Exhibit 10.24
THIRD AMENDMENT TO REVOLVING CREDIT
AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO REVOLVING
CREDIT AND SECURITY AGREEMENT, dated as of March 23, 2007
(this “ Amendment ”), relating to the Credit
Agreement referenced below, is by and among PHOSPHATE HOLDINGS,
INC., a Delaware corporation, and MISSISSIPPI PHOSPHATES
CORPORATION, a Delaware corporation (collectively, the “
Borrowers ”), the lenders identified on the signature
pages thereto (the “ Lenders ”), and PNC Bank,
National Association, a national banking association, as agent for
the Lenders (in such capacity, the “ Agent ”).
Terms used herein but not otherwise defined herein shall have the
meanings provided to such terms in the Credit Agreement.
W I T N E S S E T H
WHEREAS, a $15,000,000 credit
facility has been extended to the Borrowers pursuant to the terms
of that certain Revolving Credit and Security Agreement dated as of
March 24, 2005, as amended as of February 27, 2006 and as
of August 23, 2006 (as amended and modified from time to time,
the “ Credit Agreement ”) among the Borrowers,
the Lenders identified therein, and PNC Bank, National Association,
as agent for the Lenders;
WHEREAS, the Borrowers have
requested certain modifications to the Credit Agreement;
WHEREAS, the Lenders have agreed to
the requested modifications on the terms and conditions set forth
herein;
NOW, THEREFORE, IN CONSIDERATION of
the premises and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. Amendments . The Credit
Agreement is amended as set forth below:
(a) New definitions of “
Bond ”, “ Domestic Rate Loan ”,
“ Eurodollar Rate ”, “ Eurodollar Rate
Loan ”, “ Interest Period ”, “
Reserve Percentage ”, “ Term Loan
”, and “ Term Note ” are added to
Section 1.2 in correct alphabetical order to read as
follows:
“ “ Bond ”
shall mean a Gulf Opportunity Zone Bond issued under the GO Zone
Act or similar bond that may be obtained by Borrowers.
“ Domestic Rate Loan
” shall mean any Advance that bears interest based upon the
Alternate Base Rate.
“ Eurodollar Rate
” shall mean for any Eurodollar Rate Loan for the then
current Interest Period relating thereto the interest rate per
annum determined by Agent by dividing (the resulting quotient
rounded upwards, if necessary, to the nearest 1/100th of
1% per annum) (i) the rate of interest determined by
Agent in accordance with its usual procedures (which determination
shall be conclusive absent manifest error) to be the average of the
London interbank offered rates for U.S. Dollars quoted by the
British Bankers’ Association as set forth on Moneyline
Telerate (or appropriate successor or, if British Banker’s
Association or its successor ceases to provide such quotes, a
comparable replacement determined by Agent) display page 3750 (or
such other display page on the Moneyline Telerate system as may
replace display page 3750) two (2) Business Days prior to the
first day of such Interest Period for an amount comparable to such
Eurodollar Rate Loan and having a borrowing date and a maturity
comparable to such Interest Period by (ii) a number equal to
1.00 minus the Reserve Percentage. The Eurodollar Rate may also be
expressed by the following formula:
Average of London interbank offered
rates quoted by BBA as shown on
Eurodollar Rate =
Moneyline Telerate Service display page 3750 or appropriate
successor
1.00 - Reserve
Percentage.
The Eurodollar Rate shall be
adjusted with respect to any Eurodollar Rate Loan that is
outstanding on the effective date of any change in the Reserve
Percentage as of such effective date. The Agent shall give prompt
notice to the Borrower of the Eurodollar Rate as determined or
adjusted in accordance herewith, which determination shall be
conclusive absent manifest error.
“ Eurodollar Rate Loan
” shall mean an Advance at any time that bears interest based
on the Eurodollar Rate.
“ Interest Period
” shall mean the period provided for any Eurodollar Rate Loan
pursuant to Section 2.2(b).
“ Reserve Percentage
” shall mean as of any day the maximum percentage in effect
on such day as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve
requirements (including supplemental, marginal and emergency
reserve requirements) with respect to eurocurrency funding
(currently referred to as “ Eurocurrency Liabilities
”).
“ Term Loans ”
shall mean the Advances made pursuant to Section 2.23(a)
hereof.
“ Term Note ”
shall mean the promissory note described in Section 2.23(b)
hereof.”
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(b) The definitions of “
Advances ”, “ Business Day ”,
“ Funded Debt Payments ”, “ Interest
Rate ”, “ Note ”, “ PNC Hold
Amount ”, “ Revolver Advances ” and
“ Undrawn Availability ” in Section 1.2 are
amended to read as follows:
“ Advances ”
shall mean and include the Revolving Advances and Letters of
Credit, as well as the Term Loans.
“ Business Day ”
shall mean any day other than Saturday or Sunday or a legal holiday
on which commercial banks are authorized or required by law to be
closed for business in East Brunswick, New Jersey and, if the
applicable Business Day relates to any Eurodollar Rate Loans, such
day must also be a day on which dealing are carried on in the
London interbank market.
“ Funded Debt Payments
” shall mean and include, for any period, all cash actually
expended by the Borrowers to make (a) interest payments on any
Advances hereunder, plus (b) scheduled principal payments on
the Term Loans, plus (c) payments for all fees, commissions
and charges set forth herein and with respect to any Advances, plus
(d) capitalized lease payments, plus (e) scheduled
payments with respect to and any other Indebtedness for borrowed
money.
“ Interest Rate ”
shall mean (i) for Revolving Advances that are Domestic Rate
Loans, the Alternate Base Rate plus one-half of one percent (0.50%)
per annum, (ii) for Revolving Advances that are Eurodollar
Rate Loans, the Eurodollar Rate plus three percent (3.0%) per
annum, (iii) for Term Loans that are Domestic Rate Loans, the
Alternate Base Rate plus one percent (1.0%) per annum and
(iv) for Term Loans that are Eurodollar Rate Loans, the
Eurodollar Rate plus three and one-half of one percent
(3.50%) per annum.
“ Note ” shall
mean collectively the Revolving Credit Note and the Term
Note.
“ PNC Hold Amount
” shall mean not less than (i) fifty-one percent
(51%) of the Maximum Revolving Advance Amount as of the
Closing Date ($15,000,000) and (ii) fifty-one percent
(51%) of the amount of the Term Loan that PNC agrees to hold
at all times so long as no Default or Event of Default
exists.
“ Revolving Advances
” shall mean Advances made other than Letters of Credit and
the Term Loans.
“ Undrawn Availability
” at a particular date shall mean an amount equal to
(a) the lesser of (i) the Formula Amount or (ii) the
Maximum Revolving Advance Amount, minus (b) the sum of
(i) the outstanding amount of Advances (other than the Term
Loans) plus (ii) all amounts due and owing to each
Borrower’s trade creditors which are outstanding more than
sixty (60) days after the due date, plus
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(iii) fees and expenses for which
Borrowers are liable but which have not been paid or charged to
Borrowers’ Account.”
(c) Section 2.1(a) is amended
to read as follows:
“ 2.1(a) Revolving
Advances .
Subject to the terms and conditions
set forth in this Agreement including Section 2.1(b), each
Lender, severally and not jointly, will make Revolving Advances to
Borrowers in aggregate amounts such that such Lender’s
Commitment Percentage of all outstanding Revolving Advances plus
such Lender’s Commitment Percentage of all outstanding
Letters of Credit shall not exceed its Commitment Percentage of the
lesser of (x) the Maximum Revolving Advance Amount less the
aggregate Maximum Undrawn Amount of all outstanding Letters of
Credit or (y) an amount equal to the sum of:
(i) up to 85%, subject to the
provisions of Section 2.1(b) hereof (“ Receivables
Advance Rate ”), of Eligible Receivables, plus
(ii) up to the lesser of
(A) 65%, subject to the provisions of Section 2.1(b)
hereof, of the value of the Eligible Inventory, (B) 85% of the
appraised net orderly liquidation value of Eligible Inventory (as
evidenced by an Inventory appraisal satisfactory to Agent in its
sole discretion exercised in good faith) or (C) $8,000,000 in
the aggregate at any one time (“ Inventory Advance
Rate ”), plus
(iii) through and including
March 31, 2007, up to the lesser of (A) 30% on
December 31, 2006 and thereafter, subject to the provisions of
Section 2.1(b) hereof, of Eligible Insurance Claims, or
(B) $2,000,000 in the aggregate on February 28, 2007 and
thereafter (the “ Eligible Insurance Claims Advance
Rate ”), minus
(iv) such reserves as Agent may
reasonably deem proper and necessary from time to time in its
reasonable credit judgment exercised in good faith, including,
without limitation, a reserve of (A) $250,000 commencing on
April 1, 2007 through and including April 30, 2007;
(B) $500,000 on May 1, 2007 through and including
May 31, 2007; (C) $750,000 on June 1, 2007 through
and including June 30, 2007; and (D) $1,000,000 on
July 1, 2007 and at all times thereafter.
The amount derived from the sum of
(w) Sections 2.1(a)(y)(i), (ii) and (iii) minus
(z) Section 2.1 (a)(y)(iv) at any time and from time to
time shall be referred to as the “Formula Amount”. The
Revolving Advances shall be evidenced by one or more secured
promissory notes (collectively, the “ Revolving Credit
Note ”) substantially in the form attached hereto as
Exhibit 2.1(a).”
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(d) Section 2.2 is amended to
read as follows:
“ 2.2 Procedure for
Revolving Advances Borrowing .
(a) Borrowers may notify Agent prior
to 10:00 a.m. (New York time) on a Business Day of
Borrowers’ request to incur, on that day, a Revolving Advance
hereunder. In the event Borrowers desire a Term Loan, Borrowers
shall give Agent at least three (3) Business Days’ prior
written notice. Should any amount required to be paid as interest
hereunder, or as fees or other charges under this Agreement or any
other agreement with Agent or Lenders, or with respect to any other
Obligation, become due, same shall be deemed a request for a
Revolving Advance as of the date such payment is due, in the amount
required to pay in full such interest, fee, charge or Obligation
under this Agreement or any other agreement with Agent or Lenders,
and such request shall be irrevocable.
(b) Notwithstanding the provisions
of subsection (a) above, in the event Borrowers desire to
obtain a Eurodollar Rate Loan, Borrowers shall give Agent written
notice by no later than 10:00 a.m. on the day which is
three (3) Business Days prior to the date such Eurodollar Rate
Loan is to be borrowed, specifying (i) the date of the
proposed borrowing (which shall be a Business Day), (ii) the
type of borrowing and the amount on the date of such Advance to be
borrowed, which amount shall be in an aggregate principal amount
that is not less than $1,000,000 and in integral multiples of
$100,000, in excess thereof, and (iii) the duration of the
first Interest Period therefor. Interest Periods for Eurodollar
Rate Loans shall be for one, two or three months; provided, if an
Interest Period would end on a day that is not a Business Day, it
shall end on the next succeeding Business Day unless such day falls
in the next succeeding calendar month in which case the Interest
Period shall end on the next preceding Business Day. No Eurodollar
Rate Loan shall be made available to Borrowers during the
continuance of a Default or an Event of Default. After giving
effect to each requested Eurodollar Rate Loan, including those
which are converted from a Domestic Rate Loan under
Section 2.2(d), there shall not be outstanding more than six
(6) Eurodollar Rate Loans, in the aggregate.
(c) Each Interest Period of a
Eurodollar Rate Loan shall commence on the date such Eurodollar
Rate Loan is made and shall end on such date as Borrowers may elect
as set forth in subsection (b)(iii) above provided that the
exact length of each Interest Period shall be determined in
accordance with the practice of the interbank market for offshore
Dollar deposits and no Interest Period shall end after the last day
of the Term.
Borrowers shall elect the initial
Interest Period applicable to a Eurodollar Rate Loan by their
notice of borrowing given to Agent pursuant to Section 2.2(b)
or by its notice of conversion given to Agent pursuant to
Section 2.2(d), as the
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case may be. Borrowers shall elect
the duration of each succeeding Interest Period by giving
irrevocable written notice to Agent of such duration not later than
10:00 a.m. (New York time) on the day which is three (3)
Business Days prior to the last day of the then current Interest
Period applicable to such Eurodollar Rate Loan. If Agent does not
receive timely notice of the Interest Period elected by Borrowers,
Borrowers shall be deemed to have elected to convert to a Domestic
Rate Loan subject to Section 2.2(d) hereinbelow.
(d) On the last Business Day of the
then current Interest Period applicable to any outstanding
Eurodollar Rate Loan, or on any Business Day with respect to
Domestic Rate Loans, Borrowers may convert any such loan into a
loan of another type in the same aggregate principal amount
provided that any conversion of a Eurodollar Rate Loan shall be
made only on the last Business Day of the then current Interest
Period applicable to such Eurodollar Rate Loan and any conversion
to a Eurodollar Rate Loan may only be done if no Event of Default
has occurred and is continuing. If Borrowers desire to convert a
loan, Borrowers shall give Agent written notice by no later than
10:00 a.m. (New York time) (i) on the day which is three
(3) Business Days’ prior to the date on which such
conversion is to occur with respect to a conversion from a Domestic
Rate Loan to a Eurodollar Rate Loan, or (ii) on the day which
is one (1) Business Day prior to the date on which such
conversion is to occur with respect to a conversion from a
Eurodollar Rate Loan to a Domestic Rate Loan, specifying, in each
case, the date of such conversion, the loans to be converted and if
the conversion is from a Domestic Rate Loan to any other type of
loan, the duration of the first Interest Period
therefor.
(e) At their option and upon written
notice given prior to 10:00 a.m. (New York time) at least three
(3) Business Days’ prior to the date of such prepayment,
Borrowers may prepay the Eurodollar Rate Loans in whole at any time
or in part from time to time with accrued interest on the principal
being prepaid to the date of such repayment. Borrowers shall
specify the date of prepayment of Advances which are Eurodollar
Rate Loans and the amount of such prepayment. In the event that any
prepayment of a Eurodollar Rate Loan is required or permitted on a
date other than the last Business Day of the then current Interest
Period with respect thereto, Borrowers shall indemnify Agent and
Lenders therefor in accordance with Section 2.2(f)
hereof.
(f) Borrowers shall indemnify Agent
and Lenders and hold Agent and Lenders harmless from and against
any and all losses or expenses that Agent and Lenders may sustain
or incur as a consequence of any prepayment, conversion of or any
default by Borrowers in the payment of the principal of or interest
on any Eurodollar Rate Loan or failure by Borrowers to complete a
borrowing of, a prepayment of or conversion of or to a Eurodollar
Rate Loan after notice thereof has been given, including, but not
limited to, any interest payable by Agent or Lenders to lenders of
funds obtained by it in order to make or maintain its
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Eurodollar Rate Loans hereunder. A
certificate as to any additional amounts payable pursuant to the
foregoing sentence submitted by Agent or any Lender to Borrowers
shall be conclusive absent manifest error.
(g) Notwithstanding any other
provisi
