exv10w12



 





AMENDMENT NO. 1 TO

SUNTRON CORPORATION

AMENDED AND RESTATED CREDIT AGREEMENT




     Amendment No. 1 (this “Amendment”), dated as of March 23, 2004, among
K*TEC Operating Corp., EFTC Operating Corp., each a Delaware corporation (each
a “Borrower” and collectively, the “Borrowers”), Suntron Corporation (the
“Company”), the guarantors listed as such on the signature pages hereof (each a
“Guarantor” and, collectively, the “Guarantors”) and Citicorp USA, Inc., as
Administrative Agent and sole Lender and Issuer (each as defined below), to the
Amended and Restated Credit Agreement, dated as of April 11, 2003 (as amended
to the date hereof, the “Credit Agreement”), among the Company, the Borrowers,
the Lenders and Issuers from time to time party thereto and Citicorp USA, Inc.,
as agent for such Lenders and Issuers (in such capacity, the “Administrative
Agent”). Capitalized terms used herein but not defined herein are used as
defined in the Credit Agreement.



W I T N E S S E T H:




     WHEREAS, the Company, the Borrowers, the Lenders, the Issuers and the
Administrative Agent are party to the Credit Agreement;



     WHEREAS, the Company and the Borrowers have requested an increase in the
Advance Rates for (i) Eligible Raw Materials and (ii) Eligible Finished Goods;



     WHEREAS, the Company and the Borrowers have requested that the minimum
EBITDA required for the Fiscal Quarters ending (i) September 30, 2004 and (ii)
December 31, 2004 set forth in clause (d) of Section 5.1 (Minimum EBITDA) be
amended;



     WHEREAS, pursuant to Section 11.1 (Amendments, Waivers) of the Credit
Agreement, the consent of the Lenders constituting (i) the Supermajority
Lenders is required to effect any increase in the Advance Rate and (ii) the
Requisite Lenders is required to effect any change in the financial covenants
set forth in Section 5.1 (Minimum EBITDA) of the Credit Agreement;



     WHEREAS, the Administrative Agent and the undersigned Lender, being the
sole Lender as of the date hereof, the Company and the Borrowers have agreed,
subject to certain limitations and conditions set forth below, to make certain
amendments to the Credit Agreement, as more specifically set forth below;



     NOW, THEREFORE, in consideration of the premises and the covenants and
obligations contained herein the parties hereto agree as follows:



     Section 1. Amendment



     Effective as of the Amendment Effective Date (as defined below) and
subject to the satisfaction (or due waiver) of the conditions set forth in
Section 2 (Conditions Precedent to the Effectiveness of this Amendment) hereof,
the Administrative Agent and the Lender party hereto hereby agree to amend the
Credit Agreements as follows:



 









 





Amendment No. 1 to

Amended and Restated Credit Agreement

Suntron Corporation



          (a) Amendment to Article I (Definitions, Interpretation and Accounting
Terms)



               (i) Clause (b) of the definition of “Advance Rate” in Section 1.1 (Defined
Terms) is hereby amended in its entirety to read as follows:



               (b) in the case of Eligible Raw Materials, 38%



               (ii) Clause (c) of the definition of “Advance Rate” in Section 1.1
(Defined Terms) is hereby amended in its entirety to read as follows:



               (c) in the case of Eligible Finished Goods, 46%



          (b) Amendment to Article V (Financial Covenants)



          Clause (d) of Section 5.1 (Minimum EBITDA) is deleted in its entirety and
replaced with the following:




               (d) The Company shall have, as of the last day of each Fiscal
Quarter set forth below, EBITDA for the four Fiscal Quarters ending on
such day of not less than the amount set forth opposite such Fiscal
Quarter:



	 	 	 	 	 
	FISCAL QUARTER ENDING	 	 
	ON OR ABOUT
	 	MINIMUM EBITDA

	March 31, 2004
	 	 	($8,000,000	)
	June 30, 2004
	 	$	0	 
	September 30, 2004
	 	$	2,000,000	 
	December 31, 2004
	 	$	5,000,000	 







     Section 2. Conditions Precedent to the Effectiveness of this Amendment



          This Amendment shall become effective when, and only when, each of the
following conditions precedent shall have been satisfied or waived by the
Administrative Agent (the “Amendment Effective Date”):



          (a) Certain Documents. The Administrative Agent shall have received each
of the following, each dated the Amendment Effective Date (unless otherwise
agreed by the Administrative Agent), in form and substance satisfactory to the
Administrative Agent and in sufficient copies for each Lender:



               (i) this Amendment, executed by each Borrower, each Guarantor, the
Administrative Agent and each Lender; and



               (ii) such additional documentation as the Administrative Agent or the
Lenders party thereto may reasonably require;



          (b) Corporate and Other Proceedings. All corporate and other proceedings,
and all documents, instruments and other legal matters in connection with the
transactions



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Amendment No. 1 to

Amended and Restated Credit Agreement

Suntron Corporation


contemplated by this Amendment shall be satisfactory in all respects to
the Administrative Agent and each Lender;




          (c) No Default or Event of Default. After giving effect to this
Amendment, no Default or Event of Default shall have occurred and be
continuing, either on the date hereof or on the Amendment Effective Date; and



          (d) Fees and Expenses Paid. Each Borrower shall have paid all Obligations
due, after giving effect to this Amendment, on or before the later of the date
hereof and the Amendment Effective Date including, without limitation, the fees
set forth in Section 4 (Fees and Expenses) hereof.



     Section 3. Representations and Warranties



          On and as of the date hereof and as of the Amendment Effective Date, after
giving effect to this Amendment, the Company and each Borrower hereby represent
and warrant to the Administrative Agent and each Lender as follows:



          (a) this Amendment has been duly authorized, executed and delivered by
each Borrower and each Guarantor and constitutes a legal, valid and binding
obligation of each Borrower and each Guarantor, enforceable against the
Borrower and each Guarantor in accordance with its terms and the Credit
Agreement as amended by this Amendment and constitutes the legal, valid and
binding obligation of each Borrower and each Guarantor, enforceable against
each Borrower and each Guarantor in accordance with its terms;



          (b) all of the representations and warranties of the Company and each
Borrower contained in Article IV (Representations and Warranties) of the Credit
Agreement and in any other Loan Document are true and correct in all material
respects on and as of the date hereof and the Amendment Effective Date, in each
case as if made on and as of such date and except to the extent that such
representations and warranties specifically relate to a specific date, in which
case such representations and warranties shall be true and correct in all
material respects as of such specific date; and



          (c) no Default or Event of Default has occurred and is continuing.



     Section 4. Fees and Expenses



          Each Borrower and each other Loan Party agrees to pay on demand in
accordance with the terms of Section 11.3 (Costs and Expenses) of the Credit
Agreement all costs and expenses of the Administrative Agent in connection with
the preparation, reproduction, execution and delivery of this Amendment and all
other Loan Documents entered into in connection herewith (including, without
limitation, the reasonable fees and out-of-pocket expenses of counsel for the
Administrative Agent with respect thereto and all other Loan Documents).



     Section 5. Release



          In further consideration for the Administrative Agent and the Lenders’
execution of this Agreement, each Borrower and each other Loan Party hereby
release each of the Administrative Agent, each Lender and the Issuer and their
respective Affiliates, officers,



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Amendment No. 1 to

Amended and Restated Credit Agreement

Suntron Corporation


employees, directors, agents and advisors (collectively, the “Releasees”)
from any and all claims, demands, liabilities, responsibilities, disputes,
causes of action (whether at law or equity) and obligations of any nature
whatsoever, whether liquidated or unliquidated, known or unknown, matured or
unmatured, fixed or contingent that any of the Loan Parties may have against
any Releasee and that arise from or relate to the Obligations, any Collateral,
any Loan Document or any document, dealing or other matter in connection with
any of the Loan Documents or the Collateral, and any third party liable in
whole or in part for any of the Obligations, in each case to the extent arising
(a) on or prior to the date hereof or the Amendment Effective Date or (b) out
of, or relating to, actions, dealings or other matters occurring on or prior to
the date hereof or the Amendment Effective Date (including, without limitation,
any actions or inactions of any Releasee prior to the date hereof or the
Amendment Effective Date).




     Section 6. Reference to the Effect on the Loan Documents



          (a) As of the Amendment Effective Date, each reference in the Credit
Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of
like import, and each reference in the other Loan Documents to the Credit
Agreement (including, without limitation, by means of words like “thereunder”,
“thereof” and words of like import), shall mean and be a reference to the
Credit Agreement as modified hereby, and this Amendment and the Credit
Agreement shall be read together and construed as a single instrument. Each of
the table of contents and lists of Exhibits and Schedules of the Credit
Agreement shall be amended to reflect the changes made in this Amendment as of
the Amendment Effective Date.



          (b) Except as expressly amended hereby, all of the terms and provisions of
the Credit Agreement and all other Loan Documents are and shall remain in full
force and effect and are hereby ratified and confirmed.



          (c) The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of the Lenders, Issuers, Arranger or the Administrative Agent under any
of the Loan Documents, nor constitute a waiver or amendment of any other
provision of any of the Loan Documents or for any purpose except as expressly
set forth herein.



          (d) This Amendment is a Loan Document.



     Section 7. Consents by Guarantors



          Each Guarantor hereby consents to the provisions hereof and agrees that
the terms hereof shall not affect in any way its obligations and liabilities
under the Loan Documents (as amended and otherwise expressly modified hereby),
all of which obligations and liabilities shall remain in full force and effect
and each of which is hereby reaffirmed (as amended and otherwise expressly
modified hereby).



     Section 8. Execution in Counterparts



          This Amendment may be executed in any number of counterparts and by
different parties in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Signature pages may be detached from
multiple separate counterparts and attached to a single counterpart so that all
signature pages are attached to the same document. Delivery of an



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Amendment No. 1 to

Amended and Restated Credit Agreement

Suntron Corporation


executed counterpart by telecopy shall be effective as delivery of a
manually executed counterpart of this Amendment.




     Section 9. Governing Law



          This Amendment shall be governed by and construed in accordance with the
law of the State of New York.



     Section 10. Section Titles



          The section titles contained in this Amendment are and shall be without
substantive meaning or content of any kind whatsoever and are not a part of the
agreement between the parties hereto, except when used to reference a section.
Any reference to the number of a clause, sub-clause or subsection of any Loan
Document immediately followed by a reference in parenthesis to the title of the
section of such Loan Document containing such clause, sub-clause or subsection
is a reference to such clause, sub-clause or subsection and not to the entire
section; provided, however, that, in case of direct conflict between the
reference to the title and the reference to the number of such section, the
reference to the title shall govern absent manifest error. If any reference to
the number of a section (but not to any clause, sub-clause or subsection
thereof) of any Loan Document is followed immediately by a reference in
parenthesis to the title of a section of any Loan Document, the title reference
shall govern in case of direct conflict absent manifest error.



     Section 11. Notices



          All communications and notices hereunder shall be given as provided in the
Credit Agreement or, as the case may be, the Guaranty.



     Section 12. Severability



          The fact that any term or provision of this Agreement is held invalid,
illegal or unenforceable as to any person in any situation in any jurisdiction
shall not affect the validity, enforceability or legality of the remaining
terms or provisions hereof or the validity, enforceability or legality of such
offending term or provision in any other situation or jurisdiction or as
applied to any person



     Section 13. Successors



          The terms of this Amendment shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and assigns.



     Section 14. Waiver of Jury Trial



          EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION
OR PROCEEDING WITH RESPECT TO THIS AMENDMENT OR ANY OTHER LOAN DOCUMENT.



[SIGNATURE PAGES FOLLOW]




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


	 	 	 	 	 
	 	SUNTRON CORPORATION,

as Company and Guarantor

 	 
	 	By:  	 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	K*TEC OPERATING CORP.,

as Borrower

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	EFTC OPERATING CORP.,

as Borrower

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 




[Signature Page to Amendment no. 1 to Suntron’s Amended and Restated Credit Agreement]






 









 








	 	 	 	 	 
	 	CITICORP USA, INC.,

as Administrative Agent and Lender

 	 
	 	By:  	/s/ Keith R. Gerding
 	 
	 	 	Name:  	Keith R. Gerding 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Amendment no. 1 to Suntron’s Amended and Restated Credit Agreement]




 









 









	 	 	 	 	 
	 	 	 
	 	Additional Guarantors:	 
	 	 	 
	 	RODNIC LLC,

as Guarantor	 
	 	 	 
	 	By: K*TEC Operating Corp.,

as its sole Member	 
	 	 	 
	 	By:  	  /s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 





	 	 	 	 	 
	 	 	 
	 	CATHIO LLC,

as Guarantor	 
	 	 	 
	 	By: K*TEC Operating Corp.,

as its sole Member	 
	 	 	 
	 	By:  	                  /s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 
	

	

	








	 	 	 	 	 
	 	SUNTRON GCO, L.P.

(f/k/a K*TEC Electronics L.P.),

as Guarantor	 
	 	 	 
	 	By: RodniC LLC,

as its general partner	 
	 	 	 
	 	 	By: K*TEC Operating Corp.,

as its sole Member	 
	 	 	 
	 	By:  	                  /s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	SUNTRON-IOWA, INC.,

as Guarantor

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



[Signature Page to Amendment no. 1 to Suntron’s Amended and Restated Credit Agreement]





 









 








	 	 	 	 	 
	 	SUNTRON-KANSAS, INC.

as Guarantor

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	CURRENT ELECTRONICS, INC.,

as Guarantor

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	RM ELECTRONICS, INC.,

as Guarantor

 	 
	 	By:  	/s/ Peter W. Harper
 	 
	 	 	Name:  	Peter W. Harper 	 
	 	 	Title:  	Chief Financial Officer