Document:

SYNL-2013.12.28-10K EX 10.15

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

	
			
	 
	9520406872
	 

	 
	Account Number
	 

This Third Amendment to First Amended and Restated Loan Agreement (this “Amendment”) is made as of January 2, 2014 by and among BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation (“Bank”) and the following entities (collectively, the “Borrowers”):

Synalloy Corporation, a Delaware corporation (“Synalloy”); 

Metchem, Inc., a Delaware corporation (“Metchem”);

Synalloy Fabrication, LLC, a South Carolina limited liability company (formerly named SFR, LLC) (“Synalloy Fabrication”);

Ram-Fab, LLC, a South Carolina limited liability company (“Ram-Fab”);

Synalloy Metals, Inc., a Tennessee corporation (“Synalloy Metals”);

Bristol Metals, LLC, a Tennessee limited liability company (“Bristol”);

Manufacturers Soap & Chemical Company, a Tennessee corporation (“Manufacturers Soap”);

Manufacturers Chemicals, LLC, a Tennessee limited liability company (“Manufacturers Chemicals”); and

Palmer of Texas Tanks, Inc., a Texas corporation (“Palmer”);

Syntrans, LLC, a Texas limited liability company (“Syntrans”); and

CRI Tolling, LLC, a South Carolina limited liability company (“CRI Tolling”)

for purposes of amending (without novation, accord nor satisfaction) certain aspects and provisions of the First Amended and Restated Loan Agreement dated as of August 21, 2012; as adjoined to add Palmer pursuant to the Palmer Joinder Agreement dated as of August 21 ̧ 2012 by the among the parties hereto; and as amended to effect a temporary extension of the amount available to be drawn under the revolving Line of Credit pursuant to the First Amendment to First Amended and Restated Loan Agreement dated as of October 22, 2012 and the Second Amendment to First Amended and Restated Loan Agreement dated as of August 9, 2013 (all of the foregoing sequentially, cumulatively and collectively, the “Loan Agreement”).  Capitalized terms used herein without definition have the meanings assigned to such terms in the Loan Agreement.

Agreement

Section 1.  Defined Terms from Loan Agreement

Capitalized terms used in this Amendment without definition retain (except, to the extent applicable, as amended hereby) the meanings respectfully assigned to such terms in the Loan Agreement.  

Section 2.   Recitals and Loan Agreement Incorporated Herein by Reference

Each and all of opening paragraphs, statements, information and other provisions of this Agreement above constitute an integral part of this Amendment among the parties and are to be considered binding upon the parties.  In addition, the statements, recitals, terms, conditions and agreements of and in the Loan Agreement are hereby incorporated herein by this reference thereto as if set forth herein in full.

Section 3.   Extension of Maturity Date of Line of Credit
        
		
	(a)
	The availability for drawings, the extended final maturity date of the Line of Credit and the other terms thereof are hereby extended as set forth in the Modification, Renewal, Restatement, of Promissory Note  dated of even date herewith.

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

		
	(b)
	The paragraph on the first page of the Loan Agreement and entitled “Line of Credit” is hereby restated to read in full as follows:

Line of Credit (“Line of Credit”) in the maximum principal amount not to exceed, at any one time, the lesser of the following subsections (a) and (b) (such lesser amount, the “Line of Credit Availability”):

		
	(a) 
	the principal amount of $25,000,000; and

		
	(b) 
	the Availability (as defined in Section 10.01 below). 

The Line of Credit is for the purpose of working capital and is evidenced by the Borrowers’ restated promissory note dated on or about the date hereof in the original principal amount of up to $25,000,000 (as the same may be amended, restated, extended, renewed, increased, decreased, replaced or otherwise modified and in effect from time to time, the “Restated Line of Credit Note”) and maturing as provided therein or any renewal thereof, when the entire unpaid principal balance then outstanding plus accrued interest thereon shall be paid in full.  In the event that at any time the principal amount outstanding under the Line of Credit shall exceed the then applicable Line of Credit Availability, the Borrower shall promptly repay such excess principal amounts to the extent necessary to regain compliance with the Line of Credit Availability.  Accrued interest only shall be repayable monthly.  Prior to maturity or the occurrence of any Event of Default hereunder and subject to the Availability limitations, the Borrowers may borrow, repay, and reborrow under the Line of Credit through maturity. The Line of Credit shall bear interest at the rate set forth in the Restated Line of Credit Note or in any other note or other instrument evidencing all or any portion of the Line of Credit, the terms of which are incorporated herein by reference.

Section 4.  [Reserved]

Section 5.  Revision of Tangible Net Worth Floor

Section 5 of the Loan Agreement entitled “Tangible Net Worth” is hereby restated to read as follows:

Tangible Net Worth:  A minimum tangible net worth at all times from the date of this Agreement equal to $70,000,000, (as such amount is increased pursuant to the following sentence, the “Minimum Tangible Net Worth”). The Minimum Tangible Net Worth amount shall increase by at least 50% of Consolidated Net Income over the prior fiscal year-end result, and then each fiscal year end thereafter. Tangible Net Worth is defined as net worth, plus obligations contractually subordinated to debts owed to Bank, minus goodwill, contract rights, and assets representing claims on stockholders or affiliated entities.  Consolidated Net Income is defined as Borrowers after tax net income as shown on the Annual Financial Statements referred to in Section 3.08 of this Agreement.

Any references to this Tangible Net Worth covenant set forth in the Loan Agreement, the other Loan Documents and any related agreement, instrument, filing, document or other papers shall henceforth be deemed amended, mutatis mutandis, to reflect the above revision.

Section 6.   Modification of Capital Expenditures Covenant.  

Section 6.03 of the Loan Agreement is hereby restated to read as follows:

Capital Expenditures.  Expenditures for fixed assets in any fiscal year shall not exceed, in the aggregate as to all Borrowers, (a) for the 2013 fiscal year the sum of $6,500,000; (b) for the 2014 fiscal year, the sum of $11,000,000; and (c) for the 2015 fiscal year and each fiscal year after during the term of the Loan(s) the sum of $6,500,000.

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

Section 7.  Borrowing Base Certificates.  

The paragraph in Section 3.09 entitled “Quarterly Financial Statements and Borrowing Base Certificates” in Section 3.09 of the Loan Agreement is hereby restated to read as follows:

Quarterly Financial Statements and Borrowing Base Certificates: Interim financial statements (10-Q) within 45 days of each quarter end, which shall be accompanied by the following: a) Loan Agreement Compliance Certificate; b) quarterly Borrowing Base Certificates and; c) Accounts receivable agings and other information on A/R, inventory and Accounts Payable, if requested by Bank.  All information shall in reasonable detail and in a form acceptable to Bank.

Section 8.  Release of Life Insurance Collateral.  The Bank hereby releases from any lien in favor of the Bank those Life Insurance Policies numbered 1820001, 1820009, 1820007, 1820003, 1820005, 1821425. 

Section 9.   Amendment and Extension Fee.  The Borrower shall pay to the Bank on the date hereof an amendment and extension fee in the amount of 10 bps (0.10%) of $25,000,000.

Section 10. Bringdown of Representations and Warranties.   The Borrowers represent and warrant to Bank the continued accuracy and completeness, as of the date hereof, of all representations made in the Loan Documents (including without limitation Section 2 of the Loan Agreement) and as to Palmer the same by virtue of the Palmer Joinder Agreement referenced above, taking into account this Amendment constituting one of the Loan Documents.

Section 11.  Indemnification

The Borrowers hereby jointly and severally agree to and do hereby indemnify and defend the Bank, its affiliates, their successors and assigns and their respective directors, officer, employees and shareholders, and do hereby hold each of them harmless from and against, any loss, liability, lawsuit, proceeding, cost expense or damage (including reasonable in-house and outside counsel fees, whether suit is brought or not) arising from or otherwise relating to the closing, disbursement, administration, or repayment of the Loan(s) and the other Loans, including without limitation: (i) the failure to make any payment to the Bank promptly when due, whether under the Loans or otherwise; (ii) the breach of any representations or warranties to the Bank contained in this Amendment, the Loan Documents or in any other loan documents now or hereafter executed in connection with this Amendment and the Loans; (iii) the violation of any covenants or agreements made for the benefit of the Bank and contained in any of the Loan Documents; provided, however, that the foregoing indemnification shall not be deemed to cover any loss which is finally determined by a court of competent jurisdiction to result solely from the Bank’s gross negligence or willful misconduct; or (iv) any aspect of this Amendment or the transactions contemplated hereby. 

Section 12.  Security

For the avoidance of doubt, all of the obligations of the Borrowers, whether of payment or performance, under the Line of Credit, the Term Loan, the CRI Acquisition Loan and any additional Loans shall be and continue following the effectiveness of this Amendment to be (along with the other obligations referenced therein), secured by and enjoying the benefits of the pledges, mortgages, deeds of trust, collateral and other matters and security set forth in the Loan Documents, including without limitation the Mortgages and the Security Agreement and the other agreements, instruments, filings and other papers set forth and/or referenced on Attachment 1 to this Amendment.
Section 13.  Miscellaneous.  
		
	(a)
	Certain Provisions Incorporated by Reference.  Without limiting the continued general applicability of Section 10 (or any other provisions) of the Loan Agreement, the provisions of Sections 10.02 through Section 10.18 of the Loan Agreement are incorporated into this Amendment, mutatis mutandis, as if set forth herein in full.

		
	(b)
	Matters as to Amendment. This Amendment constitutes an amendment to the Loan Agreement (and, to the extent applicable, all other Loan Documents) and except for the effect of any matters expressly set forth in this Amendment, this Amendment, the Loan Agreement and each of the Loan Documents is, and shall continue to be following the effectiveness of this Amendment, in full force and effect in accordance with the terms thereof, and nothing in this Amendment shall otherwise be deemed to amend or modify any provision of the Loan Agreement or the other Loan 

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

Documents, each of which shall remain in full force and effect except as otherwise expressly provided herein or therein.  This Amendment is not intended to be, nor shall it be construed to create, a novation or accord and satisfaction.  This Amendment does not effect the release of any collateral, does not disturb the perfection or priority of any existing liens, and does not effect the release of any obligor, guarantor or other party from its obligations.
		
	(c)
	References to Documents.  Each reference in the Loan Agreement, this Amendment and any other Loan Documents shall be the same as may be amended, restated, increased, decreased, extended, reduced or otherwise modified and effect from time to time.

[The remainder of this page is left blank intentionally]

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

		
	 (d)
	WAIVER OF JURY TRIAL.  UNLESS EXPRESSLY PROHIBITED BY APPLICABLE LAW, THE UNDERSIGNED HEREBY WAIVE THE RIGHT TO TRIAL BY JURY OF ANY MATTERS OR CLAIMS ARISING OUT OF THIS AMENDMENT OR ANY OF THE LOAN DOCUMENTS EXECUTED IN CONNECTION HEREWITH OR OUT OF THE CONDUCT OF THE RELATIONSHIP BETWEEN THE UNDERSIGNED AND BANK.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR BANK TO MAKE THE LOAN AND ENTER INTO THIS AMENDMENT.  FURTHER, THE UNDERSIGNED HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR BANK’S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT SEEK TO ENFORCE THIS WAIVER OR RIGHT TO JURY TRIAL PROVISION.  NO REPRESENTATIVE OR AGENT OF BANK, NOR BANK’S COUNSEL, HAS THE AUTHORITY TO WAIVE, CONDITION OR MODIFY THIS PROVISION. 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment under seal as of the date first written above.

	
		
	

Witness (as to the co-Borrowers):

______________________________
	SYNALLOY CORPORATION
METCHEM, INC.
SYNALLOY METALS, INC.
MANUFACTURERS SOAP & CHEMICAL COMPANY
RAM-FAB, LLC
MANUFACTURERS CHEMICALS, LLC
BRISTOL METALS, LLC
SYNALLOY FABRICATION, LLC
PALMER OF TEXAS TANKS, INC.
SYNTRANS, LLC
CRI TOLLING, LLC

By:                                                                                    (SEAL)
Richard D. Sieradzki
Vice President, Finance
of and on behalf of each of
the above-named entities

	Witness (as to BB&T):

______________________________
	BRANCH BANKING AND TRUST COMPANY

By:  ________________________________
        Stan W. Parker
        Senior Vice President

[Signature Page to Third Amendment to First Amended and Restated Loan Agreement]

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

January 2, 2014

Borrowers:  The entities executing as co-Borrowers to the agreement of instrument to which this Attachment is attached, on a joint and several basis

This page forms a part of the instrument or agreement to which it is attached and constitutes an integral part thereof.
                                                                                                                                                                                                             

The agreement or instrument to which this attachment is attached and all loans, notes, instruments and other liabilities and obligations referenced therein are all governed, secured, guarantied and/or otherwise related to by, as applicable, each of the following (each of which is - except as otherwise set forth below - originally dated on or about August 21, 2012, provided that references to the following are as the same may be amended, restated, increased, decreased or otherwise modified and in effect from time to time), among any other applicable pledge, security, collateral, agreements and instruments in effect from time to time.

		
	•
	First Amended and Restated Loan Agreement dated as of August 21, 2012 (the “Loan Agreement”) among Branch Banking and Trust Company (“BB&T”) and the multiple Borrowers referenced above (collectively, the “Borrowers”).

		
	◦
	As amended by the First Amendment to First Amended and Restated Loan Agreement dated as of October 22, 2012 and the Second Amendment to First  Amended and Restated Loan Agreement dated as of August 9, 2013 and this Third Amendment to First Amended and Restated Loan Agreement

		
	•
	Palmer Joinder Agreement dated as of August 21, 2012 among the Borrowers, Palmer of Texas Tanks, Inc. (“Palmer”) and the Bank.

		
	•
	Syntrans / CRI Tolling Joinder Agreement dated August 8, 2013 among the Borrowers (including two new Adjoining Borrowers) and BB&T.

		
	•
	The Promissory Note dated on or about August 21, 2012 from the Borrowers to BB&T in the principal amount of $25,000,000.

		
	•
	The Modification, Renewal, Increase and Restatement of Promissory Note dated on or about August 21, 2012 from the Borrowers to BB&T in the principal amount of $22,500,000.

		
	◦
	As amended and temporarily increased by the Modification, Renewal, Increase and Restatement of Promissory Note dated as of October 2012 from the Borrowers to BB&T.

		
	•
	The Promissory Note dated August 9, 2013 from the Borrowers to BB&T in the principal amount of $4,033,250.

		
	•
	All Swap Agreements (as defined in the Loan Agreement)

		
	•
	Security Agreement dated as of August 21, 2012 among the Borrowers and BB&T (to which the Adjoining Borrowers are become additional pledgors).

		
	•
	Mortgage of Real Estate dated on or about August 21, 2012 with respect to one or more parcels of real property located in the State of Arkansas, from one or more of the applicable Borrowers for the benefit of BB&T.

		
	•
	Deed of Trust for Real Estate dated on or about August 21, 2012 with respect to one or more parcels of real property located in the State of Tennessee, from one or more of the applicable Borrowers for the benefit of BB&T.

		
	•
	Deed of Trust for Real Estate dated on or about August 21, 2012 with respect to one or more parcels of real property located in the State of Texas, from one or more of the applicable Borrowers for the benefit of BB&T.

		
	•
	Mortgage of Real Estate dated on or about August 9, 2013 with respect to one or more parcels of real property located in Laurens County, South Carolina, from one or more of the applicable Borrowers for the benefit of BB&T.

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

		
	•
	Negative Pledge Agreements, each dated on or about July 9, 2010, from the applicable Borrower(s) named therein for the benefit of BB&T and relating to real properties in Spartanburg County, SC; Bradley County, TN; Sullivan County, TN.  Also, any other negative pledge agreements or similar documents executed and delivered by one or more Borrowers, including without limitation in connection with the Palmer Acquisition.

		
	•
	Negative Pledge Agreement dated August 9, 2013, from the applicable Borrower(s) named therein for the benefit of BB&T and relating to real properties in Laurens County, SC

		
	•
	Stock and LLC Interests Pledge Agreement dated the date hereof among the Borrowers and the Bank.

		
	•
	Any and all other Loan Documents (as defined in the Loan Agreement)SYNL-2013.12.28-10K EX 10.21

Borrower:  SYNALLOY CORPORATION AND THE OTHER CO-BORROWERS NAMED ON THE SIGNATURE PAGE HERETO                                                      
Account Number:    9520406872                                                                            Note Number:                  ________     2                           
Address:    775 SPARTAN BLVD STE 102                                                                          Spartanburg, South Carolina             .
                SPARTANBURG, SC 29301                                                  Date:                               January 2, 2014                         
BB&T
MODIFICATION, RENEWAL, INCREASE AND 
 RESTATEMENT OF PROMISSORY NOTE

	
				
	Up to $25,000,000
	August 21, 2016
	October 22, 2012
	January 2, 2014

	Note Amount
	Extended Maturity Date
	Prior Note Date
	Modification Date

THIS NOTE (“Note”) MODIFIES, RENEWS, INCREASES, RESTATES, AND CONSTITUTES A SUBSTITUTION FOR THE PROMISSORY NOTE DATED THE PRIOR NOTE DATE SHOWN ABOVE, FROM THE BORROWERS EXECUTING THIS NOTE PAYABLE TO THE ORDER OF BANK IN THE PRIOR NOTE AMOUNT SHOWN ABOVE.  THE INDEBTEDNESS AND OBLIGATIONS OF THE BORROWERS EVIDENCED BY SUCH PRIOR NOTE ARE NOT EXTINGUISHED HEREBY, AND THE BORROWERS ACKNOWLEDGE THAT THIS NOTE CONSTITUTES A MODIFICATION AND RESTATEMENT AND SUBSTITUTION OF AND FOR THE SAID PRIOR NOTE.  THE EXECUTION AND DELIVERY OF THIS NOTE SHALL IN NO WAY IMPAIR THE SECURITY NOW HELD FOR THE INDEBTEDNESS EVIDENCED BY THE SAID PRIOR NOTE, AND ALL SUCH SECURITY SHALL SECURE PAYMENT OF THIS NOTE TO THE SAME EXTENT AS THE SAID PRIOR NOTE.

BORROWER(S) REPRESENTS HEREWITH THAT THE LOAN EVIDENCED HEREBY IS BEING OBTAINED FOR BUSINESS/COMMERCIAL PURPOSES.  For value received, the undersigned, jointly and severally, if more than one, promises to pay to BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation (the “Bank”), or order, at said bank at any of its offices in the above referenced city (or such other place or places that may be hereafter designated by Bank), the sum of TWENTY-FIVE MILLION DOLLARS ($25,000,000) of revolving line of credit maximum availability from the date hereof until the final maturity date of this Note as specified below 

In each case in immediately available coin or currency of the United States of America.

Consistent with the maximum available line of credit principal amounts of this Note as indicated above, in the event that at any time the principal amount outstanding under the Line of Credit and this Note shall exceed the lesser of (a) the then applicable stated principal amount above and (b) the then applicable Line of Credit Availability (as defined in the Loan Agreement referred to below), the Borrower shall promptly repay such excess principal amounts to the extent necessary to regain compliance with the then applicable above principal amount and Line of Credit Availability.

Interest shall accrue from the date hereof on the unpaid balance outstanding from time to time at the:

x The Adjusted LIBOR Rate, as defined in the attached Addendum to Promissory Note

Principal and interest is payable as follows:

x Principal (plus any accrued interest not otherwise scheduled herein) is due in full at maturity on August 21, 2016.

x Accrued interest is payable monthly continuing on January 21, 2014 and continuing on the same day of each calendar period thereafter, with one final payment of all remaining interest due on August 21, 2016.

x Prior to an event of default, Borrower may borrow, repay, and reborrow hereunder pursuant to the terms of the Loan Agreement, as hereinafter defined.    

The undersigned shall pay to Bank a late fee in the amount of five percent (5%) of any installment past due for fifteen (15) or more days. When any installment payment is past due for fifteen (15) or more days, subsequent payments shall first be applied to the past due balance. In addition, the undersigned shall pay to Bank a returned payment fee if the undersigned or any other 

obligor hereon makes any payment at any time by check or other instrument, or by any electronic means, which is returned to Bank because of nonpayment due to nonsufficient funds.

     All interest shall be computed and charged for the actual number of days elapsed on the basis of a year consisting of three hundred sixty (360) days. In the event periodic accruals of interest shall exceed any periodic fixed payment amount described above, the fixed payment amount shall be immediately increased, or additional supplemental interest payments required on the same periodic basis as specified above (increased fixed payments or supplemental payments to be determined in the Bank’s sole discretion), in such amounts and at such times as shall be necessary to pay all accruals of interest for the period and all accruals of unpaid interest from previous periods. Such adjustments to the fixed payment amount or supplemental payments shall remain in effect for so long as the interest accruals shall exceed the original fixed payment amount and shall be further adjusted upward or downward to reflect changes in the variable interest rate; provided that unless elected otherwise above, the fixed payment amount shall not be reduced below the original fixed payment amount. However, Bank shall have the right, in its sole discretion, to lower the fixed payment amount below the original payment amount.

This Note is given by the undersigned in connection with the following agreements (if any) between the undersigned and the Bank (collectively, the “Agreements”):

x First Amended and Restated Loan Agreement dated August 21, 2012, executed by the Borrowers and the Bank (as so amended, the “Loan Agreement”) executed by the Borrowers and the Bank.

x Those additional agreements, instruments and documents scheduled or referenced on Attachment 1 to the Loan Agreement.

All of the terms, conditions and covenants of the above described agreements are expressly made a part of this promissory note (the “Note”) by reference in the same manner and with the same effect as if set forth herein at length and any holder of this Note is entitled to the benefits of and remedies provided in the Agreements and any other agreements by and between the undersigned and the Bank. In addition to Bank’s right of off-set and to any liens and security interests granted to Bank in the Agreements, the undersigned hereby grants to Bank a security interest in all of its depository accounts with and investment property held by Bank, which shall serve as collateral for the indebtedness and obligations evidenced by this Note.

No delay or omission on the part of the holder in exercising any right hereunder shall operate as a waiver of such right or of any other right of such holder, nor shall any delay, omission or waiver on any one occasion be deemed a bar to or waiver of the same or of any other right on any future occasion. Every one of the undersigned and every endorser or guarantor of this Note regardless of the time, order or place of signing waives presentment, demand, protest and notices of every kind and assents to any one or more extensions or postponements of the time of payment or any other indulgences, to any substitutions, exchanges or releases of collateral if at any time there be available to the holder collateral for this Note, and to the additions or releases of any other parties or persons primarily or secondarily liable.

The failure to pay any part of the principal or interest when due on this Note or to fully perform any covenant, obligation or warranty on this or on any other liability to the Bank by any affiliate (as defined in 11USC Section (101)(2)), or by any guarantor or surety of this Note (said affiliate, guarantor, and surety are herein called “Obligor”); or if any financial statement or other representation made to the Bank by any of the undersigned or any Obligor shall be found to be materially incorrect or incomplete; or if any of the undersigned shall fail to furnish information to the Bank sufficient to verify the identity of the undersigned as required under the USA Patriot Act; or in the event of a default pursuant to any of the Agreements or any other obligation of any of the undersigned or any Obligor in favor of the Bank; or in the event the Bank demands that the undersigned secure or provide additional security for its obligations under this Note and security deemed adequate and sufficient by the Bank is not given when demanded; or in the event one or more of the undersigned or any Obligor shall die, terminate its existence, allow the appointment of a receiver for any part of its property, make an assignment for the benefit of creditors, or where a proceeding under bankruptcy or insolvency laws is initiated by or against any of the undersigned or any Obligor; or in the event the Bank should otherwise deem itself, its security interest, or any collateral unsafe or insecure; or should the Bank in good faith believe that the prospect of payment or other performance is impaired; or if there is an attachment, execution, or other judicial seizure of all or any portion of the Borrower’s or any Obligor’s assets, including an action or proceeding to seize any funds on deposit with the Bank, and such seizure is not discharged within 20 days; or if final judgment for the payment of money shall be rendered against the Borrower or any Obligor which is not covered by insurance or debt cancellation and shall remain undischarged for a period of 30 days unless such judgment or execution thereon is effectively stayed; or the termination of any guaranty agreement given in connection with this Note, then any one of the same shall be a material default hereunder and this Note and other debts due the Bank by any one or more of undersigned shall immediately become due and payable without notice, at the option of the Bank. From and after any event of default hereunder, interest shall accrue on the sum of the principal balance and accrued interest then outstanding at the variable rate equal to the Bank’s Prime Rate plus 5% per annum (“Default Rate”), provided that such rate shall not exceed at any 

time the highest rate of interest permitted by the laws of the State of South Carolina; and further provided that such rate shall apply after judgment. In the event of any default, the then remaining unpaid principal amount and accrued but unpaid interest then outstanding shall bear interest at the Default Rate called for hereunder until such principal and interest have been paid in full. In addition, upon default, the Bank may pursue its full legal remedies at law or equity, and the balance due hereunder may be charged against any obligation of the Bank to any party, including any Obligor. Bank shall not be obligated to accept any check, money order, or other payment instrument marked “payment in full” on any disputed amount due hereunder, and Bank expressly reserves the right to reject all such payment instruments. Borrower agrees that tender of its check or other payment instrument so marked will not satisfy or discharge its obligation under this Note, disputed or otherwise, even if such check or payment instrument is inadvertently processed by Bank unless in fact such payment is in fact sufficient to pay the amount due hereunder.

WAIVER OF TRIAL BY JURY. UNLESS EXPRESSLY PROHIBITED BY APPLICABLE LAW, THE UNDERSIGNED HEREBY WAIVE THE RIGHT TO TRIAL BY JURY OF ANY MATTERS OR CLAIMS ARISING OUT OF THIS NOTE OR ANY LOAN DOCUMENT EXECUTED IN CONNECTION HEREWITH OR OUT OF THE CONDUCT OF THE RELATIONSHIP BETWEEN THE UNDERSIGNED AND BANK. THIS PROVISION IS A MATERIAL INDUCEMENT FOR BANK TO MAKE THE LOAN EVIDENCED BY THIS NOTE. FURTHER, THE UNDERSIGNED HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR BANK’S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT SEEK TO ENFORCE THIS WAIVER OR RIGHT TO JURY TRIAL PROVISION IN THE EVENT OF LITIGATION. NO REPRESENTATIVE OR AGENT OF BANK, NOR BANK’S COUNSEL, HAS THE AUTHORITY TO WAIVE, CONDITION OR MODIFY THIS PROVISION.

Unless otherwise required under a Loan Agreement, if applicable, and as long as any indebtedness evidenced by this note remains outstanding or as long as Bank remains obligated to make advances, the undersigned shall furnish annually an updated financial statement in a form satisfactory to Bank, which, when delivered shall be the property of the Bank.

The term “Prime Rate,” if used herein, means the rate of interest per annum announced by the Bank from time to time and adopted as its Prime Rate. The Prime Rate is one of several rate indexes employed by the Bank when extending credit. Any change in the interest rate resulting from a change in the Bank’s Prime Rate shall become effective as of the opening of business on the effective date of the change. If this Note is placed with an attorney for collection, the undersigned agrees to pay, in addition to principal and interest, all costs of collection, including reasonable attorneys’ fees     of Bank actually incurred at their customary rates and all related costs of collection or enforcement that may be incurred by Bank.  The Borrowers shall be liable for such attorneys’ fees and costs whether or not any suit or proceeding is actually commenced. which the undersigned agrees shall be equal to 15% of the principal and interest outstanding at the time of acceleration or other action by Lender to collect the sums due hereunder, unless the actual attorneys’ fees incurred, based upon Bank’s counsel’s normal hourly fees chargeable to Bank, shall be greater than 15% of  principal and interest, in which case such billed amount based on such hourly rate shall be the attorneys’ fee payable hereunder. All obligations of the undersigned and of any Obligor shall bind his heirs, executors, administrators, successors, and/or assigns.  Use of the masculine pronoun herein shall include the feminine and the neuter, and also the plural. If more than one party shall execute this Note, the term “undersigned” as used herein shall mean all parties signing this Note and each of them, and all such parties shall be jointly and severally obligated hereunder. Whenever possible, each  provision of this Note shall be interpreted in such a manner to be effective and valid under law, but if any provision of this Note shall be prohibited by or invalid under such law, such provision shall be ineffective but only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note. All of the undersigned hereby waive all exemptions and homestead laws. The proceeds of the loan evidenced by this Note may be paid to any one or more of the undersigned. No waivers and modifications shall be valid unless in writing and signed by the Bank. In case of conflict between the terms of this Note and the Loan Agreement or Commitment Letter issued in connection herewith, the priority of controlling terms shall be first this Note, then the Loan Agreement, and then the Commitment Letter. This Note shall be governed by and construed in accordance with the laws of South Carolina.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

*     of Bank actually incurred at their customary rates and all related costs of collection or enforcement that may be incurred by Bank.  The Borrowers shall be liable for such attorneys’ fees and costs whether or not any suit or proceeding is actually commenced.

BB&T

SIGNATURE PAGE
TO
MODIFICATION, RENEWAL, INCREASE AND 
RESTATEMENT OF PROMISSORY NOTE

Borrower:  SYNALLOY CORPORATION AND THE OTHER CO-BORROWERS NAMED ON THIS SIGNATURE PAGE                                              
Account Number:    9520406872                            Note Number:           2                                                      Date:            January 2, 2014               

NOTE AMOUNT
Up to $25,000,000
Subject to the line of credit availability
as and when provided herein

Waiver of Appraisal Rights.  The laws of South Carolina provide that in any real estate foreclosure proceeding a defendant against whom a personal judgment is taken or asked may within thirty days after the sale of the mortgaged property apply to the court for an order of appraisal.  The statutory appraisal value as approved by the court would be substituted for the high bid and may decrease the amount of any deficiency owing in connection with the transaction.  TO THE FULLEST EXTENT PERMITTED BY LAW AND AS A MATERIAL INDUCEMENT FOR LENDER TO MAKE THE LOAN,THE BORROWERS HEREBY WAIVE AND RELINQUISH THE STATUTORY APPRAISAL RIGHTS WHICH MEANS THE HIGH BID AT THE JUDICIAL FORECLOSURE SALE WILL BE APPLIED TO THE DEBT REGARDLESS OF ANY APPRAISED VALUE OF THE MORTGAGED PROPERTY.

        IN WITNESS WHEREOF, the parties hereto have executed and delivered this Note under seal as of the date first written above.

	
		
	

Witness (as to the co-Borrowers):

______________________________
	SYNALLOY CORPORATION  
METCHEM, INC.
SYNALLOY FABRICATION, LLC
RAM-FAB, LLC
SYNALLOY METALS, INC.
BRISTOL METALS, LLC
MANUFACTURERS SOAP & CHEMICAL COMPANY
MANUFACTURERS CHEMICALS, LLC
PALMER OF TEXAS TANKS, INC.
SYNTRANS, LLC
CRI TOLLING, LLC

By:                                                                                    (SEAL)
Richard D. Sieradzki
Vice President, Finance
of and on behalf of each of
the above-named entities

	Witness (as to BB&T):

______________________________
	BRANCH BANKING AND TRUST COMPANY

By:  ________________________________
        Stan W. Parker
        Senior Vice President

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