Document:

ex10_13.htm

 EXHIBIT 10.1.3

Excess of Loss Reinsurance Agreement

By and Between

EMC Reinsurance Company

And

Employers Mutual Casualty Company

This Excess of Loss Reinsurance Agreement (the “XOL Agreement”) is hereby made by and between EMC Reinsurance Company ("EMC Re") and Employers Mutual Casualty Company ("EMCC").

WHEREAS, EMCC and EMC Re have been operating under the terms of a Quota Share Reinsurance Retrocessional Agreement between the parties, as amended from time to time, since January 1, 1981 (the “Agreement”) and a Restated Quota Share Reinsurance Retrocessional Agreement between the parties, as amended from time to time, since January 1, 2006 (the "Restated Agreement"); and

WHEREAS, the parties now desire to restate the terms and coverage of the Restated Agreement and to restructure the reinsurance relationship between the parties, and the written agreements related thereto, in a manner that which conforms more closely with industry practices; and

WHEREAS, the respective Inter-Company Committees of the boards of directors of EMCC and of EMC Insurance Group Inc. (collectively, the "Inter-Company Committees") have each approved the restructured reinsurance relationship between the parties and the reinsurance agreements between the parties necessary to accomplish the desire of the parties;

NOW THEREFORE, in consideration of the mutual covenants and conditions contained herein, the parties hereto hereby agree as follows:

I.              AGREEMENT

	
  

	
1.

	
EMC Re shall cede, and EMCC shall accept as reinsurance, One Hundred Percent (100%) of all “Net Loss” incurred which is in excess of $3,000,000 for each “Occurrence” with an “Occurrence” date on or after January 1, 2011 arising out of “Subject to Cession” reinsurance contracts and reinsurance contracts written directly by EMC Re (the “Contract”).

	
  

	
2.

	
EMC Re shall also cede, and EMCC shall accept as premium, Ten and One-Half Percent (10.5%) of all “Net Written Premium” on the Contracts.

 

  

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3.

	
All premium, loss, and expense shall be settled at least quarterly through the EMCC inter-company closing process, with settlement amounts due to be completed no later than forty-five (45) days after the end of the applicable quarter.

 

II.             DEFINITIONS

	
  

	
1.

	
“Allocated Loss Expense” shall have the same meaning as ascribed in the Contracts, or, in the absence of any definition in a Contract, shall mean:  (a) expenses sustained in connection with adjustment, defense, settlement and litigation of claims and suits, satisfaction of judgments, resistance to or negotiations concerning a loss (which shall include the expenses and the pro rata share of the salaries of the insurer's field employees according to the time occupied in adjusting such loss and the expenses of the insurer's employees while diverted from their normal duties to the service of field adjustment but shall not include any salaries of officers or normal overhead expenses of the insurer); (b) legal expenses and costs incurred in connection with coverage questions regarding specific claims and legal actions, including declaratory judgment actions, connected thereto; (c) all interest on judgments other than prejudgment interest except when included in “Net Loss”; and (d) expenses sustained to obtain recoveries, salvages or other reimbursements, or to secure the reversal or reduction of a verdict or judgment.

	
  

	
2.

	
“Extra-contractual Obligations” means those liabilities not covered under any other provision of this XOL Agreement, including, but not limited to, compensatory, consequential, punitive or exemplary damages, other than that which is a “Loss Excess of Contract Limits”, together with any legal costs and expenses incurred in connection therewith, paid as damages or in settlement or in judgment by EMC Re as a result of a demand, claim or an action by its insured, its insured's assignee, or other third party, which demand, claim or action alleges negligence, gross negligence, fraud, bad faith or other tortious behavior or conduct on the part of EMC Re in the handling, adjustment, rejection or settlement of a claim under a Contract or bond covered by this XOL Agreement.  An “Extra-contractual Obligation” shall be deemed to have occurred on the same date as the loss covered or alleged to be covered under the Contract.  Notwithstanding anything stated herein, this XOL Agreement shall not apply to any “Extra-contractual Obligation” incurred by EMC Re as a result of any fraudulent and/or criminal act directed against EMC Re by any officers or directors of EMC Re acting individually or collectively or in collusion with any individual or corporation or any other organization or party involved in the presentation, defense or settlement of any claim covered hereunder.

	
  

	
3.

	
“Ex-gratia Settlements” shall mean payments made for which EMC Re has no legal obligation under the terms and conditions of any Contract, but which are made solely to maintain the good will of EMC Re.

 

  

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4.

	
“Net Written Premium” is defined as written premium on Contracts assumed by and written directly by EMC Re, less any such written premium that is ceded by EMC Re, which is booked by EMC Re during the applicable calendar year.

	
  

	
5.

	
“Loss Excess of Contract Limits” means any amount of loss, together with any legal costs and expenses incurred in connection therewith, paid as damages or in settlement or in judgment by EMC Re in excess of its Contract limits, but otherwise within the coverage terms of the Contract, as a result of a demand, claim or an action by its insured, its insured's assignee, or other third party, which demand, claim or action alleges gross negligence, negligence, fraud, bad faith or other tortious behavior or conduct on the part of EMC Re in the handling of a claim under a Contract or bond covered by this XOL Agreement, in rejecting a settlement within the Contract limits, in discharging or failing to discharge a duty to defend or prepare the defense in the trial of an action against its insured, or in discharging or failing to discharge its duty to prepare or prosecute an appeal consequent upon such an action.  A “Loss Excess of Contract Limits” shall be deemed to have occurred on the same date as the loss covered or alleged to be covered under the Contract.  For the avoidance of doubt, the decision by EMC Re to settle a claim for an amount in excess of the Contract limit when EMC Re has reasonable basis to believe that it may have liability to its insured or assignee on the claim will be deemed a “Loss Excess of Contract Limits”.

	
  

	
6.

	
“Net Loss” means:

	
  

	
a.

	
The sum total of:

	
  

	
(1)

	
Contractual indemnity loss under the coverage terms of the Contracts that is reported to EMC Re;

	
  

	
(2)

	
Associated "Allocated Loss Expense";

	
  

	
(3)

	
“Extra-contractual Obligations” and “Loss Excess of Contract Limits” that is paid (or imminently payable) by EMC Re in settlement of claims or in satisfaction of judgments rendered on account of those claims, after deduction of all net subrogation, salvage and other recoveries; and

	
  

	
(4)

	
Any additional case reserves (ACRs) or additional incurred but not reported reserves (IBNR) established by EMC Re on the Contracts.

	
  

	
b.

	
Inter-company reinsurance with respect to the original ceding companies, not to include this XOL Agreement, shall be disregarded in calculating “Net Loss”.

	
  

	
c.

	
All subrogation, salvage, recoveries or payments recovered or received subsequent to a “Net Loss” settlement under this XOL Agreement shall be applied as if recovered or received prior to payment or settlement, and all necessary adjustments shall be made by the parties to this XOL Agreement.

 

  

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d.

	
Nothing in this definition, however, shall be construed to mean that “Net Loss” is not recoverable from EMCC until the “Net Loss” of EMC Re has been absolutely ascertained.

	
  

	
7.

	
“Occurrence” is defined as follows:

	
  

	
a.

	
Except as otherwise provided herein, an “Occurrence” means an accident, disaster, casualty or happening, or series of accidents, disasters, casualties or happenings arising out of or following on one event, regardless of the number of interests insured or the number of Contracts responding or whether the claims arising out of the “Occurrence” are made under Contracts issued on an “occurrence” and/or “claims made” or other basis.  Except where specifically provided otherwise in this XOL Agreement, each “Occurrence” shall be deemed to take place in its entirety as of the earliest date of loss as determined by any Contract responding to the “Occurrence”.  Any claims made under an Extended Reporting Period Endorsement or any other extended reporting and/or discovery period under any Contract shall, for the purposes of this XOL Agreement, be considered to be made on the last day of the Contract period immediately preceding the extended reporting and/or discovery period.

	
  

	
b.

	
Continuous Or Repeated Injurious Exposure.  As respects liability (bodily injury and property damage) other than Automobile and Products-Completed Operations Hazard coverage liability under any Contract, and at the option of EMC Re, the term “Occurrence” shall also mean the sum of all damages for bodily injury and property damage sustained by each insured during a period of twelve (12) consecutive months arising out of a continuous or repeated injurious exposure to substantially the same general conditions.  For purposes of this definition, the date of loss shall be deemed to be the inception or renewal date of the Contract to which payment is charged.

	
  

	
c.

	
Aggregate Basis. With respect to Contracts written on an aggregate basis (not subject to an aggregate limit) and at the option of EMC Re, the term “Occurrence” shall also mean all loss or losses, whether or not related to or arising from the same event or occurrence, that are subject to and covered under an aggregate basis Contract (or, if such losses arise under two or more Contracts written on an aggregate basis), during the twelve (12) month policy period of that Contract (or if two or more such Contracts are issued to the same risk, during any twelve (12) month policy period of the Contract chosen by EMC Re).  The date of the “Occurrence” shall be the inception date of such new or renewal policy period (or if such losses arise under two or more Contracts, the inception, anniversary or renewal date of the Contract chosen by EMC Re).  The term “policy period” refers to each annual period of the Contract which is written on an aggregate basis. To be certain, EMC Re, at its option, shall be entitled to extract any “Net Loss” arising from an “Occurrence” as defined above from the provisions of this paragraph to apply the basic per occurrence reinsurance coverage of this XOL Agreement.

 

  

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d.

	
Occupational Disease or Cumulative Injury.  Each case of Occupational Disease or Cumulative Injury suffered by an employee of an EMCC insured and covered by a Workers’ Compensation or similar Contract shall be deemed to be a separate and distinct “Occurrence”.  The date of such “Occurrence” shall be deemed to be the date of loss under the Contract as determined by EMC Re.

	
  

	
8.

	
“Subject to Cession” shall mean all voluntary assumed and ceded reinsurance contracts unless specifically coded by EMCC's Home Office Assumed Reinsurance Department as “not subject to cession” at the time the synopsis (coverage summary) is set up. “Subject to Cession” shall not include non-affiliated or involuntary contracts unless specifically coded by EMCC's Home Office Assumed Reinsurance Department as “subject to cession” at the time the synopsis (coverage summary) is set up.

III.           CONTINUOUS CONTRACT

This XOL Agreement is continuous until canceled by mutual agreement of the parties, but may be terminated by either party as of the end of any calendar year upon ninety (90) days prior written notice.

IV.           TERM

 

	
  

	
1.

	
This XOL Agreement shall take effect at 12:01 a.m., Central Standard Time, January 1, 2011, with respect to the accounting for Contracts booked after such time and date.

 

	
  

	
2.

	
At the expiration of this XOL Agreement, EMCC shall remain liable for all Contracts covered by this XOL Agreement that are in force at expiration, until the termination, expiration or renewal of such Contracts, whichever occurs first, plus any discovery or extended reporting periods.

 

	
  

	
3.

	
However, at the expiration of this XOL Agreement, EMC Re shall have the option to require a return of the ceded unearned premium, net of ceding commission, as of the date of expiration, on business in force at that date, in which event EMCC shall be released from liability for losses occurring or claims made, as applicable, after expiration.

 

	
  

	
4.

	
In the event this XOL Agreement expires on a run-off basis, EMCC’s liability hereunder shall continue if EMC Re is required by statute or regulation to continue coverage, until the earliest date on which EMC Re may cancel the Contract.

 

  

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V.            TERRITORY

 

The territorial limits of this contract shall be identical with those of the original reinsurance contracts.

 

VI.           EXCLUSIONS

 

This XOL Agreement shall not apply to and specifically excludes:

 

	
  

	
1.

	
Liability of EMC Re arising by contract, operation of law, or otherwise from its participation or membership, whether voluntary or involuntary, in any Insolvency Fund.  “Insolvency Fund” includes any guaranty fund, insolvency fund, plan, pool, association, fund or other arrangement, however denominated, established or governed, that provides for any assessment of or payment or assumption by EMCC of part or all of any claim, debt, charge, fee or other obligation of an insurer, or its successors or assigns, that has been declared by any competent authority to be insolvent, or that is otherwise deemed unable to meet any claim, debt, charge, fee or other obligation in whole or in part.

 

	
  

	
2.

	
Foreign exchange risk on Contracts incepting prior to January 1, 2006.

 

VII.          LOSS SETTLEMENTS

 

All loss settlements made by EMC Re within the terms of this XOL Agreement or by way of compromise, including any “Ex-gratia Settlements”, shall be binding upon EMCC, and EMCC agrees to pay or allow, as the case may be, its share of each such settlement in accordance with this XOL Agreement.

 

VIII.         SALVAGE AND SUBROGATION

 

	
  

	
1.

	
Salvages and all recoveries, including recoveries under all reinsurances that inure to the benefit of this XOL Agreement (whether recovered or not), shall be first deducted from such loss to arrive at the amount of liability attaching hereunder.

 

	
  

	
2.

	
All salvages, recoveries or payments recovered or received subsequent to loss settlement hereunder shall be applied as if recovered or received prior to the aforesaid settlement, and all necessary adjustments shall be made by the parties hereto.

 

IX.           NO THIRD PARTY RIGHTS

 

This XOL Agreement is solely between EMC Re and EMCC, and in no instance shall any insured, claimant or other third party have any rights under this XOL Agreement except as may be expressly provided otherwise herein.

 

X.             INSOLVENCY

	
  

	
1.

	
In the event of insolvency and the appointment of a conservator, liquidator or statutory successor of EMC Re, the portion of any risk or obligation assumed by EMCC shall be payable to the conservator, liquidator or statutory successor on the basis of claims allowed against the insolvent EMC Re by any court of competent jurisdiction or by any conservator, liquidator or statutory successor of EMC Re having authority to allow such claims, without diminution because of that insolvency, or because the conservator, liquidator or statutory successor has failed to pay all or a portion of any claims.

 

  

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2.

	
Payments by EMCC as above set forth shall be made directly to EMC Re or to its conservator, liquidator or statutory successor, except where the contract of insurance or reinsurance specifically provides another payee of such reinsurance or except as provided by applicable law and regulation (such as subsection (a) of section 4118 of the New York Insurance laws) in the event of the insolvency of EMC Re.

	
  

	
3.

	
In the event of the insolvency of EMC Re, the liquidator, receiver, conservator or statutory successor of EMC Re shall give written notice to EMCC of the pendency of a claim against the insolvent EMC Re on the Contract or Contracts reinsured within a reasonable time after such claim is filed in the insolvency proceeding and, during the pendency of such claim, any reinsurer may investigate such claim and interpose, at its own expense, in the proceeding where such claim is to be adjudicated any defense or defenses which it may deem available to EMC Re or its liquidator, receiver, conservator or statutory successor.

	
  

	
4.

	
Where two or more reinsurers are involved in the same claim and a majority in interest elects to interpose a defense to such claim, the expense shall be apportioned in accordance with the terms of this XOL Agreement as though such expense had been incurred by EMC Re.

	
  

	
5.

	
The original insured or policyholder shall not have any rights against EMCC which are not specifically set forth in this XOL Agreement, or in a specific agreement between EMCC and the original insured or policyholder.

XI.           DISPUTES

 

Any disputes arising out of the interpretation of this XOL Agreement shall be submitted to the respective Inter-Company Committees pursuant to the terms of the charter of the Inter-Company Committees then in effect for final and binding resolution.

 

XII.          JURISDICTION

 If EMCC, as the assuming insurer, fails to perform its obligations under the terms of the XOL Agreement, then EMCC, at EMC Re's request, shall agree (a) to submit itself to the jurisdiction of any court of competent jurisdiction in any state of the United States, (b) to comply with all requirements necessary to give the court jurisdiction, and (c) to abide by the final decision of the court or any appellate court if there is an appeal.  For the purpose of achieving authorized reinsurer status in North Carolina pursuant to North Carolina General Statute 58-7-21(b)(3), or any successor provision, EMCC further designates the Insurance Commissioner (or equivalent elected or appointed official) of the State of North Carolina, or his or her designated attorney, as its true and lawful attorney upon whom may be served any lawful process in any action, suit or proceeding begun by or on behalf of EMC Re, as the ceding company under this XOL Agreement.

 

  

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XIII.         OFFSET

EMC Re and EMCC shall have the right to offset any balance or amounts due from one party to the other under the terms of this XOL Agreement; the 100% Quota Share Reinsurance Retrocessional Agreement between the parties effective January 1, 2011; the Agreement; and the Restated Agreement.  The party asserting the right of offset may exercise such right any time whether the balances due are on account of premiums or losses or otherwise. In the event of the insolvency of any party, offset shall be as permitted by applicable law.

 

XIV.        ERRORS AND OMISSIONS

Inadvertent delays, errors or omissions made by EMC Re in connection with this XOL Agreement (including the reporting of claims) shall not relieve EMCC from any liability which would have attached had such error or omission not occurred, provided always that such error or omission shall be rectified as soon as possible. This Article XIV shall not apply to a commutation made in connection with this XOL Agreement.

 

In WITNESS WHEREOF, the parties hereto, by their respective duly authorized officers, have executed this XOL Agreement on the dates recorded below.

	
EMC Reinsurance Company

	  	
Employers Mutual Casualty Company

	  	  	  
	
By: /s/ Ronnie D. Hallenbeck

	  	
By: /s/ Bruce G. Kelley

	
Ronnie D. Hallenbeck

	  	
Bruce G. Kelley

	
President

	  	
President & CEO

	  	  	  
	
Date:  December 21, 2010

	  	
Date:  December 21, 2010

This Excess of Loss Reinsurance Agreement, effective January 1, 2011, was approved by the Inter-Company Committees on September 30, 2010.

 

  

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Amendment to the

Excess of Loss Reinsurance Agreement

By and Between

EMC Reinsurance Company

And

Employers Mutual Casualty Company

The Excess of Loss Reinsurance Agreement (the “XOL Agreement”), executed by and between EMC Reinsurance Company, an Iowa corporation ("EMC Re"), and Employers Mutual Casualty Company, an Iowa corporation (“EMCC”), on December 21, 2010, is amended, effective as of January 1, 2011, by modifying Section I.2, to read as follows:

I.              AGREEMENT

	
  

	
2.

	
EMC Re shall also cede, and EMCC shall accept as premium, Ten Percent (10%) of all “Net Written Premium” on the Contracts.

 

In WITNESS WHEREOF, the parties hereto, by their respective duly authorized officers, have executed this Amendment to the Excess of Loss Reinsurance Agreement on the dates recorded below.

	
EMC Reinsurance Company

	  	
Employers Mutual Casualty Company

	  	  	  
	
By: /s/ Ronnie D. Hallenbeck

	  	
By: /s/ Bruce G. Kelley

	
Ronnie D. Hallenbeck

	  	
Bruce G. Kelley

	
President

	  	
President & CEO

	  	  	  
	
Date:  January 28, 2011

	  	
Date:  January 28, 2011

  

9

  

Second Amendment to the

Excess of Loss Reinsurance Agreement

By and Between

EMC Reinsurance Company

And

Employers Mutual Casualty Company

The Excess of Loss Reinsurance Agreement (the “XOL Agreement”), executed by and between EMC Reinsurance Company, an Iowa corporation ("EMC Re"), and Employers Mutual Casualty Company, an Iowa corporation (“EMCC”), on December 21, 2010, as amended on January 1, 2011 ("Amendment"), is further amended by this Second Amendment, effective as of January 1, 2012, by modifying Sections I.1 and I.2, to read as follows:

I.              AGREEMENT

	
  

	
1.

	
a.

	
EMC Re shall cede, and EMCC shall accept as reinsurance, One Hundred Percent (100%) of all “Net Loss” incurred which is in excess of $3,000,000 for each “Occurrence” with “Occurrence” dates on or after 12:01 a.m. Central Standard Time, January 1, 2011 through 12:01 a.m., Central Standard Time, January 1, 2012 arising out of “Subject to Cession” reinsurance contracts and reinsurance contracts written directly by EMC Re (the “Contract”).

	
  

	
b.

	
Notwithstanding the foregoing, EMC Re shall cede, and EMCC shall accept as reinsurance, One Hundred Percent (100%) of all “Net Loss” incurred which is in excess of $4,000,000 for each “Occurrence” with “Occurrence” dates on or after 12:01 a.m., Central Standard Time, January 1, 2012 arising out of “Subject to Cession” reinsurance contracts and reinsurance contracts written directly by EMC Re (the “Contract”).

	
  

	
2.

	
a.

	
With respect to Contracts subject to Section I.1.a., above, EMC Re shall also cede, and EMCC shall accept as premium, Ten Percent (10.0%) of all “Net Written Premium” on such Contracts.

	
  

	
b.

	
With respect to Contracts subject to Section I.1.b., above, EMC Re shall also cede, and EMCC shall accept as premium, Ten Percent (10.0%) of all “Net Written Premium” on such Contracts.

 

  

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In WITNESS WHEREOF, the parties hereto, by their respective duly authorized officers, have executed this Second Amendment to the Excess of Loss Reinsurance Agreement on the dates recorded below.

	
EMC Reinsurance Company

	  	
Employers Mutual Casualty Company

	  	  	  
	
By: /s/ Ronnie D. Hallenbeck

	  	
By: /s/ Bruce G. Kelley

	
Ronnie D. Hallenbeck

	  	
Bruce G. Kelley

	
President

	  	
President & CEO

	  	  	  
	
Date:  February 13, 2012

	  	
Date:  February 13, 2012

 

11ex10_1.htm

Exhibit 10.1

 

FOURTH AMENDMENT

 

to that certain

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT

This FOURTH AMENDMENT, dated as of February 13, 2012 (this “Amendment”), is made in connection with that certain Fourth Amended and Restated Credit Agreement, dated as of December 31, 2009 (as amended and in effect from time to time, the “Credit Agreement”), among (a) Columbus McKinnon Corporation (the “Company”) and certain subsidiaries of the Company party thereto (together with the Company, the “Borrowers”), (b) the lending institutions party thereto (the “Lenders”), and (c) Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer.  Capitalized terms used herein and not defined herein shall have the meanings ascribed thereto in the Credit Agreement.

 

WHEREAS, the Company is proposing a change to its global legal entity structure (the “Corporate Restructuring”); and

WHEREAS, pursuant to that certain Share Pledge Agreement among Yale Industrial Products, Inc. (“Yale”), the Administrative Agent, the Lenders and Columbus McKinnon Industrial Products GmbH (formerly known as Yale Industrial Products, GmbH, “Columbus Germany”), Yale, a Guarantor, pledged 0.65 shares of Columbus Germany (constituting 65% of the issued and outstanding shares of Columbus Germany) to the Administrative Agent and the Lenders as security for the Obligations (the “German Pledge”); and

WHEREAS, pursuant to the Corporate Restructuring, among other things, (a) three new holding companies organized under Dutch law shall be interposed between Yale and Columbus Germany (the “Dutch Holding Companies”) and (b) Yale shall transfer its ownership interests in Columbus Germany to such Dutch Holding Companies; and

WHEREAS, in connection with the Corporate Restructuring, the Borrowers have requested that the Administrative Agent and the Lenders agree to release the German Pledge, and in consideration of such release, Yale will provide a pledge of 65% of the issued and outstanding shares in the share capital of the first tier Dutch Holding Company (“Dutch Holdco I”),

WHEREAS, the Administrative Agent and the Lenders are willing to release the German Pledge on the terms and subject to the conditions set forth herein.

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

 

§1. Amendments.

(a)  Section 1.01 of the Credit Agreement is hereby amended by adding the following new definitions in the appropriate alphabetical order:

 

  

  

  

 

““Corresponding Obligations” means Yale’s Obligations as they may exist from time to time, other than its Parallel Debt.”

““Dutch Holdco I” means the first tier Dutch holding company that is a wholly-owned direct Subsidiary of Yale.”

““Dutch Holdco II” means the second tier Dutch holding company that is a wholly-owned direct Subsidiary of Dutch Holdco I.”

““Dutch Holdco III” means the third tier Dutch holding company that is a wholly-owned direct Subsidiary of Dutch Holdco II.”

““Dutch Holding Companies” means Dutch Holdco I, Dutch Holdco II and Dutch Holdco III.”

““Parallel Debt” has the meaning specified in Section 10.22.”

““Yale” means Yale Industrial Products, Inc.

(b) Section 7.02 of the Credit Agreement is hereby amended by deleting clause (b) contained therein and substituting in lieu thereof the following:

“(b) Investments of a Loan Party in any of the Company’s Subsidiaries that are not Loan Parties; provided that the aggregate amount of such Investments made from and after the Closing Date does not exceed $30,000,000;”

(c) Section 7.02 of the Credit Agreement is hereby amended by (i) deleting the “and” immediately after clause (h) contained therein, (ii) deleting the period at the end of clause (i) contained therein and substituting in lieu thereof the text “; and” and (iii) adding the following new clause in the appropriate alphabetical order:

“(j) Investments of any Subsidiary that is not a Loan Party in any other Subsidiary that is not a Loan Party.”

(d) Section 7.03 of the Credit Agreement is hereby amended by deleting clause (i) contained therein and substituting in lieu thereof the following:

“(i) Indebtedness of any Subsidiary owing to any Loan Party provided that the Investment corresponding to such Indebtedness is permitted pursuant to Section 7.02(b);”

(e) Section 7.03 of the Credit Agreement is hereby amended by (i) deleting the “and” immediately after clause (k) contained therein, (ii) deleting the period at the end of clause (l) contained therein and substituting in lieu thereof the text “; and” and (iii) adding the following new clause in the appropriate alphabetical order:

 

  

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“(m) Indebtedness of any Subsidiary that is not a Loan Party to any other Subsidiary that is not a Loan Party.”

(f) Article VII of the Credit Agreement is hereby amended by adding the following new Section in the appropriate numerical order:

“7.15   Dutch Holding Companies.  Permit any Dutch Holding Company to engage in any trade or business (other than (a) operating as a treasury center for its Subsidiaries and (b) lending and borrowing intercompany loans that are not otherwise prohibited hereunder), or own any assets (other than (i) the capital stock of its Subsidiaries, (ii) cash and (iii) de-minimis assets) or incur any Indebtedness or other liabilities (other than (x) intercompany Indebtedness and liabilities owing to Loan Parties and (y) Indebtedness and other liabilities arising in connection with the treasury center services provided by it to its Subsidiaries, in each case, to the extent such Indebtedness and other liabilities are not otherwise prohibited hereunder).”

(g) Article X of the Credit Agreement is hereby amended by adding the following new Section in the appropriate numerical order:

“10.22  Parallel Debt.

(a) For the purpose of ensuring the validity and enforceability of any right of pledge governed by Dutch law, Yale hereby irrevocably and unconditionally undertakes to pay to the Administrative Agent an amount equal to the aggregate amount due by Yale in respect of the Corresponding Obligations as they may exist from time to time. The payment undertaking of Yale under this Section 10.22 is to be referred to as the “Parallel Debt”.

(b) The Parallel Debt will be payable in the currency or currencies of the Corresponding Obligations and will become due and payable as and when and to the extent one or more of the Corresponding Obligations become due and payable. An Event of Default in respect of the Corresponding Obligations shall constitute a default (verzuim) within the meaning of section 3:248 of the Dutch Civil Code with respect to the Parallel Debt without any notice being required.

(c) Each of the parties to this hereto hereby acknowledges that:

 

(i) the Parallel Debt constitutes an undertaking, obligation and liability to the Administrative Agent which is separate and independent from, and without prejudice to, the Corresponding Obligations; and

(ii) the Parallel Debt represents the Administrative Agent's own separate and independent claim to receive payment of the Parallel Debt from Yale, it being understood, in each case, that pursuant to this Section 10.22(c) the amount which may become payable by Yale as the Parallel Debt shall never exceed the total of the amounts which are payable under or in connection with the Corresponding Obligations.

 

  

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(d) To the extent the Administrative Agent irrevocably receives any amount in payment of the Parallel Debt, (i) the Administrative Agent shall distribute that amount among the Administrative Agent and the Lenders that are creditors of the Corresponding Obligations in accordance with the relevant provisions of the Credit Agreement as if received by it in payment of the Corresponding Obligations and (ii) the Corresponding Obligations shall be reduced by an amount equal to such payment.

(e) For the purpose of this Section 10.22 but subject to paragraph (d) above the Administrative Agent acts in its own name and on behalf of itself and not as agent, representative or trustee of any other Lender.”

§2. Release.  Upon both (a) the consummation of the Corporate Restructuring substantially on the terms disclosed to the Administrative Agent and the Lenders prior to the date hereof (as such terms may be modified with the prior approval of the Administrative Agent) and (b) the contemporaneous satisfaction of the covenants set forth in Section 3 herein, the Administrative Agent and the Lenders hereby agree (i) that the German Pledge shall be released without further action of the Administrative Agent or the Lenders and (ii) to execute and deliver, at the sole cost and expense of the Borrowers, such releases or termination statements as the Borrowers may reasonably request in connection with the above-described release of the German Pledge.  The Lenders hereby authorize the Administrative Agent to execute and deliver, on behalf of the Lenders, any such releases and termination statements described in clause (b) of this Section.

§3. Covenants.  Each Borrower shall, and shall cause each Subsidiary to:

(a) Prior to the consummation of the Corporate Restructuring, deliver to the Administrative Agent (i) the deed of incorporation of each Dutch Holding Company, and (ii) an extract from the relevant Chamber of Commerce Commercial Register in relation to each Dutch Holding Company, all such deliverables to be in form and substance reasonably satisfactory to the Administrative Agent.

(b) Contemporaneously with the consummation of the Corporate Restructuring, deliver to the Administrative Agent (i) satisfactory evidence that the Corporate Restructuring has occurred substantially on the terms disclosed to the Administrative Agent and the Lenders prior to the date hereof (as such terms may be modified with the prior approval of the Administrative Agent), (ii) a duly executed copy of a pledge agreement in form and substance reasonably satisfactory to the Administrative Agent whereby Yale shall pledge not less than 65% of the issued and outstanding shares in the share capital of Dutch Holdco I to the Administrative Agent as security for the Obligations, (iii) satisfactory evidence that such pledge is duly perfected under Dutch law, (iv) a favorable opinion addressed to the Administrative Agent and the Lenders of DLA Piper Nederland N.V., Dutch counsel to Yale and the Dutch Holding Companies, in form and substance reasonably satisfactory to the Administrative Agent, as to the matters concerning such Persons and such pledge as the Administrative Agent may reasonably request, (v) resolutions of the managing board and shareholder of Dutch Holdco I in form and substance reasonably satisfactory to the Administrative Agent, approving the pledge on its shares and the conditional transfer of the voting rights attached to its shares, (vi) the original promissory note payable to Yale to be issued by Dutch Holdco I in connection with the Corporate Restructuring, together with a duly executed instrument of transfer or assignment in blank, (vii) an updated Schedule 5.13 to the Credit Agreement in form and substance reasonably satisfactory to the Administrative Agent, which shall replace the existing Schedule 5.13 to the Credit Agreement, and (ix) such other assurances, certificates, documents, consents or opinions that the Administrative Agent reasonably may require in connection with the foregoing transactions.

 

  

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§4. Affirmation and Acknowledgment.  Each Borrower hereby ratifies and confirms all of its Obligations to the Lenders, including, without limitation, the Loans, the Notes and the other Loan Documents, and each Borrower hereby affirms its absolute and unconditional promise to pay to the Lenders all Obligations under the Credit Agreement as amended hereby.  Each Guarantor hereby acknowledges and consents to this Amendment and agrees that its Guaranty remains in full force and effect, and each such Guarantor confirms and ratifies all of its obligations under the Loan Documents.  Each Borrower and each Guarantor hereby confirms that the Obligations are and remain secured pursuant to the Security Documents and pursuant to all other instruments and documents executed and delivered by the Borrowers and the Guarantors, as security for the Obligations.

§5. Representations and Warranties.  Each Borrower hereby represents and warrants to the Lenders as follows:

(a) The execution and delivery by each Borrower and each Guarantor of this Amendment, and the performance by each Borrower and each Guarantor of its obligations and agreements under this Amendment and the Credit Agreement as amended hereby, are within the corporate authority of each Borrower and each Guarantor and have been duly authorized by all necessary corporate proceedings on behalf of each Borrower and each Guarantor, and do not contravene any provision of law, statute, rule or regulation to which any Borrower or any Guarantor is subject or any Borrower’s or any Guarantor’s charter, other incorporation papers, by-laws or any stock provision or any amendment thereof or of any agreement or other instrument binding upon any Borrower or any Guarantor.

(b) This Amendment and the Credit Agreement as amended hereby constitute legal, valid and binding obligations of the Borrowers and the Guarantors, enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights or general principles of equity and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefore may be brought.

(c) Other than approvals or consents which have been obtained, no approval or consent of, or filing with, any governmental agency or authority is required to make valid and legally binding the execution, delivery or performance by the Borrowers of this Amendment and the Credit Agreement, as amended hereby.

 

  

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(d) The representations and warranties contained in Article V of the Credit Agreement are true and correct at and as of the date made and as of the date hereof, except to the extent of changes resulting from transactions contemplated or permitted by the Credit Agreement and the other Loan Documents and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse, or to the extent that such representations and warranties relate expressly to an earlier date.

(e) The Borrowers have performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by it prior to or at the time hereof, and as of the date hereof, after giving effect to the provisions hereof, there exists no Event of Default or Default.

§6. Conditions to Effectiveness.  The Administrative Agent, the Lenders and the Company agree that this Amendment shall become effective as of the date first written above upon the receipt by the Administrative Agent of counterparts of this Amendment, duly executed by each of the Company, the Guarantors, the Administrative Agent and each of the Required Lenders.

§7. Expenses.  Borrowers agree to pay to the Administrative Agent upon written demand therefor an amount equal to any and all reasonable out-of-pocket costs, expenses, and liabilities incurred or sustained by the Adminsitrative Agent in connection with the preparation of this Amendment (including, without limitation, reasonable fees and expenses of legal counsel).  Amounts payable pursuant to this Section 7 shall be subject to the provisions of Section 10.04(a) of the Credit Agreement, as fully as if set forth therein.

 

§8. Miscellaneous Provisions.

 

(a) Except as otherwise expressly provided by this Amendment, all of the terms, conditions and provisions of the Credit Agreement and the other Loan Documents shall remain in full force and effect without modification or waiver.

(b) This Amendment shall constitute a Loan Document under the Credit Agreement, and all obligations included in this Amendment (including, without limitation, all obligations for the payment of principal, interest, fees, and other amounts and expenses) shall constitute obligations under the Loan Documents and be secured by the collateral security for the Obligations.  The Credit Agreement, together with this Amendment, shall be read and construed as a single agreement.  All references in the Loan Documents to the Credit Agreement or any other Loan Document shall hereafter refer to the Credit Agreement or any other Loan Document as amended hereby.

(c) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

  

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(d) This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute but one instrument.  In making proof of this Amendment it shall not be necessary to produce or account for more than one counterpart signed by each party hereto by and against which enforcement hereof is sought.  Delivery of an executed counterpart of this Amendment by facsimile or electronic mail in portable document format (.pdf) shall be equally effective as delivery of an original executed counterpart of this Amendment.

 

[Remainder of page intentionally left blank.]

 

  

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IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be executed as of the date first written above.

 

	 	
BORROWERS

	 
	 	 	 
	 	COLUMBUS MCKINNON CORPORATION	 
	 	 	 	 
	 	
By: 

	/s/ Gregory P. Rustowicz	 
	 	 	
Name: Gregory P. Rustowicz

	 
	 	 	
Title: Vice President and Chief Financial Officer

	 

 

	 	
GUARANTORS

	 
	 	 	 
	 	
YALE INDUSTRIAL PRODUCTS, INC.

	 
	 	 	 	 
	 	
By: 

	
/s/ Gregory P. Rustowicz

	 
	 	 	
Name: Gregory P. Rustowicz

	 
	 	 	
Title: Vice President and Chief Financial Officer

	 

 

	 	

CRANE EQUIPMENT & SERVICE, INC.

	 
	 	 	 	 
	 	
By: 

	
/s/ Gregory P. Rustowicz

	 
	 	 	
Name: Gregory P. Rustowicz

	 
	 	 	
Title: Vice President and Chief Financial Officer

	 

 

  

  

  

 

	 	

BANK OF AMERICA, N.A.,

	 
	 	as Administrative Agent	 
	 	 	 	 
	 	
By: 

	

/s/ Colleen O’Brien

	 
	 	 	
Name: Colleen O’Brien

	 
	 	 	
Title: Sr. Vice President

	 

 

  

  

  

 

	 	

BANK OF AMERICA, N.A.,

	 
	 	
as a Lender, L/C Issuer and Swing Line Lender

	 
	 	 	 	 
	 	
By: 

	

/s/ Colleen O’Brien

	 
	 	 	
Name: Colleen O’Brien

	 
	 	 	
Title: Sr. Vice President

	 

 

  

  

  

 

	 	

JPMORGAN CHASE BANK, N.A., as a Lender

	 
	 	 	 	 
	 	By: /s/ Karen L. Mikols	 
	 	Name: Karen L. Mikols	 
	 	Title: Authorized Officer	 

 

  

  

  

 

	 	

RBS CITIZENS BANK, N.A., as a Lender

	 
	 	 	 	 
	 	
By: /s/ Michael Kennuth

	 
	 	
Name: Michael Kennuth

	 
	 	
Title:   Vice President

	 

 

  

  

  

 

	 	

M&T BANK, as a Lender

	 
	 	 	 	 
	 	
By: /s/ Andrew M. Constantino

	 
	 	
Name: Andrew M. Constantino

	 
	 	
Title:   Vice President

	 

 

  

  

  

 

	 	

PNC BANK, N.A., as a Lender

	 
	 	 	 	 
	 	
By: /s/ James F. Stevenson

	 
	 	
Name: James F. Stevenson

	 
	 	
Title:   Senior Vice President

	 

 

  

  

  

 

	 	

CREDIT SUISSE AG, CAYMAN ISLANDS 

	 
	 	BRANCH, as a Lender	 
	 	 	 	 
	 	
By: /s/ John D. Toronto

	 
	 	
Name: John D. Toronto

	 
	 	
Title:   Managing Director

	 

	 	 	 	 
	 	
By: /s/ Vipul Dhadda

	 
	 	
Name: Vipul Dhadda

	 
	 	
Title:   Associate

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