, 2005. Beginning with the November 30, 2003 payment, principal
and interest payments with respect to Term Loan A shall be divided equally
between PNC and Bank One.

 

(b) Term Loan B and Term Loan C have been paid in full and are terminated.

 

4. Interest Rates.

 

Annex I to the Credit Agreement, as modified by paragraph 2(f) of the Third
Amendment to Credit Agreement, paragraph 2(c) of the Fourth Amendment to Credit
Agreement, paragraph 4 of the Sixth Amendment to Credit Agreement and paragraph
4 of the Seventh Amendment to Credit Agreement, is hereby further modified to
provide that from and after the date of this Amendment the interest rate on all
Loans is Base Rate plus 5% per annum.

 

5. Extension Fee. Upon execution of this Amendment, Borrowers shall pay to: (i)
Fifth Third, an Extension Fee in the amount of $20,000; (ii) PNC, an Extension
Fee in the amount of $10,000; and (iii) Bank One, an Extension Fee in the amount
of $10,000. Provided that all amounts due pursuant to Term Loan A have not been
paid in full prior thereto, on June 30, 2004, Borrowers shall pay to: (i) PNC,
and additional Extension Fee in the amount of $5,000; and (ii) Bank One, an
additional Extension Fee in the Amount of $5,000. If all amounts due pursuant to
Term Loan A have been paid prior to June 30, 2004, the additional Extension Fees
payable to PNC and Bank One shall not be payable.

 

6. Appraisals and Field Audits. After January 1, 2004, Borrowers shall engage
appraisals of the equipment and real property of Borrowers by one or more
appraisers who are acceptable to the Banks. Copies of the appraisals shall be
completed and distributed to the Banks prior to March 1, 2004. After the date of
this Amendment, Fifth Third shall perform all field audits under the Amended
Credit Agreement and shall promptly provide copies of reports of the field
audits to the other Banks.

 

7. Amendment to the Loan Documents. All references to the Credit Agreement in
the Loan Documents and in any documents executed in connection therewith shall
be deemed to refer to the Credit Agreement as amended by this Amendment and all
prior amendments to the Credit Agreement.

 

8. Ratification of the Loan Documents. Notwithstanding anything to the contrary
herein contained or any claims of the parties to the contrary, the Agent, the
Banks and the Borrowers agree that the Loan Documents and each of the documents
executed in connection therewith are in full force and effect and each such
document shall remain in full force and effect, as further amended by this
Amendment, and each of the Borrowers hereby ratifies and confirms its
obligations thereunder.

 

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9. Representations and Warranties.

 

(a) Each Borrower hereby certifies that (i) the representations and warranties
of such Borrower in the Credit Agreement as previously amended and as amended
herein, are true and correct in all material respects as of the date hereof, as
if made on the date hereof, provided that, for purposes of this Amendment, only:
(x) the representations and warranties made in Section 3.1(a) and (b) and 3.21
of the Amended Credit Agreement shall relate to the most recent financial
statements of the type referred to therein which have been given by the
Borrowers to the Banks (but the foregoing shall not be a waiver of any Default
or Event of Default based on any representation or warranty made by the
Borrowers in the Credit Agreement or any amendment thereof, prior to this
Amendment, being untrue at the time made, or for any breach of any covenant
contained in the Credit Agreement, as amended prior to the date of this
Amendment); (y) the representations and warranties made in Section 3.1(c) of the
Amended Credit Agreement shall be made as of the date of this Amendment and not
as of the Closing Date; and (z) the representations and warranties made in
Section 3.2 of the Amended Credit Agreement shall refer to Material Adverse
Effect since the last audited consolidated financial statements of the Borrowers
provided to the Banks by the Borrowers, instead of since September 30, 1999 (but
the foregoing shall not be a waiver of any Default or Event of Default based on
any representation or warranty made by the Borrowers in the Credit Agreement or
any amendment thereof, prior to this Amendment, being untrue at the time made,
or for any breach of any covenant contained in the Credit Agreement, as amended
prior to the date of this Amendment); and (ii) no Event of Default and no event
which could become an Event of Default with the passage of time or the giving of
notice, or both, under the Credit Agreement or the other Loan Documents exists
on the date hereof.

 

(b) Each Borrower further represents that it has all the requisite power and
authority to enter into and to perform its obligations under this Amendment, and
that the execution, delivery and performance of this Amendment have been duly
authorized by all requisite action and will not violate or constitute a default
under any provision of any applicable law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award presently in effect or of
the Articles of Incorporation or by-laws of such Borrower, or of any indenture,
note, loan or credit agreement, license or any other agreement, lease or
instrument to which such Borrower is a party or by which such Borrower or any of
its properties are bound.

 

(c) Each Borrower also further represents that its obligation to repay the
Loans, together with all interest accrued thereon, is absolute and
unconditional, and there exists no right of set off or recoupment, counterclaim
or defense of any nature whatsoever to payment of the Loans, and each Borrower
further represents that the Agents and Banks have fully performed all of their
respective obligations under the Loan Documents through the date of this
Amendment.

 

(d) Each Borrower also further represents that there have been no changes to the
Articles of Incorporation, by-laws or other organizational documents of each
such Borrower since the most recent date true and correct copies thereof were
delivered to the Agent.

 

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10. Conditions Precedent. The effectiveness of the amendments set forth herein
are subject to the fulfillment, to the satisfaction of the Banks and their
counsel, of the following conditions precedent:

 

(a) The Borrowers shall have delivered to the Banks the following, all of which
shall be in form and substance satisfactory to the Banks and shall be duly
completed and executed:

 

(i) This Amendment and the consents of the Guarantor and the Subordinated
Creditors as attached hereto; and

 

(ii) Such additional documents, certificates and information as the Agent may
require pursuant to the terms hereof or otherwise reasonably request.

 

(b) The Banks acknowledge that they have received evidence which is satisfactory
to the Banks that $1,200,000 has been invested by owners in CECO Group, Inc.
prior to the date of this Amendment. Borrowers acknowledge that they are
required to provide company prepared, preliminary and draft financial statements
to the Banks on or before February 29, 2004 to establish that the financial
covenants for December 31, 2003 as set forth in the Amended Credit Agreement
have been satisfied. If those financial statements show that the Fixed Charge
Coverage Ratio is less than 1 to 1 as required by the Amended Credit Agreement,
on or before March 31, 2004, the Borrowers shall provide to the Banks evidence
which is satisfactory to the Banks that an additional $300,000 has been invested
by owners in CECO Group, Inc. Such investment shall not, however, cure any
default which results from failure of the Borrowers to satisfy any financial
covenants in the Amended Credit Agreement.

 

(c) After giving effect to the amendments contained herein, the representations
and warranties set forth in the Amended Credit Agreement shall be true and
correct on and as of the date hereof.

 

(d) After giving effect to the amendments contained herein, no Event of Default
hereunder, and no event which, with the passage of time or the giving of notice,
or both, would become such an Event of Default shall have occurred and be
continuing as of the date hereof.

 

(e) The Borrowers shall have paid the portion of the Extension Fee which is due
upon execution of this Amendment as provided in paragraph 5 above and the
reasonable fees and disbursements of the Banks’ counsel incurred in connection
with this Amendment.

 

11. No Waiver. Except as expressly provided herein, this Amendment does not and
shall not be deemed to constitute a waiver by the Agent or the Banks of any
Event of Default, or of any event which with the passage of time or the giving
of notice or both would constitute an Event of Default, nor does it obligate the
Agent or the Banks to agree to any further modifications to the Amended Credit
Agreement or any other Loan Document or constitute a waiver of any of the
Agent’s or the Banks’ other rights or remedies.

 

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12. Waiver and Release. The Borrowers each on behalf of themselves, their
agents, employees, officers, directors, successors and assigns, do hereby waive
and release Agent and Banks, their agents, employees, officers, directors,
affiliates, parents, successors and assigns, from any claims arising from or
related to administration of the Amended Credit Agreement and the Loan Document
and any course of dealing among the parties not in compliance with those
agreements from the inception of the Credit Agreement whether known or unknown
through the date of execution and delivery of this Amendment.

 

13. Effective Date. The parties hereto agree that this Amendment shall for all
purposes be deemed to be effective as of the date set forth in the first
paragraph of this Amendment (the “effective date”) and for all purposes the
Amended Credit Agreement shall be deemed to have been amended as of such date to
reflect the amendments to the Credit Agreement set forth in herein, even though
this Amendment is executed after such date.

 

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

 

CECO GROUP, INC.

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

CFO

CECO FILTERS, INC.

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

Treasurer

 

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AIR PURATOR CORPORATION

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

President

NEW BUSCH CO., INC.

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

Treasurer

THE KIRK & BLUM MANUFACTURING COMPANY

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

Treasurer

KBD/TECHNIC, INC.

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

Treasurer

CECO ABATEMENT SYSTEMS, INC.

By:

 

/s/ Marshall J. Morris

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Name:

 

Marshall J. Morris

Title:

 

Treasurer

 

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PNC BANK, NATIONAL ASSOCIATION, as Agent and as a Bank

By:

 

/s/ William C. Miles

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Name:

 

William C. Miles

Title:

 

Vice President

FIFTH THIRD BANK, as a Bank

By:

 

/s/ David G. Fuller

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Name:

 

David G. Fuller

Title:

 

Vice President

BANK ONE, NA, as a Bank

By:

 

/s/ Jeffrey C. Nicholson

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Name:

 

Jeffrey C. Nicholson

Title:

 

First Vice President

 

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GUARANTOR’S CONSENT

 

By Corporate Guaranty, dated December 7, 1999 (the “Guaranty”), the undersigned
(the “Guarantor”) guaranteed to the Agent and the Banks, subject to the terms
and conditions set forth therein, the prompt payment and performance of all of
the Obligations (as defined therein). The Guarantor consents to the Borrowers’
execution of the foregoing Eighth Amendment to Credit Agreement. The Guarantor
hereby acknowledges and agrees that the Guaranty remains unaltered and in full
force and effect and is hereby ratified and confirmed in all respects.

 

CECO ENVIRONMENTAL CORP.

By:

 

/s/ Phillip J. DeZwirek

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Name:

 

Phillip J. DeZwirek

Title:

 

Chairman, CEO

 

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SUBORDINATED CREDITOR’S CONSENT

 

The undersigned (the “Subordinated Creditor”) is a party to the Subordination
Agreement with the Agent and the Banks and other subordinated creditors, dated
December 7, 1999 (the “Subordination Agreement”). The Subordinated Creditor
consents to the Borrowers’ execution of the foregoing Eighth Amendment to Credit
Agreement. The Subordinated Creditor hereby acknowledges and agrees that the
Subordination Agreement remains unaltered and in full force and effect and is
hereby ratified and confirmed in all respects.

 

GREEN DIAMOND OIL CORP.

By:

 

/s/ Phillip J. DeZwirek

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Name:

 

Phillip J. DeZwirek

Title:

 

President

 

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SUBORDINATED CREDITOR’S CONSENT

 

The undersigned (the “Subordinated Creditor”) is a party to the Subordination
Agreement with the Agent and the Banks and other subordinated creditors, dated
December 7, 1999 (the “Subordination Agreement”). The Subordinated Creditor
consents to the Borrowers’ execution of the foregoing Eighth Amendment to Credit
Agreement. The Subordinated Creditor hereby acknowledges and agrees that the
Subordination Agreement remains unaltered and in full force and effect and is
hereby ratified and confirmed in all respects.

 

ICS TRUSTEE SERVICES, LTD.

By:

 

 

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Name:

   

Title

   

 

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SUBORDINATED CREDITOR’S CONSENT

 

The undersigned (the “Subordinated Creditor”) is a party to the Subordination
Agreement with the Agent and the Banks and other subordinated creditors, dated
December 7, 1999 (the “Subordination Agreement”). The Subordinated Creditor
consents to the Borrowers’ execution of the foregoing Eighth Amendment to Credit
Agreement. The Subordinated Creditor hereby acknowledges and agrees that the
Subordination Agreement remains unaltered and in full force and effect and is
hereby ratified and confirmed in all respects.

 

HARVEY SANDLER

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