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Exhibit 4.5
FOURTH AMENDMENT TO CREDIT AGREEMENT
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THIS FOURTH AMENDMENT TO CREDIT AGREEMENT, dated as of
December 8, 1998, (this "Fourth Amendment"), is by and among OLYMPIC STEEL,
INC., an Ohio corporation ("Borrower"), and NATIONAL CITY BANK ("NCB") and the
group of other banks signatory hereto or that become parties to the Credit
Agreement hereafter identified by amendment or supplement thereto (NCB and the
banks comprising such group at any specific time, hereinafter referred to as the
"Banks") and NATIONAL CITY BANK, as agent for the Banks (in that capacity,
"NCB-Agent").
RECITALS
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A. Borrower, the Banks and NCB-Agent entered into a Credit
Agreement, dated as of October 4, 1996 (the "Credit Agreement"), pursuant to
which Borrower may obtain, among other things, (i) loans ratably from the Banks
that are on a revolving credit basis and (ii) subject LCs issued by NCB in which
the Banks agree to ratably share the obligations in respect thereof, in each
case until the expiration date.
B. Borrower, the Banks and NCB-Agent entered into the First
Amendment to Credit Agreement, dated as of January 24, 1997 (the "First
Amendment"), in order to increase the amount of the commitments by the Banks for
subject revolving credit loans and additional subject LCs by Ten Million Dollars
($10,000,000) and to permit Borrower to make certain joint venture investments
and guarantees of indebtedness of the joint venture entities.
C. Borrower, the Banks and NCB-Agent entered into the Second
Amendment to Credit Agreement, dated as of May 30, 1997 (the "Second
Amendment"), in order to increase the amount of the commitments by the Banks for
subject revolving credit loans and additional subject LCs by Eight Million
Dollars ($8,000,000), to add a commitment by Banks for new Series A term loans
in the amount of Seventeen Million Dollars ($17,000,000), to permit certain
borrowing from other lenders, to permit the Borrower to allow certain of its
property to become encumbered by liens in favor of other lenders and to extend
the expiration date to June 30, 2000.
D. Borrower, the Banks and NCB-Agent entered into the Third
Amendment to Credit Agreement, dated as of July 14, 1997 (the "Third Amendment")
in order to add an additional bank as a party to Credit Agreement, adjust the
ratable share of the obligations among the Banks which were original parties to
the Credit Agreement, decrease the aggregate amount of the commitments by the
Banks for existing subject LCs, and make appropriate changes to the Credit
Agreement in recognition that some or all of the proceeds of the subject loans
would be used by a new subsidiary of Borrower, Olympic Steel Iowa, Inc., for the
purpose of acquiring land and constructing a temper mill facility in Bettendorf,
Iowa.
E. Borrower, the Banks and NCB-Agent desire to again amend the
Credit Agreement by this Fourth Amendment to Credit Agreement (the "Fourth
Amendment") in order to (1) authorize Borrower to borrow funds from Mellon Bank,
N.A. ("Mellon"), one of the Banks, pursuant to a discretionary Swing Line of
Credit facility (the "Swing Loan") as an additional exception to the prohibition
against incurring indebtedness under Section 3D.02 of the Credit Agreement; (2)
grant to Mellon a one-time right to have the Banks refund the outstanding Swing
Loan as a subject revolving credit loan; and (3) adjust Mellon's subject
commitment with respect to the subject loans made pursuant to the Credit
Agreement until such time as the Swing Loan is refunded at Mellon's request by a
subject revolving credit loan.
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AGREEMENT
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Accordingly, the parties have agreed and do hereby agree as follows:
1. The following new Subsection 2A.06 shall be added to the Credit
Agreement immediately following Subsection 2A.05 thereof:
2A.06 MELLON SWING LOAN, REFUNDING THEREOF, AND ADJUSTMENT OF SUBJECT
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COMMITMENTS
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(a) Subject to the terms and conditions of a discretionary Swing
Line Loan Agreement, Borrower shall have the right to obtain
and have outstanding from time to time the Swing Loan from
Mellon in aggregate principal amount not exceeding at any time
$16,000,000.00 as such amount may be reduced at Mellon's sole
discretion (the "Maximum Swing Loan Amount"). Notwithstanding
the provisions of Section 2A.01 or any other provision hereof,
at all times during the Swing Loan Availability Period (as
defined in Subsection (b) below), the aggregate amount of the
commitments by the Banks for subject revolving credit loans
and additional subject LCs and Series A subject term loans
shall be reduced by the value of the Maximum Swing Loan
Amount, whether or not there is any amount outstanding under
the Swing Loan. Such reduction shall not affect the commitment
fees payable pursuant to Section 2A.04 hereof.
(b) (i) Except as set forth in subsection (b)(ii) below,
during the period (the "Swing Loan Availability
Period") from and after the effective date hereof and
until the earlier of (A) the date on which the Banks
refund the Swing Loan pursuant to paragraph (c) below
(the "Refunding Date") or (B) the expiration date, or
(C) the date Mellon terminates the Swing Loan's
availability to Borrower (a "Swing Loan Availability
Termination"), the proportion (expressed as a
percentage) that the amount of the subject commitment
of Mellon bears to the aggregate of all subject
commitments pursuant to the Credit Agreement shall be
reduced to eleven percent (11%) and the amount of
each Bank's commitment to make subject revolving
credit loans and additional subject LCs and Series A
subject term loans to Borrower, and the proportion
(expressed as a percentage) that each Bank's subject
commitment bears to all of the subject commitments,
are set forth opposite the Bank's name on SCHEDULE
2A.06 hereto.
(ii) In the event that during the Swing Loan Availability
Period, Mellon elects to reduce the Maximum Swing
Loan Amount (a "Swing Loan Reduction"), the subject
commitment of each Bank shall be adjusted to the
percentages of the aggregate subject commitments of
the Banks set forth in Schedule 2A.06(b)(ii) hereto.
(c) On any day when the Swing Loan is outstanding prior to the
expiration date (whether before or after the maturity thereof
or the occurrence of an event of default under the Swing Loan
Agreement or under this Credit Agreement), Mellon shall have
the one-time right to request that the Banks refund the
outstanding principal amount of the Swing Loan and any accrued
but unpaid
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interest thereon as a subject revolving credit loan obtained
by Borrower by written notice thereof by Mellon to NCB-Agent,
the Banks and Borrower not later than 1:00 p.m. Cleveland time
on a Banking Day. Any such notice by Mellon shall be deemed to
be a "credit request" by Borrower for purposes of Section
2D.01 of the Credit Agreement for disbursement of a sum equal
to the principal amount of the Swing Loan and accrued but
unpaid interest thereon. Promptly following receipt of such
notice from Mellon to NCB-Agent, NCB-Agent shall promptly
notify each Bank thereof (by facsimile or telephone, confirmed
in writing) and the amount required from each Bank on account
thereof following which each Bank shall cause the required
subject loan to be disbursed to NCB-Agent, in immediately
available funds, not later than 12:00 Noon, Cleveland time, on
the next Banking Day, to be held for the benefit of Mellon at
its direction, provided, however, the amount required from
each Bank shall in no event exceed such Bank's subject
commitment with respect to the subject revolving credit loan
to Borrower pursuant to the Credit Agreement. On such next
Banking Day, the subject commitments of Mellon and the other
Banks in the subject loans shall revert to the amounts and
percentages set forth on SCHEDULE 2A.01 of the Credit
Agreement and in Subsection 2A.01.1(c) of the Credit
Agreement. The obligations of the Banks to refund the Swing
Loan in accordance with this Subsection 2A.06(c) shall be
absolute and unconditional and not subject to Section 2.D of
the Credit Agreement and irrespective of the existence of an
event of default by any Bank or Borrower hereunder or under
the Swing Loan Agreement or any set-off, counterclaim,
recoupment, defense or other right such Bank may have against
Mellon or the Borrower or any adverse change in Borrower's
condition, financial or otherwise or any other circumstance,
happening or event whatsoever.
(d) Mellon shall promptly give NCB-Agent and the other Banks
written notice of a Swing Loan Reduction or Swing Loan
Availability Termination. On the next Banking Day thereafter,
the subject commitments of Mellon and the other Banks in the
subject loans shall change, in the case of a Swing Loan
Reduction, to the percentages of the aggregate subject
commitments of the Banks as set forth in Schedule 2A.06(b)(ii)
hereto or, in the case of a Swing Loan Availability
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Termination, to the amounts and percentages set forth in
Schedule 2A.01 of the Credit Agreement and in Subsection
2A.01.1(c) of the Credit Agreement.
(e) Mellon shall discontinue making further advances of the Swing
Loan as promptly as practicable after receipt of notice from
NCB-Agent that the Banks, other than Mellon, require
discontinuation of such further advances as a result of an
Event of Default under the Credit Agreement.
(f) Notwithstanding any provision to the contrary contained in the
Credit Agreement, no part of this Section 2A.06 may be
modified or amended without the prior written consent of
Mellon.
2. Subsection 3D.02 BORROWINGS of the Credit Agreement shall be deleted
in its entirety and the following shall be substituted in place thereof:
3D.02 BORROWINGS - Borrower will not, nor permit
OSLI, OSMI or OSII to create, assume or have outstanding at any time
any indebtedness for borrowed money (or become a guarantor in respect
any indebtedness for borrowed money) the incurrence of which would
create a default under this Agreement, including, without limitation, a
default under section 3B.01 or 3B.03; PROVIDED, that this subsection
shall not apply to any indebtedness existing on October 4, 1996 or any
Swing Loan indebtedness authorized under Subsection 2A.06 hereof.
3. Section 9 DEFINITIONS of the Agreement is amended to delete the
definition of EXPIRATION DATE therein and substitute the following therefor:
EXPIRATION DATE means the date referred to as such in subsection 2A.02
or such later date, if any, as may be established pursuant to
subsection 2A.05.
4. Section 2A.03 of the Agreement is amended by adding the following
language after the first sentence:
Borrower shall simultaneously deliver a copy of such notice to Mellon.
5. Section 2D.01 of this Agreement is amended by adding the following
language at the end of the first sentence:
with immediate notice thereof delivered to Mellon utilizing the same
method of delivery as utilized to deliver the credit request
6. From and after the effective date of this Fourth Amendment,
references in the Credit Agreement (as amended by the First Amendment, the
Second Amendment, the Third Amendment and this Fourth Amendment thereto) shall
be deemed to be references to the Agreement as amended by all such amendments
(unless otherwise expressly indicated).
7. Borrower restates and reaffirms all of its representations and
warranties set forth in Section 4B of the Credit Agreement as of the date
hereof.
8. This Fourth Amendment and the modifications set forth herein shall
be and become effective as of the date hereof.
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9. The Credit Agreement, as amended by the First Amendment, the Second
Amendment, the Third Amendment and this Fourth Amendment, is hereby ratified and
confirmed.
10. This Fourth Amendment may be executed in one or more counterparts,
each counterpart to be executed by Borrower, by NCB-Agent and by one or more or
all of the Banks. Each such executed counterpart shall be deemed to be an
executed original for all purposes but all such counterparts taken together
shall constitute one agreement, which agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof.
11. This Fourth Amendment may be executed by representatives of the
Banks using facsimile signatures and facsimilied signature pages shall in all
respects be binding on all parties hereto and thereto as if such signature pages
were originally delivered. Original signature pages for all facsimilied
signature pages shall be delivered to NCB-Agent not later than December ___,
1998.
IN WITNESS WHEREOF, the parties have executed this Fourth Amendment as
of the date first above written.
NATIONAL CITY BANK, AGENT OLYMPIC STEEL, INC.
By: By:
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Donald B. Hayes, Jr. Richard T. Marabito
Senior Vice President Treasurer
NATIONAL CITY BANK MELLON BANK, N.A.
By: By:
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Donald B. Hayes, Jr. John K. Walsh
Senior Vice President Vice President
COMERICA BANK PNC BANK, NATIONAL ASSOCIATION
By: By:
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Richard S. Arceci Mark W. Rutherford
Vice President Vice President
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SCHEDULE 2A.06(B)(II)
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ADJUSTMENT OF BANKS' SUBJECT COMMITMENTS AS A RESULT OF A SWING LOAN REDUCTION
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If the Maximum Then the percentage of the aggregate
Swing Loan Amount is: subject commitment of the Banks is:
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PNC BANK
NATIONAL CITY COMERICA NATIONAL
MELLON BANK BANK BANK ASSOCIATION
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$16,000,000 11% 44% 28% 17%
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Less than $16,000,000 but 12% 43.5% 27.7% 16.8%
greater or equal to $14,222,222
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Less than $14,222,222 but 13% 43% 27.4% 16.6%
greater or equal to $12,444,444
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Less than $12,444,444 but 14% 42.5% 27.1% 16.4%
greater or equal to $10,666,667
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Less than $10,666,667 but 15% 42.1% 26.8% 16.1%
greater or equal to $8,888,889
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Less than $8,888,889 but 16% 41.7% 26.5% 15.8%
greater or equal to $7,111,111
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Less than $7,111,111 but 17% 41.3% 26.1% 15.6%
greater or equal to $5,333,333
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Less than $5,333,333 but 18% 40.8% 25.8% 15.4%
greater or equal to $3,555,556
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Less than $3,555,556 but 19% 40.4% 25.4% 15.2%
greater or equal to $1,777,778
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Less than $1,777,778 20% 40% 25% 15%
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SCHEDULE 2A.06
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ADJUSTED SUBJECT COMMITMENTS RESULTING FROM SWING LOAN
Subject commitments for subject revolving credit loans and subject LCs Schedule 2A.01
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Bank Subject revolving credit Existing subject Aggregate Subject Percentage
loans and additional LCs* Commitment*
subject LCs (excluding
existing subject LCs)
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National City Bank $22,880,000 $3,556,691 $26,436,691 44%
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Comerica Bank $14,560,000 $2,263,349 $16,823,349 28%
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Mellon Bank, N.A. $5,720,000 $889,173 $6,609,173 11%
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PNC Bank, National
Association $8,840,000 $1,374,176 $10,214,176 17%
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Total $52,000,000 $8,083,389 $60,083,389 100%
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* Rounded to the nearest whole dollar (as of 12/03/98).
Series A term loan subject commitments Section 2A.01.1(c)
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Bank Series A Subject Term Loan Percentage
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National City Bank $7,480,000 44%
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Comerica Bank $4,760,000 28%
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Mellon Bank, N.A. $1,870,000 11%
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PNC Bank, National Association $2,890,000 17%
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Total $17,000,000 100%
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