Unassociated Document


     

    
      EXHIBIT
10.1

      


      FIFTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT

      


      


      THIS FIFTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT (the “Fifth Amendment”) is executed and entered into this
30th day of January, 2009 by and between CTI Industries Corporation, an Illinois
corporation and CTI Helium, Inc., an Illinois corporation (collectively the
“Borrower”) and RBS Citizens, N.A., successor  by merger to Charter
One Bank, N.A., a national banking association (“Bank”) and amends, as of the
effective date hereof, the Loan and Security Agreement between the parties dated
February 1, 2006, as amended by the First Amendment to Loan and Security
Agreement dated June, 2006, the Second Amendment to Loan and Security Agreement
dated December 6, 2006, the Third Amendment to Loan and Security Agreement dated
November 13, 2007, and the Fourth Amendment to Loan and Security Agreement dated
April 15, 2008 (collectively the “Loan Agreement”).  Capitalized terms
used herein without definition shall have the meanings ascribed to them in the
Loan Agreement.

      


      For and in consideration of the mutual
covenants and agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Loan Agreement is hereby amended as follows:

      


      1.           The
definition of “Applicable Margin” in Section 1.1 of the
Loan Agreement shall be amended in it entirety to read as follows:

      


      
        	
                 

                 

                 
      

              	
                     “Applicable
      Margin” shall mean the rate per annum added to the Base Rate to
      determine the Revolving Interest Rate, Term Interest Rate and Mortgage
      Interest Rate, as determined by the ratio of Senior Debt to consolidated
      EBITDA of the Borrower and its Subsidiaries for the twelve month period
      ending as of the end of the prior fiscal quarter, effective as of any
      Interest Rate Change Date, as set forth
below:

              


      

       

      
        
          	 
      	
                  Ratio
      of Senior

                	 
      	 
	 
      	
                  Debt to
      EBITDA

                	
                  Applicable
      Margin

                	 
	 
      	 
      	
                   
      

                	 
	 
      	
                  Greater
      than or equal to 4.00

                	
                  1.50%

                	 
	 
      	
                  to
      1.00

                	
                   
      

                	 
	 
      	 
      	
                   
      

                	 
	 
      	
                  Greater
      than or equal to 3.50

                	
                  1.25%

                	 
	 
      	
                  to
      1.00; less than 4.00 to 1.00

                	
                   
      

                	 
	 
      	 
      	
                   
      

                	 
	 
      	
                  Greater
      than or equal to 3.25

                	
                  1.00%

                	 
	 
      	
                  to
      1.00; less than 3.50 to 1.00

                	
                   
      

                	 
	 
      	 
      	
                   
      

                	 
	 
      	
                  Greater
      than or equal to 2.75

                	
                  0.75%

                	 
	 
      	
                  to
      1.00; less than 3.25 to 1.00

                	
                   
      

                	 
	 
      	 
      	
                   
      

                	 
	 
      	
                  Less
      than 2.75 to 1.00

                	
                  0.50%.

                	 


        

         

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      2.           The
definition of “Letter of Credit Rate” in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:

       

                “Letter of Credit
Rate” shall mean the per annum rate as determined by the ratio of the
Senior Debt to the consolidated EBITDA of the Borrower and its Subsidiaries for
the twelve month period ending as to the end of the fiscal quarter most recently
ended at the time of the issuance of a Letter of Credit, as set forth
below:

       

      
        
          	 
      	
                  Ratio
      of Senior

                	 
      	 
      
	 
      	
                  Debt to
      EBITDA

                	
                  Letter of Credit
      Rate

                	 
      
	 
      	 
      	 
      	 
      
	 
      	
                  Greater
      than or equal to 4.00

                	
                  2.50%

                	 
      
	 
      	
                  to
      1.00

                	
                   
      

                	 
      
	 
      	 
      	
                   
      

                	 
      
	 
      	
                  Greater
      than or equal to 3.50

                	
                  2.25%

                	 
      
	 
      	
                  to
      1.00; less than 4.00 to 1.00

                	
                   
      

                	 
      
	 
      	 
      	
                   
      

                	 
      
	 
      	
                  Less
      than 3.50 to 1.00

                	
                  2.00%

                	 
      


        

      

       

      3.           The
definition of “Non-Utilization Fee Rate” in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:

      


      
        
          	
                   

                	
                        
      “Non-Utilization
      Fee Rate” shall mean the per annum rate as determined by the ratio
      of the Senior Debt to the consolidated EBITDA of the Borrower and its
      Subsidiaries for the twelve month period ending as of the end of the prior
      fiscal quarter, as set forth
below:

                


        

      

       

      
        
          	 
      	
                  Ratio
      of Senior

                	 
      	 
      
	 
      	
                  Debt to
      EBITDA

                	
                  Non-Utilization Fee
      Rate

                	 
      
	 
      	 
      	
                   
      

                	 
      
	 
      	
                  Greater
      than or equal to 4.00

                	
                  0.50%

                	
                   
      

                
	 
      	
                  to
      1.00

                	
                   
      

                	
                   
      

                
	 
      	 
      	
                   
      

                	 
      
	 
      	
                  Greater
      than or equal to 3.50

                	
                  0.35%

                	 
      
	 
      	
                  to
      1.00; less than 4.00 to 1.00

                	
                   
      

                	 
      
	 
      	 
      	
                   
      

                	 
      
	 
      	
                  Less
      than 3.50 to 1.00

                	
                  0.25%

                	 
      


        

      

       

      4.           The
definition of “Revolving Loan Maturity Date” as set forth in Section 1.1 of the
Loan Agreement shall be amended in its entirety to read as follows:

      


      “Revolving Loan Maturity
Date” shall mean January 31, 2010, unless extended by the Bank pursuant
to any modification , extension or renewal note executed by the Borrower and
accepted by the Bank in its sole and absolute discretion is substitution for the
Revolving Note.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      5.           Section 8.11 of the
Loan Agreement shall be amended in its entirety to read as follows:

       

                “Borrowing Base
Certificate.  The Borrower shall, on Wednesday of every other
week deliver to the Bank a Borrowing Base Certificate dated as of the last
Business Day of the prior week, certified as true and correct by an authorized
representative of the Borrower and acceptable to the Bank in its sole and
absolute discretion; provided, however,  at any time an Event of
Default exists, the Bank may require the Borrower to deliver Borrowing Base
Certificates more frequently.”

      


      6.           Section 10.3 of the
Loan Agreement shall be amended in its entirety to read as follows:

      


           
10.3  Senior Debt
to EBITDA.  As of the end of each of its fiscal quarters set
forth below, the Borrower and its Subsidiaries shall maintain a ratio of (a)
consolidated Senior  Debt; to (b) consolidated EBITDA for the twelve
month period ending on the last day of such fiscal quarter, of not greater than
the following:

       

      
        	 
      	 
      	
                Senior
      Debt

              	 
      
	 
      	
                Computation Period
      Ending

              	
                to
      EBITDA

              	 
      
	 
      	 
      	 
      	 
      
	 
      	
                March
      31, 2009-June 30, 2009

              	
                3.25
      to 1.00

              	 
      
	 
      	 
      	 
      	 
      
	 
      	
                September
      30, 2009 and thereafter

              	
                3.00
      to 1.00

              	 
      


      

    

    
      


      7.           The
effectiveness of this Fifth Amendment is subject to the satisfaction of all of
the following conditions precedent:

      


      
        	
              	
                (a)

              	
                Bank
      shall have accepted this Fifth Amendment in the spaces provided for that
      purpose below.

              


      

      


      
        	
              	
                (b)

              	
                The
      Guaranties shall have been reaffirmed by the
  Guarantors.

              


      

      


      
        	
              	
                (c)

              	
                Except
      as set forth herein, the Borrower shall be in full compliance with the
      terms of the Loan Documents and no Event of Default or Unmatured Event of
      Default shall have occurred or be continuing after giving effect to this
      Fifth Amendment.

              


      

      


      
        	
              	
                (d)

              	
                Borrower
      shall have paid Bank a waiver/modification fee of
    $31,500.00.

              


      

      


      
        	
              	
                (e)

              	
                Borrower
      shall have delivered certified copies of Board of Director resolutions
      authorizing this Fifth Amendment.

              


      

      


      
        	
              	
                (f)

              	
                All
      other legal matters incident to the execution and delivery hereof
      contemplated hereby and to the transaction contemplated hereby (including
      the delivery of ancillary documentation requested by Bank) shall be
      satisfactory to Bank and its
counsel.

              


      

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

       

      8.           To
the extent the terms of this Fifth Amendment conflict with the terms of the Loan
Agreement, the terms hereof shall be controlling.  Except as
specifically amended hereby, the Loan Agreement shall remain unchanged and in
full force and effect.  The Loan Agreement, as amended hereby, and all
rights and powers created thereby and thereunder are in all respects ratified
and confirmed.  This Fifth Amendment may be executed in any number of
counterparts and by different parties hereto on separate counterparts and each
such counterpart shall be deemed an original, but all such counterparts together
shall constitute but one and the same Fifth Amendment.  This Fifth
Amendment shall be binding upon and inure to the benefit of the Bank and the
Borrower, and their respective successors and assigns.  This Fifth
Amendment shall be governed by and construed in accordance with the laws of the
State of Illinois.

      


      


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

       

      
        
          	
                  BORROWER:

                	 
      
	 
      	 
      
	
                  CTI
      Helium, Inc.

                	
                  CTI
      Industries Corporation

                
	 
      	 
      
	
                  By:  /s/ Stephen M.
      Merrick

                	
                  By:  /s/ Stephen M.
      Merrick

                
	 
      	 
      
	
                  Title:  Executive Vice
      President

                	
                  Title:  Executive Vice
      President

                
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                  BANK:

                
	 
      	 
      
	 
      	
                  RBS
      Citizens, N.A., successor by merger to Charter One Bank,
    N.A.

                
	 
      	 
      
	 
      	
                  By:  /s/ Timothy J.
      Moran

                
	 
      	 
      
	 
      	
                  Title:  Senior Vice
      President

                


        

      

       

      


       

      


      


      


      [Fifth
Amendment to Loan and Security Agreement]

       

      
        
           

        

        
          4