Amendment No. 6 and Waiver to Loan and Security Agreement among Handy & Harman, Subsidiaries, Guarantors, and Wachovia Bank

 Exhibit 4.7 [Execution] AMENDMENT NO. 6 AND WAIVER TO LOAN AND SECURITY AGREEMENT AMENDMENT NO. 6 AND WAIVER TO LOAN AND SECURITY AGREEMENT (this "Amendment No. 6"), dated as of December 29, 2005, by and among Handy & Harman, a New York corporation ("H&H"), OMG, Inc., a Delaware corporation, ("OMG"), Continental Industries, Inc., an Oklahoma corporation ("Continental"), Maryland Specialty Wire, Inc., a Delaware corporation ("Maryland Wire"), Handy & Harman Tube Company, Inc., a Delaware corporation ("H&H Tube"), Camdel Metals Corporation, a Delaware corporation ("Camdel"), Canfield Metal Coating Corporation, a Delaware corporation ("Canfield"), Micro-Tube Fabricators, Inc., a Delaware corporation ("Micro-Tube"), Indiana Tube Corporation, a Delaware corporation ("Indiana Tube"), Lucas-Milhaupt, Inc., a Wisconsin corporation ("Lucas"), Handy & Harman Electronic Materials Corporation, a Florida corporation ("H&H Electronic"), Sumco Inc., an Indiana corporation ("Sumco" and together with H&H, OMG, Continental, Maryland Wire, H&H Tube, Camdel, Canfield, Micro-Tube, Indiana Tube, Lucas and H&H Electronic, each individually, a "Borrower" and collectively, "Borrowers"), Handy & Harman of Canada, Limited, an Ontario corporation ("H&H Canada"), ele Corporation, a California corporation ("ele"), Alloy Ring Service Inc., a Delaware corporation ("Alloy"), Daniel Radiator Corporation, a Texas corporation ("Daniel"), H&H Productions, Inc., a Delaware corporation ("H&H Productions"), Handy & Harman Automotive Group, Inc., a Delaware corporation ("H&H Auto"), Handy & Harman International, Ltd., a Delaware corporation ("H&H International"), Handy & Harman Peru, Inc., a Delaware corporation ("H&H Peru"), KJ-VMI Realty, Inc., a Delaware corporation ("KVR"), Pal-Rath Realty, Inc., a Delaware corporation ("Pal-Rath"), Platina Laboratories, Inc., a Delaware corporation ("Platina"), Sheffield Street Corporation, a Connecticut corporation ("Sheffield"), SWM, Inc., a Delaware corporation ("SWM") and Willing B Wire Corporation, a Delaware corporation ("Willing" and together with each of H&H Canada, ele, Alloy, Daniel, H&H Productions, H&H Auto, H&H International, H&H Peru, KVR, Pal-Rath, Platina, Sheffield and SWM, each individually, a "Guarantor" and collectively, "Guarantors"), Wachovia Bank, National Association, a national banking association, in its capacity as agent pursuant to the Loan Agreement (as hereinafter defined) acting for the financial institutions party thereto as lenders (in such capacity, together with its successors and assigns, "Agent"), and the financial institutions party thereto as lenders (collectively, "Lenders"). Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Loan Agreement. W I T N E S S E T H: WHEREAS, Agent, Lenders, Borrowers and Guarantors have entered into financing arrangements pursuant to which Lenders (or Agent on behalf of Lenders) have made and may make loans and advances and provide other financial accommodations to Borrowers as set forth in the Loan and Security Agreement, dated as of March 31, 2004, by and among Agent, Lenders, Borrowers and Guarantors (as amended by Consent and Amendment No. 1 to Loan and Security Agreement, dated as of August 31, 2004, Amendment No. 2 to Loan and Security Agreement, dated as of October 29, 2004, Amendment No. 3 to Loan and Security Agreement, dated as of December 29, 2004, Amendment No. 4 to Loan and Security Agreement, dated as of May 20, 2005 and Amendment No. 5 to Loan and Security  Agreement, dated as of September 8, 2005, and as the same may hereafter be further amended, modified, supplemented, extended, renewed, restated or replaced, the "Loan Agreement"), and the other agreements, documents and instruments referred to therein or at any time executed and/or delivered in connection therewith or related thereto (all of the foregoing, together with the Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein as the "Financing Agreements"); WHEREAS, Borrowers and Guarantors have requested that Agent and Lenders agree to (a) waive certain defaults under the Loan Agreement and (b) make certain related amendments to the Loan Agreement, and Agent and Lenders are willing to agree to such amendments and to grant such waivers, subject to the terms and conditions contained herein; and WHEREAS, by this Amendment No. 6, Borrowers, Guarantors, Agent and Lenders desire and intend to evidence such consents and amendments; NOW THEREFORE, in consideration of the foregoing, and the respective agreements and covenants contained herein, the parties hereto agree as follows: 1. AMENDMENT TO DEFINITION. The definition of "Borrowing Base" in Section 1.11 of the Loan Agreement is hereby amended by deleting "or" at the end of clause (a)(i)(B)(2) of such Section and replacing it with the following: "PLUS (C) (i) from the Amendment No. 6 Effective Date through and including January 31, 2006, $3,500,000 and (ii) after January 31, 2006, $0, or". 2. ADDITIONAL DEFINITIONS. As used herein, the following terms shall have the following meanings given to them below, and the Loan Agreement and the other Financing Agreements are hereby amended to include, in addition and not in limitation, the following: (a) "Amendment No. 6" shall mean Amendment No. 6 and Waiver to Loan and Security Agreement by and among Borrowers, Guarantors, Agent and the Lenders, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced. (b) "Amendment No. 6 Effective Date" shall mean the first date on which all of the conditions precedent to the effectiveness of Amendment No. 6 shall have been satisfied or waived. 3. AMENDMENTS. (a) Section 9.9(f)(i) of the Loan Agreement is hereby amended by deleting "$71,000,000" and replacing it with "$81,000,000". (b) Section 9.17(a) of the Loan Agreement is hereby amended by deleting such Section and replacing it with the following: 2  "(a) EBITDA. Parent and its Subsidiaries shall not permit EBITDA of Parent and its Subsidiaries, on a consolidated basis, for each period set forth below to be less than the amount set forth below opposite such period: Period Minimum EBITDA ------ -------------- 12 months ending December 31, 2005 $22,500,000 3 months ending March 31, 2006 $5,000,000 6 months ending June 30, 2006 $13,000,000 9 months ending September 30, 2006 $20,000,000 12 months ending December 31, 2006 and on the last day of each fiscal quarter thereafter $27,000,000" (c) Section 9.17(b) of the Loan Agreement is hereby amended by deleting such Section and replacing it with the following: "(b) FIXED CHARGE COVERAGE RATIO. Parent and its Subsidiaries shall not permit the Fixed Charge Coverage Ratio for each period set forth below to be less than the ratio set forth below opposite such period: Minimum Fixed Period Charge Coverage Ratio ------ --------------------- 3 months ending March 31, 2006 0.75 to 1 6 months ending June 30, 2006 1 to 1 9 months ending September 30, 2006 1 to 1 12 months ending December 31, 2006 and on the last day of each fiscal 3  Minimum Fixed Period Charge Coverage Ratio ------ --------------------- quarter thereafter 1 to 1" (d) Section 9.17(c) of the Loan Agreement is hereby amended by deleting such Section and replacing it with the following: "(c) MAXIMUM CAPITAL EXPENDITURES. Parent and it Subsidiaries shall not, directly or indirectly, make or commit to make (whether through purchase, capital lease or otherwise) Capital Expenditures for each period set forth below in an amount in excess of the amount set forth below opposite such period: Maximum PERIOD CAPITAL EXPENDITURES 3 months ending March 31, 2006 $3,000,000 6 months ending June 30, 2006 $6,000,000 9 months ending September 30, 2006 $9,000,000 12 months ending December 31, 2006 and on the last day of each fiscal quarter thereafter $12,000,000" (e) Section 9.17(d) of the Loan Agreement is hereby amended by deleting such Section in its entirety and replacing it with the following: "(d) [Intentionally Deleted]". 4. WAIVER OF EVENTS OF DEFAULT. (a) Subject to the terms and conditions contained herein, Agent and Required Lenders hereby waive the following Events of Default arising under Section 10.1(a)(iii) of the Loan Agreement (collectively, the "Existing Defaults"): (i) the Event of Default arising as a result of the failure of Parent and its Subsidiaries to maintain minimum EBITDA for the fiscal quarter ending September 30, 2005 as required under Section 9.17(a) of the Loan Agreement; (ii) the Event of Default arising as a result of the failure of Parent and its Subsidiaries to maintain the minimum Fixed Charge Coverage Ratio for the 9 month period ending September 30, 2005 as required under Section 9.17(b) of the Loan Agreement; and 4  (iii) the Event of Default arising as a result of the failure of Parent and its Subsidiaries to maintain the maximum Leverage Ratio with respect to the fiscal quarter ending September 30, 2005 as required under Section 9.17(d) of the Loan Agreement. (b) Agent and Lenders have not waived and are not by this Amendment No. 6 agreement waiving, and have no present intention of waiving, any other Events of Default, which may have occurred prior to the date hereof, or may be continuing on the date hereof or any Event of Default which may occur after the date hereof, other than the Existing Defaults, whether the same or similar to the Existing Defaults or otherwise. Agent and Lenders reserve the right, in their discretion, to exercise any or all of its or their rights and remedies arising under the Financing Agreements, applicable law or otherwise, as a result of any other Events of Default which may have occurred prior to the date hereof, or are continuing on the date hereof, or any Event of Default which may occur after the date hereof, whether the same or similar to the Existing Defaults. Nothing contained herein shall be construed as a waiver of the failure of Borrowers and Guarantors to comply with the terms of the Loan Agreement and the other Financing Agreements after the date hereof. 5. AMENDMENT FEE. In addition to all other fees, charges, interest and expenses payable by any Borrower or Guarantor to Agent or Lenders under the Loan Agreement and the other Financing Agreements, Borrowers and Guarantors shall pay to Agent for the ratable benefit of Lenders, contemporaneously with the effectiveness of this Amendment No. 6, an amendment fee in the amount of $35,000, which fee shall be fully earned and nonrefundable as of the date hereof and may be charged to any loan account of Borrowers. 6. REPRESENTATIONS, WARRANTIES AND COVENANTS. Each Borrower and Guarantor hereby represents, warrants and covenants to Agent and Lenders the following (which shall survive the execution and delivery of this Amendment No. 6), the truth and accuracy of which are a continuing condition of the making of Loans and providing Letter of Credit Accommodations to Borrowers: (a) This Amendment No. 6 and each other agreement or instrument to be executed and delivered by Borrowers and Guarantors in connection herewith (collectively, together with this Amendment No. 6, the "Amendment Documents") have been duly authorized, executed and delivered by all necessary action on the part of each of the Borrowers and Guarantors which is a party hereto and thereto and, if necessary, their respective stockholders and is in full force and effect as of the date hereof and the agreements and obligations of each of the Borrowers and Guarantors contained herein and therein constitute the legal, valid and binding obligations of each of the Borrowers and Guarantors, enforceable against them in accordance with their terms, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting the enforcement of creditors' rights generally and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought. (b) The execution, delivery and performance of this Amendment No. 6 and the other Amendment Documents, (a) are all within each Borrower's and Guarantor's corporate or limited liability company powers and (b) are not in 5  contravention of law or the terms of any Borrower's or Guarantor's certificate or articles of incorporation, by laws, or other organizational documentation, or any indenture, agreement or undertaking to which any Borrower or Guarantor is a party or by which any Borrower or Guarantor or its property are bound. (c) After giving effect to the wavier set forth in Section 4 hereof, no Default or Event of Default exists or has occurred and is continuing. (d) The Tranche B Amendment (as defined below) has been executed and delivered by all parties thereto and is in full force and effect. (e) All of the representations and warranties set forth in the Loan Agreement and the other Financing Agreements, each as amended hereby, are true and correct in all material respects on and as of the date hereof, as if made on the date hereof, except to the extent any such representation or warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date. 7. CONDITIONS PRECEDENT. The provisions contained herein shall only be effective upon the satisfaction of each of the following conditions precedent in a manner satisfactory to Agent: (a) Agent shall have received this Amendment No. 6, duly authorized, executed and delivered by Borrowers, Guarantors and Lenders; (b) Agent shall have received (i) an amendment and waiver to the Tranche B Term Loan Agreement (the "Tranche B Amendment"), in form and substance satisfactory to Agent, duly authorized, executed and delivered by each of the parties thereto, which Tranche B Amendment shall be in full force and effect, and (ii) an amendment to the Intercreditor Agreement (the "Intercreditor Amendment"), in form and substance satisfactory to Agent, duly authorized, executed and delivered by Tranche B Term Loan Agent and acknowledged by Borrowers and Guarantors, which Intercreditor Amendment shall be in full force and effect; (c) Agent shall have received a true and correct copy of any consent, waiver or approval to or of this Amendment No. 6 or any other Amendment Documents which any Borrower or Guarantor is required to obtain from any other Person, and such consent, waiver or approval shall in form and substance satisfactory to Agent; and (d) after giving effect to the wavier set forth in Section 4 hereof, no Default or Event of Default shall exist or have occurred and be continuing. 8. EFFECT OF THIS AGREEMENT. Except as expressly amended pursuant hereto, no other changes or modifications to the Financing Agreements are intended or implied, and, in all other respects, the Financing Agreements are hereby specifically ratified, restated and confirmed by all parties hereto as of the Amendment No. 6 Effective Date. To the extent that any provision of the Loan Agreement or any of the other Financing Agreements are inconsistent with the provisions of this Amendment No. 6, the provisions of this Amendment No. 6 shall control. 6  9. FURTHER ASSURANCES. Borrowers and Guarantors shall execute and deliver such additional documents and take such additional action as may be requested by Agent to effectuate the provisions and purposes of this Amendment No. 6. 10. GOVERNING LAW. The validity, interpretation and enforcement of this Agreement and the other Financing Agreements (except as otherwise provided therein) and any dispute arising out of the relationship between the parties hereto, whether in contract, tort, equity or otherwise, shall be governed by the internal laws of the State of New York but excluding any principles of conflicts of law or other rule of law that would cause the application of the law of any jurisdiction other than the laws of the State of New York. 11. BINDING EFFECT. This Amendment No. 6 shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns. 12. HEADINGS. The headings listed herein are for convenience only and do not constitute matters to be construed in interpreting this Amendment No. 6. 13. COUNTERPARTS. This Amendment No. 6 may be executed in any number of counterparts, each of which shall be an original, but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of this Amendment No. 6 by telefacsimile or other electronic method of transmission shall have the same force and effect as the delivery of an original executed counterpart of this Amendment No. 6. Any party delivering an executed counterpart of this Amendment No. 6 by telefacsimile or other electronic method of transmission shall also deliver an original executed counterpart, but the failure to do so shall not affect the validity, enforceability or binding effect of such agreement. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 7  IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 6 to be executed on the day and year first above written. AGENT BORROWERS WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent By: /s/ Sang Kim HANDY & HARMAN ------------------------------- Title: Associate By: /s/ Robert K. Hynes ---------------------------- ------------------------------- Title: Vice President and CFO LENDERS ---------------------------- WACHOVIA BANK, NATIONAL ASSOCIATION OMG, INC. By: /s/ Sang Kim ------------------------------ By: /s/ Robert K. Hynes Title: Associate ------------------------------- --------------------------- Title: Vice President and Treasurer ---------------------------- TEXTRON FINANCIAL CORPORATION CONTINENTAL INDUSTRIES, INC. By: /s/ Kurt Kaliomaa ----------------------------- By: /s/ Robert K. Hynes Title: Sr. Account Executive ------------------------------- -------------------------- Title: Vice President and Treasurer ---------------------------- BANK OF AMERICA, N.A. MARYLAND SPECIALTY WIRE, INC. By: /s/ Kim Bushey ----------------------------- By: /s/ Robert K. Hynes Title: SVP -------------------------------- -------------------------- Title: Vice President, CFO and Secretary ----------------------------- HANDY & HARMAN TUBE COMPANY, INC By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- [SIGNATURE PAGES CONTINUE ON NEXT PAGE]  [SIGNATURE PAGES CONTINUED FROM PREVIOUS PAGE] CAMDEL METALS CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- CANFIELD METAL COATING CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- MICRO-TUBE FABRICATORS, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- INDIANA TUBE CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- LUCAS-MILHAUPT, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- HANDY & HARMAN ELECTRONIC MATERIALS CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- SUMCO INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- [SIGNATURE PAGES CONTINUE ON NEXT PAGE]  [SIGNATURE PAGES CONTINUED FROM PREVIOUS PAGE] GUARANTORS HANDY & HARMAN OF CANADA, LIMITED By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- ELE CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- ALLOY RING SERVICE INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- DANIEL RADIATOR CORPORATION By: /s/ Robert K. Hynes -------------------------------- Title: Vice President, Treasurer and Controller ----------------------------- H&H PRODUCTIONS, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- HANDY & HARMAN AUTOMOTIVE GROUP, INC. By: /s/ Robert K. Hynes -------------------------------- Title: Vice President, Treasurer and Assistant Secretary ----------------------------- HANDY & HARMAN INTERNATIONAL, LTD. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- [SIGNATURE PAGES CONTINUE ON NEXT PAGE]  [SIGNATURE PAGES CONTINUED FROM PREVIOUS PAGE] HANDY & HARMAN PERU, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- KJ-VMI REALTY, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- PAL-RATH REALTY, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- PLATINA LABORATORIES, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- SHEFFIELD STREET CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- SWM, INC. By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ---------------------------- WILLING B WIRE CORPORATION By: /s/ Robert K. Hynes ------------------------------- Title: Vice President and Treasurer ----------------------------