A.M. CASTLE & CO. 8-K


 


Exhibit 10.1


 


THIRD AMENDMENT


TO CREDIT AND GUARANTY AGREEMENT


 


This THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
(this “Third Amendment”) is dated as of May 4, 2017 and entered into by and among A.M. CASTLE & CO.,
a corporation organized under the laws of the state of Maryland (the “Company”) and TOTAL PLASTICS INC.,
a corporation organized under the laws of the state of Michigan (“TPI”; and together with the Company, each,
a “Borrower” and collectively, the “Borrowers”), A.M. CASTLE & CO. (CANADA) INC.,
a corporation existing under the laws of the province of British Columbia, Canada (“Castle Canada”), HY-ALLOY
STEELS COMPANY, a corporation organized under the laws of the state of Delaware (“HY-Alloy”), KEYSTONE
SERVICE, INC., a corporation organized under the laws of the state of Indiana (“Keystone Service”) and KEYSTONE
TUBE COMPANY, LLC, a limited liability company organized under the laws of the state of Delaware (“Keystone”;
and together with Castle Canada, HY-Alloy, Keystone Service and each other Subsidiary (as defined in the Agreement that is defined
below) of the Company party hereto from time to time as a guarantor, a “Guarantor” and collectively, the “Guarantors”),
the Lenders party to the Agreement from time to time, CANTOR FITZGERALD SECURITIES (“Cantor Fitzgerald”,
as Administrative Agent (in such capacity, the “Administrative Agent”) and Collateral Agent (in such capacity,
the “Collateral Agent”), and is made with reference to that certain Credit
and Guaranty Agreement dated as of December 8, 2016 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the “Agreement”), by and between the Borrowers, the Guarantors, the Lenders, the
Administrative Agent, and the Collateral Agent. Capitalized terms used herein without definition shall have the meanings ascribed
to them in the Agreement.


RECITALS


WHEREAS, the Borrowers, the Lenders,
the Guarantors, the Administrative Agent, and the Collateral Agent entered into the Agreement on or about December 8, 2016;


WHEREAS, the Agreement contemplates
that the next Delayed Draw Term Loan Commitment in the amount of $12,500,000.00 will be available to the Borrowers on or after
June 12, 2017;


WHEREAS, given the Borrowers’
liquidity needs, the Lenders are willing to advance the availability date of such Delayed Draw Term Loan Commitment to May 10,
2017 or thereafter;


WHEREAS, the Agreement imposes
certain mandatory prepayment provisions on the Borrowers;


WHEREAS, the Lenders are willing
to waive such mandatory prepayment provisions as to the contemplated receipt of certain funds by the Borrowers; and


WHEREAS, the Borrowers, the Guarantors,
the Lenders, the Administrative Agent and the Collateral Agent desire to amend the Agreement accordingly as set forth below on
the terms and conditions set forth herein.


NOW, THEREFORE, in consideration
of the premises and the agreements, provisions and covenants herein contained, the Borrowers, the Guarantors, the Lenders, the
Administrative Agent, and the Collateral Agent hereby agree as follows:


 




    	 



    	 



    

 


Section 1.


AMENDMENTS TO THE AGREEMENT


1.1       


Amendments to Section 2.2(a):
Delayed Draw Term Loans


A.       


Section 2.2(a) (Delayed
Draw Term Loan Commitments) of the Agreement is hereby amended in its entirety to read as follows:


Delayed Draw Term Loan Commitments. Subject to
the terms and conditions hereof, each Lender severally agrees to make the Delayed Draw Term Loans to the Borrowers in an
aggregate amount up to but not exceeding such Lender’s Delayed Draw Term Loan Commitment; provided, that (i) the
Borrowers shall not be entitled to issue more than two Delayed Draw Funding Notices in total in respect of the Delayed Draw
Term Loan Commitments, (ii) $24,500,000 of the Delayed Draw Term Loan Commitment will be available to the Borrowers on or
after December 12, 2016, (iii) $12,500,000 of the Delayed Draw Term Loan Commitment will be available to the Borrowers on or
after May 10, 2017, and (iv) after giving effect to the making of any Delayed Draw Term Loans, in no event shall the Total
Utilization of the Delayed Draw Term Loan Commitments exceed the Delayed Draw Term Loan Commitments then in effect. Any
amount borrowed pursuant to this Section 2.2(a) and subsequently repaid or prepaid may not be reborrowed. The portion of each
Lender’s Delayed Draw Term Loan Commitment funded after giving making a Delayed Draw Term Loan shall terminate
immediately and without further action after giving effect to the funding by such Lender on such date. The Lenders agree
that: (i) the solvency requirement in Section 4.20 below shall not apply for purposes of the Delayed Draw Term Loan
Commitment that will be available to the Borrowers pursuant to subclause (iii) above; and (ii) execution of the Restructuring
Support Agreement dated as of April 6, 2017 by the Borrowers and the Guarantors does not constitute a Material Adverse
Effect.


1.2       


Amendments to Section 2.10:
Mandatory Prepayments


A.       


Section 2.10(f) (Extraordinary
Receipts) of the Agreement is hereby amended in its entirety to read as follows:


Extraordinary Receipts. No later
than the third Business Day following the date of receipt by the Company or any of its Subsidiaries of any Extraordinary Receipts
or tax refunds in an amount greater than $500,000 either individually or in aggregate in any financial year, the Company shall
prepay the Loans together with all amounts owing in accordance with Section 2.12(b), which amounts, including any Exit Fee, will
be payable solely from the proceeds of such Extraordinary Receipts or tax refunds in an aggregate amount equal to such Extraordinary
Receipts or tax refunds; provided, that notwithstanding the foregoing, neither the Company nor any of its Subsidiaries shall
be required to prepay the Loan from any net cash proceeds received by the Company pursuant to the release of any letter of credit
cash collateral account related to its Janesville, Wisconsin location.


Section 2.


CONDITIONS TO EFFECTIVENESS


Section 1 of this Third Amendment shall
become effective only upon (a) execution of this Third Amendment by each of the parties hereto and (b) written consent hereto by
each Lender.


Section 3.


REPRESENTATIONS AND WARRANTIES


A.       


Credit Party Representations and Warranties.
Each of the Credit Parties represents and warrants as follows:


(i)       


Authorization. The execution, delivery
and performance by each Credit Party of this Third Amendment and the incurrence of all obligations hereunder, are within such Credit
Party’s corporate powers and have been duly authorized by all necessary corporate action.


(ii)       


No Conflict. The execution, delivery
and performance by each Credit Party of this Third Amendment do not (i) violate such Credit Party’s certificate of formation
or operating agreement, or (ii) violate any law or regulation or any order, judgment or decree of any court or governmental agency
body binding on such Credit Party, or (iii) result in a breach of or a default under, or result in or require the imposition of
a Lien pursuant to any contract. 




    	 



    	 



    

 


(iii)       


Governmental Consents. No authorization
or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and performance by the Credit Parties of this Third Amendment.


(iv)       


Validity. This Third Amendment
and the Agreement as amended hereby are legal, valid, and binding obligations of each Credit Party, enforceable against each Credit
Party in accordance with each such document’s terms, except as enforcement may be limited by applicable laws relating to
or limiting creditors’ rights generally or by equitable principles relating to enforceability.


Section 4.


MISCELLANEOUS


A.       


Reference to and Effect on the
Agreement and the Other Credit Documents. 


(i)       


Except as specifically amended by this
Third Amendment, the Agreement and the other Credit Documents shall remain in full force and effect and are hereby ratified and
confirmed.


(ii)       


The execution, delivery and performance
of this Third Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as
a waiver of any right, power or remedy of the Lenders under the Agreement or any of the other Credit Documents.


B.       


Fees and Expenses. The Borrowers
acknowledge that all costs, fees and expenses as described in Section 10.2 of the Agreement incurred by any Agent and the Lenders
with respect to this Third Amendment and the documents and transactions contemplated hereby shall be for the account of the Borrowers.


C.       


Instruction to the Agents. Each of
the Lenders signatory hereto (constituting all of the Lenders) directs the Administrative Agent and the Collateral Agent to execute
and deliver this Third Amendment and authorize the Administrative Agent and the Collateral Agent to take action as agent on its
behalf and to exercise such powers and discretion under the Agreement and the other Credit Documents as are delegated to the Administrative
Agent and the Collateral Agent by the terms thereof, together with such powers and discretion as are reasonably incidental thereto. 
The Loan Parties and Lenders agree that the indemnifications provided in Sections 9.4, 9.7 and 10.3 of the Agreement apply to the
foregoing instruction and the execution and delivery of this Third Amendment.


D.       


Headings. Section headings in this
Third Amendment are included for convenience of reference only and shall not be given any substantive effect.


E.       


Applicable Law. THIS THIRD AMENDMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES
THAT WOULD REQUIRE APPLICATION OF ANOTHER LAW.


F.       


Counterparts; Effectiveness. This
Third Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.


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IN WITNESS WHEREOF, the parties
hereto have caused this Third Amendment to be duly executed and delivered by their respective officers thereunto duly authorized
as of the date first written above.


	 	BORROWERS:
	 	 
	 	A.M. CASTLE & CO.
	 	 
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Executive Vice President, Chief Financial Officer & Treasurer
	 	 
	 	TOTAL PLASTICS INC.
	 	 
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Vice President & Treasurer
	 	 
	 	GUARANTORS:
	 	 
	 	A.M. CASTLE & CO. (CANADA) INC.
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Vice President, Chief Financial Officer & Treasurer
	 	 
	 	HY-ALLOY STEELS COMPANY
	 	 
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Treasurer
	 	 
	 	KEYSTONE SERVICE, INC.
	 	 
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Treasurer
	 	 
	 	KEYSTONE TUBE COMPANY, LLC
	 	 
	 	By:	/s/ Patrick R. Anderson
	 	 	Name:  Patrick R. Anderson
	 	 	Title:  Treasurer


 




    	 



    	 



    

 


	 	HIGHBRIDGE INTERNATIONAL LLC
	 	as Lender
	 	 
	 	By: 	HIGHBRIDGE CAPITAL MANAGEMENT, LLC,
	 	 	as Trading Manager
	 	 
	 	By:	/s/ Jonathan Segal
	 	 	Name: Jonathan Segal
	 	 	Title: Managing Director
	 	 
	 	HIGHBRIDGE TACTICAL CREDIT & CONVERTIBLES MASTER FUND, L.P.,
	 	as Lender
	 	 
	 	By: 	HIGHBRIDGE CAPITAL MANAGEMENT, LLC,
	 	 	as Trading Manager
	 	 
	 	By:	/s/ Jonathan Segal
	 	 	Name: Jonathan Segal
	 	 	Title: Managing Director


 




    	 



    	 



    

 


	 	WHITEBOX ASYMMETRIC PARTNERS, L.P.,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Mark Strefling
	 	 	Name: Mark Strefling
	 	 	Title: Chief Operating Officer & General Counsel
	 	 
	 	 
	 	WHITEBOX CREDIT PARTNERS, L.P.,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Mark Strefling
	 	 	Name: Mark Strefling
	 	 	Title: Chief Operating Officer & General Counsel
	 	 
	 	 
	 	WHITEBOX MULTI-STRATEGY PARTNERS, L.P.,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Mark Strefling
	 	 	Name: Mark Strefling
	 	 	Title: Chief Operating Officer & General Counsel
	 	 
	 	 
	 	WHITEBOX INSTITUTIONAL PARTNERS, L.P.,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Mark Strefling
	 	 	Name: Mark Strefling
	 	 	Title: Chief Operating Officer & General Counsel


 




    	 



    	 



    

 


	 	CORRE OPPORTUNITIES QUALIFIED MASTER FUND, LP,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Eric Soderlund
	 	 	Name: Eric Soderlund
	 	 	Title: Authorized Signatory
	 	 
	 	 
	 	CORRE OPPORTUNITIES FUND, LP,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Eric Soderlund
	 	 	Name: Eric Soderlund
	 	 	Title: Authorized Signatory
	 	 
	 	 
	 	CORRE OPPORTUNITIES II MASTER FUND, LP,
	 	as Lender
	 	 
	 	 
	 	By:	/s/ Eric Soderlund
	 	 	Name: Eric Soderlund
	 	 	Title: Authorized Signatory


 




    	 



    	 



    

 


	 	WFF CAYMAN II LTD.,
	 	as Lender
	 	 
	 	By: 	WOLVERINE ASSET MANAGEMENT, LLC, its investment manager
	 	 
	 	 
	 	By:	/s/ Kenneth L. Nadel
	 	 	Name: Kenneth L. Nadel
	 	 	Title: Chief Operating Officer









     


     


    







	 	SGF, LLC




	 	as Lender 
	 	 
	 	 
	 	By:	/s/ Jonathan B. Mellin
	 	 	Name: Jonathan B. Mellin
	 		Title: Member










     


     


    

 


	 	CANTOR FITZGERALD SECURITIES, 
	 	as Administrative Agent and Collateral Agent 
	 	 
	 	 
	 	By:	/s/
    Shawn P. Matthews
	 	 	Name: Shawn P. Matthews
	 	 	Title: Chief Executive Officer