Document:

Exhibit 10.2

 

July 19, 2002

 

Thomas Reynolds

47 The Fairways

Ipswich, MA 01938

 

Dear Thomas:

 

This Letter

Agreement sets forth the terms of your employment separation from Lightbridge,

Inc., a Delaware corporation (“Lightbridge”).

 

1.             Termination.  The effective date of termination of your

employment with Lightbridge is July 22, 2002.

 

2.             Severance Payment.  You will receive a lump sum severance

payment of $70,673, minus applicable deductions, upon the expiration of the

seven-day period immediately following your indication of acceptance of the

terms of this Letter Agreement by signing on the signature line below. You

agree that the payments described in this letter agreement are above and beyond

any payments or compensation otherwise owed to you under the terms of your

employment with Lightbridge or required by law.

 

3.             Benefits.  A summary of your principal benefits upon

termination is as follows:

 

Health Coverage - Upon the effective date of

termination, your rights under the so-called COBRA statute shall attach and

shall entitle you to participate in Lightbridge’s group health and dental

plans. Should you or any of your family members elect COBRA continuation

coverage, for the twelve week period immediately following the effective date

of termination, Lightbridge shall be responsible for paying the difference

between the cost of COBRA continuation coverage and the premium contribution

amount applicable to you as of the effective date of termination subject to any

applicable carrier rate adjustments. After such twelve week period ends, if you

or any of your family members elect to continue COBRA coverage, you will be

responsible for all of the premium payments. Shortly after the date hereof, we

will provide you with COBRA documentation and instructions for submitting COBRA

payments.

 

Life Insurance - Your Lightbridge paid life

insurance ends on the effective date of termination.  If you are interested in continuing coverage at your own cost,

please call The Hartford at 1-800-548-5157.

 

401(k) Plan - Your participation in the 401(k)

plan ends on the effective date of termination.  For rollover, loan or company match questions, please contact

MassMutual at 1-800-743-5274.

 

Stock Options - You have received stock option

grants while employed at Lightbridge and you have 30 days from the effective

date of termination to exercise any vested, unexercised options.  You may do so through your E-trade account.

 

Other Benefits - All other Lightbridge

benefits terminate on the effective date of termination. Enclosed herewith is a

brief summary of the impact that the termination of your employment has on

other employee benefits and what steps, if any, you need to take in connection

therewith.

 

4.             Unemployment Insurance Benefits.  Please see the Attachment - How to File for

Unemployment Insurance Benefits.

 

5.             Release.  In exchange for the consideration set forth

in this Letter Agreement, you hereby irrevocably and unconditionally release,

acquit and forever discharge Lightbridge, its affiliated and related

corporations and each of their predecessors and successors, and each of their

agents, directors, officers, trustees, attorneys, present and former employees,

representatives, and related entities (collectively referred to as

“Lightbridge”) from any and all charges, complaints, claims, liabilities,

obligations, promises, agreements, controversies, damages, actions, causes of

action, suits, rights, demands, costs, losses, damages and expenses (including

attorneys’ fees and costs actually incurred) of any nature whatsoever known or

unknown, suspected or unsuspected, which you now have, own or hold, or claim to

have, own or hold, or which at any time heretofore, had owned or held, or

claimed to have owned or held, or which you at any time hereafter may have, own

or hold, or claim to have owned or held against Lightbridge, based

 

 

upon, arising out of or in

connection with any circumstance, matter or state of fact up to the date of

this Letter Agreement, including but not limited to, claims or rights under any

federal, state, or local statutory and/or common law in any way regulating or

affecting the employment relationship, including but not limited to Title VII

of the Civil Rights Act of 1964, the Americans with Disabilities Act, Chapter

151B of the Massachusetts General Laws, and the Age Discrimination in

Employment Act.  THIS MEANS YOU MAY NOT

SUE LIGHTBRIDGE FOR ANY CURRENT OR PRIOR CLAIMS ARISING OUT OF YOUR EMPLOYMENT

WITH OR TERMINATION FROM LIGHTBRIDGE.

 

You further

agree that you will not bring any lawsuits, file any charges or complaints, or

make any other demands against Lightbridge, or further pursue any lawsuits,

cases or complaints already brought, based on your employment by

Lightbridge.  You further represent that

you have no current or pending actions, charges, lawsuits, or complaints

against Lightbridge.  You acknowledge

and understand that the consideration provided for in this Letter Agreement

constitutes a full, fair and complete payment for the release and waiver of all

of your possible claims.  You

acknowledge and understand that Lightbridge does not owe you anything for your

claims in addition to the consideration set forth in this Letter Agreement.

 

6.             Return of Documents and Lightbridge

Property.  You agree that you

will return to Lightbridge all documents, tapes, notes, computer files and

other information or materials (and all copies) in your possession which

contain confidential information and all Lightbridge property and equipment by

the effective date of termination. For additional information or property or

equipment needing to be returned, you agree to schedule in advance a specific

time to meet with management for this purpose prior to the effective date of

termination.

 

7.             Confidentiality.  You and Lightbridge agree that the terms of

this Letter Agreement are strictly confidential and shall not be disclosed to

any other person, except that you may disclose this Letter Agreement to your

immediate family, attorney, and tax and other professional advisor, and

Lightbridge may disclose this Letter Agreement to Lightbridge employees and

advisors with a need to know about the Letter Agreement, including without

limitation, legal counsel, corporate officers and officials, tax or accounting

consultants, human resources and payroll representatives.

 

8              Non-disparagement.  You agree that you will not make any

disparaging comments concerning Lightbridge or Lightbridge’s employment

practices.

 

9.             Challenge to Validity of Letter

Agreement.  Lightbridge and

you shall never bring a proceeding to challenge the validity of this Letter

Agreement.  Should you do so, you will

first be required to pay back to Lightbridge any monies received from

Lightbridge under paragraph two (2) of this Letter Agreement.

 

10.           Enforcement.  In the event that you

violate paragraphs 6, 7 or 8 of this Letter Agreement during the twelve-week

period of Salary Continuation, the payments described in paragraph 2 shall

cease.  In the event that you violate

paragraphs 6, 7 or 8 following the expiration of the twelve-week Salary

Continuation period, Lightbridge shall be entitled to an order enjoining future

violations and an award of $5,000.00 in liquidated damages for each such

violation.

 

11.           Entire Agreement; Other Agreements.  This Letter Agreement sets forth the full

terms of the separation arrangement between you and Lightbridge, and supersedes

any prior oral or written understanding. 

Notwithstanding the previous sentence, the agreement entitled

“Lightbridge, Inc. Confidentiality and Non Competition Agreement” executed by

you remains in full force and effect.

 

12.           Governing Law.  This Letter Agreement will be governed by and interpreted in

accordance with the substantive laws of The Commonwealth of Massachusetts.

 

13.           Signature. 

This Letter Agreement may be signed on one or more copies, each of which

when so signed will be deemed to be an original, and all of which together will

be one and the same document.

 

14.           Representations.  You represent that you understand the various claims you could

have asserted under M.G.L. c. 151B, The American with Disabilities Act, Title

VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act,

and other such similar laws; that you have read this Letter Agreement carefully

and understand all its provisions; that the consideration received by you under

this Letter Agreement is above and beyond the payments or benefits otherwise

owed to you under the terms of your employment with Lightbridge or required by

law; and that you enter this Letter Agreement and waive any claims knowingly

and willingly.

 

15.           Effective Date.  This Letter Agreement shall become effective seven (7) days after

it is signed.  You may revoke this

Letter Agreement within seven (7) days after it is signed, and it shall not

become effective or enforceable until this seven (7) day revocation period has

expired.

 

2

 

14.           Review.  In

signing this Letter Agreement, you acknowledge that you understand its

provisions, that your agreement is knowing and voluntary, that you have been

afforded a full and reasonable opportunity of at least 21 days to consider its

terms and to consult with or seek advice from an attorney or any other person

of your choosing, and that you have been advised by Lightbridge to consult with

an attorney prior to executing this Letter Agreement.

 

Please

indicate your acceptance of the terms of this Letter Agreement by signing below

and subsequently mailing or personally delivering the signed agreement to me.

 

	

  Very truly

  yours,

  	

   

  
	

   

  	

   

  
	

  /s/ Kathleen

  V. Betts

  	

   

  	

   

  
	

   

  	

   

  
	

  Kathleen V. Betts

  	

   

  
	

   

  	

   

  
	

  Vice

  President of Human Resources

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

  Agreed and

  accepted:

  	

   

  
	

   

  	

   

  
	

  /s/Thomas

  Reynolds

  	

   

  	

  22 July 02

  	

   

  
	

   

  	

   

  
	

  Thomas

  Reynolds

  	

  Date

  	

   

  

 

3EXHIBIT

10.20

 

SECOND AMENDMENT TO

CREDIT AGREEMENT

 

THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this

“Amendment”) is entered into as of June 30, 2002, by and between NORTHWEST PIPE

COMPANY, an Oregon corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL

ASSOCIATION (“Bank”).

 

RECITALS

 

WHEREAS, Borrower is currently indebted to Bank

pursuant to the terms and conditions of that certain Credit Agreement between

Borrower and Bank dated as of May 30, 2001, as amended from time to time

(“Credit Agreement”).

 

WHEREAS, Bank and Borrower have agreed to certain

changes in the terms and conditions set forth in the Credit Agreement and have

agreed to amend the Credit Agreement to reflect said changes.

 

NOW, THEREFORE, for valuable consideration, the

receipt and sufficiency of which are hereby acknowledged, the parties hereto

agree that the Credit Agreement shall be amended as follows:

 

1.             Section

1.1 (a) is hereby amended by deleting “June 30, 2003” as the last day on which

Bank will make advances under the Revolving Line of Credit, and by substituting

for said date “September 30, 2003,” with such change to be effective upon the

execution and delivery to Bank of a promissory note substantially in the form

of Exhibit ”A” attached hereto (which promissory note shall replace and be

deemed the Revolving Line of Credit Note defined in and made pursuant to the

Credit Agreement) and all other contracts, instruments and documents required

by Bank to evidence such change.

 

2.             Section 6.1

(g) is hereby deleted in its entirety, and the following substituted therefor:

 

“There shall occur any material adverse change in the operations, business

or condition (including the financial condition) of the Borrower and

Subsidiaries, taken as a whole, after the date of this Agreement and at a time

when the outstanding principal balance of the Line of Credit (inclusive,

without limitation, of contingent letter of credit liabilities) exceeds 75% of

the maximum amount available under the Line of Credit.”

 

3.             Except

as specifically provided herein, all terms and conditions of the Credit

Agreement remain in full force and effect, without waiver or modification.  All terms defined in the Credit Agreement

shall have the same meaning when used in this Amendment.  This Amendment and the Credit Agreement

shall be read together, as one document.

 

4.             Borrower

hereby remakes all representations and warranties contained in the Credit

Agreement and reaffirms all covenants set forth therein.  Borrower further certifies that as of the

date of this Amendment there exists no Event of Default as defined in the

Credit Agreement, nor any condition, act or event which with the giving of

notice or the passage of time or both would constitute any such Event of

Default.

 

UNDER

OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY BANK AFTER

OCTOBER 3, 1989 CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR

PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER’S

RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE

ENFORCEABLE.

 

 

IN WITNESS WHEREOF, the parties hereto have caused

this Amendment to be executed as of the day and year first written above.

 

	

   

  	

  WELLS FARGO BANK,

  	

   

  
	

  NORTHWEST PIPE COMPANY

  	

  NATIONAL ASSOCIATION

  
	

   

  	

   

  
	

  By: 

  	

   

  	

  /s/ John Murakami 

  	

   

  	

  By:

  	

   

  	

  /s/ S. Myers

  	

   

  
	

   

  	

  VP - CFO

  	

   

  	

  Stanton Myers, Vice President

  
											

 

2

 

REVOLVING LINE OF CREDIT

NOTE

 

	

  $30,000,000.00

  	

   

  	

  Portland, Oregon

  
	

   

  	

   

  	

  June 30, 2002

  

 

FOR VALUE RECEIVED, the undersigned NORTHWEST PIPE

COMPANY (“Borrower”) promises to pay to the order of WELLS FARGO BANK, NATIONAL

ASSOCIATION (“Bank”) at its office at Portland RCBO, 1300 S.W. Fifth Avenue

T-13, Portland, Oregon, or at such other place as the holder hereof may

designate, in lawful money of the United States of America and in immediately

available funds, the principal sum of Thirty Million Dollars ($30,000,000.00),

or so much thereof as may be advanced and be outstanding, with interest

thereon, to be computed on each advance from the date of its disbursement as

set forth herein.

 

DEFINITIONS:

 

As used herein, the following terms shall have the

meanings set forth after each, and any other term defined in this Note shall

have the meaning set forth at the place defined:

 

(a)           “Business

Day” means any day except a Saturday, Sunday or any other day on which

commercial banks in Oregon are authorized or required by law to close.

 

(b)           “Fixed

Rate Term” means a period commencing on a Business Day and continuing for 1, 2,

3 or 6 months, as designated by Borrower, during which all or a portion of the

outstanding principal balance of this Note bears interest determined in

relation to LIBOR; provided however, that no Fixed Rate Term may be selected

for a principal amount less than Two Hundred and Fifty Thousand Dollars ($250,000.00);

and provided further, that no Fixed Rate Term shall extend beyond the scheduled

maturity date hereof.  If any Fixed Rate

Term would end on a day which is not a Business Day, then such Fixed Rate Term

shall be extended to the next succeeding Business Day.

 

(c)           “LIBOR”

means the rate per annum (rounded upward, if necessary, to the nearest whole

1/8 of 1%) and determined pursuant to the following formula:

 

	

  LIBOR =

  	

  Base LIBOR

  	

   

  
	

   

  	

  100% - LIBOR Reserve

  Percentage

  	

   

  

 

(i)            “Base

LIBOR” means the rate per annum for United States dollar deposits quoted by

Bank as the Inter-Bank Market Offered Rate, with the understanding that such

rate is quoted by Bank for the purpose of calculating effective rates of

interest for loans making reference thereto, on the first day of a Fixed Rate

Term for delivery of funds on said date for a period of time approximately

equal to the number of days in such Fixed Rate Term and in an amount

approximately equal to the principal amount to which such Fixed Rate Term

applies.  Borrower understands and

agrees that Bank may base its quotation of the Inter-Bank Market Offered Rate

upon such offers or other market indicators of the Inter-Bank Market as Bank in

its discretion deems appropriate including, but not limited to, the rate offered

for U.S. dollar deposits on the London Inter-Bank Market.

 

(ii)           “LIBOR

Reserve Percentage” means the reserve percentage prescribed by the Board of

Governors of the Federal Reserve System (or any successor) for “Eurocurrency

Liabilities” (as defined in Regulation D of the Federal Reserve Board, as

amended), adjusted by Bank for expected changes in such reserve percentage

during the applicable Fixed Rate Term.

 

(d)           “Prime

Rate” means at any time the rate of interest most recently announced within

Bank at its principal office as its Prime Rate, with the understanding that the

Prime Rate is one of Bank’s base rates and serves as the basis upon which

effective rates of interest are calculated for those loans making reference

thereto, and is evidenced by the recording thereof after its announcement in

such internal publication or publications as Bank may designate.

 

3

 

INTEREST:

 

(a)           Interest.  The outstanding principal balance of this

Note shall bear interest (computed on the basis of a 360-day year, actual days

elapsed) either (i) at a fluctuating rate per annum fifty hundredths percent

(.50%) below the Prime Rate in effect from time to time, or (ii) at a fixed

rate per annum determined by Bank to be one and one half percent above LIBOR in

effect of the first day of each Fixed Rate Term.  When interest is determined in relation to the Prime Rate, each

change in the rate of interest hereunder shall become effective on the date

each Prime Rate change is announced within Bank.  With respect to each LIBOR selection hereunder, Bank is hereby

authorized to note the date, principal amount, interest rate and Fixed Rate

Term applicable thereto and any payments made thereon on Bank’s books and

records (either manually or by electronic entry) and/or on any schedule

attached to this Note, which notations shall be prima facie evidence of the

accuracy of the information noted.

 

(b)           Selection

of Interest Rate Options.  At any

time any portion of this Note bears interest determined in relation to LIBOR,

it may be continued by Borrower at the end of the Fixed Rate Term applicable

thereto so that all or a portion thereof bears interest determined in relation

to the Prime Rate or to LIBOR for a new Fixed Rate Term designated by Borrower.  At any time any portion of this Note bears

interest determined in relation to the Prime Rate, Borrower may convert all or

a portion thereof so that it bears interest determined in relation to LIBOR for

a Fixed Rate Term designated by Borrower. 

At such time as Borrower requests an advance hereunder or wishes to

select a LIBOR option for all or a portion of the outstanding principal balance

hereof, and at the end of each Fixed Rate Term, Borrower shall give Bank notice

specifying: (i) the interest rate option selected by Borrower; (ii) the

principal amount subject thereto; and (iii) for each LIBOR selection, the

length of the applicable Fixed Rate Term. Any such notice may be given by

telephone (or such other electronic method as Bank may permit) so long as, with

respect to each LIBOR selection, (A) if requested by Bank, Borrower provides to

Bank written confirmation thereof not later than three (3) Business Days after

such notice is given, and (B) such notice is given to Bank prior to 10:00 a.m.

on the first day of the Fixed Rate Term, or at a later time during any Business

Day if Bank, at it’s sole option but without obligation to do so, accepts

Borrower’s notice and quotes a fixed rate to Borrower.  If Borrower does not immediately accept a

fixed rate when quoted by Bank, the quoted rate shall expire and any subsequent

LIBOR request from Borrower shall be subject to a redetermination by Bank of

the applicable fixed rate.  If no

specific designation of interest is made at the time any advance is requested

hereunder or at the end of any Fixed Rate Term, Borrower shall be deemed to

have made a Prime Rate interest selection for such advance or the principal

amount to which such Fixed Rate Term applied.

 

(c)           Taxes

and Regulatory Costs.  Borrower

shall pay to Bank immediately upon demand, in addition to any other amounts due

or to become due hereunder, any and all (i) withholdings, interest equalization

taxes, stamp taxes or other taxes (except income and franchise taxes) imposed

by any domestic or foreign governmental authority and related in any manner to

LIBOR, and (ii) future, supplemental, emergency or other changes in the LIBOR

Reserve Percentage, assessment rates imposed by the Federal Deposit Insurance

Corporation, or similar requirements or costs imposed by any domestic or

foreign governmental authority or resulting from compliance by Bank with any

request or directive (whether or not having the force of law) from any central

bank or other governmental authority and related in any manner to LIBOR to the

extent they are not included in the calculation of LIBOR.  In determining which of the foregoing are

attributable to any LIBOR option available to Borrower hereunder, any

reasonable allocation made by Bank among its operations shall be conclusive and

binding upon Borrower.

 

(d)           Payment

of Interest.  Interest accrued on

this Note shall be payable on the last day of each Month, commencing July 31,

2002.

 

(e)           Default Interest. 

From and after the maturity date of this Note, or such earlier date as

all principal owing hereunder becomes due and payable by acceleration or

otherwise, the outstanding principal balance of this Note shall bear interest

until paid in full at an increased rate per annum (computed on the basis of a

360-day year, actual days elapsed) equal to three percent (3%) above the rate

of interest from time to time applicable to the credit agreement dated May 30,

2001.

 

BORROWING AND REPAYMENT:

 

(a)           Borrowing

and Repayment.  Borrower may from

time to time during the term of this Note borrow, partially or wholly repay its

outstanding borrowings, and reborrow, subject to all of the limitations, terms

and

 

4

 

conditions of this Note and of any document executed in connection with

or governing this Note; provided however, that the total outstanding borrowings

under this Note shall not at any time exceed the principal amount stated

above.  The unpaid principal balance of

this obligation at any time shall be the total amounts advanced hereunder by

the holder hereof less the amount of principal payments made hereon by or for

any Borrower, which balance may be endorsed hereon from time to time by the

holder.  The outstanding principal

balance of this Note shall be due and payable in full on September 30, 2003.

 

(b)           Advances.  Advances hereunder, to the total amount of

the principal sum stated above, may be made by the holder at the oral or

written request of (i) Paul Parsons, Mike Van Note, Al Rose or John Murakami,

any one acting alone, who are authorized to request advances and direct the

disposition of any advances until written notice of the revocation of such

authority is received by the holder at the office designated above, or (ii) any

person, with respect to advances deposited to the credit of any deposit account

of any Borrower, which advances, when so deposited, shall be conclusively

presumed to have been made to or for the benefit of each Borrower regardless of

the fact that persons other than those authorized to request advances may have

authority to draw against such account. 

The holder shall have no obligation to determine whether any person

requesting an advance is or has been authorized by any Borrower.

 

(c)           Application

of Payments.  Each payment made on

this Note shall be credited first, to any interest then due and second, to the

outstanding principal balance hereof. 

All payments credited to principal shall be applied first, to the

outstanding principal balance of this Note which bears interest determined in

relation to the Prime Rate, if any, and second, to the outstanding principal

balance of this Note which bears interest determined in relation to LIBOR, with

such payments applied to the oldest Fixed Rate Term first.

 

PREPAYMENT:

 

(a)           Prime

Rate.  Borrower may prepay principal

on any portion of this Note which bears interest determined in relation to the

Prime Rate at any time, in any amount and without penalty.

 

(b)           LIBOR.  Borrower may prepay principal on any portion

of this Note which bears interest determined in relation to LIBOR at any time and

in the minimum amount of One Hundred Thousand Dollars ($100,000.00); provided

however, that if the outstanding principal balance of such portion of this Note

is less than said amount, the minimum prepayment amount shall be the entire

outstanding principal balance thereof. 

In consideration of Bank providing this prepayment option to Borrower,

or if any such portion of this Note shall become due and payable at any time

prior to the last day of the Fixed Rate Term applicable thereto by acceleration

or otherwise, Borrower shall pay to Bank immediately upon demand a fee which is

the sum of the discounted monthly differences for each month from the month of

prepayment through the month in which such Fixed Rate Term matures, calculated

as follows for each such month:

 

(i)                                     Determine

the amount of interest which would have accrued each month on the amount

prepaid at the interest rate applicable to such amount had it remained

outstanding until the last day of the Fixed Rate Term applicable thereto.

 

(ii)                                  Subtract

from the amount determined in (i) above the amount of interest which would have

accrued for the same month on the amount prepaid for the remaining term of such

Fixed Rate Term at LIBOR in effect on the date of prepayment for new loans made

for such term and in a principal amount equal to the amount prepaid.

 

(iii)                               If

the result obtained in (ii) for any month is greater than zero, discount that

difference by LIBOR used in (ii) above.

 

Each Borrower acknowledges that prepayment of such amount may result in

Bank incurring additional costs, expenses and/or liabilities, and that it is

difficult to ascertain the full extent of such costs, expenses and/or

liabilities.  Each Borrower, therefore,

agrees to pay the above–described prepayment fee and agrees that said amount

represents a reasonable estimate of the prepayment costs, expenses and/or

liabilities of Bank.  If Borrower fails

to pay any prepayment fee when due, the amount of such prepayment fee shall

thereafter bear interest until paid at a rate per annum two percent (2.00%)

above the Prime Rate in effect from time to time (computed on the basis of a

360–day

 

5

 

year, actual days elapsed). 

Each change in the rate of interest on any such past due prepayment fee

shall become effective on the date each Prime Rate change is announced within

Bank.

 

EVENTS OF DEFAULT:

 

This Note is made pursuant to

and is subject to the terms and conditions of that certain Credit Agreement

between Borrower and Bank dated as of May 30th, 2001, as amended from time to

time (the “Credit Agreement”).  Any

default in the payment or performance of any obligation under this Note, after

the expiration of any applicable notice or cure periods as may be provided in

the Credit Agreement, or any defined event of default under the Credit

Agreement, shall constitute an “Event of Default” under this Note.

 

MISCELLANEOUS:

 

(a)           Remedies.  Upon the occurrence of any Event of Default,

the holder of this Note, at the holder’s option, may declare all sums of principal

and interest outstanding hereunder to be immediately due and payable without

presentment, demand, notice of nonperformance, notice of protest, protest or

notice of dishonor, all of which are expressly waived by each Borrower, and the

obligation, if any, of the holder to extend any further credit hereunder shall

immediately cease and terminate.  Each

Borrower shall pay to the holder immediately upon demand the full amount of all

payments, advances, charges, costs and expenses, including reasonable attorneys’

fees (to include outside counsel fees and all allocated costs of the holder’s

in–house counsel), expended or incurred by the holder in connection with

the enforcement of the holder’s rights and/or the collection of any amounts

which become due to the holder under this Note, and the prosecution or defense

of any action in any way related to this Note, including without limitation,

any action for declaratory relief, whether incurred at the trial or appellate

level, in an arbitration proceeding or otherwise, and including any of the

foregoing incurred in connection with any bankruptcy proceeding (including

without limitation, any adversary proceeding, contested matter or motion

brought by Bank or any other person) relating to any Borrower or any other

person or entity.

 

(b)           Obligations

Joint and Several.  Should more than

one person or entity sign this Note as a Borrower, the obligations of each such

Borrower shall be joint and several.

 

(c)           Governing

Law.  This Note shall be governed by

and construed in accordance with the laws of the State of Oregon.

 

UNDER

OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY BANK AFTER

OCTOBER 3, 1989 CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR

PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER’S

RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE

ENFORCEABLE.

 

IN WITNESS WHEREOF, the undersigned has executed this

Note as of the date first written above.

 

	

  NORTHWEST PIPE COMPANY

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   /s/ John

  Murakami

  	

   

  	

   

  
	

   

  	

   

  
	

  Title:

  	

  VP - CFO

  	

   

  
						

 

ADDENDUM TO PROMISSORY

NOTE

(LIBOR PRICING

ADJUSTMENTS)

 

THIS ADDENDUM is attached to and made a part of that

certain promissory note executed by NORTHWEST PIPE COMPANY (“Borrower”) and

payable to WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”), or order, dated as

of June 30, 2002, in the principal amount of Thirty Million Dollars

($30,000,000.00) (the “Note”).

 

6

 

The following provisions are hereby incorporated into

the Note to reflect the interest rate adjustments agreed to by Bank and

Borrower:

 

INTEREST RATE ADJUSTMENTS:

 

(a)           Initial

LIBOR Margin.  The initial LIBOR

margin applicable to this Note shall be as set forth in the “Interest”

paragraph herein.

 

(b)           LIBOR

Rate Adjustments.  Bank shall adjust

the LIBOR margin used to determine the rate of interest applicable to LIBOR

options selected by Borrower under this Note on a quarterly basis, commencing

with Borrower’s fiscal quarter ending June 30, 2002, if required to reflect a

change in Borrower’s ratio of Total Liabilities to Tangible Net Worth (as

defined in the Credit Agreement referenced herein), in accordance with the

following grid:

 

	

  Funded Debt to

  EBITDA

  	

   

  	

  Applicable

  LIBOR

  Margin

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  2.50 to 1.0 or

  greater

  	

   

  	

  2.00

  	

  %

  
	

   

  	

   

  	

   

  	

   

  
	

  at least 2.00 to

  1.0 but equal to or less than 2.50 to 1.0

  	

   

  	

  1.50

  	

  %

  
	

   

  	

   

  	

   

  	

   

  
	

  at least 1.5 to

  1.0 but equal to or less than 2.00 to 1.0

  	

   

  	

  1.25

  	

  %

  
	

   

  	

   

  	

   

  	

   

  
	

  Equal to or less

  than 1.5 to 1.0

  	

   

  	

  1.00

  	

  %

  

 

Each such adjustment shall be effective on the first Business Day of

Borrower’s fiscal quarter following the quarter during which Bank receives and

reviews Borrower’s most current quarter-end financial statements in accordance

with any requirements established by Bank for the preparation and delivery thereof.

 

IN WITNESS WHEREOF, this Addendum has been executed as

of the same date as the Note.

 

	

  NORTHWEST PIPE COMPANY

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

  /s/ John Murakami

  	

   

  	

   

  
	

   

  	

   

  
	

  Title:

  	

  VP - CFO

  	

   

  
						

 

7

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