\n December 31, 1999 1.00 to 1.0
\n March 31, 2000 1.00 to 1.0
\n June 30, 2000 and thereafter 1.25 to 1.0
\n<\/c><\/s><\/caption>\n<\/table>\n (d) Its EBITDA at the end of any Fiscal Quarter to be less than
\n $25,000,000.00 for the prior twelve-month period. For this purpose,
\n EBITDA will be calculated on a pro-forma basis to include all entities
\n acquired;<\/p>\n
where in the calculation of Fixed Charge Coverage Ratio, actual
\n capital expenditures are to be reduced by expenditures associated with
\n the Quincy West plant, which include $1,875,000 for the fiscal quarter
\n ending September 30, 1999, $2,410,000 for the fiscal quarter ending
\n December 31, 1999 and future actual amounts, not to exceed $1,500,000
\n in any Fiscal Quarter.<\/p>\n
2.2 Schedule 3.1 of the Credit Agreement is hereby amended to read as
\nattached hereto.<\/p>\n
2.3 Exhibit B of the Credit Agreement is hereby amended to read as attached
\nhereto.<\/p>\n
-2-<\/p>\n
3<\/p>\n
SECTION 3. OTHER MODIFICATIONS, RATIFICATIONS AND AGREEMENTS.<\/p>\n
3.1 All references to the Credit Agreement in the Loan Documents are hereby
\namended to refer to the Credit Agreement as hereby amended.<\/p>\n
3.2 Borrower acknowledges that the indebtedness evidenced by the Notes is
\njust and owing, that the balance thereof is correctly shown in the records of
\nLender as of the date hereof, and Borrower agrees to pay the indebtedness
\nevidenced by the Notes according to the terms thereof, as herein modified.<\/p>\n
3.3 Borrower hereby reaffirms to Lender each of the representations,
\nwarranties, covenants and agreements of Borrower set forth in the Notes and the
\nCredit Agreement, with the same force and effect as if each were separately
\nstated herein and made as of the date hereof.<\/p>\n
3.4 Borrower hereby ratifies, reaffirms, acknowledges, and agrees that the
\nNotes and the Credit Agreement, represent valid, enforceable and collectible
\nobligations of Borrower, and that there are no existing claims, defenses,
\npersonal or otherwise, or rights of setoff whatsoever with respect to any of
\nthese documents or instruments. In addition, Borrower hereby expressly waives,
\nreleases and absolutely and forever discharges Lender and its present and former
\nshareholders, directors, officers, employees and agents, and their separate and
\nrespective heirs, personal representatives, successors and assigns, from any and
\nall liabilities, claims, demands, damages, action and causes of action, of which
\nBorrower has, or may reasonably be expected to have knowledge, that Borrower may
\nnow have, or has had prior to the date hereof, or that may hereafter arise with
\nrespect to acts, omissions or events occurring prior to the date hereof and,
\nwithout limiting the generality of the foregoing, from any and all liabilities,
\nclaims, demands, damages, actions and causes of action, known or unknown,
\ncontingent or matured, arising out of, or in any way connected with, the Loans.
\nBorrower further acknowledges and represents that no event has occurred and no
\ncondition exists that, after notice or lapse of time, or both, would constitute
\ndefault under this Agreement, the Notes or the Credit Agreement.<\/p>\n
3.5 All terms, conditions and provisions of the Notes and the Credit
\nAgreement are continued in full force and effect and shall remain unaffected and
\nunchanged except as specifically amended hereby. The Notes and the Credit
\nAgreement, as amended hereby, are hereby ratified and reaffirmed by Borrower,
\nand Borrower specifically acknowledges the validity and enforceability thereof.<\/p>\n
SECTION 4. GENERAL.<\/p>\n
4.1 This Agreement in no way acts as a release or relinquishment of those
\nrights securing payment of the Loans. Such rights are hereby ratified,
\nconfirmed, renewed and extended by Borrower in all respects.<\/p>\n
4.2 The modifications contained herein shall not be binding upon Lender
\nuntil Lender shall have received all of the following:<\/p>\n
-3-<\/p>\n
4<\/p>\n
(a) An original of this Agreement fully executed by the Borrower.<\/p>\n
(b) An original Consent and Agreement of Guarantors executed by each
\n Guarantor.<\/p>\n
(c) Such resolutions or authorizations and such other documents as
\n Lender may require relating to the existence and good standing of the
\n Borrower and each Subsidiary and the authority of any person executing this
\n Agreement or other documents on behalf of the Borrower and each Subsidiary.<\/p>\n
4.3 Borrower shall execute and deliver such additional documents and do as
\nLender may reasonably require to fully implement the intent of this Agreement.<\/p>\n
4.4 Borrower shall pay all costs and expenses, including, but not limited
\nto, reasonable attorneys’ fees incurred by Lender in connection herewith,
\nwhether or not all of the conditions described in Paragraph 4.2 above are
\nsatisfied. Lender, at its option, but without any obligation to do so, may
\nadvance funds to pay any such costs and expenses that are the obligation of the
\nBorrower, and all such funds advanced shall bear interest at the highest rate
\nprovided in the RLC Note and shall be due and payable upon demand.<\/p>\n
4.5 Notwithstanding anything to the contrary contained herein or in any
\nother instrument executed by Borrower or Lender, or in any other action or
\nconduct undertaken by Borrower or Lender on or before the date hereof, the
\nagreements, covenants and provisions contained herein shall constitute the only
\nevidence of Lender’s consent to modify the terms and provisions of the Credit
\nAgreement. Accordingly, no express or implied consent to any further
\nmodifications involving any of the matters set forth in this Agreement or
\notherwise shall be inferred or implied by Lender’s execution of this Agreement.
\nFurther, Lender’s execution of this Agreement shall not constitute a waiver
\n(either express or implied) of the requirement that any further modification of
\nthe Loans or of the Notes or the Credit Agreement, shall require the express
\nwritten approval of Lender; no such approval (either express or implied) has
\nbeen given as of the date hereof.<\/p>\n
4.6 Time is hereby declared to be of the essence hereof of the Loans, of
\nthe Notes and of the Credit Agreement, and Lender requires, and Borrower agrees
\nto, strict performance of each and every covenant, condition, provision and
\nagreement hereof, of the Notes and the Credit Agreement.<\/p>\n
4.7 This Agreement shall be binding upon, and shall inure to the benefit
\nof, the parties hereto and their heirs, personal representatives, successors and
\nassigns.<\/p>\n
4.8 This Agreement is made for the sole protection and benefit of the
\nparties hereto, and no other person or entity shall have any right of action
\nhereon.<\/p>\n
-4-
\n 5<\/p>\n
4.9 This Agreement shall be governed by and construed according to the laws
\nof the State of Arizona.<\/p>\n
IN WITNESS WHEREOF, these presents are executed as of the date indicated
\n above.<\/p>\n
SCHUFF STEEL COMPANY, a Delaware
\n corporation<\/p>\n
By: \/s\/ Kenneth Zylstra
\n ————————————-
\n Name: Ken Zylstra
\n —————————–
\n Its: Vice President and CFO
\n ——————————-<\/p>\n
COMPANY<\/p>\n
WELLS FARGO BANK, NATIONAL
\n ASSOCIATION, a national banking association<\/p>\n
By: \/s\/ John Helms
\n ——————————-
\n Name: John Helms
\n ———————–
\n Its: Vice President
\n ——————————<\/p>\n
LENDER<\/p>\n
-5-<\/p>\n
6<\/p>\n
SCHEDULE 3.1<\/p>\n
PRICING GRID<\/p>\n
\n\n Eurodollar Rate
\nLeverage Ratio Spread Base Rate Spread Facility Fee Rate
\n————– —— —————- —————–
\n
\n4.00 or higher 3.50% 1.50% .625%
\n3.75 or higher 3.25% 1.25% .500%
\n3.50 or higher 3.00% 1.00% .500%
\n3.00 or higher 2.50% .50% .375%
\nbelow 3.0 2.25% 0% .250%
\n<\/c><\/c><\/c><\/s><\/caption>\n<\/table>\n 7<\/p>\n
EXHIBIT “B”<\/p>\n
COMPLIANCE CERTIFICATE
\n FOR FISCAL QUARTER\/YEAR ENDING
\n __________________, 20__<\/p>\n
Wells Fargo Bank, National Association
\n100 West Washington
\nPhoenix, Arizona 85003<\/p>\n
Attn: John Helms Date:_________________
\n #4101-251<\/p>\n
Dear Ladies and Gentlemen:<\/p>\n
This Compliance Certificate refers to the Credit Agreement dated as of June
\n30, 1998 (as it may hereafter be amended, modified, extended or restated from
\ntime to time, the “Credit Agreement”), among SCHUFF STEEL COMPANY, a Delaware
\ncorporation (“Borrower”), the Lenders named therein, and WELLS FARGO BANK,
\nNATIONAL ASSOCIATION, as Administrative Agent for the Lenders and as Arranger,
\nIssuing Bank and Swing Line Lender. Capitalized terms used and not otherwise
\ndefined herein shall have the meanings assigned to such terms in the Credit
\nAgreement.<\/p>\n
Pursuant to Section 7.1 of the Credit Agreement, the undersigned certifies
\nthat:<\/p>\n
1. Enclosed are the required financial statements for the [fiscal quarter]
\n[fiscal year] ending ____________ (“Reporting Period”) for Borrower as required
\nunder Section 7.1 of the Credit Agreement.<\/p>\n
2. To the best of the undersigned’s knowledge, no “Event of Default” or
\n“Default” has occurred [or if so, specifying the nature and extent thereof and
\nany corrective actions taken or to be taken].<\/p>\n
3. As of the last day of the Reporting Period, the computations below were
\ntrue and correct:<\/p>\n
8<\/p>\n
I. SECTION 6.11(a) LEVERAGE RATIO<\/p>\n
Numerator: Net Funded Debt A
\n ——————<\/p>\n
Divided by<\/p>\n
Denominator: EBITDA B
\n ——————<\/p>\n
Ratio: Equals (A\/B): X
\n ——————<\/p>\n
\n\n Maximum Permitted: Leverage
\n Fiscal Quarter Ending Ratio
\n ——————— ——–
\n
\n December 31, 1999 4.25 to 1.0
\n March 31, 2000 4.25 to 1.0
\n June 30, 2000 4.00 to 1.0
\n September 30, 2000 4.00 to 1.0
\n December 31, 2000 and
\n thereafter 3.75 to 1.0
\n<\/c><\/c><\/s><\/caption>\n<\/table>\nII. SECTION 6.11(b) INTEREST COVERAGE RATIO<\/p>\n
Numerator: EBITDA A
\n ——————-<\/p>\n
Divided by<\/p>\n
Denominator: Interest Expense B
\n ——————-<\/p>\n
Ratio: Equals (A\/B): X
\n ——————-<\/p>\n
\n\n Minimum Permitted: Interest Coverage
\n Fiscal Quarter Ending Ratio
\n ——————— ——————
\n <\/p>\n December 31, 1999 2.00 to 1.0
\n March 31, 2000 2.00 to 1.0
\n June 30, 2000 and
\n thereafter 2.25 to 1.0
\n<\/c><\/s><\/caption>\n<\/table>\n
III. SECTION 6.11(c) FIXED CHARGE COVERAGE RATIO<\/p>\n
Numerator: EBITDA
\n ——————<\/p>\n
– Capital Expenditures(1)
\n ——————
\n – Taxes Paid
\n ——————
\n Equals: A
\n ——————<\/p>\n
———-<\/p>\n
(1) Actual capital expenditures are to be reduced by expenditures associated
\nwith the Quincy West plant, which include $1,875,000 for the fiscal quarter
\nending September 30, 1999, $2,410,000 for the fiscal quarter ending December 31,
\n1999 and future actual amounts, not to exceed $1,500,000 in any Fiscal Quarter.<\/p>\n
-2-
\n 9<\/p>\n
Divided by<\/p>\n
Denominator: Scheduled Principal Payments
\n ——————
\n + Interest Payments
\n ——————
\n + Lease Payments
\n ——————
\n Equals: B
\n ——————<\/p>\n
Ratio: Equals (A\/B): X
\n ——————<\/p>\n
\n\n Minimum Permitted: Fixed Charge
\n Fiscal Quarter Ending Coverage Ratio
\n ——————— ————–
\n
\n December 3 1, 1999 1.00 to 1.0
\n March 31, 2000 1.00 to 1.0
\n June 30, 2000 and thereafter 1.25 to 1.0
\n<\/c><\/s><\/caption>\n<\/table>\nIV. SECTION 6.11(d) EBITDA (prior twelve months)<\/p>\n
Minimum Permitted $ 25,000,000
\n ——————<\/p>\n
Actual
\n ——————<\/p>\n
SCHUFF STEEL COMPANY, a Delaware
\n corporation<\/p>\n
By:_________________________________________<\/p>\n
Name:_______________________________________<\/p>\n
Its:__________________________________________
\n Senior Officer<\/p>\n
-3-
\n 10<\/p>\n
CONSENT AND AGREEMENT OF GUARANTORS<\/p>\n
Each of the undersigned Guarantors executed a Continuing Guaranty dated as
\nof March 10, 1999 as described in the Cred – it Agreement dated as of June 30,
\n1998 between WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking
\nassociation, and SCHUFF STEEL COMPANY, a Delaware corporation. Each of the
\nundersigned Guarantors hereby consents and agrees to, the modifications and all
\nother matters contained in the foregoing Second Modification Agreement of even
\ndate herewith.<\/p>\n
BANNISTER STEEL INC., a California
\ncorporation<\/p>\n
By: \/s\/ Ted Rossin
\n ————————————–
\n Name: Ted Rossin
\n ————————————–
\n Its: President
\n ————————————–<\/p>\n
ADDISON STEEL, INC., a Florida corporation<\/p>\n
By: \/s\/ Glen Davis
\n ————————————–
\n Name: Glen Davis
\n ————————————–
\n Its: President
\n ————————————–<\/p>\n
ADDISON STRUCTURAL SERVICES, INC., a
\n Florida corporation<\/p>\n
By: \/s\/ Ken Zylstra
\n ————————————–
\n Name: Ken Zylstra
\n ————————————–
\n Its: Secretary – Treasurer
\n ————————————–<\/p>\n
11<\/p>\n
QUINCY JOIST COMPANY, a Florida corporation<\/p>\n
By: \/s\/ Sam Mahdavi
\n ————————————–
\n Name: Sam Mahdavi
\n ————————————–
\n Its: President
\n ————————————–<\/p>\n
SIX INDUSTRIES, INC., a Texas corporation<\/p>\n
By: \/s\/ Wayne Harris
\n ————————————–
\n Name: Wayne Harris
\n ————————————–
\n Its: President
\n ————————————–<\/p>\n
Dated as of March 28, 2000<\/p>\n
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