ARC
Group Worldwide 8-K


 


Exhibit 10.32


 


FIRST AMENDMENT TO
CREDIT AGREEMENT


 


This FIRST AMENDMENT
TO CREDIT AGREEMENT (this “Amendment”), is entered into as of June 25, 2014, by and among ARC Group Worldwide,
Inc., a Utah corporation (the “Parent”), the Lenders (as defined below) party hereto, and RBS Citizens, N.A.,
as Administrative Agent (as defined below).


 


RECITALS:


 


WHEREAS, the Parent,
the Borrowers party thereto, the lenders from time to time party thereto (the “Lenders”), and RBS Citizens,
N.A., as administrative agent (in such capacity, the “Administrative Agent”) and Collateral Agent, are parties
to the Credit Agreement, dated as of April 7, 2014 (as in effect from time to time, the “Credit Agreement”).
Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement; and


 


WHEREAS, the Parent
and the Borrowers wish to amend the Credit Agreement on the terms set forth herein; and


 


WHEREAS, the Administrative
Agent and the Lenders party hereto are willing to amend, or consent to the amendment of, the Credit Agreement, all as provided
herein.


 


NOW THEREFORE, in consideration
of the premises and the agreements herein and for other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:


 


Section 1. Interpretation.


 


1.1             
Interpretation. This Amendment shall be construed and interpreted in accordance with the rules of construction set
forth in Sections 1.02, 1.03, 1.04, 1.05 and 1.06 of the Credit Agreement.


 


Section 2. Amendments
to Credit Agreement.


 


2.1             
Amendment of Section 1.01 (Defined Terms).


 


(a)               
Addition of New Definition. Section 1.01 of the Credit Agreement is hereby amended by adding the following
definition in the proper alphabetical order:


 


““Kecy
Acquisition” means the acquisition by ARC Metal Stamping, LLC, a Delaware limited liability company and a wholly
owned subsidiary of the Parent (“AMS”), of substantially all of the assets of Kecy Corporation, a Michigan corporation
(“Kecy”), pursuant to that certain Asset Purchase Agreement, dated as of June 25, 2014, by and among Kecy, AMS,
Munson Holding, LLC, a Michigan limited liability company, and, in a limited capacity, the Parent.”


 



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    (b)              
Amendments of Existing Definition. (i) The definition of “Consolidated EBITDA” set forth
in Section 1.01 of the Credit Agreement is hereby amended by adding the following sentence at the end of the last paragraph
thereof:


 


“In
addition, in calculating Consolidated EBITDA for any Test Period that includes the fiscal quarter in which the Kecy Acquisition
is consummated, Consolidated EBITDA shall be calculated on a pro forma basis to reflect cost savings, not to exceed $1,202,000
in the aggregate, relating to payments to Raymond Cox and David Zerbey prior to the Kecy Acquisition (but without duplication of
any item set forth in clauses (b)(i) through (b)(ix) of such definition, and only to the extent the items reflected in such
cost savings had been included in the calculation of Consolidated Net Income for such Test Period).”


 


(ii)              
The definition of “Permitted Acquisition” set forth in Section 1.01 of the Credit Agreement
is hereby amended by adding the words “other than in the case of the Kecy Acquisition” at the beginning of clause (v)(b)(ii)
of such definition.


 


(c)               
Amendment of Section 7.03(k) (Investments). Section 7.03(k) of the Credit Agreement is hereby amended
by replacing the words “a Borrower” with the words “the Parent”.


 


(d)              
Amendment of Subsection 7.03(c) (Indebtedness). Clause (ii) of Section 7.03(c) of the Credit Agreement
is hereby restated in its entirety to read as follows:


 


“(ii) the
Loan Parties and any Subsidiaries of the Parent that are not Loan Parties, in an aggregate principal amount not to exceed $500,000
at any time outstanding to such Subsidiaries that are not Loan Parties; provided that all such Indebtedness of any Loan
Party to a Person that is not a Loan Party shall be subject to the Intercompany Subordination Agreement.”


 


(e)               
Schedule 6.17 (Post-Closing Actions). Schedule 6.17 of the Credit Agreement is hereby replaced with
Schedule 6.17 hereto.


 


Section 3.Consent.


 


The Required Lenders
consent to the repayment of prepayment, in full, by the Parent of the Indebtedness of the Parent under the Loan Agreement, dated
June 16, 2014 between AFT-Hungary Korlátolt Feleösségü Társaság, as lender, and the
Parent, as Borrower, in the original principal amount of $4,500,000, in accordance with the terms thereof as in effect on the date
hereof, notwithstanding any provision of the Loan Documents to the contrary, provided that no such repayment or prepayment
may be made if, before or after giving effect thereto, any Default or Event of Default shall have occurred and be continuing, including
on a Pro Forma Basis after giving effect thereto.


 



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    Section 4.Effectiveness.


 


4.1             
Conditions Precedent. The effectiveness of this Amendment is subject to the satisfaction of the following conditions
precedent:


 


(a)               
this Amendment shall have been (i) executed by the Parent, the Administrative Agent and the Required Lenders and (ii) acknowledged
by each of the other Loan Parties, and in each case, counterparts hereof as so executed or acknowledged shall have been delivered
to the Administrative Agent, sufficient in number for distribution to the Administrative Agent, each Lender and the Parent;


 


(b)              
the Administrative Agent shall have received such assurances, certificates, documents, consents or opinions as the Administrative
Agent, the Issuing Bank or any Lender reasonably may require.


 


(c)               
the Loan Parties shall have paid all reasonable legal fees and expenses of the Administrative Agent in connection with the
preparation, negotiation and execution of this Amendment and the other documents being executed or delivered in connection therewith,
and for which they have received invoices at least one Business Day prior to the date the other conditions in this section have
been satisfied; and


 


(d)              
after giving effect to this Amendment, all of the representations and warranties set forth in Section 6 below and
in the Credit Agreement will be true and correct in all material respects (without duplication of any materiality qualifier contained
therein) on and as of the date hereof as though made on and as of the date hereof, except to the extent that such representations
and warranties expressly related to an earlier date, in which case such representations and warranties shall be true and correct
in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date and no Default
or Event of Default shall exist.


 


4.2             
Amendment Effective Date. This Amendment shall be effective on the date (the “First Amendment Effective
Date”) upon which the conditions precedent set forth in Section 4.1 above are satisfied.


 


Section 5. Affirmation.


 


The Borrowers and the
Guarantors hereby consent and agree to and acknowledge and affirm the terms of this Amendment. The Borrowers and the Guarantors
hereby further agree that their respective obligations under the Credit Agreement, the Guarantee and Security Agreement and the
other Loan Documents shall remain in full force and effect and be unaffected hereby.


 



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    Section 6. Representations
and Warranties. Each Loan Party hereby represents and
warrants to the Administrative Agent and the Lenders party hereto as follows:


 


6.1             
Power and Authority. It has all requisite power and authority to execute and deliver this Amendment and perform its
obligations hereunder.


 


6.2             
Authorization. It has taken all necessary corporate or limited liability company action, as applicable, to duly authorize
the execution and delivery of this Amendment and this Amendment has been duly executed and delivered by its duly authorized officer
or officers.


 


6.3             
Non-Violation. The execution and delivery of this Amendment and the performance and observance by it of the provisions
hereof (a) do not violate or contravene its Organization Documents or any applicable Laws or (b) conflict with or result in a breach
or contravention of any provision of, or constitute a default under, any other agreement, instrument or document binding upon or
enforceable against it.


 


6.4             
Validity and Binding Effect. Upon satisfaction of the conditions set forth in Section 4.1 above, this
Amendment shall constitute a legal, valid and binding agreement of such Loan Party, enforceable against it in accordance with its
terms, except as such enforceability may be limited by Debtor Relief Laws and by general principles of equity and principles of
good faith and fair dealing.


 


6.5             
Representations and Warranties in Credit Agreement. The representations and warranties of each Loan Party contained
in the Credit Agreement as modified hereby are true and correct in all material respects (without duplication of any materiality
qualifier contained therein) on and as of the date hereof as though made on and as of the date hereof, except to the extent that
such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall
be true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier
date.


 


6.6             
No Consent. No consent, exemption, authorization or approval of, registration or filing with, or any other action
by, any Governmental Authority is required in connection with this Amendment or the execution, delivery, performance, validity
or enforceability of this Amendment, except consents, exemptions, authorizations, approvals, filings and actions which have been
obtained or made and are in full force and effect.


 


6.7             
No Event of Default. No Default or Event of Default exists before, nor will occur immediately after, giving effect
to this Amendment or as a result of observing any provision hereof.


 



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    Section 7. Miscellaneous.


 


7.1             
Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.


 


7.2             
Survival of Representations and Warranties. All representations and warranties made hereunder shall survive the execution
and delivery of this Amendment.


 


7.3             
Severability. Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.


 


7.4             
Headings. The headings, captions and arrangements used in this Amendment are for convenience only and shall not affect
the interpretation of this Amendment.


 


7.5             
Loan Documents Unaffected. Each reference to the Credit Agreement in any Loan Document shall hereafter be construed
as a reference to the Credit Agreement as modified hereby. Except as herein otherwise specifically provided, this Amendment shall
not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of any party
under, the Credit Agreement or any other Loan Document, nor alter, modify, amend or in any way affect any provision of the Credit
Agreement or any other Loan Document, including, without limitation, the guarantees, pledges and grants of security interests,
as applicable, under each of the Collateral Documents, all of which are ratified and affirmed in all respects and shall continue
in full force and effect. This Amendment is a Loan Document.


 


7.6             
Entire Agreement. This Amendment, together with the Credit Agreement and the other Loan Documents, integrates all
the terms and conditions mentioned herein or incidental hereto and supersede all oral representations and negotiations and prior
writings with respect to the subject matter hereof.


 


7.7             
Acknowledgments. Each Loan Party hereby acknowledges that:


 


(a)               
it has consulted and been advised by its own legal counsel in the negotiation, execution and delivery of this Amendment
and the other Loan Documents and it has consulted its own accounting, regulatory and tax advisors to the extent it has deemed appropriate;


 


(b)              
it is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated
by this Amendment and by the other Loan Documents;


 



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    (c)               
neither the Administrative Agent nor any Lender has any fiduciary relationship with or duty to any Loan Party arising out
of or in connection with this Amendment or any of the other Loan Documents, and the relationship between the Administrative Agent
and the Lenders, on one hand, and the Loan Parties, on the other hand, in connection herewith or therewith is solely that of debtor
and creditor;


 


(d)              
the Lenders have no obligation to the Loan Parties or any of their respective Affiliates with respect to the transactions
contemplated by this Amendment and by the other Loan Documents, except any obligations expressly set forth in this Amendment and
in the other Loan Documents;


 


(e)               
the Lenders and their Affiliates may be engaged in a broad range of transactions that involve interests that differ from
those of the Loan Parties and their respective Affiliates, and the Lenders have no obligation to disclose any of such interests
to the Loan Parties or any of their respective Affiliates; and


 


(f)               
no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated
hereby among the Lenders or among the Loan Parties and the Lenders.


 


7.8             
Counterparts. This Amendment may be executed by the parties hereto separately in one or more counterparts, each of
which when so executed shall be deemed to be an original, but all of which when taken together shall constitute one and the same
agreement. Transmission by a party to another party (or its counsel) via facsimile or electronic mail of a signed copy of this
Amendment (or a signature page of this Amendment) shall be as fully effective as delivery by such transmitting party to the other
parties hereto of a counterpart of this Amendment that had been manually signed by such transmitting party.


 


7.9             
Governing Law. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS
OF LAW PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW). TO THE FULLEST EXTENT PERMITTED BY LAW,
THE PARENT, EACH BORROWER, AND EACH GUARANTOR BY ITS ACKNOWLEDGMENT HEREOF HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM
TO ASSERT THAT THE LAW OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK GOVERNS THIS AMENDMENT OR ANY OF THE OTHER LOAN DOCUMENTS.


 



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    7.10         
Jury Trial Waiver. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AMENDMENT OR ANY OF THE OTHER LOAN DOCUMENTS (INCLUDING,
WITHOUT LIMITATION, ANY AMENDMENTS, WAIVERS OR OTHER MODIFICATIONS RELATING TO ANY OF THE FOREGOING), OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.


 


[Signature page
follows]


 



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


 


	 	 	ARC GROUP WORLDWIDE, INC.
	 	 	 
	 	 	By:	/s/ Drew Kelley
	 	 	Name:	Drew Kelley
	 	 	Title:	Chief Financial Officer



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    	 	 	RBS CITIZENS, N.A., as Administrative Agent, Collateral Agent, Sole Lead Arranger, Sole Bookrunner and as a Lender
	 	 	 
	 	 	By:	/s/ Clifford Mellor
	 	 	Name:	Clifford Mellor
	 	 	Title:	Senior Vice President



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    	 	 	CAPITAL ONE, NATIONAL ASSOCIATION, as Syndication Agent and as a Lender
	 	 	 
	 	 	By:	/s/ Andrew J. Bella
	 	 	Name:	Andrew J. Bella
	 	 	Title:	Sr. Vice President



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    	 	 	TD BANK, N.A., as a Lender
	 	 	 
	 	 	By:	/s/ Eric Sebille
	 	 	Name:	Eric Sebille
	 	 	Title:	Vice President



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        Acknowledged and agreed:

         
	 
	
        ADVANCED FORMING
        TECHNOLOGY, INC., 

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        ARC WIRELESS, INC.,
        

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        flomet llc,

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        GENERAL FLANGE &
        FORGE LLC,

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        tekna seal llc,

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        3d material technologies,
        llc,

         

        as a Borrower

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        ARC GROUP WORLDWIDE,
        INC.,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        ARC WIRELESS, llc,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        Thixoforming LLC,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        Arc mETAL sTAMPING,
        llc,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        ADVANCE TOOLING CONCEPTS,
        LLC,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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        QUADRANT METALS TECHNOLOGIES
        LLC,

         
	 
	 	 
	 	 
	 	 	 
	By:	/s/ Drew Kelley	 
	Name:	Drew Kelley	 
	Title:	Chief Financial Officer	 



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    Schedule 6.17


 



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