exv10w16






EXHIBIT 10.16




SIXTEENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT




     THIS SIXTEENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as
of the 7th day of March, 2008 by and among the banks that are or may from time
to time become parties hereto (individually a “Bank” and collectively, the “Banks”), LASALLE BANK
NATIONAL ASSOCIATION, a national banking association (in its individual capacity, “LaSalle”), as
agent (“Agent”) for the Banks, and SIGMATRON INTERNATIONAL, INC., a Delaware corporation (the
“Borrower”).



WITNESSETH:




     WHEREAS, Agent, the Banks and Borrower are parties to that certain Loan and Security Agreement
dated as of August 25, 1999 (the “Original Agreement”), as amended by that certain Amendment to
Loan and Security Agreement dated as of August 31, 2000, that certain Forbearance Agreement and
Second Amendment to Loan and Security Agreement dated as of February 1, 2001, that certain
Forbearance Agreement and Third Amendment to Loan and Security Agreement dated as of May 31, 2001,
that certain Forbearance Agreement and Fourth Amendment to Loan and Security Agreement dated as of
July 31, 2001, that certain Fifth Amendment to Loan and Security Agreement dated as of November 30,
2001, that certain Sixth Amendment to Loan and Security Agreement dated as of April 22, 2002, that
certain Seventh Amendment to Loan and Security Agreement dated as of October 16, 2002, that certain
Eighth Amendment to Loan and Security Agreement dated as of February 19, 2004, that certain Ninth
Amendment to Loan and Security Agreement dated as of March 11, 2005, that certain Tenth Amendment
to Loan and Security Agreement dated as of July 14, 2005, that certain Eleventh Amendment to Loan
and Security Agreement dated as of September 12, 2005, that certain Twelfth Amendment to Loan and
Security Agreement dated as of July 31, 2006, that certain Thirteenth Amendment to Loan and
Security Agreement dated as of October 20, 2006, that certain Fourteenth Amendment to Loan and
Security Agreement dated as of January 31, 2007 and that certain Fifteenth Amendment to Loan and
Security Agreement dated as of April 30, 2007 (the Original Agreement and all of the foregoing
amendments are collectively referred to as the “Agreement”); and



     WHEREAS, the Borrower and the Banks have agreed to further amend the Agreement to modify
certain provisions of the Agreement as set forth herein.



     NOW, THEREFORE, for and in consideration of the premises and mutual agreements herein
contained and for the purposes of setting forth the terms and conditions of this Amendment, the
parties, intending to be bound, hereby agree as follows:



     1. Incorporation of the Agreement. All capitalized terms which are not defined
hereunder shall have the same meanings as set forth in the Agreement, and the Agreement, to the
extent not inconsistent with this Amendment, is incorporated herein by this reference as though the
same were set forth in its entirety. To the extent any terms and provisions of the Agreement are
inconsistent with the amendments set forth in Paragraph 2 below, such terms and provisions
shall be deemed superseded hereby. Except as specifically set forth herein, the Agreement shall
remain in full force and effect and its provisions shall be binding on the parties hereto.



 









 





     2. Amendment of the Agreement. The definition of the term “EBITDA” appearing
in Paragraph 1.1 of the Agreement is hereby amended and restated to read as follows:




     “EBITDA” means, with respect to any fiscal period of Borrower,
Borrower’s (a) net income for such period, plus (b) the aggregate amounts
deducted in determining such net income in respect of (i) Interest Expense, (ii)
federal and state income taxes, (iii) depreciation, (iv) amortization and (v)
extraordinary losses minus (c) extraordinary gains, each determined on a
consolidated basis and in accordance with GAAP consistently applied.
Notwithstanding the foregoing, solely for purposes of calculating EBITDA during the
Borrower’s fiscal year ended April 30, 2008, the Borrower may add back the amount of
non-cash charges taken against earnings during such period as a result of the
impairment of goodwill; provided, however, that such add-back shall not exceed
$9,300,000 in the aggregate at any time.



     3. Representations and Warranties. The representations and warranties set forth in
the Agreement and all covenants set forth in the Agreement shall be deemed remade and affirmed as
of the date hereof by Borrower, except any and all references to the Agreement in such
representations, warranties and covenants shall be deemed to include this Amendment. Borrower
hereby expressly reaffirms, reinstates and assumes (on the same basis as set forth in the
Agreement) all of the obligations and liabilities to the Agent as set forth in the Agreement and
this Amendment, and agrees to be bound by and abide by and operate and perform under and pursuant
to and comply fully with all of the terms, conditions, provisions, agreements, representations,
undertakings, warranties, guarantees, indemnities, grants of security interest and covenants
contained in the Agreement. Borrower also acknowledges and reaffirms that the Agreement, as
amended by this Amendment, is in full force and effect and that no defenses exist as of the date of
this Amendment to Borrower’s full compliance with the Agreement, as amended by this Amendment.
Borrower hereby acknowledges that the security interests granted in the Agreement constitute a
valid continuing first Lien in and to the Collateral. Except as set forth herein, no Event of
Default has occurred and is continuing and no event has occurred and is continuing which, with the
lapse of time, the giving of notice, or both, would constitute such an Event of Default under the
Agreement.



     4. Delivery of Documents/Information. Prior to entering into this Amendment, Agent
shall have received from the Borrower the following fully executed documents, in form and substance
satisfactory to Agent and each Bank, and all of the transactions contemplated by each such document
shall have been consummated or each condition contemplated by each such document shall have been
satisfied:



          (a) this Amendment; and



          (b) such other document and certificates as Agent may request.



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     5. Reference to the Effect on the Agreement.



          (a) References. Upon the date of this Amendment and on and after the date hereof,
each reference in the Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of
like import shall mean and be a reference to the Agreement, as amended hereby.



          (b) Ratification. As specifically modified above, the Agreement and all other
documents, instruments and agreements executed and/or delivered in connection therewith shall
remain in full force and effect, and are hereby ratified and confirmed.



     6. Representations and Warranties of the Borrower. Borrower hereby represents and
warrants to Agent and the Banks as of the date hereof as follows:



          (a) The execution and delivery of this Amendment and the performance by Borrower of its
obligations hereunder are within Borrower’s powers and authority, have been duly authorized by all
necessary corporate action and do not and will not contravene or conflict with the Certificate of
Incorporation or By-laws of Borrower.



          (b) The Agreement (as amended by this Amendment) and the Other Agreements constitute legal,
valid and binding obligations enforceable in accordance with their terms by Agent and the Banks
against Borrower, and Borrower expressly reaffirms each of its obligations under the Agreement (as
amended by this Amendment) and each of the Other Agreements, including, without limitation,
Borrower’s Liabilities. Borrower further expressly acknowledges and agrees that Agent has a valid,
duly perfected, first priority and fully enforceable security interest in and lien against each
item of Collateral except as otherwise set forth in the Agreement. Borrower agrees that it shall
not dispute the validity or enforceability of the Agreement (as it was stated before and after this
Amendment) or any of the Other Agreements or any of its respective obligations thereunder, or the
validity, priority, enforceability or extent of Agent’s security interest in or lien against any
item of Collateral, in any judicial, administrative or other proceeding;



          (c) No consent, order, qualification, validation, license, approval or authorization of, or
filing, recording, registration or declaration with, or other action in respect of, any
governmental body, authority, bureau or agency or other Person is required in connection with the
execution, delivery or performance of, or the legality, validity, binding effect or enforceability
of, this Amendment; and



          (d) The execution, delivery and performance of this Amendment by Borrower does not and will
not violate any law, governmental regulation, judgment, order or decree applicable to Borrower and
does not and will not violate the provisions of, or constitute a default or any event of default
under, or result in the creation of any security interest or lien upon any property of Borrower
pursuant to, any indenture, mortgage, instrument, contract, agreement or other undertaking to which
Borrower is a party or is subject or by which Borrower or any of its real or personal property may
be bound.



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     7. Releases; Indemnities.



          (a) In further consideration of the Banks’ execution of this Amendment, Borrower, and on
behalf of its successors, assigns, subsidiaries and Affiliates, hereby forever releases Agent and
each Bank and their respective successors, assigns, parents, subsidiaries, Affiliates, officers,
employees directors, agents and attorneys (collectively, the “Releasees”) from any and all debts,
claims, demands, liabilities, responsibilities, disputes, causes, damages, actions and causes of
action (whether at law or in equity) and obligations of every nature whatsoever, whether liquidated
or unliquidated, known or unknown, matured or unmatured, fixed or contingent (collectively,
“Claims”), that Borrower may have against the Releasees which arise from or relate to any actions
which the Releasees may have taken or omitted to take
prior to the date this Amendment was executed, including without limitation with respect to
Borrower’s Liabilities, any Collateral, the Agreement, any Other Agreement and any third parties
liable in whole or in part for Borrower’s Liabilities. This provision shall survive and continue
in full force and effect whether or not Borrower shall satisfy all other provisions of this
Amendment, the Other Agreements or the Agreement, including payment in full of Borrower’s
Liabilities.



          (b) Borrower hereby agrees that its obligation to indemnify and hold the Releasees harmless as
set forth in Paragraph 7(a) of this Amendment shall include an obligation to indemnify and
hold the Releasees harmless with respect to any and all liabilities, obligations, losses,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever incurred by the Releasees, or any of them, whether direct, indirect or consequential, as
a result of or arising from or relating to any proceeding by, or on behalf of, any Person,
including, without limitation, officers, directors, agents, trustees, creditors, partners or
shareholders of Borrower, whether threatened or initiated, asserting any claim for legal or
equitable remedy under any statute, regulation or common law principle arising from or in
connection with the negotiation, preparation, execution, delivery, performance, administration and
enforcement of this Amendment or any other document executed in connection herewith. The foregoing
indemnity shall survive the payment in full of the Borrower’s Liabilities and the termination of
this Amendment, the Agreement and the Other Agreements.



     8. Fees and Expenses. Borrower agrees to pay on demand all costs, fees and expenses
of or incurred by the Agent in connection with the evaluation, negotiation, preparation, execution
and delivery of this Amendment and the other instruments and documents executed and delivered in
connection with the transactions described herein (including the filing or recording thereof),
including, but not limited to, the reasonable fees and expenses of counsel for the Agent, search
fees and taxes payable in connection with this Amendment and any future amendments to the
Agreement.



     9. Counterparts. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, and all of which together shall constitute one and the same
instrument.



[SIGNATURE PAGE FOLLOWS]




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(Sixteenth Amendment to Loan and Security Agreement Signature Page)




     IN WITNESS WHEREOF, the parties hereto have duly executed this Sixteenth Amendment to Loan and
Security Agreement as of the date first above written.



	 	 	 	 	 
	 	SIGMATRON INTERNATIONAL, INC.

 	 
	 	By:  	/s/ Linda K. Blake
 	 
	 	 	Its:  CFO 	 
	 	 	 	 
	 
	 	LASALLE BANK NATIONAL ASSOCIATION, for itself and as Agent

 	 
	 	By:  	/s/ Patrick J. O’Toole
 	 
	 	 	Its:  First Vice President 	 
	 	 	 	 
	 
	 	NORTH SHORE COMMUNITY BANK, as a Lender

 	 
	 	By:  	/s/ Thomas E. Fredricksen
 	 
	 	 	Its:  Vice President