Exhibit 10.17
WAIVER, CONSENT AND
AGREEMENT
WAIVER, CONSENT AND AGREEMENT, dated
as of March 31, 2005 (this “ Agreement ”), to
the Loan and Security Agreement, dated as of February 10, 2003, as
amended by the First Amendment, dated as of February 19, 2004 and
the Second Amendment and Waiver, dated as of June 30, 2004 (as so
amended and as the same may be further amended, restated or
otherwise modified, the “ Loan Agreement ”), by
and among, on the one hand, the lenders identified on the signature
pages hereof (each a “ Lender ” and
collectively, the “ Lenders ”), and WELLS FARGO
FOOTHILL, INC. (f/k/a Foothill Capital Corporation), a California
corporation, as the arranger and administrative agent for the
Lenders (the “ Agent ”), and, on the other hand,
ELGIN NATIONAL INDUSTRIES, INC., a Delaware corporation (the
“ Parent ”), and each of Parent’s
Subsidiaries identified on the signature pages hereof (such
Subsidiaries, together with Parent, each a “ Borrower
”, and individually and collectively, jointly and severally,
the “ Borrowers ”).
WHEREAS, Roberts & Schaefer
International, Ltd. (“ R&S International ”)
made advances to Roberts & Schaefer Australia Pty. Ltd.
(“ R&S Australia ”) consisting of (i) a loan
on November 4, 2003, in an amount equal to the Australian Dollar
equivalent of USD$1,420,000 (the “ First Australia
Loan ”), which loan is evidenced by a Promissory Note
(the “ First Australia Note ”) pledged by
R&S International to the Agent pursuant to the terms of the
Pledge Agreement (as defined in the Loan Agreement), (ii) a loan on
June 30, 2004, in an amount equal to the Australian Dollar
equivalent of USD$200,000 (the “ Second Australia Loan
”), which loan is evidenced by a Promissory Note (the “
Second Australia Note ”) pledged by R&S
International to the Agent pursuant to the terms of the Pledge
Agreement, and (iii) a loan on January 3, 2005, in an amount equal
to the United States Dollar equivalent of AUD$333,333.33 (the
“ Third Australia Loan ”; together with the
First Australia Loan and the Second Australia Loan, collectively,
the “ Australia Loans ”), which loan is
evidenced by a Promissory Note (the “ Third Australia
Note ”; together with the First Australia Note and the
Second Australia Note, collectively, the “ Australia
Notes ”) pledged by R&S International to the Agent
pursuant to the terms of the Pledge Agreement;
WHEREAS, the proceeds of the
Australia Loans were used by R&S Australia to make investments
in Australian Coal Processing Holdings Pty. Ltd., an Australian
special purpose entity incorporated in New South Wales (the
“SPE” );
WHEREAS, R&S Australia intends
to enter into an agreement (the “ SPE APA ”)
pursuant to which R&S Australia will agree to sell to White
Mining Limited and Itochu Coal Resources Australia Pty. Ltd.
(collectively, “ White Mining ”), and White
Mining will agree to purchase from R&S Australia, all of
R&S Australia’s interests in the SPE (the “ SPE
Sale ”);
WHEREAS, the Borrowers have
requested that the Agent and the Lenders waive and consent to any
Events of Default that would otherwise arise as a result of the SPE
Sale; and
WHEREAS, the Agent and the Lenders
are willing to do so on the terms and conditions set forth
herein;
NOW, THEREFORE, in consideration of
the premises and other good and valuable consideration, the parties
hereto hereby agree as follows:
1. Definitions . Any
capitalized term used herein (including in the recitals hereto) and
not defined herein shall have the meaning assigned to it in the
Loan Agreement.
2. Waivers and Consents .
Subject to the conditions set forth in this Section 2 and in
Section 3 below, the Agent and the Lenders under the Loan Agreement
as of the date hereof hereby (a) consent to the consummation of SPE
Sale and (b) waive any Event of Default that would otherwise arise
under Section 8.2 of the Loan Agreement from any noncompliance by
the Borrowers with Section 7.4 of the Loan Agreement solely by
reason of the disposition by R&S Australia of its interests in
the SPE; provided , that (i) the Borrowers shall have
delivered to the Agent a true and correct copy of the fully
executed SPE APA, which shall be in form and
substance reasonably satisfactory to the Agent,
(ii) the SPE Sale shall have been consummated on or before April
15, 2005, and R&S Australia shall have received aggregate Net
Cash Proceeds of not less than AUD$2,125,000 in connection
therewith, (iii) R&S Australia shall have repaid in full all
amounts owing to R&S International under the Australia Notes,
and (iv) notwithstanding anything to the contrary contained in
Section 2.04(c)(viii) of the Loan Agreement, the Borrowers shall
have prepaid the outstanding principal amount of the Loans in an
amount equal to 100% of the Net Cash Proceeds received by R&S
Australia in connection with the SPE Sale, which Net Cash Proceeds
shall be applied in accordance with Section 4 below. Promptly after
the receipt of the Net Cash Proceeds referred to in clause (iv)
above, the Agent shall return the original Australia Notes to the
R&S International for cancellation.
3. Conditions to
Effectiveness . The effectiveness of this Agreement is subject
to the fulfillment, in a manner satisfactory to the Agent, of each
of the following conditions precedent (the date such conditions are
fulfilled or waived by the Agent is hereafter referred to as the
“ Agreement Effective Date ”):
(a) The representations and
warranties contained herein, in Section 5 of the Loan Agreement and
in each other Loan Document and certificate or other writing
delivered to the Agent or any Lender pursuant thereto on or prior
to the Agreement Effective Date shall be true and correct in all
material respects on and as of the Agreement Effective Date as
though made on and as of such date, except to the extent that such
representations and warranties expressly relate solely to an
earlier date (in which case such representati
