Exhibit 10.1


 


Execution Version


 


THIRD AMENDMENT TO CREDIT AGREEMENT


 


THIS
THIRD AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of November 12,
2010, is entered into by and among CONTINENTAL MATERIALS CORPORATION, a
Delaware corporation (the “Company”), the financial institutions that
are or may from time to time become parties to the Credit Agreement referenced
below (together with their respective successors and assigns, the “Lenders”
and each, a “Lender”) and THE PRIVATEBANK AND TRUST COMPANY, an Illinois
state chartered bank as Administrative Agent for each Lender (the “Administrative
Agent”).  Capitalized terms used
herein and not otherwise defined shall have the meanings given to such terms in
the Credit Agreement referenced below.


 


WHEREAS,
the Lender previously made available to the Company a credit facility pursuant
to the terms and conditions of that certain Credit Agreement, dated as of April 16,
2009, by and among the Company, the Lender and the Administrative Agent, as
amended by that certain First Amendment to Credit Agreement, dated as of November 18,
2009, by and among the Company, the Lender and the Administrative Agent (the “First
Amendment”), and as further amended by that certain Waiver and Second
Amendment to Credit Agreement, dated as of April 15, 2010, by and among
the Company, the Lender and the Administrative Agent (the “Second Amendment”)
(as further amended, restated or supplemented from time to time, the “Credit
Agreement”);


 


WHEREAS,
pursuant to the Credit Agreement, the Lender previously (i) made available
to the Company a revolving credit facility in the amount of $20,000,000
(reduced to $13,500,000 from and after October 1, 2010 pursuant to the
Second Amendment), and (ii) funded a term loan in the original principal amount
of $10,000,000; and


 


WHEREAS,
the parties to this Amendment desire to amend the Credit Agreement to, among
other things, (i) extend the maturity date of the Revolving Loan and Term
Loan to December 31, 2011, and (ii) modify the Minimum Adjusted EBITDA
covenant set forth in Section 11.13.1 of the Credit Agreement, in
each case, all on the terms and conditions set forth herein.


 


NOW,
THEREFORE, in consideration of the premises, to induce the Lender and
Administrative Agent to enter into this Amendment, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed by the parties hereto as follows:


 


Section 1.  Incorporation of Recitals.  The foregoing recitals are hereby
incorporated into and made a part of this Amendment.


 


Section 2.  Amendment of the Credit Agreement.  It is hereby agreed and understood that,
subject to the complete fulfillment and performance of the conditions precedent
set forth in Section 5 of this Amendment, the Credit Agreement is
hereby amended and modified as follows:


 


A.                                   Section 1.1.  Section 1.1
of the Credit Agreement is hereby amended as follows:


 


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(1)                                  The definition of “Term Loan Maturity Date” is hereby deleted in
its entirety and replaced with the following:


 


“Term
Loan Maturity Date means the earlier of (a) December 31, 2011 or (b) the
Termination Date.”


 


(2)                                  The definition of “Termination Date” is hereby deleted in its
entirety and replaced with the following:


 


“Termination
Date means the earlier to occur of (a) December 31, 2011 or (b) such
other date on which the Commitments terminate pursuant to Section 6
or Section 13.”


 


B.                                     Section 11.13.1.  Section 11.13.1
(Minimum Adjusted EBITDA) of the Credit Agreement is hereby deleted in its
entirety and replaced with the following:


 


“11.13.1                              Minimum Adjusted EBITDA.  Not permit Adjusted EBITDA for any
Computation Period to be less than the applicable amount set forth below for
such Computation Period:


 


	
  Computation

  Period Ending

  	
   

  	
  Adjusted EBITDA

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 1, 2011

  	
   

  	
  $

  	
  250,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  April 2, 2011

  	
   

  	
  $

  	
  (600,000

  	
  )

  
	
   

  	
   

  	
   

  	
   

  
	
  July 2, 2011

  	
   

  	
  $

  	
  2,100,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 1, 2011

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  December 31, 2011

  	
   

  	
  $

  	
  500,000

  	
  ”

  



 


Section 3.  Revolving Loan Note and Term Loan Note.  It is hereby agreed and understood that the
Revolving Loan Note and the Term Loan Note remain in full force and effect and
that the Obligations evidenced thereby remain due and payable on the terms set
forth therein and in the Credit Agreement (as modified by this Amendment).


 


Section 4.  Amendment of the Loan Documents.  It is hereby agreed and understood by the
Administrative Agent, each Lender and the Company that, subject to the complete
fulfillment and performance of the conditions precedent set forth in Section 5
of this Amendment and effective as of the effective date of this Amendment,
each reference to the Credit Agreement, the Revolving Loan, the Term Loan, the
Revolving Loan Note, the Term Loan Note, and/or any other defined terms or any
Loan Documents in any Loan Documents shall be deemed to be a reference to any
such defined terms or such agreements as such terms or agreements are amended
or modified by this Amendment.  Any
breach of any representation, warranty, covenant 


 


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or agreement contained in this Amendment shall be
deemed to be an Event of Default for all purposes of the Credit Agreement.


 


Section 5.  Conditions Precedent.  The effectiveness of this Amendment and the
obligations of the Administrative Agent and each Lender hereunder are subject
to the satisfaction, or waiver by the Administrative Agent, of the following
conditions precedent on or before the date hereof (unless otherwise provided or
agreed to by the Administrative Agent) in addition to the conditions precedent
specified in Section 12.2 of the Credit Agreement:


 


A.                                   The Company shall have paid and/or reimbursed
all reasonable fees, costs and expenses relating to this Amendment and owed to
the Lender pursuant to the Credit Agreement in connection with this Amendment.


 


B.                                     The Company shall have delivered, or caused to
be delivered, original fully completed, dated and executed originals of (i) this
Amendment, and (ii) such other certificates, instruments, agreements or
documents as the Administrative Agent may reasonably request (each of the
foregoing certificates, instruments, agreements and documents described in this
Section 5(B) (other than this Amendment) which constitute Loan
Documents are hereinafter referred to collectively as the “Other Documents”).


 


C.                                     The following statements shall be true and
correct and the Company, by executing and delivering this Amendment to the
Lender and the Administrative Agent, hereby certifies that the following
statements are true and correct as of the date hereof:


 


(1)                                  Other than as expressly contemplated by this Amendment, since the date of
the most recent financial statements furnished by the Company to the
Administrative Agent (which financial statements were true and correct in all
material respects and otherwise conformed to the requirements set forth in the
Credit Agreement for such financial statements), there shall have been no
change which has had or will have a material adverse effect on the business,
operations, properties or financial condition of the Loan Parties taken as a
whole;


 


(2)                                  The representations and warranties of the Company set forth in the Credit
Agreement and the other Loan Documents (as amended by this Amendment) are true
and correct in all respects on and as of the date of this Amendment with the
same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date, and no
Unmatured Event of Default or Event of Default has occurred and is continuing;
and


 


(3)                                  No consents, licenses or approvals are required in connection with the
execution, delivery and performance by the Company of this Amendment or the
Other Documents or the validity or enforceability against the Company of this
Amendment or the Other Documents which have not been obtained and delivered to
the Lender.


 


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Section 6.  Miscellaneous.


 


A.                                   Except as expressly amended and modified by
this Amendment, the Credit Agreement and the other Loan Documents are and shall
continue to be in full force and effect in accordance with the terms thereof.


 


B.                                     This Amendment may be executed by the parties
hereto in counterparts, and all of such counterparts taken together shall be
deemed to constitute one and the same instrument.


 


C.                                     This Amendment shall be construed in
accordance with and governed by the internal laws, and not the laws of
conflict, of the State of Illinois.


 


D.                                    The headings contained in this Amendment are
for ease of reference only and shall not be considered in construing this
Amendment.


 


[SIGNATURE PAGES FOLLOW]


 


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IN
WITNESS WHEREOF, the parties hereto have caused this Third Amendment to Credit
Agreement to be duly executed as of the day and year first above written.


 


	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  CONTINENTAL
  MATERIALS CORPORATION 

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Joseph
  J. Sum 

  
	
   

  	
   

  	
  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ADMINISTRATIVE
  AGENT AND LENDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  PRIVATEBANK AND TRUST COMPANY 

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Steven
  M. Cohen 

  
	
   

  	
   

  	
  Managing
  Director & Senior Vice President

  



 


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