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Exhibit
10.1
EXECUTION
COPY
WAIVER AND AMENDMENT NO. 1
TO SECOND AMENDED AND
RESTATED CREDIT
AGREEMENT
WAIVER AND AMENDMENT (this
“ Amendment ”) dated as of August 22, 2007
to the Second Amended and Restated Credit Agreement dated as of
January 26, 2007 (the “ Credit Agreement ”)
among RYERSON INC., JOSEPH T. RYERSON & SON, INC., RYERSON
CANADA, INC., the LENDERS party thereto, JPMORGAN CHASE BANK, N.A.,
as General Administrative Agent, Collateral Agent and Swingline
Lender, JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, TORONTO BRANCH,
as Canadian Administrative Agent, GENERAL ELECTRIC CAPITAL
CORPORATION, as Syndication Agent and Co-Collateral Agent and BANK
OF AMERICA, N.A., as Documentation Agent.
The parties hereto agree as
follows:
SECTION 1 . Defined
Terms; References. Unless otherwise specifically defined
herein, each term used herein that is defined in the Credit
Agreement has the meaning assigned to such term in the Credit
Agreement. Each reference to “hereof”,
“hereunder”, “herein” and
“hereby” and each other similar reference and each
reference to “this Agreement” and each other similar
reference contained in the Credit Agreement shall, after this
Amendment becomes effective, refer to the Credit Agreement as
amended hereby.
SECTION 2 .
Amendments. The Credit Agreement is hereby amended as
follows:
(a) The following additional
clause (iii) is added to the first sentence of the definition
of “Affiliate”: “or (iii) any Person which
controls or is under common control with the Company.” In the
event the slate of directors proposed by Harbinger Capital Partners
Master Fund I, Ltd. and Harbinger Capital Partners Special
Situations Fund, L.P. (together, “ Harbinger ”)
at the Company’s 2007 annual meeting of shareholders is
elected, Harbinger and its affiliates shall be deemed
Affiliates.
(b) Clause (i) of the
definition of “Borrowing Base” is amended by
(1) adding the following subclause (D) immediately
following the existing subclause (C): “ minus
(D) in the case of the U.S. Borrowers, the sum of
(x) 101% of the aggregate outstanding principal amount of the
2011 Notes, plus (y) the aggregate outstanding
principal amount of the Permitted Bonds” and
(2) revising the initial proviso thereto to read as follows:
“ provided , that Suppressed Residual Value may not
account for more than 10% of the aggregate Borrowing Base
(calculated without regard to the preceding subclause (D)) of all
Borrowers”.
(c) Clause (ii) of the
definition of “Borrowing Base” is amended by
(1) adding the following subclause (D) immediately
following the existing subclause (C): “ minus
(D) in the case of the U.S. Borrowers, the sum of
(x) 101% of the aggregate outstanding principal amount of the
2011 Notes, plus (y) the aggregate outstanding
principal amount of the Permitted Bonds” and
(2) revising the proviso thereto to read as follows: “
provided that for purposes of this clause (ii), Available
Inventory may not account for more than 70% of the Borrowing Base
(calculated without regard to the immediately preceding subclause
(D)).”
(d) Section 5.07 is
amended by the addition of the following concluding
sentence:
Notwithstanding the
foregoing, no Restricted Payment, Restricted Equity Repurchase
(other than Restricted Equity Repurchases required to be made as a
result of a change of control pursuant to the Ryerson 2002
Incentive Stock Plan, the Ryerson 1999 Incentive Stock Plan, the
Ryerson 1996 Incentive Stock Plan, the Ryerson 1995 Incentive Stock
Plan, the Directors’ Compensation Plan, the Ryerson
Nonqualified Savings Plan and change in control agreements by and
between Ryerson Inc. (or its subsidiaries) and employees) or
Restricted Investment (other than Restricted Investments in an
aggregate amount not to exceed $10 million to the extent otherwise
permitted hereunder) shall be made during the period from and
including August 22, 2007 to and including December 1,
2007 (or if an Event of Default exists on December 1, 2007,
for so long thereafter as such Event of Default is
continuing).
SECTION 3 .
Waiver . At the request of the Borrowers, the Lenders hereby
agree that during the period from the Amendment Effective Date
until November 30, 2007 (the “ Waiver Period
”):
(a) an event or condition
resulting from the election of directors at the Company’s
2007 annual meeting of shareholders which would but for this Waiver
constitute a Change of Control of the Company (a “ Proxy
Contest Change of Control ”) shall be deemed not to
constitute a Change of Control of the Company for purposes of the
Financing Documents; and
(b) an event or condition
with respect to the 2011 Notes or the Permitted Bonds resulting
from the election of directors at the Company’s 2007 annual
meeting of shareholders which would but for this Waiver constitute
an Event of Default pursuant to Section 6.01(c) of the Credit
Agreement (a “ Proxy Contest Cross Default ”)
shall be deemed not to constitute an Event of Default pursuant to
Section 6.01(c) of the Credit Agreement.
The Waiver granted pursuant
to this Section 3 shall terminate without further force or
effect at the end of the Waiver Period and any Proxy Contest Change
of Control and/or any Proxy Contest Cross Default shall, if
continuing to exist at the end of the Waiver Period, thereafter
constitute a Change of Control of the Company for all purposes of
the Financing Documents and/or an Event of Default pursuant to
Section 6.01(c) of the Credit Agreement, as the case may
be.
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SECTION 4 .
Representations of Borrowers. The Borrowers represent and
warrant that (i) the representations and warranties of each
Credit Party set forth in the Financing Documents will be true on
and as of the Amendment Effective Date and (ii) no Default
will have occurred and be continuing on such date.
SECTION 5 .
Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New
York.
SECTION 6 .
Counterpa
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