EXHIBIT 99.2
TENTH AMENDMENT TO CREDIT AGREEMENT
THIS TENTH AMENDMENT TO CREDIT AGREEMENT dated as of April 2, 2002
(this "Amendment"), by and among BIRMINGHAM STEEL CORPORATION (the "Borrower"),
each of the financial institutions party hereto, and BANK OF AMERICA, N.A.,
successor to NationsBank, N.A. (South), as Agent (the "Agent").
WHEREAS, the Borrower, the Lenders, the Swingline Lender and the Agent
have entered into that certain Credit Agreement dated as of March 17, 1997 (as
amended through the date hereof and as may be further amended from time to time,
the "Credit Agreement"); and
WHEREAS, the Borrower, the Agent, the Lenders and the Swingline Lender
desire to amend the Credit Agreement upon the terms and conditions set forth
herein to extend the Termination Date to May 15, 2002, in order to provide time
for the Borrower, in conjunction with its agent, CIBC World Markets Corp.
("CIBC"), to complete the process of seeking acquisition, merger, strategic
alliance and restructuring proposals in an effort to determine the best
alternatives for the Borrower to satisfy its obligations to the Lenders and its
other stakeholders.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by all of the parties hereto, all
of the parties hereto agree as follows:
Section 1. Amendments to Credit Agreement. Subject to the terms and
conditions hereof, including without limitation, satisfaction of the conditions
contained in Section 2, the parties hereto agree that the Credit Agreement is
amended as follows:
(a) Section 1.1 of the Credit Agreement is amended by adding or
entirely amending the following definitions:
"TERMINATION DATE" means May 15, 2002.
(b) A new Section 6.1(s) is added to the Credit Agreement
immediately following Section 6.1(r) thereof, as follows:
(s) Use of Proceeds. In connection with each requested Loan or
Letter of Credit, the Borrower represents and warrants to the
Agent and each Lender that the Loan or Letter of Credit, as
applicable, being requested is not being requested for a
purpose inconsistent with the ongoing business operations of
the Borrower.
(c) A new Section 8.8 is added to the Credit Agreement immediately
following Section 8.7 thereof, as follows:
Section 8.8 Engagement of CIBC; Additional Informational Requirements.
(a) The Borrower has engaged CIBC World Markets Corp.
("CIBC") to engage in a process designed to maximize
value for all of the Borrower's stakeholders. The
Borrower covenants and agrees that it will (i)
through CIBC, seek prospective purchasers of the
Borrower or its assets and potential merger partners,
investors and other strategic partners, and (ii) seek
CIBC's advice and assistance in connection with its
efforts to restructure its debt. The Borrower has
provided to the Lenders information about CIBC's
engagement and the process in which CIBC is engaged
on behalf of the Borrower. The Borrower covenants and
agrees that it will diligently use all reasonable
efforts to support CIBC in the endeavor described in
this subsection (a) consistent with its duties to the
Lenders and other stakeholders.
(b) The Borrower covenants and agrees to provide, and to
cause CIBC to provide, regular and full reporting to
the Lenders with respect to CIBC's activities
described in paragraph (a) above on at least a weekly
basis, and more frequently upon the occurrence of a
material event. Such reporting shall be provided to
the Lenders through a subcommittee of the Lenders and
certain holders of the notes issued pursuant to the
Existing Note Purchase Agreements.
(d) A new Section 10.1(r) is added to the Credit Agreement
immediately following Section 10.1(q) thereof, as follows:
(R) FAILURE TO PURSUE STRATEGIC ALTERNATIVES.
(i) Either the Borrower or CIBC terminates
the CIBC engagement described in Section
8.8; (ii) the Borrower, in the judgment of
the Requisite Lenders, has restricted the
ability of CIBC to pursue strategic
alternatives; or (iii) the Borrower, in the
judgment of the Requisite Lenders, ceases to
pursue strategic alternatives that are
acceptable to the Requisite Lenders.
(e) Exhibit B and Exhibit E to the Credit Agreement are amended to
read in the forms attached hereto as Exhibit B and Exhibit E.
Section 2. Conditions Precedent. The effectiveness of this Amendment is
subject to receipt by the Agent of each of the following, each in form and
substance satisfactory to the Agent:
(a) Copies of fully-executed amendments to (or amendments and
restatements of) each of the following agreements evidencing
that such agreements have been amended in a manner comparable
to the amendments to the Credit Agreement provided for in
Section 1 above or otherwise in a manner satisfactory to the
Lenders:
(i) the Existing Note Purchase Agreements; and
(ii) the applicable Lease Documents (as defined in the
Collateral Agency Agreement).
(b) Fully-executed copies of all corporate or other necessary
action taken by the Borrower to authorize the execution,
delivery and performance of the this Amendment and the other
Loan Documents being delivered in connection herewith,
certified by the Secretary or Assistant Secretary of the
Borrower.
2
(c) Payment of all fees and expenses owing to, and fully funded
retainers satisfactory to the Agent with respect to, each of
Arthur Andersen L.L.P. and Winstead Sechrest & Minick P.C.,
together with all other fees and expenses payable by the
Borrower to the Agent and the Lenders on or prior to the
effectiveness of this Amendment in immediately available
funds, including without limitation, all fees and expenses of
the Agent's counsel and financial advisors and each Lender's
counsel as provided in Section 7 hereof
(d) Such other documents, agreements and instruments as the Agent
may reasonably request.
Section 3. Representations and Warranties of the Borrower. To induce
the Agent, the Lenders and the Swingline Lender to enter into this Amendment,
the Borrower represents and warrants to each of them as follows as of the date
hereof (and assuming the effectiveness of this Amendment):
(a) No Default or Event of Default has occurred and is continuing;
(b) The representations and warranties made or deemed made by the
Borrower and each Restricted Subsidiary in the Loan Documents
to which it is a party, are true and correct with the same
force and effect as if made on and as of the date hereof
except to the extent that such representations and warranties
expressly relate solely to an earlier date (in which case such
representations and warranties were true and accurate on and
as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted under the
Credit Agreement and except for changes that have been
disclosed in filings made by the Borrower with the Securities
and Exchange Commission since the time such representations
and warranties were made;
(c) The Borrower and the Restricted Subsidiaries have the right
and power, and each has taken all necessary action to
authorize it, to execute, deliver and perform this Amendment
and all of the other documents, instruments and agreements
being executed by the Borrower or any Restricted Subsidiary in
connection with any of the foregoing (collectively, the
"Amendment Documents") to the extent such Person is a party
thereto, and, with respect to the Borrower, to perform the
Credit Agreement as amended by this Amendment, in each case in
accordance with their respective terms. This Amendment and the
other Amendment Documents to which the Borrower or any
Restricted Subsidiary is a party have been duly executed and
delivered by the duly authorized officers of the Borrower and
its Restricted Subsidiaries, as the case may be, and each of
this Amendment, such other Amendment Documents and the Credit
Agreement as amended by this Amendment is a legal, valid and
binding obligation of the Borrower and each Restricted
Subsidiary a party thereto enforceable against such Person in
accordance with its respective terms except as may be limited
by bankruptcy, insolvency or other laws of general application
relating to or affecting the enforcement of creditors' rights
generally and general principles of equity; and
(d) The execution and delivery of this Amendment, such other
Amendment Documents, and the performance of each of this
Amendment, such other Amendment Documents and the Credit
Agreement as amended by this Amendment, in accordance with
their respective terms, do not and will not, by the passage of
time, the giving of notice, or otherwise;
3
(i) require any Governmental Approval or violate any
Applicable Law relating to the Borrower or any Subsidiary;
(ii) conflict with, result in a breach of or constitute a
default under the certificate or incorporation or the bylaws
of the Borrower or any Restricted Subsidiary, or any
indenture, agreement or other instrument to which the Borrower
or any Subsidiary is a party or by which the Borrower or any
Subsidiary or any of its representative properties may be
bound; or (iii) result in or require the creation or
imposition of any Lien upon or with respect to any property
now owned or hereafter acquired by the Borrower or any
Subsidiary except for Liens granted pursuant to, or
contemplated by, the Collateral Agency Agreement.
Section 4. No Third Party Beneficiaries. Except for the Borrower, the
Lenders, the Swingline Lender and the Agent, no Person is intended to be a
beneficiary of this Amendment and no other Person shall be authorized to rely
upon the contents of this Amendment.
Section 5. Effect. The amendments contained herein shall be deemed to
have prospective application only.
Section 6. Release of Claims.
(i) The Borrower, for itself and all of its predecessors,
successors and assigns, acknowledges, affirms and
represents that immediately prior to giving effect to
this Amendment, it is legally, validly and
enforceably obligated to each of the Agent, the
Lenders and the Swingline Lender under and pursuant
to the Credit Agreement and each of the other Loan
Documents to which the Borrower is a party (the
Credit Agreement, together with such other Loan
Document, the "Existing Loan Documents") and that the
Borrower has no defense, offset, counterclaim or
right of recoupment with regard to such obligations,
hereby fully, forever and completely releases and
discharges each of the Agent, the Lenders and the
Swingline Lender and all of their respective
employees, officers, directors, trustees,
shareholders, affiliates (including, without
limitation, Banc of America Securities LLC), agents,
attorneys, representatives, predecessors, successors
and assigns (collectively, the "Released Parties"),
from any and all claims, demands, liabilities,
damages and causes of action (collectively, the
"Borrower Claims") of any kind whatsoever, whether
based on facts in existence prior to or as of the
date of the effectiveness of this Amendment, whether
known or unknown, which the Borrower may now have or
may have had at any time heretofore or may have at
anytime hereafter, whether for contribution or
indemnity or otherwise, and whether direct or
indirect, fixed or contingent, liquidated or
unliquidated, arising out of or related in any way to
any of the following: (a) any of the Existing Loan
Documents; and (b) any action, inaction or omission
by any of the Released Parties. Upon this Amendment
becoming effective, the Borrower and each of its
Subsidiaries covenants and agrees never to commence,
voluntarily aid in any way, prosecute or cause to be
commenced or prosecuted against any of the Released
Parties any action or other proceeding based upon any
of the Borrower Claims which may have arisen at any
time on or prior to the date of this Amendment and
were in any manner related to or arising in
connection with any of the Loan Documents.
(ii) The agreements of the Borrower set forth in
this Section 6 shall survive termination of
the Loan Documents.
4
Section 7. Expenses. The Borrower agrees to pay or reimburse the Agent
and each Lender for all of their reasonable out-of-pocket costs and expenses
incurred in connection with the preparation, negotiation and execution of this
Amendment, any of the other Amendment Documents (including due diligence
expenses and travel expenses relating to closing), and the consummation of the
transactions contemplated hereby and thereby, including the reasonable fees and
disbursements of counsel to the Agent and counsel to each Lender.
Section 8. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 9. Counterparts. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall constitute an original, but all of which taken
together shall be one and the same instrument. Telecopies of signatures shall be
binding and effective as originals.
Section 10. Severability. If any provision of this Amendment shall be
determined to be invalid, then only such provision shall be invalid and all
other provisions of this Amendment shall remain effective and binding.
Section 11. Defined Terms. Terms not otherwise defined in this
Amendment which are defined in the Credit Agreement are used herein with the
respective meanings given them in the Credit Agreement.
Section 12. References to Credit Agreement. Each reference to the
Credit Agreement in any of the Loan Documents shall be deemed to be a reference
to the Credit Agreement as amended by this Amendment.
Section 13. Transaction Documents. The Lenders direct and authorize the
Agent to enter into each Amendment Document to which the Agent (in such
capacity) is or is to be come a party.
[Signatures on Following Page]
5
IN WITNESS WHEREOF, the parties hereto have caused this Tenth Amendment
to Credit Agreement to be executed as of the date first above written.
THE BORROWER:
BIRMINGHAM STEEL CORPORATION
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
THE AGENT AND THE LENDERS:
BANK OF AMERICA, N.A., successor to
NationsBank, N.A. (South), as Agent, as a
Lender and as Swingline Lender
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
PNC BANK, NATIONAL ASSOCIATION, as Co-
Agent and as a Lender
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
THE BANK OF NOVA SCOTIA, as Co-Agent and
as a Lender
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[Signatures Continued on Following Page]
6
[Signature Page to Tenth Amendment to Credit Agreement
dated as of April 2, 2002 with Birmingham Steel Corporation]
THE BANK OF TOKYO - MITSUBISHI, LTD.
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ARK II CLO 2001-1, LIMITED
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
DZ BANK AG DEUTSCHE ZENTRAL
GENOSSENSCHAFTSBANK FRANKFURT
AM MAIN
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[Signatures Continued on Following Page]
7
[Signature Page to Tenth Amendment to Credit Agreement
dated as of April 2, 2002 with Birmingham Steel Corporation]
GENERAL ELECTRIC CAPITAL
CORPORATION
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
CAPITAL FUNDING VII LLC
By: Apollo Management V, L.P.,
as its Manager
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
GOLDMAN SACHS
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
UBS AG, STAMFORD BRANCH, successor to
Union Bank of Switzerland, New York
Branch
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
8
EXHIBIT B
FORM OF NOTICE OF BORROWING
------------, -----
Bank of America, N.A., as Agent
101 North Tryon, Mail Code NC1001-15-13
Charlotte, North Carolina 28255
Attention: _____________________
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of March 17, 1997,
as amended (the "Credit Agreement"), by and among Birmingham Steel Corporation
(the "Borrower"), the financial institutions initially party thereto and their
assignees under Section 12.5.(d) thereof, and Bank of America, N.A., successor
to NationsBank, N.A. (South), as Agent (the "Agent"). Capitalized terms used
herein, and not otherwise defined herein, have their respective meanings given
them in the Credit Agreement.
(a) Pursuant to Section 2.1.(b) of the Credit
Agreement, the Borrower hereby requests that
the Lenders make Revolving Loans to the
Borrower in an aggregate amount equal to
$___________________.
(b) The Borrower requests that such Revolving
Loans be made available to the Borrower on
____________, _____.
(c) The Borrower hereby requests that the
requested Revolving Loan be of the following
Type:
[CHECK ONE BOX ONLY]
[ ] Base Rate Loans
[ ] LIBOR Loans, each with an initial Interest
Period for a duration of:
[CHECK ONE BOX ONLY] [ ] one month
[ ] two months
[ ] three months
[ ] six months
(d) The proceeds of this borrowing of Revolving
Loans will be used for the following
purpose, which purpose is not inconsistent
with the ongoing business operations of the
Borrower:
___________________________________________
___________________________________________
9
(e) The Borrower requests that the proceeds of
this borrowing of Revolving Loans be made
available to the Borrower by
____________________________. The Borrower
hereby certifies to the Agent, the Lenders
and the Swingline Lender that as of the date
hereof and as of the date of the making of
the requested Revolving Loans and after
giving effect thereto, (a) no Default or
Event of Default has or shall have occurred
and be continuing, and (b) the
representations and warranties made or
deemed made by the Borrower in the Loan
Documents to which it is a party, are and
shall be true and correct, except to the
extent that such representations and
warranties expressly relate solely to an
earlier date (in which case such
representations and warranties were true and
accurate on and as of such earlier date) and
except for changes in factual circumstances
specifically and expressly permitted under
the Credit Agreement.
The Borrower further certifies to the Agent and the Lenders that as of the date
hereof, the Borrower does not have and, after the receipt of the proceeds of the
Revolving Loans requested hereby, the Borrower will not have, Available Cash in
excess of $5,000,000.
If notice of the requested borrowing of Revolving Loans was previously given by
telephone, this notice is to be considered the written confirmation of such
telephone notice required by Section 2.1.(b) of the Credit Agreement.
BIRMINGHAM STEEL CORPORATION
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
10
EXHIBIT E
FORM OF NOTICE OF SWINGLINE BORROWING
------------, -----
Bank of America, N.A.
101 North Tryon, Mail Code NC1001-15-13
Charlotte, North Carolina 28255
Attention: _________________
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of March 17, 1997,
as amended (the "Credit Agreement"), by and among Birmingham Steel Corporation
(the "Borrower"), the financial institutions initially party thereto and their
assignees under Section 12.5.(d) thereof, and Bank of America, N.A., successor
to NationsBank, N.A. (South), as Agent (the "Agent"). Capitalized terms used
herein, and not otherwise defined herein, have their respective meanings given
them in the Credit Agreement.
1. Pursuant to Section 2.4.(b) of the Credit Agreement, the
Borrower hereby requests that the Swingline Lender make a
Swingline Loan to the Borrower in an amount equal to
$___________________.
(f) The Borrower requests that such Swingline
Loan be made available to the Borrower on
____________, _____.
(g) The proceeds of this Swingline Loan will be
used for the following purpose, which
purpose is not inconsistent with the ongoing
business operations of the Borrower:
(h) The Borrower requests that the proceeds of
such Swingline Loan be made available to the
Borrower by ______________________________.
The Borrower hereby certifies to the Agent and the Lenders that as of the date
hereof and as of the date of the making of the requested Swingline Loan and
after giving effect thereto, (a) no Default or Event of Default has or shall
have occurred and be continuing, and (b) the representations and warranties made
or deemed made by the Borrower in the Loan Documents to which it is a party, are
and shall be true and correct, except to the extent that such representations
and warranties expressly relate solely to an earlier date (in which case such
representations and warranties were true and accurate on and as of such earlier
date) and except for changes in factual circumstances specifically and expressly
permitted under the Credit Agreement.
11
The Borrower further certifies to the Agent, the Lenders and the Swingline
Lender that as of the date hereof, the Borrower does not have and, after the
receipt of the proceeds of the Swingline Loan requested hereby, the Borrower
will not have, Available Cash in excess of $5,000,000.
If notice of the requested borrowing of this Swingline Loan was previously given
by telephone, this notice is to be considered the written confirmation of such
telephone notice required by Section 2.4.(b) of the Credit Agreement.
BIRMINGHAM STEEL CORPORATION
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------