Exhibit 10.1






Exhibit 10.1


THIRD AMENDMENT TO CREDIT
AGREEMENT


This Third Amendment to Credit
Agreement (this “Amendment”) is made and entered into as of the
14th day of April,
2010, by and among ZOLTEK COMPANIES, INC., a Missouri corporation having its
chief executive office and principal place of business located at 3101 McKelvey
Road, St. Louis, Missouri 63044 (“Parent”), ZOLTEK CORPORATION, a
Missouri corporation, ENGINEERING TECHNOLOGY CORPORATION, a Missouri
corporation, and ZOLTEK PROPERTIES, INC., a Missouri corporation, (individually
and collectively hereinafter “Borrowers”; all references to
“Borrowers” or “Borrower” shall mean each and all of
the Borrowers) and SOUTHWEST BANK, an M&I Bank (the “Bank”),
with an office at 13205 Manchester Road, St. Louis, Missouri 63131.


W I T N E S S E T H:


WHEREAS, Bank and Borrowers are parties
to that certain Credit Agreement dated as of May 11, 2001, as amended by
that certain First Amendment to Credit Agreement dated as of February 13,
2003, as amended by that Second Amendment to Credit Agreement dated
January 13, 2004 and as further amended by letter dated April 1, 2009
(as amended, the “Agreement”); and


WHEREAS, Bank and Borrowers desire to
amend the Agreement upon and subject to the terms and conditions hereinafter
set forth.


NOW, THEREFORE, in consideration of the
premises, the covenants, promises and agreements hereinafter set forth, and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged, the parties hereto agree as follows:


1. Amendments to the
Agreement.


All of the following
amendments are effective January 1, 2010:


(a)
Section 1. Definitions – Borrowing Base is hereby
deleted in its entirety and replaced by the following:


Borrowing
Base – At any date of determination, an amount equal to:
(i) eighty percent (80%) of the face amount of Eligible Accounts
outstanding at such date; plus (ii) the Eligible Inventory Advance
Amount; minus (iii) the aggregate undrawn face amount of all
outstanding letters of credit issued by the Bank for the account of any one or
more of the Borrowers. In no event, however shall the Borrowing Base exceed Ten
Million Dollars ($10,000,000.00).


(b)
Section 1. Definitions – Eligible Account (ii) is
hereby deleted in its entirety and replaced by the following:


(ii) it remains
unpaid more than one hundred and twenty (120) days after the original
invoice date; or


(c)
Section 1. Definitions — Eligible Inventory Advance
Rate is hereby deleted in its entirety and replaced by the following:


Eligible Inventory
Advance Rate – With respect to all Eligible Inventory, fifty percent
(50%) (measured at cost).


(d) Section 3.02 of the Agreement is hereby deleted in
its entirety and replaced by the following:


Term of
Revolving Credit Facility – Subject to the Bank’s right to
cease making Loans to the Borrowers at any time upon or after the occurrence
and during the continuation of any Default or Event of Default, the Borrowers
shall be entitled to request advances under the Revolving Credit Note for the
period from January 1, 2010 to and including January 1, 2011 (the
“Revolving Loan Maturity Date”). In no event may the Borrowers
terminate this Agreement until the Borrowers have repaid all Loans and
otherwise paid and performed their Obligations hereunder. All indemnities given
by the Borrowers to the Bank under any of the Loan Documents shall survive the
repayment of the Loans and the termination of the Agreement.


(e) Section 6.03 of the Agreement, Specific
Financial Covenants, is hereby deleted in its entirety.


2. Conditions To Execution Of
This Amendment. Any provision contained herein or in the Agreement to the
contrary notwithstanding, Bank’s execution of this Amendment is subject
to the following:


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(a) All representations and
warranties made in the Agreement and herein shall be true and correct in all
material respects as of the date hereof and, by execution of this Amendment,
each Borrower hereby certifies same to Bank;


(b) After giving effect to this
Amendment, no Borrower shall have defaulted, or taken or failed to take any
action which, unless corrected, would give rise to a default on any of its
obligations to Bank;


(c) After giving effect to this
Amendment, no action or omission exists as of the date hereof which
constitutes, or which, with the passage of time, would constitute a Default or
Event of Default, and each Borrower shall have certified the same to Bank by a
duly authorized officer;


(d) Each Borrower shall be in
compliance with all covenants of the Agreement, as amended;


(e) All documents and filings
necessary to maintain and perfect Bank’s security interest in the
collateral provided for in the Loan Documents shall be in full force and
effect, and all actions necessary to maintain and perfect the same shall have
been taken;


(f) No material adverse change in
the financial condition of the Borrowers taken as a whole shall have occurred
since September 30, 2009; and


(g) No pending or threatened
litigation or other proceeding or investigation shall exist which could
reasonably be expected to have a material adverse effect on the prospects,
operation or financial condition of the Borrowers taken as a whole.


3. Representations and
Warranties. The Borrowers hereby represent and warrant to Bank that:


(a) All representations and
warranties made by the Borrowers in the Agreement are true and correct in all
material respects as if they had been made on the date hereof.


(b) No Default or Event of Default
exists within the meaning of the Agreement.


(c) The officers of the Borrowers
executing this Amendment shall be fully authorized to do so, and all corporate
actions necessary or proper to authorize the execution of this Amendment have
been duly done, taken and performed. No consent, authorization or approval of
any other Person is necessary for the due execution and delivery by any
Borrower of this Amendment and the performance by any Borrower of the terms
hereof and thereof. This Amendment is executed and delivered in accordance with
any laws and regulations applicable hereto and thereto, and is the legal, valid
and binding obligation of each Borrower, enforceable in accordance with its
terms.


(d) The execution, delivery, and
performance, in accordance with its terms, of this Amendment will not violate
any provision of any Borrower’s organizational documents, any law, or any
applicable judgment or regulation of any court or of any public or governmental
agency, officer, or authority, and will not conflict with, result in a breach
of or default under, or result in the creation of any lien, charge or
encumbrance upon any of the property or assets of any Borrower (except for the
security interest created by the Loan Documents) under any indenture, mortgage,
contract, deed of trust, or other agreement to which any Borrower is a party or
by which any Borrower or any of its properties or assets is or may be bound.


4. Entire Agreement. This
Amendment and the Agreement embody the entire agreement between the parties
respecting the subject matter hereof and supersede all prior agreements,
proposals, communications and understandings relating to such subject matter.
The terms of the Amendment shall be considered a part of the Agreement as if
fully set forth therein.


5. Miscellaneous. This
Amendment shall be binding upon the Borrowers and their respective successors
and the Bank and its successors and assigns. The Section headings are furnished
for the convenience of the parties and are not to be considered in the
construction or interpretation of this Amendment or the Agreement. This
Amendment may be executed in any number of counterparts, each of which shall be
deemed an original, but which together shall constitute one and the same
instrument. Capitalized terms not defined herein shall have the meanings set
forth in the Agreement. This Agreement shall be a contract made under and
governed by the laws of the State of Missouri applicable to contracts made and
to be performed entirely within such State.


6. No Other Amendments. In
case of a conflict between the terms of this Amendment and the Agreement, the
terms of this Amendment control. Except as expressly set forth in this
Amendment, the terms of the Agreement remain unchanged and in


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full force and effect. The following
notice is given pursuant to Section 432.045 of the Missouri Revised
Statutes; nothing contained in such notice shall be deemed to limit or modify
the terms of the Loan Documents:


ORAL AGREEMENTS OR COMMITMENTS TO LOAN
MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING
PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT YOU
(BORROWERS) AND US (BANK) FROM MISUNDERSTANDING OR DISAPPOINTMENT,
ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING,
WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US,
EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.


[SIGNATURE PAGE FOLLOWS]


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




	 	 	 
	 	BORROWERS:
	 	 	 
	 	ZOLTEK COMPANIES, INC.
	 	By:	/s/ Zsolt Rumy
	 	 	Name: Zsolt Rumy

Title: Chairman, President and Chief Executive Office
	 	 	 
	 	ZOLTEK CORPORATION

ENGINEERING TECHNOLOGY CORPORATION

ZOLTEK PROPERTIES, INC.
	 	By: 	/s/ Zsolt Rumy
	 	 	Name: Zsolt Rumy

Title: President and Chief Executive Office
	 	 	 
	 	BANK:

SOUTHWEST BANK OF ST. LOUIS
	 	By: 	/s/ Jackie Davis
	 	 	Name: Jackie Davis

Title: Vice President





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