a9thamendmenttoablcredit






DMFIRM #405514773 v3 NINTH AMENDMENT AND WAIVER TO ABL CREDIT AND GUARANTY  AGREEMENT  NINTH AMENDMENT AND WAIVER TO ABL CREDIT AND GUARANTY  AGREEMENT (this “Amendment”) dated as of November 11, 2022, among QUALTEK  BUYER, LLC (f/k/a BCP QUALTEK BUYER, LLC), a Delaware limited liability company  (“Holdings”), QUALTEK LLC, a Delaware limited liability company (the “Borrower”),  CERTAIN SUBSIDIARIES OF THE BORROWER party hereto, as Guarantors, the  LENDERS party hereto and PNC BANK, NATIONAL ASSOCIATION (“PNC Bank”), as  Administrative Agent and Collateral Agent.  RECITALS  A. Holdings, the Borrower, the other Guarantors party thereto, the Lenders party thereto, the Administrative Agent and the Collateral Agent are parties to the ABL Credit and  Guaranty Agreement, dated as of July 18, 2018, as amended by the First Amendment to ABL  Credit and Guaranty Agreement dated as of October 12, 2018, as amended by the Second   Amendment to ABL Credit and Guaranty Agreement, dated as of October 4, 2019, as amended by  the Third Amendment to ABL Credit and Guaranty Agreement, dated as of September 8, 2020, as  amended by the Fourth Amendment to ABL Credit and Guaranty Agreement, dated as of October  27, 2021, as amended by the Fifth Amendment to ABL Credit and Guaranty Agreement, dated as  of January 28, 2022 and as amended by the Sixth Amendment to ABL Credit and Guaranty  Agreement, dated as of February 14, 2022, as amended by the Seventh Amendment to ABL Credit  and Guaranty Agreement, dated as of May 13, 2022, and as amended by the Eighth Amendment  to ABL Credit and Guaranty Agreement, dated as of September 19, 2022  (as in effect immediately  prior to the date hereof, the “Existing Credit Agreement” and, as amended hereby and as  otherwise further amended, supplemented or otherwise modified from time to time hereafter, the  “Credit Agreement”).  B. Pursuant to Section 10.5(b) of the Existing Credit Agreement, the Administrative Agent and the Borrower may waive any provision of the Existing Credit Agreement and amend  the Existing Credit Agreement with the consent of the Requisite Lenders, including the waiver   amendments contemplated herein.  C. The Borrower, the Administrative Agent and the Lenders party hereto (constituting the Requisite Lenders) desire to enter into this Amendment to effect the waiver and the  modifications set forth herein, subject to the conditions set forth in Section 5 hereof.  Accordingly, the parties hereto agree as follows:   SECTION 1. Defined Terms; Interpretation.  All capitalized terms which are not defined  herein shall have the same meanings as set forth in the Credit Agreement. Except as specifically  set forth herein, the Credit Agreement shall remain in full force and effect and its provisions shall  be binding on the parties hereto and thereto. The rules of construction specified in Section 1.3 of  the Credit Agreement also apply to this Amendment, mutatis mutandis.  SECTION 2. Prospective Waiver. The Borrower has advised the Administrative Agent that it  may not satisfy the minimum Fixed Charge Coverage Ratio required under Section 6.7 of the  





 






  DMFIRM #405514773 v3 2  Credit Agreement for the period ending September 30, 2022. Upon satisfaction of each of the  conditions precedent set forth in Section 5 of this Amendment, the Lenders and the Administrative  Agent shall prospectively waive any Default or Event of Default arising from any such non- compliance by the Borrower with the minimum Fixed Charge Coverage Ratio required under  Section 6.7 of the Credit Agreement for the period ending September 30, 2022 (the “Potential  Default”). The foregoing prospective waiver is given solely with respect to the Potential Default  on a one time basis and shall not be deemed to operate as, or obligate the Lenders or the  Administrative Agent to grant any, future waiver or modification of Section 6.7 of the Credit  Agreement or of any other term, condition, breach, Default, or Event of Default under the Credit  Agreement or the other Credit Documents. The granting of such waiver shall not constitute, or be  deemed to constitute, a course of conduct on the part of the Lenders and the Administrative Agent.  SECTION 3. Amendments to Existing Credit Agreement.   (a) The definitions of “Applicable Margin” is hereby amended by deleting such  definition in its entirety and replacing it with the following:    “Applicable Margin” means, on any day, with respect to any  Base Rate Loan or BSBY Rate Loan, the applicable rate per  annum set forth below under the caption “Applicable Margin for  Base Rate Loans” or “Applicable Margin for BSBY Rate Loans”,  as the case may be, based upon the Quarterly Average Excess  Availability for the Fiscal Quarter most recently ended prior to  such day:    (a) At any time other than a Seasonal Increase Period:    Category  Quarterly  Average Excess  Availability  Applicable  Margin for Base  Rate Loans  Applicable Margin  for BSBY Rate  Loans  Category 1 ≥ 66.7% 1.75% 2.75%  Category 2 ≥ 33.3% but  < 66.7%  2.00% 3.00%  Category 3 < 33.3% 2.25% 3.25%    (b) During a Seasonal Increase Period:       Category  Quarterly  Average Excess  Availability  Applicable  Margin for Base  Rate Loans  Applicable Margin  for BSBY Rate  Loans  Category 1 ≥ 66.7% 2.00% 3.00%  





 






  DMFIRM #405514773 v3 3  Category 2 ≥ 33.3% but  < 66.7%  2.25% 3.25%  Category 3 < 33.3% 2.50% 3.50%    The Applicable Margin (a) shall be the applicable rate per annum  set forth in Category 3 above through and including the last day  of the first full Fiscal Quarter commencing after the Third  Amendment Effective  Date and (b) thereafter, shall be  determined at the commencement of each subsequent Fiscal  Quarter, with any changes to the Applicable Margin resulting  from a change in Quarterly Average Excess Availability  becoming effective on the first day of each such Fiscal Quarter;  provided that the Applicable Margin shall be deemed to be the  applicable rate per annum set forth in Category 3 above if the  Borrower shall have failed to timely deliver any Borrowing Base  Certificate required to have been delivered by it hereunder until  the first Business Day after the delivery of such Borrowing Base  Certificate (and thereafter the Applicable Margin shall be  determined in accordance with the other provisions hereof). If any  Borrowing Base Certificate shall prove to have been inaccurate, at  any time that this Agreement is in effect and any Loans or  Commitments are outstanding hereunder and provided such  inaccuracy is discovered within one year after the date on which  the applicable Borrowing Base Certificate was delivered, and such  inaccuracy shall have resulted in the payment of interest or letter of  credit fees hereunder at rates lower than those that were in fact  applicable for any period had there been no such inaccuracy, then  (x) the Borrower shall promptly deliver to the Administrative  Agent a corrected Borrowing Base Certificate for the applicable  period and (y) the Borrower shall promptly pay to the  Administrative Agent, for distribution to the Lenders at such time,  the accrued interest and letter of credit fees that should have  been paid but was not paid as a result of such inaccuracy;  provided that payment of interest or letter of credit fees at rates  lower than those that were in effect applicable as a result of such  inaccuracy shall not in any event be deemed retroactively to be an  Event of Default pursuant to Section 8.1(a), and such amount  payable shall be calculated without giving effect to any additional  interest payable on overdue amounts under Section 2.10 if paid  promptly on demand. Nothing in this paragraph shall limit the  rights of the Administrative Agent or any Lender under Section  2.10 or 8.  (b) The definition of “Covenant Period” is hereby amended by deleting such  definition in its entirety and replacing it with the following:    





 






  DMFIRM #405514773 v3 4  “Covenant Period” means a period (a) commencing on any date  (such date, a “Trigger Event”) on which the average Excess  Availability for the preceding 30 consecutive days is less than the  greater of (i) 12.5% of the Maximum Credit and (ii) $9,375,000  and (b) ending on the date on which Excess Availability shall have  been greater than the amount set forth in clause (a) above for 30  consecutive calendar days.  (c) The definition of “Trigger Event” is hereby amended by deleting such  definition in its entirety and replacing it with the following:    “Trigger Event” as defined in the definition of the term  “Covenant Period”.   (d) Section 5.13(a) of the Credit Agreement is hereby amended by deleting such  subsection in its entirety and replacing it with the following:  (a) The Credit Parties will permit the Administrative Agent and  any Persons designated by the Administrative Agent (including  any consultants, accountants, appraisers and attorneys designated  by the Administrative Agent) to conduct (a) field examinations of  the books and records of the Borrower and the other Credit Parties  relating to the Borrower’s computation of the Borrowing Base or  any component thereof and the related practices and reporting and  control systems and (b) appraisals of the Inventory included in the  Borrowing Base, all upon reasonable notice and at reasonable  times during normal business hours and as often as may reasonably  be requested by the Administrative Agent; provided that,  notwithstanding anything to the contrary in Section 10.2, (v) any  such field examinations shall be at the expense of the Credit  Parties, (w) only one such Inventory appraisal in any period of 12  consecutive months shall be at the expense of the Credit Parties  unless Excess Availability shall be less than the greater of (i)  $9,750,000 and (ii) 15% of the lesser of (A) the Maximum Credit  and (B) the Borrowing Base then in effect for five consecutive  Business Days and until such time as Excess Availability shall be  equal to or greater than the greater of (i) $9,750,000 and (ii) 15%  of the lesser of (A) the Maximum Credit and (B) the Borrowing  Base then in effect for 30 consecutive calendar days, one  additional appraisal may be conducted at the expense of the Credit  Parties during such 12 consecutive month period, (x) if an Event of  Default shall have occurred and be continuing, in which case any  appraisals commenced during the continuance of such Event of  Default shall be at the expense of the Credit Parties, (y) in addition  to the foregoing, the Administrative Agent may conduct one  additional Inventory appraisal in any period of 12 consecutive  months at the expense of the Lenders and (z) in the event that the  





 






  DMFIRM #405514773 v3 5  Borrower shall have consummated any Acquisition or shall have  designated any Unrestricted Subsidiary as a Restricted Subsidiary,  the Borrower may request that the Administrative Agent conduct a  field examination and an appraisal with respect to the Accounts  and Inventory acquired by the Credit Parties as a result thereof or  owned by such Restricted Subsidiary, and any such field  examinations and appraisals shall be at the expense of the Credit  Parties it being understood that until such field examinations or  appraisals under this clause (z) have been complete any Inventory  and Accounts so acquired shall not be considered Eligible  Inventory or Eligible Accounts. For purposes of this Section 5.13,  it is understood and agreed that a single field examination and a  single appraisal may be conducted at multiple relevant sites and  involve one or more Credit Parties and their assets. All field  examinations and appraisals shall be conducted by the  Administrative Agent or professionals (including appraisers)  reasonably satisfactory to the Administrative Agent and conducted  and prepared on a basis reasonably satisfactory to the  Administrative Agent. The Credit Parties acknowledge that the  Administrative Agent, after exercising its rights under this Section  5.13, may prepare and distribute to the Lenders certain Reports  pertaining to the Credit Parties’ assets for internal use by the  Administrative Agent and the Lenders.  (e) Section 6.7 of the Credit Agreement is hereby amended by deleting such section in  its entirety and replacing it with the following:  6.7.  Fixed Charge Coverage Ratio.  The Borrower will not  permit the Fixed Charge Coverage Ratio as of last day of any  Fiscal Quarter to be less than 1.00 to 1.00.  SECTION 4. Representations and Warranties. In order to induce the Administrative Agent,  the Collateral Agent and the Lenders to enter into this Amendment, each Credit Party represents  and warrants to the Administrative Agent, the Collateral Agent, each Lender and each Issuing  Bank on the Ninth Amendment Effective Date as follows:  (a) The execution, delivery and performance by each Credit Party party hereto of this  Amendment has been duly authorized by all necessary corporate or other organizational and, if  required, stockholder or other equityholder action on the part of such Credit Party.  (b) This Amendment has been duly executed and delivered by each Credit Party that is  a party hereto and is the legally valid and binding obligation of such Credit Party, enforceable  against such Credit Party in accordance with its terms, except as enforceability may be limited by  bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting  creditors’ rights generally or by equitable principles relating to enforceability.  





 






  DMFIRM #405514773 v3 6  (c) The execution, delivery and performance by each Credit Party hereto of this  Amendment does not and will not (i) violate any applicable law, including any order of any  Governmental Authority, (ii) violate the Organizational Documents of Holdings, the Borrower or  any Restricted Subsidiary, (iii) violate or result (alone or with notice or lapse of time, or both) in  a default under any Contractual Obligation of Holdings, the Borrower or any Restricted Subsidiary,  or give rise to a right thereunder to require any payment, repurchase or redemption to be made by  Holdings, the Borrower or any Restricted Subsidiary, or give rise to a right of, or result in, any  termination, cancelation or acceleration or right of renegotiation of any obligation thereunder, or  (iv) result in or require the creation or imposition of any Lien on any asset of Holdings, the  Borrower or any Restricted Subsidiary, except, in each case referred to in clauses (i) and (iii),  where such violation, default or payment, individually or in the aggregate, could not reasonably  be expected to have a Material Adverse Effect.  (d) The representations and warranties of each Credit Party set forth in the Credit  Documents are true and correct (i) in the case of the representations and warranties qualified as to  materiality in the text thereof, in all respects, and (ii) otherwise, in all material respects, in each  case on and as of the Ninth Amendment Effective Date, except in the case of any such  representation and warranty that expressly relates to a prior date, in which case such representation  and warranty are so true and correct on and as of such prior date.  SECTION 5.  Conditions Precedent to Effectiveness. This Amendment shall become effective  on the date (the “Ninth Amendment Effective Date”) that each of the following conditions  precedent shall have been satisfied (or waived in accordance with Section 10.5 of the Credit  Agreement):  (a) Credit Documents. The Administrative Agent shall have received from each party  hereto a counterpart signed on behalf of such party (or written evidence satisfactory to the  Administrative Agent (which may include a copy transmitted by facsimile or other electronic  transmission) that such party has signed a counterpart) of this Amendment.  (b) Fees and Expenses. The Borrower shall have paid to PNC Bank an amendment fee  in an amount of $130,000 (the “Amendment Fee”), which shall be fully earned, due and payable  and non-refundable on the Ninth Amendment Effective Date. For the avoidance of doubt, any  Revolving Loans made on the Ninth Amendment Effective Date may be net funded to account for  the Amendment Fee.    (c) Closing Certificate. The Administrative Agent shall have received a certificate,  dated the Ninth Amendment Effective Date and signed by an Authorized Officer of the Borrower,  confirming that (i) the representations and warranties of each Credit Party set forth in the Credit  Documents are true and correct (A) in the case of the representations and warranties qualified or  modified as to materiality in the text thereof, in all respects and (B) otherwise, in all material  respects, in each case on and as of the Ninth Amendment Effective Date, except in the case of any  such representation and warranty that expressly relates to an earlier date, in which case such  representation and warranty shall be so true and correct on and as of such earlier date and (ii) at  the time of and immediately after giving effect to this Amendment, no Default or Event of Default  has occurred and is continuing or would result therefrom.  





 






  DMFIRM #405514773 v3 7  SECTION 6. Reaffirmation by the Credit Parties. Without limiting its obligations under or the  provisions of the Credit Agreement, as amended by this Amendment, and the Collateral  Documents, each Credit Party hereby (a) affirms and confirms its guaranty obligations under  Section 7 of the Credit Agreement and its pledges, grants, indemnification obligations and other  commitments and obligations under the Credit Agreement and each other Credit Document to  which it is a party, in each case after giving effect to this Amendment, (b) agrees that each  Collateral Document to which it is a party and all guarantees, pledges, grants and other  commitments and obligations thereunder and under the Credit Agreement shall continue to be in  full force and effect following the effectiveness of this Amendment and (c) confirms that all of the  Liens and security interests created and arising under the Collateral Documents remain in full force  and effect, and are not released or reduced, as collateral security for the Obligations.  SECTION 7. Fees and Expenses. The Borrower shall pay, in accordance with Section 10.2 of  the Credit Agreement, all reasonable and documented out-of-pocket costs and expenses (including  the reasonable fees, expenses and other charges of counsel) incurred by the Administrative Agent  in connection with the preparation, negotiation, execution and delivery of this Amendment and the  other certificates and documentation executed and delivered in connection herewith.  SECTION 8. Miscellaneous.  (a) This Amendment and the other Credit Documents constitute the entire contract  among the parties relating to the subject matter hereof and supersede any and all previous  agreements and understandings, oral or written, relating to the subject matter hereof to the extent  provided in Section 10.20 of the Credit Agreement. This Amendment shall constitute a “Credit  Document” for all purposes under the Credit Documents.  (b) On and after the Ninth Amendment Effective Date, each reference in the Credit  Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import, and  each reference to the Credit Agreement in any other Credit Document, shall be deemed to be a  reference to the Credit Agreement as amended hereby.  (c) This Amendment may be executed in any number of counterparts, each of which  when so executed and delivered shall be deemed an original, but all such counterparts together  shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature  page of this Amendment by facsimile or in electronic format (i.e., “pdf' or “tif' shall be effective  as delivery of a manually executed counterpart of this Amendment.  (d) Except as expressly provided herein, the execution, delivery and effectiveness of  this Amendment shall not, directly or indirectly, operate as a waiver of any right, power or remedy  of any Agent, any Issuing Bank or any Lender under any Credit Document or a waiver of, or  agreement to forbear by any Agent, any Issuing Bank or any Lender with respect to, any Default  or Event of Default, or constitute a course of dealing or other basis for altering any obligation of  any Credit Party or any other Person or any right, privilege or remedy of any Agent, any Issuing  Bank or any Lender under any Credit Document.   





 






  DMFIRM #405514773 v3 8  (e) The provisions of this Amendment shall be binding upon and inure to the benefit  of the parties to the Credit Agreement and their respective successors and assigns permitted  thereby.  (f) THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE  PARTIES HEREUNDER (INCLUDING ANY CLAIMS SOUNDING IN CONTRACT LAW OR  TORT LAW ARISING OUT OF THE SUBJECT MATTER HEREOF AND ANY  DETERMINATIONS WITH RESPECT TO POST-JUDGMENT INTEREST) SHALL BE  GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE  WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT  OF LAWS PRINCIPLES THEREOF THAT WOULD RESULT IN THE APPLICATION OF  ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK.  (g) The provisions of the Credit Agreement contained in Section 10.15 and Section  10.16 are incorporated herein by reference to the same extent as if reproduced herein in their  entirety.    [SIGNATURE PAGE FOLLOWS]    





 






IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written. QUALT~KLLC ~~_ By: ~~am~e:-A-d-a-m--S-p-itt-le-r------------- Title: Chief Financial Officer QUALTEKBUYER~ BY:~ :an;SpTttIef Title: Chief Financial Officer QUAL TEK MIDCO, LLC QUAL TEK MANAGEMENT, LLC QUAL TEK WIRELINE LLC QUALSAT, LLC ADV ANTEK ELECTRICAL CONSTRUCTION, LLC QUALTEK WIRELESS LLC SITE SAFE, LLC QUAL TEK RECOVERY LOGISTICS LLC QUAL TEK FULFILLMENT LLC NX UTILITIES ULC QUAL TEK RENEWABLES LLC CONCURRENT GROUP LLC, By:~ ~~ ~~ _ : Adam Spittler Title: Chief Financial Officer [Signature Page to Ninth Amendment]