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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM 10-Q
[ X ] Quarterly Report Pursuant To Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the quarterly period ended March 31, 1997
OR
[ ] Transition Report Pursuant To Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the transition period from _________ to __________
Commission File Number 0-23688
AMERICAN BUILDINGS COMPANY
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 63-0931058
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
P.O. BOX 800
STATE DOCKS ROAD
EUFAULA, ALABAMA 36027
--------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(334) 687-2032
----------------------------------------------------
(Registrant's telephone number, including area code)
NOT APPLICABLE
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(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares
outstanding of each of the issuer's classes of common stock, as of the latest
practicable date: MAY 6, 1997 -- 5,316,243 SHARES.
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<PAGE>
INDEX
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
Page Number
-----------
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Condensed Consolidated Balance Sheets --
March 31, 1997 and December 31, 1996 ................. 2
Condensed Consolidated Statements of Income --
Three months ended March 31, 1997 and 1996 ........... 3
Condensed Consolidated Statements of Cash Flows --
Three months ended March 31, 1997 and 1996 ........... 4
Notes to Condensed Consolidated Financial Statements ... 5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS .................. 8
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K ....................... 11
<PAGE>
<TABLE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<CAPTION>
MARCH 31, DECEMBER 31,
1997 1996
-------------- -------------
(UNAUDITED)
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash ......................................................... $ 0 $ 0
Accounts receivable, net of allowance for doubtful accounts
of $3,434 and $3,345 in 1997 and 1996, respectively......... 28,317 36,332
Inventories .................................................. 20,871 19,823
Other ........................................................ 4,799 4,417
------- --------
Total current assets ....................................... 53,987 60,572
PROPERTY, PLANT AND EQUIPMENT, AT COST .......................... 74,498 71,880
Less accumulated depreciation ................................ 39,811 38,686
------- --------
34,687 33,194
RESTRICTED CASH ................................................. 400 466
DEFERRED INCOME TAXES ........................................... 1,313 1,313
OTHER ASSETS, NET ............................................... 6,808 6,425
------- --------
TOTAL ASSETS ............................................... $97,195 $101,970
======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt ......................... $ 1,048 $ 1,051
Accounts payable ............................................. 21,720 32,306
Accrued liabilities .......................................... 12,793 12,137
Accrued income taxes ......................................... 746 1,368
------- --------
Total current liabilities .................................. 36,307 46,862
LONG-TERM DEBT, NET OF CURRENT MATURITIES ....................... 15,022 10,872
OTHER NONCURRENT LIABILITIES .................................... 2,841 2,770
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 4,000 shares authorized,
no shares issued and outstanding in 1997 and 1996 .......... -- --
Common stock, $.01 par value; 25,000 shares authorized,
6,317 shares and 6,312 shares issued at March 31, 1997
and December 31, 1996, respectively ........................ 63 63
Additional paid-in capital ................................... 31,093 31,049
Retained earnings ............................................ 38,400 36,885
------- --------
69,556 67,997
Less-Treasury stock, at cost (1,001 shares at
March 31, 1997 and December 31, 1996) ...................... (26,531) (26,531)
------- --------
Total stockholders' equity ................................. 43,025 41,466
------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ................. $97,195 $101,970
======= ========
See notes to condensed consolidated financial statements.
</TABLE>
2
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED
MARCH 31,
---------------------
1997 1996
------- -------
NET SALES ......................................... $57,604 $48,180
COSTS AND EXPENSES:
Cost of sales .................................. 48,843 40,688
Selling, general, and administrative ........... 6,071 5,643
------- -------
54,914 46,331
OPERATING INCOME .................................. 2,690 1,849
INTEREST EXPENSE (INCOME) ......................... 225 (175)
------- -------
INCOME BEFORE PROVISION FOR INCOME TAXES .......... 2,465 2,024
PROVISION FOR INCOME TAXES ....................... 950 779
------- -------
NET INCOME ........................................ $ 1,515 $ 1,245
======= =======
NET INCOME PER COMMON AND COMMON
EQUIVALENT SHARE ................................ $ .27 $ .19
======= =======
WEIGHTED AVERAGE NUMBER OF COMMON
AND COMMON EQUIVALENT SHARES OUTSTANDING ........ 5,666 6,533
======= =======
See notes to condensed consolidated financial statements.
3
<PAGE>
<TABLE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
-----------------------
1997 1996
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income ........................................................... $ 1,515 $ 1,245
-------- --------
Adjustments to reconcile net income to net cash used for operating
activities:
Depreciation and amortization ................................. 1,202 1,058
Changes in assets and liabilitites:
Accounts receivable, net ................................... 8,015 6,568
Inventories ................................................ (1,048) (447)
Accounts payable ........................................... (10,586) (5,589)
Accrued liabilities and taxes .............................. 34 (2,208)
Other working capital changes .............................. (382) (2,788)
Other, net ................................................. (392) (166)
-------- --------
Total adjustments ....................................... (3,157) (3,572)
-------- --------
Net cash used for operating activities .................. (1,642) (2,327)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in restricted cash .......................................... 66 2,944
Investment in China Joint Venture .................................... -- (1,500)
Proceeds from sales of fixed assets .................................. -- 30
Proceeds from sales of nonoperating property, net .................... -- 947
Additions to property, plant, and equipment .......................... (2,618) (2,117)
-------- --------
Net cash (used for) provided by investing activities..... (2,552) 304
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Changes in revolving credit facility, net ............................ 4,150 --
Proceeds from issuance of common stock, net of issuance costs ........ 44 90
Purchase of treasury stock ........................................... -- (2,516)
-------- --------
Net cash provided by (used for) financing activities..... 4,194 (2,426)
-------- --------
NET DECREASE IN CASH .................................................... -- (4,449)
CASH AT BEGINNING OF PERIOD ............................................. -- 17,100
-------- --------
CASH AT END OF PERIOD ................................................... $ -- $ 12,651
======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest ............................................... $ 220 $ 107
======== ========
Cash paid for income taxes ........................................... $ 1,562 $ 1,332
======== ========
See notes to condensed consolidated financial statements.
</TABLE>
4
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1997
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
1. The condensed consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information
not misleading. In the opinion of management, the condensed consolidated
financial statements contain all adjustments necessary to present fairly
the financial position of the Company as of March 31, 1997 and the results
of its operations and cash flows for the three months ended March 31, 1997
and 1996. All such adjustments are of a normal recurring nature. The
results of operations for the three months ended March 31, 1997 are not
necessarily indicative of the results to be expected for the year ended
December 31, 1997. The accounting policies continue unchanged from December
31, 1996. For further information, refer to the Consolidated Financial
Statements and footnotes thereto included in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1996.
2. Inventories consisted of the following :
MARCH 31, DECEMBER 31,
1997 1996
--------- ------------
Raw materials $17,011 $17,151
Work in process 3,417 2,862
Finished goods 695 357
------- -------
$21,123 $20,370
Allowance to state
Inventories at LIFO cost (252) (547)
======= =======
$20,871 $19,823
======= =======
5
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED) - CONTINUED
3. Included in accrued liabilities are estimated insurance claims for the
self-insured portion of workers' compensation, property, casualty and
health insurance plans totaling $6,104 and $4,711 at March 31, 1997 and
December 31, 1996, respectively.
4. On December 7, 1994, the Company closed a $9,700 industrial revenue bond
transaction with the Industrial Development Authority ("IDA") of
Mecklenburg County, Virginia, for the purpose of financing its new
manufacturing facility located in Virginia. The bonds bear interest at a
variable rate which averaged 3.5% for the first quarter of 1997, compared
to 3.6% for the first quarter of 1996. Additionally, the Company pays a
.25% remarketing fee on the bond balance. The bonds mature December 1, 2004
and are subject to mandatory sinking fund redemption of $970 per year and
are subject to mandatory redemption under certain circumstances. The
Company has secured its obligation with respect to the IDA bonds through
the issuance of a letter of credit. The carrying amount of the bonds is
assumed to approximate fair value due to the bonds' variable rate
structure. The balance of the IDA bonds, including current portion, was
$7,760 at March 31, 1997 and December 31, 1996.
The unused proceeds from this transaction are classified as Restricted Cash
on the Condensed Consolidated Balance Sheets. The balance in the restricted
cash account is reduced as capital expenditures are made related to the
Virginia plant. This balance was $400 as of March 31, 1997 and $466 as of
December 31, 1996. These funds are invested in highly liquid short-term
investments.
5. On March 24, 1997, the Company and its lender amended its revolving credit
facility to lower the interest rate to the banks reference rate (which is
generally equivalent to the prime rate) or LIBOR plus 2% and to reduce
certain other fees associated with this facility. All cash received by the
Company is immediately applied against the outstanding balance of the
Revolver. The Loan Agreement, as currently in effect, provides the Company
with a $33,000 revolving credit facility. At March 31, 1997 and December
31, 1996 borrowings under the Revolver were $8,128 and $3,963,
respectively.
6
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED) - CONTINUED
6. During the first quarter of 1997, the Financial Accounting Standards Board
(FASB) issued Statement 128, Earnings per Share. This statement sets out
new guidelines for the calculation and presentation of earnings per share.
The following table represents a reconciliation of basic and diluted
weighted average shares and a pro forma calculation of earnings per share
using the guidelines of SFAS # 128.
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
- - ----------------------------------------------------------------------------------------------------
(000 omitted except per share data) 1997 1996
- - ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Basic weighted average shares outstanding 5,316 6,179
ADD: Shares of common stock assumed issued upon exercise of stock
options using the "Treasury Stock" method as it applies to the
computation of diluted earnings per share. 350 354
------ -----
Diluted weighted average shares outstanding 5,666 6,533
====== =====
Net earning used in the computation of basic and diluted earnings per
share $1,515 $1,245
====== ======
Earnings per share:
Basic $ .29 $ .20
====== ======
Diluted $ .27 $ .19
====== ======
- - -----------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MARCH 31, 1997
Statements in this Quarterly Report on Form 10-Q concerning the Company's
business outlook or future economic performance; anticipated profitability,
revenues, expenses or other financial items; and product line growth together
with other statements that are not historical facts, are "forward-looking
statements" as that term is defined under the Federal Securities Laws.
Forward-looking statements are subject to risks, uncertainties, and other
factors which could cause actual results to differ materially from those stated
in such statements. Such risks, uncertainties, and factors include, but are not
limited to, industry cyclicality, fluctuations in customer demand and order
patterns, the seasonal nature of the business, changes in pricing or other
actions by competitors, and general economic conditions as well as other risks
detailed in the Company's filings with the Securities and Exchange Commission,
including its Annual Report on Form 10-K for the year ended December 31, 1996.
RESULTS OF OPERATIONS
QUARTER ENDED MARCH 31, 1997 COMPARED TO QUARTER ENDED MARCH 31, 1996
Net sales for the quarter ended March 31, 1997 increased 20% to $57.6 million
from $48.2 million in the same period a year ago. Gross margins decreased to
15.2% in the current quarter compared to 15.6% in the corresponding quarter of
1996 primarily due to slightly higher labor and burden costs. Backlog at March
31, 1997 increased 22% to approximately $89.9 million from $73.7 million at
March 31, 1996. Backlog has increased by approximately 12.5% since the end of
1996. Selling, general and administrative expenses increased by 7.6% to $6.1
million in the first quarter of 1997 from $5.6 million in the first quarter of
1996. The increase is primarily the result of the acquisition of American
Modular Technologies in November 1996, combined with higher commission costs and
certain other volume-related costs resulting from the higher sales volume in the
first quarter of 1997. As a percent of net sales, these expenses were 10.5% in
1997 compared to 11.7% in the first quarter of 1996. Operating income improved
45% to $2.7 million in the first quarter of 1997 compared to $1.8 million in the
same quarter of 1996. The Company had net interest expense for the quarter ended
March 31, 1997 of $.2 million compared to net interest income of $.2 for the
comparable period in 1996. This increase in interest expense resulted primarily
from the Company having borrowings on its Revolver during the current quarter
compared to no such borrowings during the corresponding period of last year.
Additionally, the Company is earning less interest income on Restricted Cash as
the balance is reduced from its March 31, 1996 level. Net income for the current
quarter increased 22% to $1.5 million from $1.2 million in the first quarter of
last year.
LIQUIDITY AND CAPITAL RESOURCES
The Company has historically funded its operations from cash flow from
operations, bank borrowings and sales of its debt and equity securities.
8
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
Net cash used for operations was $1.6 million in the first quarter of 1997
compared to $2.3 million in the first quarter of 1996. The improvement for 1997
resulted primarily from improved earnings and a decreased working capital
investment compared to a year ago.
Net cash (used for) provided by investing activities was ($2.6) million for the
three months ended March 31, 1997 compared to $.3 million for the three months
ended March 31, 1996. In the 1997 period, primarily all investing activities
were for additions to property, plant and equipment. In the 1996 period, the
Company applied $2.9 million of the proceeds of the Industrial Revenue Bonds
which were included in Restricted Cash at the beginning of the year to the
capital expenditures made for the Virginia manufacturing facility. This amount
exceeded total capital expenditures of $2.1 million for the quarter as part of
it represented a drawdown of the restricted cash balance for expenditures made
in late 1995. The Company also increased its investment in its joint venture in
the People's Republic of China by $1.5 million during the first quarter of 1996.
Net cash provided by (used for) financing activities was $4.2 million for the
quarter ended March 31, 1997 compared to ($2.4) million for the quarter ended
March 31, 1996. In 1997, this was primarily the result of new borrowings under
its Revolver. In 1996, this was primarily the result of the repurchase in the
open market of 110,000 shares of the Company's common stock pursuant to the
Board of Directors authorization made on October 3, 1995 to repurchase up to
300,000 shares of the Company's Common Stock in the open market. The repurchase
was made from excess cash on hand.
The Company currently has budgeted an aggregate of $6.0 million for capital
expenditures in 1997, consisting of $1.1 million to complete the Virginia
manufacturing facility and Eufaula office expansion projects and $4.9 million
primarily for machinery and equipment at its other existing facilities. The
Company expects to be able to fund these expenditures from cash provided by
operations, borrowings under its revolving credit facility and, in the case of
its Virginia facility, the remaining proceeds from IDA Bonds. There can be no
assurance that budgeted capital expenditures will be made as planned or that
additional capital expenditures will not be required.
At March 31, 1997, the Company's outstanding debt (including current portion)
was $16.1 million, primarily consisting of $7.8 million of Industrial Revenue
Bonds which are subject to mandatory sinking fund requirements of approximately
$1.0 million per year through December 1, 2004 and $8.1 million of borrowings
outstanding under the Company's revolving credit facility under which it may
borrow up to $25 million. At December 31, 1996, the Company's outstanding debt
(including current portion) was $11.9 million which consisted of $7.8 million of
Industrial Revenue Bonds and $4.0 million of borrowings under its revolving
credit facility.
The Company's Loan and Security Agreement (the "Revolver") was amended on March
24, 1997. Changes included in the amendment were that interest rates and certain
fees associated with the facility were reduced. The Loan Agreement, as currently
in effect, provides the Company with a $33.0 million revolving credit facility.
The Revolver expires on January 31, 1999 and is automatically renewable for
successive one year periods unless terminated by the Company or the bank.
Borrowings under the Revolver are subject to certain borrowing base limitations
based on eligible accounts receivable and
9
<PAGE>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
inventory less amounts outstanding under letters of credit. Loans under the
Revolver bear interest at a rate equal to, at the option of the Company, either
(i) the sum of two percent plus the interest rate in the London interbank market
for loans in an amount substantially equal to the amount of the borrowing and
for the period of the borrowing selected by the Company or (ii) the bank's
reference rate (which is generally equivalent to the prime rate). In addition,
the Company is required to pay a fee of 0.25% per year for the unused amount
under the Revolver and a 1.25% fee per annum on the average undrawn face amount
of letters of credit. Up to $13.0 million of the Revolver at any one time
outstanding is available for the issuance of letters of credit. At March 31,
1997 there were $10.9 million of outstanding letters of credit, including a $7.9
million letter of credit in favor of the Trustee for the IDA bonds. The Revolver
is secured by substantially all the assets of the Company. The amount of the
Revolver is reduced each year by approximately $1.0 million in conjunction with
the Company's annual repayment of approximately $1.0 million of IDA Bonds so
that the total available facility, once the IDA Bonds are repaid, will be $25.0
million.
The Loan Agreement limits the Company's ability to incur indebtedness, to create
or incur liens or assets, to pay dividends and to purchase or redeem the
Company's stock. In addition, the Loan Agreement requires that the Company meet
certain financial tests, and provides the bank with the right to require the
payment of all amounts outstanding under the Loan Agreement if a change in
control of the Company occurs.
The Company believes that cash generated from operations and borrowings under
the revolving credit facility will be sufficient to meet its working capital and
capital expenditure needs for the foreseeable future. There can be no assurance
that liquidity would not be impacted by a decline in general economic conditions
and higher interest rates which would affect the Company's ability to obtain
external financing.
10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN BUILDINGS COMPANY
Date May 6, 1997 /s/ ROBERT T. AMMERMAN
------------ ------------------------------
Robert T. Ammerman
Chief Executive Officer
Date May 6, 1997 /s/ R. CHARLES BLACKMON, JR.
------------ ------------------------------
R. Charles Blackmon, Jr.
Executive Vice President,
Chief Financial Officer
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Amendment No. 4 to Loan and Security Agreement, entered into as
of March 24, 1997, by and among American Buildings Company and
LaSalle Business Credit, Inc., as agent for itself and the
various other financial institutions which may become parties to
the Loan Agreement.
10.2 Guaranty, dated March 18, 1997, made by AMT/Bearmam Corporation
in favor of LaSalle Business Credit, Inc., as agent.
11. Computation of Earnings Per Share
27. Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K during the three
months ended March 31, 1997.
12
AMENDMENT NO. 4
TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NO. 4 ("Amendment") is entered into as of March 24, 1997, by
and among American Buildings Company, a corporation organized under the laws of
the State of Delaware ("Borrower") and LaSalle Business Credit, Inc.
(successor-in-interest to StanChart Business Credit, Inc.), as agent ("Agent")
for itself and the various other financial institutions as may hereafter become
parties to the Loan Agreement (as defined below) (collectively, the "Lenders"
and individually, each a "Lender") and LaSalle as "Agent" for the Lenders.
BACKGROUND
Borrower, Agent and Lenders are parties to a Loan and Security Agreement
dated as of January 19, 1993 (as amended, supplemented or otherwise modified
from time to time, the "Loan Agreement") pursuant to which Lenders provide
Borrower with certain financial accommodations.
Borrower has requested that Agent and Lenders amend the Loan Agreement and
Agent and Lenders are willing to do so on the terms and conditions hereafter set
forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of credit
heretofore or hereafter made to or for the account of Borrower by Lenders, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. All capitalized terms not otherwise defined herein shall
have the meanings given to them in the Loan Agreement.
2. Amendment to Loan Agreement. Subject to satisfaction of the conditions
precedent set forth in Section 3 below, the Loan Agreement is hereby amended as
follows:
(a) Section 1.2 of the Loan Agreement is hereby amended as follows:
(i) the following defined term is added in its appropriate
alphabetical order:
"AMENDMENT DATE" shall mean March 24, 1997.
<PAGE>
(ii) the following defined term is amended in its entirety to
provide as follows:
"DEBT SERVICE COVERAGE RATIO" shall mean, with respect to
any applicable fiscal period (without duplication), the
ratio of (a) EBITDA to (b) current maturities of long term
debt and capitalized leases scheduled to be paid during such
period plus interest expenses paid during such period.
(b) Section 2.8(A) of the Loan Agreement is amended in its entirety to
provide as follows:
"(A) RATE, REVOLVING LOANS. Prime Loans shall bear interest,
on the Daily Balances owing, at a rate per annum (the
"Revolving Prime Rate") equal to the Reference Rate, payable
monthly in arrears on the first Business Day of each month
for the preceding month. Eurodollar Loans shall bear
interest, on the Daily Balances owing, at a rate per annum
(the "Revolving LIBOR Rate") equal to two percentage points
(2.0%) above the Eurodollar Rate, payable in arrears at the
end of the applicable Interest Period, provided, however,
that with respect to Eurodollar Loans with an Interest
Period of six months, interest shall be payable in arrears
both at the end of the three (3) month anniversary of such
Eurodollar Loan and at the end of the Interest Period,
without duplication."
(c) Section 2.10 of the Loan Agreement is amended in its entirety to
provide as follows:
"2.10 LOCKBOX; CREDITING COLLECTIONS.
On or before the Closing date, Borrower shall establish depository
account ("Depository Account") and lock box ("Lockbox") arrangements
acceptable to the Lenders at banks acceptable to the Lenders
("Collecting Banks") and, to the extent requested by Agent at any time
thereafter, invoices issued by Borrower after such request shall
direct Account Debtors to send their payments directly to the post
office box established by the aforesaid Lockbox arrangement or to a
Depository Account. Such Lockbox and Depository Account arrangements
will provide that Collecting Banks have no right of setoff against
such Lockbox or Depository Account, and the Depository Account shall
be in the name of Agent or in the name of Borrower if Agent has
obtained a perfected security interest in such Lockbox and Depository
Accounts. If Borrower receives any payments from any Account Debtor,
Borrower hereby agrees that all such payments shall be the sole
-2-
<PAGE>
and exclusive property of the Lenders for application to the
outstanding Revolving Loans, and Borrower shall hold such payments in
trust as the Lenders' trustee and immediately deliver said payments to
Borrower's Depository Account. For purposes of calculating interest
payable hereunder, the receipt of any check, wire transfer or other
item of payment by Agent shall not be considered a payment on account
until the date the same is honored by Agent's depositary bank with
respect thereto and final settlement thereof is reflected by
irrevocable credit to Agent's account in such bank. For purposes of
calculating Revolving Loan Availability, each such item of payment
shall be considered a payment on account on the date of receipt by
Agent's depository bank. Notwithstanding the foregoing, so long as
Excess Revolving Loan Availability is equal to or greater than
$10,000,000 at all times or such lower amount that Agent in its sole
discretion may determine, payments from Account Debtors may be
received directly by Borrower, Borrower shall not be required to
direct Account Debtors to send their payments to the box or a
Depository Account and any payments received in such post office box
or Depository Account may be delivered directly to Borrower."
(d) The first sentence of Section 3.1(A) of the Loan Agreement is
amended in its entirety to provide as follows:
"This Agreement shall have a term (the "Initial Term") commencing on
the Effective Date and expiring on January 31, 1999. Upon notice by
Agent to Borrower, the term of this Agreement shall be renewed for
successive periods of one (1) year (each a "Renewal Term"). Notice of
such renewal shall be effectuated by providing Notice in the manner
set forth in Section 17 not less than thirty (30) days prior to the
effective date of such renewal (which date may only be at the end of
the Initial Term or the end of any Renewal Term)."
(e) Section 3.2 of the Loan Agreement is amended in its entirety to
provide as follows:
"3.2 PREPAYMENT; TERMINATION.
Borrower may borrow, repay and reborrow Revolving Loans subject to the
terms of this Agreement. Subject to the terms of this Section 3.2,
Borrower may, at any time, on one hundred and twenty (120) days
written notice, prepay in full the Loans and terminate this Agreement
by paying to Agent, for the ratable benefit of the Lenders, in cash or
by a wire transfer of immediately available funds, the Obligations. If
any Letters of Credit are
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<PAGE>
outstanding on the effective date of termination, Borrower shall
deliver to Agent cash collateral or back-up letters of credit in an
amount equal to the aggregate undrawn face amount of such Letters of
Credit (plus the projected amount of all fees associated therewith).
Borrower and the Lenders acknowledge and agree that, as a direct and
proximate result of the prepayment and termination of this Agreement
under any circumstances, the Lenders will suffer a loss in an amount
which is difficult to calculate and determine with certainty and,
therefore, as a result of Borrower's and each of the Lender's
reasonable endeavor to ascertain and agree in advance as to the amount
necessary to compensate the Lenders for said loss, Borrower agrees to
pay to Agent for the ratable benefit of the Lenders in cash or by wire
transfer of immediately available funds, in addition to the other
Obligations, an aggregate prepayment fee calculated as a percentage of
the Maximum Revolving Credit Facility as follows:
FEE AS A
PERCENTAGE OF
MAXIMUM REVOLVING CREDIT
FACILITY AND TERM LOAN IF PREPAID
------------------------- ----------
1% Any time on or before the first
anniversary of the Amendment
date.
1/2% Any time after the first anniversary of the
Amendment date, but on or before the second
anniversary of the Amendment date.
In the event that the Agent, any Lender or any Participant requests
reimbursement or compensation for a sum greater than $100,000 in the
aggregate under Section 2.15 and/or under Section 2.17, in either
case, as a result of the occurrence of any event described in Section
2.15 or 2.17 which is applicable only to any or all of the Agent,
Lenders and Participants, and not to financial institutions generally,
then, at any time on or after the date on which such request is made,
Borrower may pay the Obligations in full without payment of any
prepayment fee."
(f) Section 8.13 of the Loan Agreement is amended in its entirety to
provide as follows:
"8.13 DISTRIBUTIONS. Purchase, redeem or retire any of its
capital stock of any class, whether now or hereafter outstanding, pay,
directly or indirectly, any
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<PAGE>
cash, stock or other securities or property dividends or distributions
to its shareholders (or relatives thereof) or issue any stock or other
securities except (a) as described on Schedule 7.13, (b) stock and
stock options issued to Borrower's and its Subsidiaries' senior
management employees as described in Section 7.14, (c) dividends to
Borrower from any Subsidiary, (d) issuance by Borrower of equity
securities provided that no such issuance shall constitute or result
in a Change of Control and (e) so long as no Event of Default has
occurred or would exist after giving effect thereto, Borrower may
purchase, in addition to the 1,000,500 shares previously purchased by
Borrower, an additional 999,500 shares in the aggregate of its own
common stock that is designated treasury stock."
(g) Sections 11.1, 11.2, 11.3 and 11.5 of the Loan Agreement are amended in
their entirety to provide as follows:
"11.1 TANGIBLE NET WORTH. Borrower shall maintain at all times
Tangible Net Worth in an amount of not less than Thirty Million
Dollars ($30,000,000), plus an amount equal to ninety percent
(90%) of Borrower's Net Income (but not decreased for losses)
for the fiscal quarter then ending, minus the amount utilized by
Borrower to purchase up to two million (which amount includes
the 1,000,500 shares previously purchased by Borrower) in the
aggregate of its own common stock."
"11.2 DEBT SERVICE COVERAGE. Borrower shall maintain as at the end of
each fiscal quarter a Debt Service Coverage Ratio of not less
than 10.0 to 1.0 measured on a rolling four quarter basis."
"11.3 EBITDA. Borrower shall maintain as at the end of each fiscal
year, commencing with the fiscal year ending December 31, 1997,
EBITDA of at least $21,000,000."
"11.5 CAPITAL EXPENDITURES. Borrower and its Subsidiaries on a
consolidated basis shall not make Capital Expenditures in any
Fiscal Year in excess of (a) with respect to the Fiscal Year
ended December 31, 1997, the sum of Ten Million Dollars
($10,000,000) and (b) with respect to the Fiscal Year ending
December 31, 1998 and each Fiscal Year commencing thereafter,
the sum of (i) Three Million Dollars ($3,000,000) plus (ii) the
aggregate amount of depreciation reported by Borrower and its
Subsidiaries for such Fiscal Year on their consolidated federal
income tax returns."
(h) The first parenthetical in Section 14.1 of the Loan Agreement is
amended in its entirety to provide as follows:
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<PAGE>
"(except the fees set forth in Section 2.9(D))"
3. Conditions of Effectiveness. This Amendment shall become effective upon
satisfaction of the following conditions precedent: Agent shall have received
(i) four (4) copies of this Amendment executed by Borrower and consented and
agreed to by Guarantors,(ii) a guaranty of the Obligations by AMT/Beamon
Corporation, and (iii) such other certificates, instruments, documents,
agreements and opinions of counsel as may be required by Agent and Lenders or
their counsel, each of which shall be in form and substance satisfactory to
Agent, Lenders and their counsel.
4. Representations and Warranties. Borrower hereby represents and warrants
as follows:
(a) This Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of Borrower and are
enforceable against Borrower in accordance with their respective terms.
(b) Upon the effectiveness of this Amendment, Borrower hereby
reaffirms all covenants, representations and warranties made in the Loan
Agreement to the extent the same are not amended hereby and agree that all
such covenants, representations and warranties shall be deemed to have been
remade as of the effective date of this Amendment.
(c) No Event of Default or Default has occurred and is continuing or
would exist after giving effect to this Amendment.
(d) Borrower has no defense, counterclaim or offset with respect to
the Loan Agreement.
5. Effect on the Loan Agreement.
(a) Upon the effectiveness of Section 2 hereof, each reference in the
Loan Agreement to "this Agreement," "hereunder," "hereof," "herein" or
words of like import shall mean and be a reference to the Loan Agreement as
amended hereby.
(b) Except as specifically amended herein, the Loan Agreement, and all
other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby
ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment shall
not operate as a waiver of any right, power or remedy of Agent or any
Lender, nor constitute a waiver of any provision of the Loan Agreement, or
any other documents, instruments or agreements executed and/or delivered
under or in connection therewith.
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<PAGE>
6. Governing Law. This Amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns and
shall be governed by and construed in accordance with the laws of the State of
New York.
7. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
8. Counterparts. This Amendment may be executed by the parties hereto in
one or more counterparts, each of which shall be deemed an original and all of
which taken together shall constitute one and the same agreement.
IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and
year first written above.
AMERICAN BUILDINGS COMPANY,
Borrower
By: /s/ ROBERT T. AMMERMAN
----------------------------------
Name: Robert T. Ammerman
Its: President
LASALLE BUSINESS CREDIT, INC.,
as Agent and Lender
By: /s/ ERNEST J. ABATI
-----------------------------------
Name: Ernest J. Abati
Its: Vice President
Acknowledged and Agreed to by
each of the following Guarantors:
ABC TRANSPORTATION COMPANY
By: /s/ R. CHARLES BLACKMON
------------------------------
Name:R. Charles Blackmon
Its: Assistant Secretary
ABC BROKERAGE CO.
By: /s/ R. CHARLES BLACKMON
------------------------------
Name: R. Charles Blackmon
Its: Assistant Secretary
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GUARANTY
(Corporate)
New York, New York March 18, 1997
FOR VALUE RECEIVED, and in consideration of loans made or to be made or
credit otherwise extended or to be extended by LaSalle Business Credit, Inc.
("LaSalle"), each of the financial institutions (collectively, "Lenders") named
in or which hereafter become a party to the Loan Agreement (as hereinafter
defined) and LaSalle as agent for Lenders (in such capacity "Agent") to or for
the account of American Buildings Company ("Borrower") from time to time and at
any time and for other good and valuable consideration and to induce Agent and
Lenders, in their discretion, to make such loans or extensions of credit and to
make or grant such renewals, extensions, releases of collateral or
relinquishments of legal rights as Agent and Lenders may deem advisable, the
undersigned (and each of them if more than one, the liability under this
Guaranty being joint and several) unconditionally guaranties to Agent for its
own benefit and for the ratable benefit of Lenders, their successors, endorsees
and assigns the prompt payment when due (whether by acceleration or otherwise)
of all present and future obligations and liabilities of any and all kinds of
Borrower to Agent or Lenders and of all instruments of any nature evidencing or
relating to any such obligations and liabilities upon which Borrower is or may
become liable to Agent or Lenders, whether incurred by Borrower as maker,
endorser, drawer, acceptor, guarantor, accommodation party or otherwise, and
whether due or to become due, secured or unsecured, absolute or contingent,
joint or several, and however or whenever acquired by Agent or Lenders, whether
arising under, out of, or in connection with that certain Loan and Security
Agreement by and among Borrower, Lenders and Agent (as amended, supplemented,
modified or restated from time to time, the "Loan Agreement") or any documents,
instruments or agreements relating to or executed in connection with the Loan
Agreement or any documents, instruments or agreements referred to therein
(together with the Loan Agreement, the "Loan Documents"), (all of which are
herein collectively referred to as the "Obligations"), and irrespective of the
genuineness, validity, regularity or enforceability of such Obligations, or of
any instrument evidencing any of the Obligations or of any collateral therefor
or of the existence or extent of such collateral. Terms defined in the Loan
Agreement shall have the same meanings herein, unless otherwise herein expressly
provided. In furtherance of the foregoing, the undersigned hereby agrees as
follows:
1. No Impairment. Agent and Lenders may at any time and from time to time,
either before or after the maturity thereof, without notice to or further
consent of the undersigned, extend the time of payment of, exchange or surrender
any collateral for, renew or extend any of the Obligations or increase or
decrease the interest rate thereon, and may also make any agreement with
Borrower or with any other party to or person liable on any of the Obligations,
or interested therein, for the extension, renewal, payment, compromise,
<PAGE>
discharge or release thereof, in whole or in part, or for any modification of
the terms thereof or of any agreement between or among Agent, Lenders and
Borrower or any such other party or person, or make any election of rights Agent
and Lenders may deem desirable under the United States Bankruptcy Code, as
amended, or any other federal or state bankruptcy, reorganization, moratorium or
insolvency law relating to or affecting the enforcement of creditors' rights
generally (any of the foregoing, an "Insolvency Law") without in any way
impairing or affecting this Guaranty. This instrument shall be effective
regardless of the subsequent incorporation, merger or consolidation of Borrower,
or any change in the composition, nature, personnel or location of Borrower and
shall extend to any successor entity to Borrower, including a debtor in
possession or the like under any Insolvency Law.
2. Guaranty Absolute. The undersigned guarantees that the Obligations will
be paid strictly in accordance with the terms of the Loan Agreement and/or any
other document, instrument or agreement creating or evidencing the Obligations,
regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of Borrower with respect
thereto. The undersigned hereby knowingly accepts the full range of risk
encompassed within a contract of "continuing guaranty" which risk includes the
possibility that Borrower will contract additional indebtedness for which the
undersigned may be liable hereunder after Borrower's financial condition or
ability to pay its lawful debts when they fall due has deteriorated, whether or
not Borrower has properly authorized incurring such additional indebtedness. The
undersigned acknowledges that (i) no oral representations, including any
representations to extend credit or provide other financial accommodations to
Borrower, have been made by Agent or any Lender to induce the undersigned to
enter into this Guaranty and (ii) any extension of credit to the Borrower shall
be governed solely by the provisions of the Loan Agreement. The liability of the
undersigned under this Guaranty shall be absolute and unconditional, in
accordance with its terms, and shall remain in full force and effect without
regard to, and shall not be released, suspended, discharged, terminated or
otherwise affected by, any circumstance or occurrence whatsoever, including,
without limitation: (a) any waiver, indulgence, renewal, extension, amendment or
modification of or addition, consent or supplement to or deletion from or any
other action or inaction under or in respect of the Loan Documents or any other
instruments or agreements relating to the Obligations or any assignment or
transfer of any thereof; (b) any lack of validity or enforceability of any Loan
Document or other documents, instruments or agreements relating to the
Obligations or any assignment or transfer of any thereof; (c) any furnishing of
any additional security to Agent for the ratable benefit of the Lenders or its
assignees or any acceptance thereof or any release of any security by Agent or
its assignees; (d) any limitation on any party's liability or obligation under
the Loan Documents or any other documents, instruments or agreements relating to
the Obligations or any assignment or transfer of any thereof or any invalidity
or unenforceability, in whole or in part, of any such document,
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<PAGE>
instrument or agreement or any term thereof; (e) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to Borrower, or any action taken with respect to this
Guaranty by any trustee or receiver, or by any court, in any such proceeding,
whether or not the undersigned shall have notice or knowledge of any of the
foregoing; (f) any exchange, release or nonperfection of any collateral, or any
release, or amendment or waiver of or consent to departure from any guaranty or
security, for all or any of the Obligations; or (g) any other circumstance which
might otherwise constitute a defense available to, or a discharge of, the
undersigned. Any amounts due from the undersigned to Agent or any Lender shall
bear interest until such amounts are paid in full at the highest rate then
applicable to the Obligations of Borrower to Lenders under the Loan Agreement.
Obligations include post-petition interest whether or not allowed or allowable.
3. Waivers. (a) This Guaranty is a guaranty of payment and not of
collection. Neither Agent nor any Lender shall be under any obligation to
institute suit, exercise rights or remedies or take any other action against
Borrower or any other person liable with respect to any of the Obligations or
resort to any collateral security held by it to secure any of the Obligations as
a condition precedent to the undersigned being obligated to perform as agreed
herein and the undersigned hereby waives any and all rights which it may have by
statute or otherwise which would require Agent or any Lender to do any of the
foregoing. The undersigned further consents and agrees that neither Agent nor
Lenders shall be under any obligation to marshal any assets in favor of the
undersigned, or against or in payment of any or all of the Obligations. The
undersigned hereby waives any rights to interpose any defense, counterclaim or
offset of any nature and description which it may have or which may exist
between and among Agent, Lenders, Borrower and/or the undersigned with respect
to the undersigned's obligations under this Guaranty, or which Borrower may
assert on the underlying debt, including but not limited to failure of
consideration, breach of warranty, fraud, payment (other than cash payment in
full of the Obligations), statute of frauds, bankruptcy, infancy, statute of
limitations, accord and satisfaction, and usury.
(b) The undersigned further waives (i) notice of the acceptance of this
Guaranty, of the making of any such loans or extensions of credit, and of all
notices and demands of any kind to which the undersigned may be entitled,
including, without limitation, notice of adverse change in Borrower's financial
condition or of any other fact which might materially increase the risk of the
undersigned; and (ii) presentment to or demand of payment from anyone whomsoever
liable upon any of the Obligations, protest, notices of presentment, non-payment
or protest and notice of any sale of collateral security or any default of any
sort.
(c) Notwithstanding any payment or payments made by the undersigned
hereunder, or any setoff or application of funds of the undersigned by Agent or
any Lender, the undersigned shall not be
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<PAGE>
entitled to be subrogated to any of the rights of Agent or any Lender against
Borrower or against any collateral or guarantee or right of offset held by Agent
or any Lender for the payment of the Obligations, nor shall the undersigned seek
or be entitled to seek any contribution or reimbursement from Borrower in
respect of payments made by the undersigned hereunder, until all amounts owing
to Agent and each Lender by Borrower on account of the Obligations are paid in
full and the Loan Agreement has been terminated. If, notwithstanding the
foregoing, any amount shall be paid to the undersigned on account of such
subrogation rights at any time when all of the Obligations shall not have been
paid in full and the Loan Agreement shall not have been terminated, such amount
shall be held by the undersigned in trust for Agent and Lenders, segregated from
other funds of the undersigned, and shall forthwith upon, and in any event
within two (2) business days of, receipt by the undersigned, be turned over to
Agent for the ratable benefit of the Lenders in the exact form received by the
undersigned (duly endorsed by the undersigned to Agent, if required), to be
applied against the Obligations, whether matured or unmatured, in such order as
Agent and Lenders may determine, subject to the provisions of the Loan
Agreement. Any and all present and future debts and obligations of Borrower to
any of the undersigned are hereby waived and postponed in favor of, and
subordinated to the full payment and performance of, all present and future
debts and obligations of Borrower to Agent and Lenders.
4. Security. All sums at any time to the credit of the undersigned and any
property of the undersigned in Agent's or any Lender's possession or in the
possession of any bank, financial institution or other entity that directly or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, Agent or any Lender (each such entity, an
"Affiliate") shall be deemed held by Agent, such Lender or such Affiliate, as
the case may be, as security for any and all of the undersigned's obligations to
Agent and Lenders and to any Affiliate of Agent or any Lender, no matter how or
when arising and whether under this or any other instrument, agreement or
otherwise.
5. Representations and Warranties. The undersigned hereby represents and
warrants (all of which representations and warranties shall survive until all
Obligations are indefeasibly satisfied in full and there remain no outstanding
commitments under the Loan Agreement), that:
(a) Corporate Status. The undersigned is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware and has full power, authority and legal right to own its property
and assets and to transact the business in which it is engaged.
(b) Authority and Execution. The undersigned has full power, authority
and legal right to execute and deliver, and to perform its obligations
under, this
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<PAGE>
Guaranty and has taken all necessary corporate and legal action to
authorize the execution, delivery and performance of this Guaranty.
(c) Legal, Valid and Binding Character. This Guaranty constitutes the
legal, valid and binding obligation of the undersigned enforceable in
accordance with its terms, except as enforceability may be limited by
applicable Insolvency Law.
(d) Violations. The execution, delivery and performance of this
Guaranty will not violate any requirement of law applicable to the
undersigned or any material contract, agreement or instrument to which the
undersigned is a party or by which the undersigned or its property is bound
or result in the creation or imposition of any mortgage, lien or other
encumbrance other than to Agent for the ratable benefit of Lenders on any
of the property or assets of the undersigned pursuant to the provisions of
any of the foregoing.
(e) Consents or Approvals. No consent of any other Person (including,
without limitation, any creditor of the undersigned) and no consent,
license, permit, approval or authorization of, exemption by, notice or
report to, or registration, filing or declaration with, any governmental
authority is required in connection with the execution, delivery,
performance, validity or enforceability of this Guaranty.
(f) Litigation. No litigation, arbitration, investigation or
administrative proceeding of or before any court, arbitrator or
governmental authority, bureau or agency is currently pending or, to the
best knowledge of the undersigned, threatened (i) with respect to this
Guaranty or any of the transactions contemplated by this Guaranty or (ii)
against or affecting the undersigned, or any of its property or assets,
which, if adversely determined, would have a material adverse effect on the
business, operations, assets or condition, financial or otherwise, of the
undersigned.
(g) Material Adverse Change. Since November 27, 1996 there has been no
material adverse change in the assets or condition, financial or otherwise,
of the undersigned.
(h) Financial Benefit. The undersigned has derived or expects to
derive a financial or other advantage from each and every loan, advance or
extension of credit made under the Loan Agreement or other Obligation
incurred by Borrower to Agent and Lenders.
The foregoing representations and warranties (other than that set forth in
paragraph (g) above) shall be deemed to have been
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<PAGE>
made by the undersigned on the date of each borrowing by Borrower under the Loan
Agreement on and as of such date of such borrowing as though made hereunder on
and as of such date (except insofar as such representations and warranties
relate expressly to an earlier date).
6. Acceleration. (a) If any breach of any covenant or condition or other
event of default shall occur and be continuing under any agreement made by
Borrower or the undersigned to Agent and Lenders, including, without limitation,
this Guaranty, or either Borrower or the undersigned should at any time become
insolvent, or make a general assignment, or if a proceeding in or under any
Insolvency Law shall be filed or commenced by, or in respect of, the
undersigned, or if a notice of any lien, levy, or assessment is filed of record
with respect to any assets of the undersigned by the United States or any
department, agency, or instrumentality thereof, or if any taxes or debts owing
at any time or times hereafter to any one of them becomes a lien or encumbrance
upon any assets of the undersigned in Agent's or any Lender's possession, or
otherwise, any and all Obligations shall for purposes hereof, at Agent's or any
Lender's option, be deemed due and payable without notice notwithstanding that
any such Obligation is not then due and payable by Borrower.
(b) The undersigned will promptly notify Agent of any default by the
undersigned in the performance or observance of any term or condition of any
agreement to which the undersigned is a party if the effect of such default is
to cause, or permit the holder of any obligation under such agreement to cause,
such obligation to become due prior to its stated maturity and, if such an event
occurs, Agent shall have the right to accelerate the undersigned's obligations
hereunder.
7. Payments from Guarantor. Agent, on behalf of Lenders, in its sole and
absolute discretion, with or without notice to the undersigned, may apply on
account of the Obligations any payment from the undersigned or any other
guarantor, or amounts realized from any security for the Obligations, or may
deposit any and all such amounts realized in a non-interest bearing cash
collateral deposit account to be maintained as security for the Obligations.
8. Costs. The undersigned shall pay on demand, all fees and expenses
(including reasonable expenses for legal services of every kind) relating or
incidental to the enforcement or protection of the rights of Agent or any Lender
hereunder or under any of the Obligations.
9. No Termination. This is a continuing irrevocable guaranty and shall
remain in full force and effect and be binding upon the undersigned, and the
undersigned's successors and assigns, until all of the Obligations have been
paid in full and the Loan Agreement has been terminated. If any of the present
or future Obligations are guarantied by persons, partnerships or corporations in
addition to the undersigned, the death, release or discharge in whole or in part
or the bankruptcy, merger, consolidation, incorporation, liquidation or
dissolution of one or more of them
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<PAGE>
shall not discharge or affect the liabilities of the undersigned under this
Guaranty.
10. Recapture. Anything in this Guaranty to the contrary notwithstanding,
if Agent or any Lender receives any payment or payments on account of the
liabilities guarantied hereby, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver, or any other party under
any Insolvency Law, common law or equitable doctrine, then to the extent of any
sum not finally retained by Agent or any such Lender, the undersigned's
obligations to Agent and Lenders shall be reinstated and this Guaranty shall
remain in full force and effect (or be reinstated) until payment shall have been
made to Lender, which payment shall be due on demand.
11. Books and Records. The books and records of Agent showing the account
among Agent, Lenders and Borrower shall be admissible in evidence in any action
or proceeding, shall be binding upon the undersigned for the purpose of
establishing the items therein set forth and shall constitute prima facie proof
thereof.
12. No Waiver. No failure on the part of Agent to exercise, and no delay in
exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by Agent of any right, remedy
or power hereunder preclude any other or future exercise of any other legal
right, remedy or power. Each and every right, remedy and power hereby granted to
Agent or allowed it by law or other agreement shall be cumulative and not
exclusive of any other, and may be exercised by Agent at any time and from time
to time.
13. Waiver of Jury Trial. THE UNDERSIGNED DOES HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED ON OR WITH RESPECT TO THIS GUARANTY OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR RELATING OR INCIDENTAL HERETO. THE UNDERSIGNED DOES
HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF AGENT OR ANY LENDER HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL
PROVISION.
14. Governing Law; Jurisdiction; Amendments. THIS INSTRUMENT CANNOT BE
CHANGED OR TERMINATED ORALLY, AND SHALL BE GOVERNED, CONSTRUED AND INTERPRETED
AS TO VALIDITY, ENFORCEMENT AND IN ALL OTHER RESPECTS IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK. THE UNDERSIGNED EXPRESSLY CONSENTS TO THE
JURISDICTION AND VENUE OF THE SUPREME COURT OF THE STATE OF NEW YORK, COUNTY OF
NEW YORK, AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK FOR ALL PURPOSES IN CONNECTION HEREWITH. ANY JUDICIAL PROCEEDING BY THE
UNDERSIGNED AGAINST AGENT AND/OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY
ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED HEREWITH
SHALL BE BROUGHT ONLY IN THE SUPREME COURT OF THE STATE OF NEW YORK, COUNTY OF
NEW
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<PAGE>
YORK OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK.
THE UNDERSIGNED FURTHER CONSENTS THAT ANY SUMMONS, SUBPOENA OR OTHER PROCESS OR
PAPERS (INCLUDING, WITHOUT LIMITATION, ANY NOTICE OR MOTION OR OTHER APPLICATION
TO EITHER OF THE AFOREMENTIONED COURTS OR A JUDGE THEREOF) OR ANY NOTICE IN
CONNECTION WITH ANY PROCEEDINGS HEREUNDER, MAY BE SERVED INSIDE OR OUTSIDE OF
THE STATE OF NEW YORK OR THE SOUTHERN DISTRICT OF NEW YORK BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY PERSONAL SERVICE PROVIDED A
REASONABLE TIME FOR APPEARANCE IS PERMITTED, OR IN SUCH OTHER MANNER AS MAY BE
PERMISSIBLE UNDER THE RULES OF SAID COURTS. THE UNDERSIGNED WAIVES ANY OBJECTION
TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREON AND SHALL NOT ASSERT
ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON
CONVENIENS.
15. Sale, Transfer or Encumbrance of Assets. The undersigned agrees that it
will not, without the prior written consent of the Required Lenders (or Agent
acting at the direction of the Required Lenders), sell, lease, pledge, encumber,
grant or permit a Lien on, or otherwise dispose of or transfer, whether by sole
or otherwise, any of its assets, except sales permitted under Section 8.1 of the
Loan Agreement.
16. Severability. To the extent permitted by applicable law, any provision
of this Guaranty which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
17. Amendments, Waivers. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by the undersigned therefrom shall in any
event be effective unless the same shall be in writing executed by the
undersigned, Agent and Lenders.
18. Notice. All notices, requests and demands to or upon the undersigned,
shall be in writing or by telecopy or telex and shall be deemed to have been
duly given or made (a) when delivered, if by hand, (b) three (3) days after
being deposited in the mail, postage prepaid, if by mail, (c) when confirmed, if
by telecopy or, (d) in the case of telex notice, when sent, answer back
receiver, in each event, to the number and address set forth beneath the
signature of the undersigned.
19. Successors. Agent or any Lender may, from time to time, without notice
to the undersigned, sell, assign, transfer or otherwise dispose of all or any
part of the Obligations and/or rights under this Guaranty. Without limiting the
generality of the foregoing, Agent or any Lender may assign, or grant
participations to, one or more banks, financial institutions or other entities
all or any part of any of the Obligations. In each such event, Agent, any
Lender, its Affiliates and each and every immediate and
-8-
<PAGE>
successive purchaser, assignee, transferee or holder of all or any part of the
Obligations shall have the right to enforce this Guaranty, by legal action or
otherwise, for its own benefit as fully as if such purchaser, assignee,
transferee or holder were herein by name specifically given such right. Agent or
any Lender shall have an unimpaired right to enforce this Guaranty for its
benefit with respect to that portion of the Obligations which Agent or any such
Lender has not disposed of, sold, assigned, or otherwise transferred.
20. Release. Nothing except cash payment in full of the obligations shall
release the undersigned from liability under this Guaranty.
IN WITNESS WHEREOF, this Guaranty has been executed by the undersigned this
18th day of March, 1997.
AMT/BEAMON CORPORATION
By: "SPECIMEN"
-----------------------------------
Its: Treasurer
Address: State Docks Road
Eufaula, AL 36027
Telephone: 334-687-2032
Facsimile: 334-687-7156
STATE OF ALABAMA )
): ss.:
COUNTY OF ALABAMA )
On the 18th day of March, 1997, before me personally came R. Charles
Blackmon to me known, who being by me duly sworn, did depose and say that he is
the Treasurer of AMT/Beamon Corporation, the corporation described in and which
executed the foregoing instrument; and that he signed his name thereto by order
of the board of directors of said corporation.
/s/ "SPECIMEN"
----------------------------
Notary Public
My Commission Expires 2/14/2000
-9-
EXHIBIT 11
<TABLE>
<CAPTION>
AMERICAN BUILDINGS COMPANY AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
-----------------------------
1997 1996
------- ------
<S> <C> <C>
PRIMARY EARNINGS PER SHARE:
Net income .................................................................. $1,515 $1,245
====== ======
Weighted average common and common equivalent
shares outstanding ........................................................ 5,316 6,179
Add - Dilutive effect of outstanding options ( as determined
by the application of the treasury stock method) .......................... 350 354
------ ------
Weighted average common and common equivalent
shares outstanding ........................................................ 5,666 6,533
====== ======
Primary earnings per share:
Net income .................................................................. $ 0.27 $ 0.19
====== ======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEETS AND THE CONDENSED CONSOLIDATED
STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 31,751
<ALLOWANCES> 3,434
<INVENTORY> 20,871
<CURRENT-ASSETS> 53,987
<PP&E> 74,498
<DEPRECIATION> 39,811
<TOTAL-ASSETS> 97,195
<CURRENT-LIABILITIES> 36,307
<BONDS> 15,022
0
0
<COMMON> 63
<OTHER-SE> 42,962
<TOTAL-LIABILITY-AND-EQUITY> 97,195
<SALES> 57,604
<TOTAL-REVENUES> 57,604
<CGS> 48,843
<TOTAL-COSTS> 54,914
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 157
<INTEREST-EXPENSE> 225
<INCOME-PRETAX> 2,465
<INCOME-TAX> 950
<INCOME-CONTINUING> 1,515
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,515
<EPS-PRIMARY> .27
<EPS-DILUTED> 0
</TABLE>
