Document:

SYNL-2013.12.28-10K EX 10.7

SYNALLOY CORPORATION
2013 Short-Term Cash Incentive and Options Plan

		
	1.
	Purpose.  This Short-Term Cash Incentive and Options Plan (the “Incentive Plan”) is intended to provide key executive employees of Synalloy Corporation (the “Company”, which term shall include Synalloy Corporation and any of its affiliates or subsidiaries) the opportunity to participate in the Company’s profitability, future prosperity and growth. The purpose of the Incentive Plan is to provide short and long-term incentive for gain through outstanding service to the Company and its shareholders, and to assist in attracting and retaining executives of ability and initiative.

		
	2.
	Administration.  The Incentive Plan shall be administered by the Company’s Compensation & Long Term Incentive Committee (the “Committee”).  The same restrictions set forth in the Company’s 2011 Long-Term Incentive Stock Option Plan (the “Stock Option Plan”), previously approved by the Company’s Board of Directors and shareholders, applicable to Committee members shall also apply under this Incentive Plan.  To the extent this Incentive Plan differs from or is inconsistent with the Stock Option Plan, the terms and provisions of the Stock Option Plan shall govern.  The Committee shall have complete authority and discretion to interpret all provisions of this Incentive Plan consistent with law and the Stock Option Plan, to prescribe the form of instruments evidencing the stock options that may be granted under this Incentive Plan and pursuant to the Stock Option Plan, to adopt, amend, and rescind general and special rules and regulations for its administration, and to make all other determinations necessary or advisable for the administration of the Incentive Plan.  No member of the Committee shall be liable for any action or determination in respect thereto, if made in good faith, and shall be entitled to indemnification by the Company with respect to all matters arising from his service on the Committee to the fullest extent allowable under the Company’s charter documents and applicable law. 

		
	3.
	Eligibility.  Any salaried employee of the Company who in the judgment of the Committee occupies a management position in which his or her efforts contribute to the profit and growth of the Company may be eligible to participate in the Incentive Plan.  The named participants to this Incentive Plan shall be recommended by the division Presidents and the CEO, and approved by the Committee.  The key metric used to measure management performance in a particular division or the Company as a whole, as the case may be, is net income before income taxes or “NIBIT” as more fully described in the Company’s Proxy Statement.  The NIBIT target ranges described herein are derived from the Company’s annual budget approved by the Company’s Board of Directors and are exclusive of and calculated prior to allocation of the cash and stock option incentives payable to all executives participating in the Incentive Plan.   Exhibit A to this Incentive Plan, as may be amended from time to time by the Committee, sets forth the annual NIBIT target range and named participants’ assigned percentage of the cash and stock option incentives.  The Committee, upon recommendation from the Company’s CEO, shall have the discretion to determine to what extent, if any, persons employed on a part-time or consulting basis will be eligible to participate in the Incentive Plan. 

		
	4.
	Cash Incentive Pool.  At the beginning of the year, for each division, including Corporate, the division Presidents will identify the executives who they recommend to participate in each division’s cash incentive pool with input from the CEO, and the CEO will recommend the executives who will participate in the Corporate division’s cash incentive pool.  Additionally, each recommended participant will be allocated a percentage of the division’s cash incentive pool.  The recommended allocations will be completed at the beginning of each year by the division Presidents, with input and review from the CEO.  The CEO will prepare the recommended allocation for the Corporate division.  These recommendations will be submitted to the Committee no later than two weeks prior to the February Board of Director’s meeting.  The Committee will review and approve, amend or reject the recommendations of the division Presidents and the CEO.  The CEO’s incentive calculation will be handled separately from the Corporate division and will be approved by the Committee.

		
	A.
	NIBIT Allocations.  At the beginning of each year, the Company’s Board of Directors will approve the upcoming year’s budget that shall include the NIBIT target range for each division and for the Company as a whole (each, a “Target Range”).  The applicable Target Range for each division, as approved by the Board of Directors, is set forth on Exhibit A attached hereto.  Each division cash incentive pool shall equal a designated percentage of NIBIT achieved by that division, or in the case of the Corporate division, achieved by the Company as a whole.  Upon the division Presidents and CEO’s recommendation, the Committee will establish the percentage of NIBIT that will comprise the cash incentive pool for each division and the Company as a whole (each, an “Incentive Pool Percentage”).  The applicable Incentive Pool Percentages for each division are set forth below.  Each Target Range will include three levels with corresponding Incentive Pool Percentages: (i) Below Target; (ii) On Target; and, (iii) Above Target.  Wherever NIBIT falls (Below Target, On Target, or Above Target), the Incentive Pool Percentage for that applicable Target Range will apply to all dollars of profit beginning with the first dollar, computed using the applicable Incentive Pool Percentage.

		
	B.
	Cash Incentive Pool Percentages (excluding inventory adjustments) See Exhibits A and B attached hereto for complete details.:

	
							
	Division
	 
	Below Target
	 
	On Target
	 
	Above Target

	General Metals Segment
	 
	1.50%
	 
	3.50%
	 
	5.50%

	K. Pennington - Metals Segment
	 
	1.00%
	 
	1.50%
	 
	2.00%

	Palmer
	 
	2.50%
	 
	5.00%
	 
	7.00%

	MCC
	 
	2.50%
	 
	5.00%
	 
	7.50%

	Corporate
	 
	1.25%
	 
	2.00%
	 
	3.00%

	CEO
	 
	1.00%
	 
	2.00%
	 
	2.75%

		
	C.
	Downward Adjustments to the Cash Incentive Pool.  Each division President, upon approval by the CEO, has the authority to reduce an individual executive’s cash incentive bonus for material underperformance against personal goals.  Additionally, at the operating division level, the Corporate division level and for the CEO and other Company executives that may be identified individually, each cash incentive pool may be reduced for poor performance in two areas as detailed below: Safety and Inventory Turns.

		
	i.
	For every lost time accident during the year, the cash incentive pool for that division will be reduced by 5%.  The cash incentive pool for the Corporate division and the CEO will be reduced as well by taking the division with the largest number of lost time accidents and multiplying the number of lost time accidents times 5.  For example, if BRISMET has the largest number of accidents at 3, then the Corporate division and the CEO’s cash incentive pool will be reduced by 15%.

		
	ii.
	An inventory turn target will be established for each division, where applicable, and will be set forth on Exhibit A.  These inventory turn targets will be established by the CEO and division Presidents and approved by the Committee.  If the inventory turns come in less than the target, the applicable division’s cash incentive pool shall be reduced by 10%.  If the inventory turns for the entire company are less than the targeted inventory turns, then the cash incentive pool for the Corporate division and the CEO will be reduced by 10% as well.  

		
	D.
	Inventory Profits or Losses.  The NIBIT calculations shall exclude any inventory profits or losses applicable to the BRISMET division as set forth in this section.  NIBIT calculations for the BRISMET division will be reduced on a dollar for dollar basis by the amount of inventory profits in that division, and the appropriate Target Range will be selected based on such reduced NIBIT calculation.  Likewise, NIBIT calculations for the BRISMET division will be increased on a dollar for dollar basis by the amount of inventory losses in that division.  The Committee will determine the correct Target Range before inventory losses are added back to the NIBIT calculation and the correct Target Range after inventory losses are added back to the NIBIT calculation.  Under no circumstances shall any applicable executive move more than one Target Range as a result of this inventory loss add back.  For example, if the CEO is in the Below Target Range before inventory losses are added back, and in the Above Target Range after inventory losses are added back, the CEO shall be permitted to move up one Target Range only into the On Target Range.  The CEO shall not be permitted in this example to move up two Target Ranges into the Above Target Range.

		
	5.
	Stock Options (Long-Term Incentives).  To the extent stock options are available under the Stock Option Plan previously approved by the shareholders, stock options of Company stock will be issued as provided herein.  All terms, conditions and restrictions set forth in the Stock Option Plan shall apply to any and all stock options issued pursuant to this Incentive Plan.  Those executives eligible to receive bonus payments from the cash incentive pool under this Incentive Plan Stock options are eligible to receive stock options.  Stock options will be issued in only those years where On Target or Above Target NIBIT is achieved in a particular division, or Company as a whole, depending upon the position of a particular executive.  No stock options will be issued when NIBIT is Below Target. 

		
	6.
	Stock Options Schedule.  Stock options shall be granted based on the schedule below.  The percentages set forth below represent a percentage of each particular executive’s base salary (i.e., base salary exclusive of bonuses) for the year under consideration. 

	
							
	Position
	 
	Below Target
	 
	On Target
	 
	Above Target

	CEO
	 
	—%
	 
	25.00%
	 
	37.50%

	CFO
	 
	—%
	 
	25.00%
	 
	30.00%

	DIV PRES/GM
	 
	—%
	 
	20.00%
	 
	30.00%

	SEC/HR
	 
	—%
	 
	15.00%
	 
	22.50%

	Others
	 
	—%
	 
	10.00%
	 
	15.00%

		
	7.
	Mid-Year Acquisition Adjustments.  The Company, from time to time, may acquire another business or operating division mid-year, which acquisition will not be budgeted or accounted for in the Target Ranges that are established at the beginning of the fiscal year.  Upon consultation with the CEO and division Presidents, the Committee shall amend the applicable Target Ranges to account for any and all mid-year acquisitions.  Specifically, the Committee will update the applicable Target Ranges to account for the pro-forma NIBIT expected from each acquisition for the remainder of the current calendar year.  The Company’s practice is to allocate unbudgeted one-time expenses associated with a mid-year acquisition to the Corporate division only.  In determining the actual year-end NIBIT calculation for the Corporate division and the CEO, the Committee will add back the one-time costs associated with each acquisition incurred during the year in question but not previously budgeted.  The amount of one-time expenses to be added back will be approved by the Committee and will include only those expenses that were incurred as a direct result of completing the acquisition.  In the event these one-time expenses extend from one calendar year to the next, the accrued one-time expenses associated with the acquisition from each year will be added back to the applicable year’s NIBIT calculations for the Corporate division and the CEO.    

		
	8.
	General Provisions.  Neither the adoption of this Incentive Plan nor its operation, nor any document describing or referring to this Incentive Plan, or any part thereof, shall confer upon any employee any right to continue in the employ of the Company or any subsidiary, or shall in any way affect the right and power of the Company to terminate the employment of any employee at any time with or without assigning a reason therefor to the same extent as the Company might have done if this Incentive Plan had not been adopted.  In light of the importance of promoting long-term relationships and a long-term commitment to the ongoing success of the Company, in order to receive any payments or stock options under this Plan, an employee must be employed by the Company on the last day of the applicable fiscal year; provided, however, that if termination of employment occurs as a result of death, disability (unable to work for 12 consecutive months), or retirement (with a minimum of 5 years of employment with the Company), payment of the cash bonus and/or the grant of options will be determined as otherwise provided in this Incentive Plan but shall be prorated to reflect that portion of the prior year in which the employee was an employee of the Company.  Eligible employees must have entered into a confidentiality and non-competition agreement in a form acceptable to the CEO of the Company in order to receive any benefits under this Incentive Plan.  Payments under this Incentive Plan will be made on or about March 15th of the year following the Company’s fiscal year end.  This Incentive Plan shall be governed by the laws of the state of South Carolina.

		
	9.
	Duration and Amendment of the Incentive Plan.  Unless previously terminated by the Committee, the Incentive Plan shall be effective for the fiscal year specified in the Incentive Plan.  The Committee may alter, amend, or terminate this Incentive Plan, including any exhibits attached hereto, at any time.  Any stock options granted prior to the termination of this Incentive Plan shall remain valid thereafter in accordance with their terms and the Stock Option Plan.SYNL-2013.12.28-10K EX 10.14

BB&T
SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

	
			
	 
	9520406872
	 

	 
	Account Number
	 

This Second Amendment to First Amended and Restated Loan Agreement (this “Amendment”) is made as of August 9, 2013 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 (all of the foregoing sequentially, cumulatively and collectively, the “Loan Agreement”).  

Recitals

In addition to the Term Loan and the Revolving Line, the Borrowers have requested the Bank and the Bank has agreed, subject to the terms of this Amendment to (a) extend a new term loan to the Borrowers (the “CRI Acquisition Loan”) in the principal amount of $4,033,250; (b) amend the definition of “EBITDA” in the Loan Agreement; and (c) provide for certain other matters as set forth herein.  The purpose of the CRI Acquisition Loan shall be to facilitate the acquisition by Synalloy of the real estate known as the CRI land and building, and by CRI Tolling of equipment assets of CRI along with related closing costs and expenses (collectively, the “CRI Acquisition”).

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.  

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SECOND AMENDMENT
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FIRST AMENDED AND RESTATED LOAN AGREEMENT

Section 2.   Recitals and Loan Agreement Incorporated Herein by Reference

Each and all of opening paragraphs, the Recitals, 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 notwithstanding their being underneath the heading “Recitals” above.  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.   CRI Acquisition Term Loan

		
	(a)
	Generally

At the request of the Borrowers and for the purposes and as contemplated by the Recitals above, the Bank does hereby extend the CRI Acquisition Loan to the Borrowers as a variable rate term loan in the principal amount of $4,033,250.  The Borrower’s obligations to repay the CRI Acquisition Loan and interest and other matters shall be evidenced by the Borrowers’ promissory note nominated as the BB&T Promissory Note dated the date of this Amendment in the original principal amount of $4,033,250 (the “CRI Acquisition Loan Note”) and maturing August 1, 2023, when the entire unpaid principal balance then outstanding on the CRI Acquisition Loan under the CRI Acquisition Loan Note plus accrued interest thereon shall be paid in full.

(b)    Advances

The CRI Acquisition Loan shall be advanced to the Borrowers in two (2) installments as more particularly set forth herein.  

		
	(i)
	The first advance shall be in the amount of $3,485,000 on the date hereof to finance the real property portion of the CRI Acquisition.  This first advance shall be made to Synalloy for this purpose, provided that all Borrower shall nonetheless be and remain joint and several co-Borrowers as to such advance notwithstanding that this advance is made to Synalloy only.

		
	(ii)
	The second advance shall be in the balance amount of $548,250 on a date not later than September 30, 2013 to finance the equipment portion of the CRI Acquisition (together and as evidenced by the CRI Acquisition Loan Note, the “CRI Acquisition Loan Advances”).  This first advance shall be made to CRI Tolling acting on behalf of the Borrowers for this purpose, provided that all Borrower shall nonetheless be and remain joint and several co-Borrowers as to such advance notwithstanding that this advance is made to CRI Tolling only.

		
	(c)
	As a “Loan” and “Note” Under the Existing Loan Documents

The CRI Acquisition Loan shall, along with the Term Loan and the Line of Credit, constitute a “Loan” for purposes of the Loan Agreement and the Loan Documents (collectively with any other “Loans” now or hereafter applicable thereunder).   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, all notes or other instruments evidencing the same, the Loan Agreement, this Amendment, the other Loan Documents constitute the joint and several obligations of the Borrowers in nature secured and enjoying the assurances, guaranties and all other benefits of the Loan Documents.  To the extent necessary to effectuate the foregoing, the Loan Agreement and each of the Loan Documents are hereby amended as necessary, mutatis mutandis, consistent with the foregoing and all other matters set forth in this Amendment.

(d)    Good and Sufficient Consideration

Each of the Borrower acknowledges and agrees that the extension by the Bank to the Borrowers, borrowing on a joint and several basis, of each of the Term Loan, the Line of Credit and the CRI Acquisition Loan, is for the full and complete betterment of each of the other Borrowers due to the same being in furtherance of their enterprises as an entirety and their entity, commercial and other relationships and affiliations.  The foregoing constitutes good and valuable consideration for the borrowing by each of the Borrowers of such Loans and the Borrowers to hereby represent and warrant as such to the Bank accordingly.

Section 4.  Conditions Precedent

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SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

(a)    Closing and Initial CRI Acquisition Loan Advance for Real Property

The closing of the extension of the CRI Acquisition Loan and the extension of the first of the two CRI Acquisition Loan Advances (for real property) shall be conditioned upon the receipt by the Bank of all items and the satisfaction of all conditions set forth in the commitment letter agreement (the “Commitment Letter”) from and between the Bank and the Borrowers dated July 19, 2013, all in form and content satisfactory to the Bank, including without limitation the following:

USA Patriot Act Verification Information:  Information or documentation, including but not limited to the legal name, address, tax identification number, driver’s license, and date of birth (if the Borrower is an individual) of the Borrowers sufficient for the Bank to verify the identity of the Borrowers in accordance with the USA Patriot Act.  Borrowers shall notify Bank promptly of any change in such information.
Note(s):  The Note(s) evidencing the Loans(s) duly executed by the Borrowers.
Security Agreement(s): Security Agreement(s) in which Borrowers and any other owner (a “Debtor”) of personal property collateral shall grant to Bank a first priority security interest in the tangible and intangible personal property specified therein.  (If Bank has or will have a security interest in any collateral which is inferior to the security interest of another creditor, Borrowers must fully disclose to Bank any and all such  security interests, and Bank must specifically approve any such security interest which will continue during the Loan.) 
Mortgages:  First and exclusive mortgage (the “Mortgage”) on the CRI Property, subject only to such liens and encumbrances as shall be permitted by the Bank in writing.  The Bank shall be provided (a) a current survey of the CRI Property; and (b) such other information and documentation of the CRI Property as the Bank may request.
Negative Pledge Agreement: No pledge agreement on the CRI Property. 
UCC Financing Statements: To the extent not already in place, copies of UCC Financing Statements duly filed in Borrowers’ or other owner’s state of incorporation, organization or residence, and in all jurisdictions necessary, or in the opinion of the Bank desirable, to perfect the security interests granted in the Security Agreement(s), and certified copies of Information Requests identifying all previous financing statements on record for the Borrowers or other owner, as appropriate from all jurisdictions indicating that no security interest has previously been granted in any of the collateral described in the Security Agreement(s), unless prior approval has been given by the Bank.
Corporate Resolution:  Entity resolutions duly adopted by each of the Borrowers authorizing the execution, delivery, and performance of this Amendment, the CRI Acquisition Loan Note and any other applicable Loan Documents on or in a form provided by or acceptable to Bank. 
Articles of Incorporation:  A copy of the Articles of Incorporation and all other charter documents of each of Synalloy, Metchem, Synalloy Metals, Manufacturers Soap and Palmer all filed with and certified by the Secretary of State of the State of each corporations incorporation.
By-Laws:  A copy of the By-Laws of Synalloy, Metchem, Synalloy Metals, Manufacturers Soap and Palmer, certified by the Secretary of each corporation as to their completeness and accuracy.
Declaration of Limited Liability Company: A declaration or resolution from the members/managers of Synalloy Fabrication, Ram-Fab, Bristol and Manufacturers Chemicals authorizing the execution, delivery, and performance of the Loan Documents on or in a form provided by or acceptable to Bank.
Articles of Organization: A copy of the Articles of Organization and all other organizational documents of Synalloy Fabrication, Ram-Fab, Bristol and Manufacturers Chemicals, all filed with and certified by the Secretary of State of each limited liability companies organization.
Operating Agreement: A copy of the Operating Agreement of Synalloy Fabrication, Ram-Fab, Bristol and Manufacturers Chemicals, certified by each limited liability companies members/managers as to its completeness and accuracy. 

BB&T
SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

Certificate of Incumbency:  A certificate of the Secretary or members/managers of the Borrowers certifying the names and true signatures of the officers or members/managers of the Borrowers authorized to sign the Loan Documents.
Certificate of Existence:  A certification of the Secretary of State (or other government authority) of the State of the Borrowers’ Incorporation or Organization as to the existence or good standing of the Borrowers and their charter documents on file.
Opinion of Counsel: An opinion of counsel for the Borrowers satisfactory to the Bank and the Bank’s counsel.
Assignment of Life Insurance Policy(ies):  To the extent not already on file with the Bank, the assignment of life insurance policy(ies) as collateral in the approximate amount of $2,900,000 by an insurance company acceptable to the Bank, covering the individuals with respect to which policies are presently assigned to the Bank and such additional individuals as the Bank may reasonably request.
Additional Documents:  Receipt by the Bank of other approvals, opinions, or documents as the Bank may reasonably request.
(b)    Closing and Initial CRI Acquisition Loan Advance for Equipment

The extension of the second of the two CRI Acquisition Loan Advances (for equipment) shall be conditioned upon (i) the satisfaction of the conditions referenced in Section 4(a) above; and (ii) the receipt by the Bank of all items and the satisfaction of all conditions as follows, all in form and content satisfactory to the Bank:  The second such CRI Acquisition Loan Advance shall be made in a single advance in the amount of $548,250 on a date on or prior to September 30, 2013 and each Borrower represents, warrants and agrees that it shall satisfy the following conditions for the extension of such second CRI Acquisition Loan Advance on or prior to such date:  Prior to the making by the Bank to the Borrowers of such second of the two CRI Acquisition Loan Advances (for equipment), the Bank shall have been furnished (a) copies of one or more bills of sale from CRI to CRI Tolling setting forth in reasonable detail the equipment being transferred to CRI Holding; (b) such equipment shall constitute substantially all of the equipment located at the CRI Project on the date hereof and be such as to enable the CRI Project to continue in operations as contemplated by the Borrowers and (c) such additional assurances as the Bank may reasonably require (such as evidence of insurance, etc.) as would the Bank for comparable equipment purchase credit facilities.

Section 5.  Amendment to Definition of “EBITDA”

The sentence in the first indented paragraph of Section 5 of the Loan Agreement, defining the term “EBITDA” is hereby restated to read as follows:

EBITDA is defined as the sum of (a) net income for such period plus (b) an amount which, in the determination of net income for such period, has been deducted for (i) interest expense (including the interest component under capital lease obligations) (ii) total federal, state and other income taxes (iii) depreciation and amortization expense and (iv) non-recurring acquisition expenses, all as determined with GAAP.

Any references to “EBITDA” 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.   Swaps.  

(a)    Section 8.09 of the Loan Agreement is hereby restated to read as follows:

8.09  Should an Event of Default, Termination Event or similar event or condition (howsoever nominated) occur under any Swap Agreement(s).

		
	(b)
	Notwithstanding anything to the contrary in the Loan Agreement, any Guaranty or any other Loan Document, no person or entity that does not qualify as an Eligible Contract Participant (as defined in the Commodity Exchange Act, as amended) or does not otherwise qualify as an indirect proprietorship pursuant to the rules of the Commodity Futures Trading Commission shall be deemed a party to any guaranty of any Swap Agreement 

BB&T
SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

with the Bank entered into or modified on or after October 12, 2012, and shall not be liable for any swap obligations to BB&T arising from such Swap Agreement. Such exclusion shall have no effect on any other obligations of any such person or entity to BB&T under this Guaranty.

Section 7.   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 on Attachment 1 to this Amendment.

Section 8. 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 9.  Fee.  In consideration for the matters set forth in this Amendment, the Borrowers shall pay to the Bank, contemporaneously with the date hereof, a one-time fee in the amount of 20,166.25.

Section 10.  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 CRI Acquisition Loan and the other Loans, including without limitation: (i) the failure to make any payment to the Bank promptly when due, whether under the CRI Acquisition and the other Notes evidencing CRI Acquisition Loan and the other 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 the CRI Acquisition Loan and the other 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 the Palmer Acquisition Documents or the transactions contemplated thereby. The Bank shall have no responsibility or liability whatsoever (in contact, tort or otherwise) with respect to the Palmer Acquisition Documents or the transactions contemplated thereby.

Section 11.  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 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.

BB&T
SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

		
	(d)
	CRI Acquisition and Cap-X Covenant.  Section 6.03 of the Loan Agreement provides that expenditures for fixed assets in any fiscal year shall not exceed, in the aggregate as to all Borrowers, the sum of $5,500,000. For the purposes of calculating such expenditures for the fiscal year 2013, the fixed assets purchased in connection with the Color Resources International transaction will not be counted toward this capital expenditure covenant.

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BB&T
SECOND AMENDMENT
TO
FIRST AMENDED AND RESTATED LOAN AGREEMENT

		
	 (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 Second Amendment to First Amended and Restated Loan Agreement]

BB&T
ATTACHMENT 1

RELATED LOAN AND SECURITY DOCUMENTS

August 9, 2013

Borrowers:  The entities executing as co-Borrowers to the First Amendment to which this Attachment 1 is Attached 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).

		
	•
	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 this Second Amended and Restated Loan Agreement dated as of August 9, 2013

		
	•
	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.

		
	•
	Assignments of Life Insurance Policies, each dated June 30, 2010, for policies executed by Synalloy Corporation for policies numbered 1820005, 1820003, 1820007, 1820001, 1820009.

		
	•
	Any and all other Loan Documents (as defined in the Loan Agreement)

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