Exhibit 10.43


 


FIRST
AMENDMENT TO


AMENDED
AND RESTATED CREDIT AGREEMENT


AND AMENDED AND RESTATED PLEDGE AGREEMENT


 


THIS FIRST AMENDMENT TO AMENDED AND RESTATED
CREDIT AGREEMENT AND AMENDED AND RESTATED PLEDGE AGREEMENT
(this “Amendment”), dated as of January 30, 2009, is made by and
among KMG CHEMICALS, INC., a Texas
corporation, KMG-BERNUTH, INC., a Delaware
corporation, and KMG ELECTRONIC CHEMICALS, INC., a
Texas corporation (hereinafter collectively referred to as “Borrowers”),
and WACHOVIA BANK, N.A., a national banking
association, as Agent (the “Agent”) and as Collateral Agent (the “Collateral
Agent”), those lenders executing this Amendment as Lenders, and such other
lenders (collectively, the “Lenders”) as may become a party to the
Credit Agreement (hereinafter defined).


 


R  E  C  I  T  A
L  S:


 


A.            Borrowers, Agent, Collateral Agent
and Lenders have entered into that certain Amended and Restated Credit
Agreement dated as of December 31, 2007 (as amended hereby, the “Agreement”).


 


B.            Borrowers have requested that Agent, Collateral Agent and
Lenders modify certain definitions and terms of the Agreement and the Pledge
Agreement (as defined in the Agreement), and Lenders
have agreed to the same upon the terms and conditions set forth in this
Amendment.


 


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


 


ARTICLE I


 


DEFINITIONS


 


Section 1.01           Definitions
Above.  As used herein, the terms “Agent,”
“Agreement,” “Amendment,” “Borrowers,” “Collateral Agent,” and “Lenders” and “Pledge
Agreement” shall have the meanings as set forth above.


 


Section 1.02           Definitions
in Agreement.  Capitalized terms used
in this Amendment, to the extent not otherwise defined herein, shall have the
same meanings as set forth in the Agreement.


 


ARTICLE II


 


AMENDMENTS TO AGREEMENT


 


Section 2.01           Defined
Terms.  Section 1.2 of
the Agreement is hereby amended as follows:


 

















 


(a)           The term “EBIDA” is amended to
read in full as follows:


 


  “EBIDA”
means, with respect to an applicable Person for the applicable period, Net
Income, plus the sum of (without duplication) Interest Expense, Amortization
Expense, Depreciation Expense, Extraordinary Expense and all other non-cash
charges, all determined in accordance with Generally Accepted Accounting
Principles.


 


(b)           The term “EBITDA” is amended
to read in full as follows:


 


“EBITDA” means, with respect to an applicable
Person for the applicable period, Net Income, plus the sum of (without
duplication) Interest Expense, Income Tax Expense, Amortization Expense,
Depreciation Expense, Extraordinary Expense and all other non-cash charges, all
determined in accordance with Generally Accepted Accounting Principles.


 


(c)           The term “Extraordinary Expense”
is hereby added to read in full as follows:


 


“Extraordinary Expense” means any
extraordinary, unusual or non-recurring expenses or losses (including, whether
or not otherwise includable as a separate item in the statement of Net Income
for such period, non-cash losses on sales of assets outside of the Ordinary
Course of Business) which shall have been approved by Agent, minus, to the
extent included in the statement of such Net Income for such period, the amount
of any Extraordinary Receipts (including, whether or not otherwise includable
as a separate item in the statement of Net Income for such period, receipts on
sales of assets outside of the Ordinary Course of Business) which shall have
been approved by Agent.


 


(d)           The term “Without Notice” is
hereby amended to read in full as follows:


 


“Without Notice” means without
demand of performance or other demand, advertisement, or notice of any kind to
or upon the applicable Person, including without limitation notice of default
or of intent to accelerate the maturity of any promissory note or other
instrument, notice of acceleration, notice of nonpayment, presentment, protest
or notice of dishonor except as may be required under applicable Laws which
cannot be waived or by express provision of any Loan Document.


 


Section 2.02           Amendment
to Section 6.10.  Section 6.10
of the Agreement is hereby amended to read in full as follows:


 


6.10  Interest.  It is the intention of the parties hereto to
conform strictly to applicable usury laws now in force.  Accordingly, if the transactions contemplated
hereby would be usurious under applicable law, then, in that event,
notwithstanding anything to the contrary in the Notes, this Agreement or in any
other Loan Document or agreement entered into in connection with or as security



 


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for the Notes, it is agreed as
follows:  (i) the aggregate of all
consideration which constitutes interest under applicable law that is
contracted for, charged or received under the Notes, this Agreement or under
any of the other aforesaid Loan Documents or agreements or otherwise in
connection with the Notes shall under no circumstances exceed the maximum
amount of interest permitted by applicable law, and any excess shall be
credited on the Notes by the holder thereof (or, if the Notes shall have been
paid in full, refunded to Borrowers); (ii) determination of the rate of
interest for determining whether the loans hereunder are usurious shall be made
by amortizing, prorating, allocating and spreading, during the full stated term
of such loans, all interest at any time contracted for, charged or received
from Borrowers or on their behalf  in
connection with such loans, and any excess shall be canceled, credited or
refunded as set forth in (i) herein; and (iii) in the event that the
maturity of the Notes is accelerated by reason of an election of the holder
thereof resulting from any Default or Event of Default under this Agreement or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest may never include more than the maximum
amount permitted by applicable law, and excess interest, if any, provided for
in this Agreement or otherwise shall be canceled automatically as of the date
of such acceleration or prepayment and, if theretofore paid, shall be credited
on the Notes (or, if the Notes shall have been paid in full, refunded to
Borrowers).


 


Section 2.03           Amendment
to Section 10.3.  Section 10.3
of the Agreement is hereby amended by restating Subsection (A)(3) to read
in full as follows:


 


(3)  A ratio of Funded Debt to EBITDA of not more
than (i) from the date of this Agreement through January 31, 2009,
3.5 to 1.0, (ii) from February 1, 2009 through April 30, 2009,
3.25 to 1.0, and (iii) thereafter, 3.0 to 1.0.


 


Section 2.04           Amendment
to Section 14.1.  Section 14.1
of the Agreement is hereby amended as follows:


 


(a)           The addresses in Subsection (B), If
to Wachovia (whether as Lender, Agent, or Collateral Agent) are hereby
amended to read in full as follows:


 


Wachovia Bank, N.A.


(If by mail)


Mail Code VA7628


P.O. Box 13327


Roanoke, Virginia 24040


 


(If by delivery)


Mail Code VA7628


10 South Jefferson Street


Roanoke, Virginia 24011


 


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With a copy to:


 


Wachovia Bank, N.A.


2800 Post Oak Blvd., Suite 3400


Houston, Texas 77056


Attn:       Dianne
Felker, Senior Vice President


 


With a copy to:


 


Winstead PC


1100 JPMorgan Chase Tower


600 Travis Street


Houston, Texas 
77002


Attn:       Nelson R.
Block


 


(b)           The addresses in Subsection (C), If
to Lenders (other than Wachovia) are hereby amended to delete the portion “and
with a copy to Agent” as set forth therein, and substitute the following:


 


and with a copy to Agent:


 


Wachovia Bank, N.A.


(If by mail)


Mail Code VA7628


P.O. Box 13327


Roanoke, Virginia 24040


 


(If by delivery)


Mail Code VA7628


10 South Jefferson Street


Roanoke, Virginia 24011


 


With a copy to:


 


Wachovia Bank, N.A.


2800 Post Oak Blvd., Suite 3400


Houston, Texas 77056


Attn:       Dianne
Felker, Senior Vice President


 


With a copy to:


 


Winstead PC


1100 JPMorgan Chase Tower


600 Travis Street


Houston, Texas 
77002


Attn:       Nelson R.
Block


 


4

















 


Section 2.05           Amendment
to Section 14.2.  Section 14.2
of the Agreement is hereby amended to read in full as follows:


 


14.1  Governing Law.  This Agreement is entered into and
performable in Harris County, Texas, and the substantive Laws, without giving
effect to principles of conflict of laws, of the United States and the State of
Texas shall govern the construction of this Agreement and the documents
executed and delivered pursuant hereto, and the rights and remedies of the
parties hereto and thereto, except to the extent that the Uniform Commercial
Code or other applicable Law requires that the perfection, the effect of
perfection or non-perfection, the priority of Collateral Agent’s Lien, or the
enforcement of certain of Collateral Agent’s remedies with respect to the
Collateral, be governed by the Laws of another Jurisdiction.


 


Section 2.06           Amendment
to Section 14.3.  Section 14.3
of the Agreement is hereby amended to read in full as follows:


 


14.3  SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL, ETC.


 


(A)  BORROWER HEREBY
IRREVOCABLY AND UNCONDITIONALLY:


 


(1)  SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, OR FOR RECOGNITION AND
ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL
JURISDICTION OF THE COURTS OF THE STATE OF TEXAS, THE COURTS OF THE UNITED
STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF TEXAS, AND APPELLATE COURTS FROM
ANY THEREOF;


 


(2)  CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE
BROUGHT IN SUCH COURTS, AND WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND
AGREES NOT TO PLEAD OR CLAIM THE SAME;


 


(3)  AGREES THAT SERVICE OF PROCESS IN ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY
REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO BORROWER AT ITS ADDRESS SET FORTH IN THIS AGREEMENT OR AT
SUCH OTHER ADDRESS OF WHICH AGENT SHALL HAVE BEEN NOTIFIED PURSUANT THERETO;
AND


 


(4)  AGREES THAT NOTHING HEREIN SHALL AFFECT THE
RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.


 


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(B)  EACH OF
BORROWER AND LENDER PARTY HEREBY:


 


(1)  IRREVOCABLY AND UNCONDITIONALLY WAIVES THE
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OR COUNTERCLAIM OF ANY
TYPE AS TO ANY MATTER ARISING DIRECTLY OR INDIRECTLY OUT OF OR WITH RESPECT TO
THIS AGREEMENT, THE NOTES, ANY OF THE OTHER LOAN DOCUMENTS OR ANY OTHER
DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH; AND


 


(2)  AGREES THAT ANY OF THEM MAY FILE A COPY
OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY
AND BARGAINED FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE TRIAL BY
JURY, AND THAT ANY DISPUTE OR CONTROVERSY OF ANY KIND WHATSOEVER BETWEEN OR
AMONG THEM SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A
JUDGE SITTING WITHOUT A JURY.


 


Section 2.07           INDEMNITIES.  EACH OF THE INDEMNITIES IN THE AGREEMENT IS
HEREBY MODIFIED TO PROVIDE THAT THE INDEMNIFIED PARTY IS INDEMNIFIED AS TO SUCH
INDEMNIFIED PARTY’S OWN NEGLIGENCE; PROVIDED, THE INDEMNIFICATION PROVIDED IN SECTION 12.7(A) SHALL
EXCLUDE FROM INDEMNIFICATION AGENT’S ACTS OR OMISSIONS OF GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT.


 


ARTICLE III


 


AMENDMENTS TO
PLEDGE AGREEMENT


 


Section 3.01           Amendment
to Section 14.  Section 14
of the Pledge Agreement is hereby amended to read in full as follows:


 


14.  Venue;
Governing Law.  This Agreement is
entered into and performable in Houston, Harris County, Texas, and the
substantive Laws, without giving effect to principles of conflict of laws, of
the United States and the State of Texas shall govern the construction of this
Agreement and the documents executed and delivered pursuant hereto, and the
rights and remedies of the parties hereto and thereto, except to the extent
that the location of any Pledged Collateral in a state or Jurisdiction other
than Texas requires that the perfection of Collateral Agent’s Lien hereunder,
and the enforcement of certain of Collateral Agent’s remedies with respect to
the Pledged Collateral, be governed by the Laws of such other state or
Jurisdiction.


 


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ARTICLE IV


 


CONDITIONS PRECEDENT


 


Section 4.01           Representations
and Warranties True and Correct.  The
representations and warranties contained herein and in all other Loan
Documents, as amended hereby and by the other documents given in connection
with this Amendment, shall be true and correct as of the date hereof except as
previously disclosed to Lender.


 


ARTICLE V


 


RATIFICATIONS,
REPRESENTATIONS AND WARRANTIES


 


Section 5.01           Ratifications.  The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Agreement and except as expressly modified and superseded by this
Amendment, the terms and provisions of the Agreement are ratified and confirmed
and shall continue in full force and effect. 
Borrowers and Lenders agree that the Agreement as amended hereby shall
continue to be legal, valid, binding and enforceable in accordance with its
terms.  The terms, provisions, and
conditions of any and all of the Loan Documents are hereby ratified and
confirmed in every respect by Borrowers and shall continue in full force and
effect.


 


Section 5.02           Representations
and Warranties.  Borrowers hereby
represent and warrant to Lenders that:


 


(a)           the execution, delivery and performance
of this Amendment and any and all other Loan Documents executed and/or
delivered in connection herewith have been authorized by all requisite
corporate action on the part of Borrowers and will not violate the articles of incorporation or bylaws of
Borrowers;


 


(b)           the representations and warranties
contained in the Agreement, after giving effect to the modifications contained
in this Amendment, and any other Loan Document, are true and correct in all
material respects on and as of the date hereof except as previously disclosed
to Lenders;


 


(c)           after giving effect to the
modifications contained in this Amendment, no Default or Event of Default has
occurred and is continuing and no event or condition has occurred that with the
giving of notice or lapse of time or both would be a Default or an Event of
Default;


 


(d)           after giving effect to the
modifications contained in this Amendment, Borrowers are in full compliance
with all covenants and agreements contained in the Agreement as amended hereby;
and


 


(e)           Borrowers are not presently aware of
any claim they have against Lenders, nor are they aware of any claim any of
their subsidiaries have against Lenders, for 


 


7

















 


damages arising out of
any prior action or inaction on the part of Lenders or their representatives or
agents.


 


ARTICLE VI


 


MISCELLANEOUS


 


Section 6.01           Survival
of Representations and Warranties. 
All representations and warranties made in this Amendment or any other
Loan Document including any Loan Document 
furnished in connection with this Amendment shall survive the execution
and delivery of this Amendment and the other Loan Documents.


 


Section 6.02           Reference
to Agreement.  Each of the Loan
Documents, including the Agreement and any and all other agreements, documents,
or instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Agreement as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Agreement shall mean
a reference to the Agreement as amended hereby.


 


Section 6.03           Expenses
of Lender.  As provided in the
Agreement, Borrowers agree to pay on demand all reasonable costs and expenses
incurred by Lenders in connection with the preparation, negotiation, and execution
of this Amendment and the other Loan Documents executed pursuant hereto and any
and all amendments, modifications, and supplements thereto, including without
limitation the reasonable costs and fees of Lenders’ legal counsel, and all
reasonable costs and expenses incurred by Lenders in connection with the
enforcement or preservation of any rights under the Agreement, as amended
hereby, or any other Loan Document, including without limitation the reasonable
costs and fees of Lenders’ legal counsel.


 


Section 6.04           Severability.  Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.


 


Section 6.05           APPLICABLE
LAW.  THIS AMENDMENT AND ALL OTHER
LOAN DOCUMENTS EXECUTED PURSUANT HERETO 
SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN HOUSTON,
HARRIS COUNTY, TEXAS AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TEXAS (BUT NOT THE RULES GOVERNING CONFLICTS OF LAWS).


 


Section 6.06           Successors
and Assigns.  This Amendment is
binding upon and shall inure to the benefit of Lenders and Borrowers and their
respective successors and assigns, except Borrowers may not assign or
transfer any of their rights or obligations hereunder without the prior written
consent of Lenders.


 


Section 6.07           Counterparts.  This Amendment may be executed 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 instrument.


 


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Section 6.08           Effect
of Waiver.  No consent or waiver,
express or implied, by Lenders to or for any breach of or deviation from any
covenant, condition or duty by Borrowers shall be deemed a consent or waiver to
or of any other breach of the same or any other covenant, condition or duty.


 


Section 6.09           Headings.  The headings, captions, and arrangements used
in this Amendment are for convenience only and shall not affect the
interpretation of this Amendment.


 


Section 6.10           SECTION 26.02
NOTICE.  THIS AMENDMENT AND ALL OTHER
INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH
THIS AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND
SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT
BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO.


 


THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE
PARTIES HERETO.


 


EXECUTED as of the date first written above.


 


[Remainder of page is
blank.  Signatures appear on following
pages.]


 


9

















 


SIGNATURE PAGES —
BORROWERS


 


 


	
   

  	
  KMG CHEMICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  KMG-BERNUTH, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  KMG ELECTRONIC CHEMICALS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


10

















 


SIGNATURE PAGE —
WACHOVIA


 


 


	
   

  	
  WACHOVIA BANK, N.A.,

  as Agent, Collateral Agent,

  Lender and Issuing Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


Instructions for Wire Transfers to Agent:


 


Wachovia Bank, N.A.


Charlotte, NC


ABA Number:  053
000 219


Account Number: 
01459670001944


Account Name: 
Agency Svcs Synd Clearing


Payment Details: 
KMG Chemicals


 


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SIGNATURE PAGE —
BANK OF AMERICA


 


 


	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


12

















 


SIGNATURE PAGE —
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA


 


 


	
   

  	
  THE PRUDENTIAL INSURANCE

  
	
   

  	
  COMPANY OF AMERICA,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


13

















 


SIGNATURE PAGE —
PRUCO LIFE INSURANCE COMPANY


 


 


	
   

  	
  PRUCO LIFE INSURANCE COMPANY,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


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