Document:

Exhibit

Exhibit 10.2

THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT 
This THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Third Amendment”), dated as of March 16, 2020 and, made by and among KADANT INC., a Delaware corporation (the “Borrower”), the Subsidiary Guarantors parties hereto, the Foreign Subsidiary Borrowers parties hereto, the several banks and other financial institutions or entities parties hereto (the “Lenders”), CITIZENS BANK, N.A., as administrative agent (the “Administrative Agent”) and CITIZENS BANK, N.A., as multicurrency administrative agent (the “Multicurrency Administrative Agent”; together with the Administrative Agent, the “Agents”).  
Background
The Borrower, the Subsidiary Guarantors, the Foreign Subsidiary Borrowers, the Agents and the Lenders entered into an Amended and Restated Credit Agreement dated as of March 1, 2017, as amended by that certain First Amendment dated as of May 24, 2017, that certain Limited Consent dated as of December 9, 2018, and that certain Second Amendment to Amended and Restated Credit Agreement dated as of December 14, 2018 (the “Original Credit Agreement”), as amended by this Third Amendment and as further amended, modified or supplemented from time to time, the “Credit Agreement”.
The Borrower has requested that the Agents and the Lenders amend the Original Credit Agreement in the manner set forth herein.
Capitalized terms not defined herein shall have the meanings given such terms in the Original Credit Agreement.  This Third Amendment constitutes a Loan Document for all purposes under the Credit Agreement and the other Loan Documents.
NOW, THEREFORE, in consideration of the promises and the agreements, provisions and covenants herein contained, the Borrower, the Subsidiary Guarantors, the Foreign Subsidiary Borrowers, the Agents and the Lenders hereby agree as follows:
1.Amendments to Original Credit.  Subject to the terms and conditions herein contained and in reliance on the representations and warranties of the Borrower herein contained, effective upon satisfaction of the conditions precedent contained in Section 2 below, the following amendments are incorporated into the Original Credit Agreement:

(A)The second sentence of Section 4.13 of the Original Credit Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

“No termination of a Single Employer Plan has occurred (other than the termination of each of a noncontributory defined benefit retirement plan for eligible employees at one of the Borrower’s U.S. divisions and its corporate office and a supplemental benefit plan for certain executive officers as disclosed in the Borrower’s Quarterly Report on Form 10-Q for the fiscal quarter year ended September 29, 2018 and updated in subsequent filings with the U.S. Securities and Exchange Commission), and no Lien in favor of the PBGC or a Plan has arisen, during such five-year period.”  
The foregoing amendments are limited to those set forth herein and is not a commitment or agreement to grant any amendment in the future.
2.Conditions Precedent.  
    

The provisions of this Third Amendment shall be effective as of the date on which all of the following conditions shall be satisfied:
(a)the Borrower, each Subsidiary Guarantor and each Foreign Subsidiary Borrower shall have delivered to the Agents an executed counterpart of this Third Amendment; 

(b)the Agents and the Lenders shall have indicated their consent and agreement by executing this Third Amendment; and 

(c)the Borrower shall have paid all of the Agents’ fees and expenses and all amounts required under the Loan Documents.

1.Miscellaneous.
(a)Ratification.  The terms and provisions set forth in this Third Amendment shall modify and supersede all inconsistent terms and provisions set forth in the Original Credit Agreement and except as expressly modified and superseded by this Third Amendment, the terms and provisions of the Original Credit Agreement and the other Loan Documents are ratified and confirmed and shall continue in full force and effect.  The Borrower, the Subsidiary Guarantors, the Foreign Subsidiary Borrowers, the Agents and the Lenders agree that the Original Credit Agreement as amended hereby and the other Loan Documents shall continue to be legal, valid, binding and enforceable in accordance with their respective terms.  For all matters arising prior to the effective date of this Third Amendment, the Original Credit Agreement (as unmodified by this Third Amendment) shall control.

(b)Representations and Warranties.  The Borrower hereby represents and warrants to the Agents that the representations and warranties set forth in the Loan Documents, after giving effect to this Third Amendment, are true and correct in all material respects (or all respects to the extent already qualified by materiality or the occurrence of a Material Adverse Effect) on and as of the date hereof, with the same effect as though made on and as of such date except with respect to any representations and warranties limited by their terms to a specific date.  The Borrower further represents and warrants to the Agents and the Lenders that the execution and delivery of this Third Amendment (i) are within the Borrower’s, each Subsidiary Guarantor’s and each Foreign Subsidiary Borrower’s organizational power and authority; (ii) have been duly authorized by all necessary organizational action of the Borrower, each Subsidiary Guarantor and each Foreign Subsidiary Borrower; (iii) is not in contravention of any provision of the Borrower’s, any Subsidiary Guarantor’s or any Foreign Subsidiary Borrower’s Organizational Documents; (iv) do not violate any law or regulation, or any order or decree of any Governmental Authority; (v) do not conflict with or result in the breach or termination of, constitute a default under or accelerate any performance required by, any material indenture, mortgage, deed of trust, lease, agreement or other material instrument to which either the Borrower, any Subsidiary Guarantor or any Foreign Subsidiary Borrower is a party or by which Borrower, any Subsidiary Guarantor, any Foreign Subsidiary Borrower or any of their property is bound.  All representations and warranties made in this Third Amendment shall survive the execution and delivery of this Third Amendment.  

(c)Expenses of the Agent.  As provided in the Credit Agreement, the Borrower agrees to pay all reasonable costs and expenses incurred by the Agents in connection with the preparation, negotiation, and execution of this Third Amendment, including without limitation, the reasonable costs and fees of the Agents’ legal counsel.

(d)Severability.  Any provision of this Third Amendment held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this 

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Third Amendment and the effect thereof shall be confined to the provision so held to be invalid or unenforceable.

(e)Applicable Law.  This Third Amendment shall be governed by and construed in accordance with the laws of the State of New York.

(f)Successors and Assigns.  This Third Amendment is binding upon and shall inure to the benefit of the Agents, the Lenders and the Borrower, the Subsidiary Guarantors, the Foreign Subsidiary Borrowers and their respective successors and assigns. 

(g)Counterparts.  This Third Amendment may be executed in one or more counterparts and on facsimile counterparts or other electronic transmission, as permitted under the Original Credit Agreement, each of which when so executed shall be deemed to be an original, but all of which when taken together shall constitute one and the same agreement.

(h)Headings.  The headings, captions, and arrangements used in this Third Amendment are for convenience only and shall not affect the interpretation of this Third Amendment.

(i)ENTIRE AGREEMENT.  THIS THIRD AMENDMENT EMBODIES THE ENTIRE AGREEMENT AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER THEREOF, AND SUPERSEDES ANY AND ALL PRIOR REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AMENDMENT. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF.

(j)Acknowledgement and Reaffirmation.  Each of the Borrower, as a guarantor, and Kadant Black Clawson LLC, Kadant International Holdings LLC and Kadant Johnson LLC (collectively, the “Subsidiary Guarantors” and together with the Borrower, the “Guarantors”), hereby acknowledges the consents granted, and amendments effected, pursuant to this Third Amendment and reaffirms its guaranty of the Borrower Obligations and the Foreign Subsidiary Borrower Obligations (each as defined in the Guarantee) pursuant to that certain Amended and Restated Guarantee Agreement, dated as of March 1, 2017 (as amended, supplemented or otherwise modified from time to time, the “Guarantee”), among the Guarantors and the Administrative Agent.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. 
KADANT INC.

By:    /s/ Jeffrey L. Powell                
Name:  Jeffrey L. Powell
Title:    President and CEO

KADANT U.K. LIMITED

By:    /s/ Jeffrey L. Powell 
Name:  Jeffrey L Powell
Title:    Director

KADANT CANADA CORP.

By:    /s/ Orrin H. Bean
Name: Orrin H. Bean
Title: Treasurer

KADANT JOHNSON EUROPE B.V.

By:    /s/ Eric T. Langevin 
Name: Eric T. Langevin
Title: Director

KADANT INTERNATIONAL LUXEMBOURG S.C.S.

By:    /s/ Stacy D. Krause 
Name: Stacy D. Krause
Title: Manager

[Signature Page - Third Amendment to Amended and Restated Credit Agreement]
(S-1)

    

KADANT LUXEMBOURG S.À R.L.
as the Foreign Subsidiary Borrower

By: /s/ Thomas A. Martin 
      Name:  Thomas A. Martin
      Title:    Class A Manager

By: /s/ Florence Gerardy
      Name:  Florence Gerardy
      Title:    Class B Manager
       
KADANT JOHNSON DEUTSCHLAND GmbH

By: /s/ Eric T. Langevin
Name:  Eric T. Langevin
Title:    Director

Subsidiary Guarantors: 

Kadant Black Clawson LLC

By: /s/ Orrin H. Bean
Name: Orrin H. Bean
Title: Treasurer

Kadant International Holdings LLC 

By: /s/ Orrin H. Bean 
Name: Orrin H. Bean
Title: Treasurer

Kadant Johnson LLC

By: /s/ Orrin H. Bean 
Name: Orrin H. Bean
Title: Treasurer

[Signature Page-Third Amendment to Amended and Restated Credit Agreement]
(S-2)

CITIZENS BANK, N.A., as Administrative Agent and as a Lender

By:    /s/ Robert Anastasio 
Name:  Robert Anastasio
Title:   Senior Vice President

[Signature Page-Third Amendment to Amended and Restated Credit Agreement]
(S-3)

CITIZENS BANK, N.A., as Multicurrency Administrative Agent and as a Lender

By:    /s/ Robert Anastasio 
Name:  Robert Anastasio
Title: Senior Vice President

[Signature Page-Third Amendment to Amended and Restated Credit Agreement]
(S-4)

CITIZENS BANK, N.A., as a Lender

By:    /s/ Robert Anastasio 
Name:  Robert Anastasio
Title:  Senior Vice President   

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-5)

WELLS FARGO BANK, NATIONAL ASSOCIATION

By:    /s/ Christopher S. Allen
Name:  Christopher S. Allen
Title:  Senior Vice President

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-6)

U.S. BANK NATIONAL ASSOCIATION

By:    /s/ Kenneth R. Fieler 
Name: Kenneth R. Fieler
Title: Vice President   

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-7)

HSBC BANK USA, N.A.

By:    /s/ Andrew Everett 
Name: Andrew Everett
Title:  Vice President

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-8)

    

SANTANDER BANK, N.A.

By:    /s/ Benjamin Hildreth 
Name:  Benjamin Hildreth
Title: VP Underwriting

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-9)

JPMORGAN CHASE BANK, N.A.

By:    /s/ Brian Keenan 
Name:  Brian Keenan
Title:  Vice President 

[Signature Page- Third Amendment to Amended and Restated Credit Agreement]
(S-10)

HSBC BANK CANADA

By:    /s/ Hai Pham
Name:  Hai Pham
Title: Head of International Subsidiary

By:    /s/ Douglas Remington 
Name:  Douglas Remington
Title:  Assistant Vice President   

BANK OF AMERICA, N.A.

By:    /s/ Robert C. Megan 
Name:  Robert C. Megan
Title: Senior Vice Presidentex_184954.htm

Exhibit 4.1

 

ELEVENTH LOAN MODIFICATION AGREEMENT

 

THIS ELEVENTH LOAN MODIFICATION AGREEMENT (the “Eleventh Modification Agreement”), is made as of the 30th day of April, 2020, by and between OPTICAL CABLE CORPORATION, a Virginia corporation (the “Borrower”), and PINNACLE BANK, a Tennessee banking corporation, successor in interest through name change and by merger with Bank of North Carolina (the “Lender”).

 

RECITALS

 

A.     The Borrower and Bank of North Carolina entered into that certain Credit Agreement dated April 26, 2016, as amended and modified by Loan Modification Agreement dated December 21, 2016, and by Second Loan Modification Agreement dated February 28, 2017, and by Third Loan Modification Agreement dated April 27, 2017, and by Fourth Loan Modification Agreement dated April 10, 2018, and by a Fifth Loan Modification Agreement dated October 15, 2018, and by a Sixth Modification Agreement dated April 30, 2019 and by a Seventh Loan Modification Agreement dated September 11, 2019 and by an Eighth Loan Modification Agreement dated January 20, 2020 and by a Ninth Loan Modification Agreement dated March 10, 2020 and by a Tenth Loan Modification Agreement dated April 15, 2020 (collectively, the “Credit Agreement”). Pursuant to the Credit Agreement, the Borrower made and delivered certain Notes described therein.

 

B.     The Borrower and the Lender desire to amend and modify the terms of the Credit Agreement, as provided herein. Lender is the holder of the Credit Agreement and the Notes described therein.

 

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C.     The Borrower is not able to secure a financing commitment letter, similar equity commitment or combination thereof to refinance the Revolving Credit Note (which matures on June 30, 2020) under the Credit Agreement, prior to May 1, 2020 as required by Section 3(e) of the Eighth Amendment.

 

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

 

1.     The foregoing recitals are incorporated in and constitute terms of this Agreement.

 

2.     Capitalized terms contained in this Agreement which are not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.     

 

3.     In exchange for the mutual consideration set forth in this Section 3, Lender and Borrower agree that Section 3(e) of the Eighth Amendment shall be deleted in its entirety and replaced with the following as Section 3(e) of the Eighth Amendment: “(e) Borrower shall engage in good faith to refinance the Revolving Credit Note under the Credit Agreement with a closing planned on or before June 30, 2020.”

 

4.     Except as expressly amended and modified hereby, all terms and conditions of the Credit Agreement and the Financing Documents remain unchanged, and of full force and effect in accordance with their terms. The amendments and modifications contained in this Agreement do not constitute or create a novation of the Credit Agreement, the Notes, or any of the other Financing Documents, or the obligations of the Borrower evidenced thereby.

 

5.     The Borrower hereby acknowledges the Lender's performance of all of the Lender's obligations under the Financing Documents, ratifies all of the Financing Documents, as expressly amended and modified hereby, and certifies that they are enforceable in accordance with their terms, without defense or offset. 

 

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6.     The Borrower represents and warrants to the Lender to induce the Lender to enter into this Eleventh Modification Agreement, that the execution, delivery and performance of this Agreement has been duly authorized by all requisite action and such authorization has not been rescinded, and that all representations and warranties made by it in the Financing Documents are true, correct and enforceable on and as of the date hereof.

 

7.     The effective date of this Eleventh Modification Agreement shall be April 30, 2020.

 

8.     This Eleventh Modification Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Virginia. The parties consent to the jurisdiction and venue of the courts of the Commonwealth of Virginia, specifically to the courts of the City of Roanoke, Virginia, and to the jurisdiction and venue of the United States District Court for the Western District of Virginia in connection with any action, suit or proceeding arising out of or relating to this Agreement.

 

9.     This Eleventh Modification Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

 

10.     This Eleventh Modification Agreement may be signed in several counterparts, each of which shall be an original and all of which shall constitute one and the same document.

 

IN WITNESS WHEREOF, the parties have caused this Eleventh Modification Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

 

[The signature pages follow]

 

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Signature Page of Borrower

 

 

 

	 	 	BORROWER:
	Witness:	 	OPTICAL CABLE CORPORATION
	 	 	 	 	 
	 	 	 	 	 
	/s/ Matt Arnold 	 	By:	/s/ Tracy G. Smith	 (Seal)
	Matt Arnold 	 	 	Tracy G. Smith	 
	 	 	 	Chief Financial Officer & Senior Vice President	 

 

    

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Signature Page of Lender

 

 

 

	 	 	LENDER:
	Witness:	 	PINNACLE BANK
	 	 	 	 	 
	 	 	 	 	 
	/s/ Janice S. Samuels 	 	By:	/s/ Marcus William	 (Seal)
	Janice S. Samuels 	 	Name: Marcus William	 
	 	 	Title:    Senior Vice President	 

 

 

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