UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________

FORM 8-K



CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934



July 15, 2020

Date of Report (Date of earliest event reported)

___________________________________

SIGMATRON INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)





 

 

Delaware

0-23248

36-3918470

(State or other jurisdiction of

incorporation)

(Commission

File number)

(I.R.S. Employer

Identification No.)



2201 Landmeier Road, Elk Grove Village, Illinois 60007

(Address of principal executive offices)                                           (Zip Code)



(847) 956-8000

(Registrant’s telephone number, including area code)

___________________________________

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:



□  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)



□  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)



□  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))



□  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



Securities registered pursuant to Section 12(b) of the Act.



Title of each class

Common Stock $0.01 par value per share

Trading Symbol

SGMA

Name of each exchange on which registered

The NASDAQ Capital Market



Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company 



If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 


 



ITEM  1.01.Entry into a Material Definitive Agreement.



On July 15, 2020, SigmaTron International, Inc. (the “Company”) entered into Amendment No. 6 to Amended and Restated Loan and Security Agreement (such Amendment No. 6, the “6th Amendment” and the Amended and Restated Loan and Security Agreement, as amended, the “Agreement”) by and among U.S. Bank National Association (the “Bank”) and the Company.  The Bank is also the Company’s lender for the Company’s PPP Loan, as discussed below.  On August 7, 2020, the Company entered into Amendment No. 7 to Amended and Restated Loan and Security Agreement (the “7th Amendment”) by and among the Bank and the Company.  On September 8, 2020, the Company entered into Amendment No. 8 to Amended and Restated Loan and Security Agreement (the “8th Amendment” and, with the 6th Amendment and the 7th Amendment, the “Amendments”) by and among the Bank and the Company.  Copies of each of the Amendments are included, respectively, as Exhibits 10.1, 10.2, and 10.3 filed herewith, and the terms of each of the Amendments filed herewith are incorporated herein by reference.  Capitalized terms used, but not otherwise defined, herein have the meanings given in the respective Amendment.



Subject to certain representations and warranties of the Company and specified conditions precedent that were met, effective as of April 30, 2020, the  6th Amendment was entered into to (i) amend and restate the definition of Adjusted EBITDAR, (ii) add certain defined terms related to the Company’s PPP Loan, which is discussed in more detail in the Company’s Current Report on Form 8-K filed on April 24, 2020, and adding the PPP Loan as a permitted Indebtedness, and (iii) amend Section 8.1 of the Agreement to add a proviso permitting the use of estimated Qualifying Expenses for the purposes of testing the Fixed Charge Coverage Ratio if April 30, 2021 testing date contains any period for which the actual Qualifying Expenses are not yet known.



Subject to certain representations and warranties of the Company and specified conditions precedent that were met, effective as of April 30, 2020, the 7th Amendment was entered into to (i) further amend and restate the definition of Adjusted EBITDAR and amend and restate the definition of EBITDA, (ii) delete the defined terms Excluded Person and Included Person, and (iii) delete the estimated Qualifying Expenses proviso that was added pursuant to the 6th Amendment.



Subject to certain representations and warranties of the Company and specified conditions precedent that were met, effective as of August 1, 2020, the 8th Amendment was entered into to (i) add as a defined term the Eighth Amendment Effective Date, (ii) add as a permitted Investment pursuant to Section 7.5 of the Agreement “other Investments not to exceed $4,000,000,” and (iii) amend and restate Section 8.2 of the Agreement to adjust the Company’s covenant not to permit Availability to be less than 20% of the Revolving Line Cap.


 



ITEM 9.01.Financial Statements and Exhibits.



(d)Exhibits



Exhibit No.Description





 

10.1

Amendment No. 6 to Amended and Restated Loan and Security Agreement

10.2

Amendment No. 7 to Amended and Restated Loan and Security Agreement

10.3

Amendment No. 8 to Amended and Restated Loan and Security Agreement




 

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 hereunto duly authorized.





 

 



SIGMATRON INTERNATIONAL, INC.



 

 

Date:    September 9, 2020

By:

/s/ Gary R. Fairhead



Name:

Gary R. Fairhead



Title:

President and Chief Executive Officer






Exhibit 101

Exhibit 10.1

 

AMENDMENT NO. 6 TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT



This AMENDMENT NO. 6 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this "Amendment"), dated as of July 15, 2020 (effective as of April 30, 2020), is by and among U.S. Bank National Association, as Bank ("Bank"), and SigmaTron International, Inc., a Delaware corporation ("Borrower").



W I T N E S S E T H:



WHEREAS, Borrower and Bank are parties to that certain Amended and Restated Loan and Security Agreement dated as of December 21, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"; capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement); and



WHEREAS, Borrower has requested that Bank amend the Credit Agreement as set forth herein and Bank is willing to do so on the terms and subject to the conditions set forth herein;



NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties hereto agree as follows:



1.    Amendments to Credit Agreement.  In reliance upon the representations and warranties of Borrower set forth in Section 2 below and subject to the conditions to effectiveness set forth in Section 3 below, the Credit Agreement is hereby amended as follows:



(a)    Section 1.1 of the Credit Agreement is hereby amended by amending and restating the following defined terms as follows:



"Adjusted EBITDAR" means, with respect to any fiscal period, the total (without duplication), in Dollars, for Borrower and its Subsidiaries on a consolidated basis and as determined in accordance with GAAP consistently applied, of: (a) EBITDAR for such period, minus (b) the aggregate cash amount of income and franchise taxes paid during such period, minus (c) all Capital Expenditures for such period, exclusive of those Capital Expenditures made from funds borrowed by Borrower or pursuant to any Capital Lease (for purposes of this clause (c) "funds borrowed" will not include funds borrowed from Bank as a Revolving Loan), minus (d) all dividends and distributions paid in cash, and all cash paid in connection with redemptions or repurchases of any Capital Stock, during such period, minus (e) solely with respect to the fiscal quarters ending April 30, 2020, July 31, 2020, October 31, 2020 and January 31, 2021, the Excluded Portion plus (f) solely with respect to the fiscal quarters ending July 31, 2020, October 31, 2020, January 31, 2021 and April 30, 2021, the Included Portion.



(b)    Section 1.1 of the Credit Agreement is hereby amended by inserting the following new defined terms in their appropriate alphabetical order as follows:


 

"Excluded Portion" means solely to the extent included in the determination of Net Income for such period, that portion of the PPP Loan expended by Borrower for Qualifying Expenses incurred during the fourth quarter of fiscal year 2020 of up to $1,699,820.00.



"Included Portion" means solely to the extent included in the determination of Net Income for such period, that portion of the PPP Loan available to Borrower for Qualifying Expenses incurred during the first quarter of fiscal year 2021 of up to $4,583,153.00.



"PPP Loan" means the loan under the Program that Borrower obtained from Bank, in the principle amount of $6,282,973.00, and evidenced by that certain SBA Payroll Protection Loan Note, dated as of April 23, 2020, issued by Borrower to Bank.



"Program" means the U.S. Small Business Administration's Paycheck Protection Program established by the Coronavirus Aid, Relief, and Economic Security Act of 2020 and the rules and regulations relating thereto.



"Qualifying Expenses" means the payroll and non-payroll costs which have been forgiven under the Program; provided that for any Fixed Charge Coverage Ratio test that contains a period for which actual amounts of payroll and non-payroll costs to be forgiven under the Program are not yet known, Qualifying Expenses for such period shall be those payroll and non-payroll costs reasonably expected to be forgiven under the Program.



(c)    Section 7.1.1 of the Credit Agreement is hereby amended by inserting a new clause (j) therein to read as follows:



(j) the PPP Loan.



(d)    Section 8.1 of the Credit Agreement is hereby amended by inserting the following proviso at the end of such section: "; provided that if the April 30, 2021 testing date contains any period for which Qualifying Expenses are not yet known, (a) the Fixed Charge Coverage Ratio shall be tested for such testing date based upon estimated Qualifying Expenses and (b) the Fixed Charge Coverage Ratio shall be retested for such testing date based upon known Qualifying Expenses as soon as practical (but in any event within five (5) Business Days) after such Qualifying Expenses are known."



2.    Representations and Warranties. Borrower hereby represents and warrants to Bank that as of the date hereof:



(a)    The execution, delivery and performance of this Amendment has been duly authorized by all requisite corporate action on the part of Borrower;



(b)    No Default or Event of Default has occurred and is continuing or shall be caused by the transactions contemplated by this Amendment; and

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(c)    The representations and warranties set forth in the Credit Agreement, as amended hereby, and in the other Loan Documents, as amended to date, are true and correct in all material respects as of the date hereof, with the same effect as though made on the date hereof (except to the extent such representations and warranties expressly refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date).



3.    Conditions Precedent to Effectiveness. The effectiveness of this Amendment is subject to the prior or concurrent consummation of each of the following conditions:



(a)    Bank shall have received a copy of this Amendment executed by

Borrower; and



(b)    No Default or Event of Default shall have occurred or be continuing after

giving effect to this Amendment.



4.    Miscellaneous.



(a)    Governing Law. THIS AMENDMENT SHALL BE SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.



(b)    Counterparts. This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by facsimile, .pdf or other similar method of electronic transmission shall be equally effective as delivery of a manually executed counterpart.



(c)    Reference to Credit Agreement. Each reference in the Credit Agreement  to "this Agreement," "hereunder," "hereof," "herein" or words of like import, and each reference in the Credit Agreement or in any other Loan Documents, or other agreements, documents or other instruments executed and delivered pursuant to the Credit Agreement, shall mean and be a reference to the Credit Agreement as amended by this Amendment.



(d)    Costs and Expenses. Borrower acknowledges that Section 10.3 of the Credit Agreement applies to this Amendment and the transactions, agreements and documents contemplated hereunder.



(e)    Release.



(i)    In consideration of the agreements of Bank contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, on behalf of itself and its successors and assigns, and its present and former members, managers, shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Borrower and all such other Persons being hereinafter referred to 

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collectively as the "Releasing Parties" and individually as a "Releasing Party"), hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges Bank, and its successors and assigns, and its present and former shareholders, members, managers, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Bank and all such other Persons being hereinafter referred to collectively as the "Releasees" and individually as a "Releasee"), of and from any and all demands, actions, causes of action, suits, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a "Claim" and collectively, "Claims") of every kind and nature, known or unknown, suspected or unsuspected, at law or in equity, which any Releasing Party or any of its successors, assigns, or other legal representatives may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the date of this Amendment, including, without limitation, for or on account of, or in relation to, or in any way in connection with this Amendment, the Credit Agreement, and any of the other Loan Documents or any of the transactions hereunder or thereunder. Releasing Parties hereby represent to the Releasees that they have not assigned or transferred any interest in any Claims against any Releasee prior to the date hereof.



(ii)    Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense to any Claim and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.



(iii)    Borrower agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered will affect in any manner the final, absolute and unconditional nature of the release set forth above..



[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their duly authorized officers as of the date first above written.





 

 



BORROWER:



 

 



SIGMATRON INTERNATIONAL, INC.



 

 



By:

/s/ Linda K. Frauendorfer



Name:

Linda K. Frauendorfer



Title:

Chief Financial Officer



 

 



U.S. BANK NATIONAL ASSOCIATION,



as Bank



 

 



By:

/s/ Ari Kaplan



Name:

Ari Kaplan



Title:

Senior Vice President



 


Exhbit 102

Exhibit 10.2

AMENDMENT NO. 7 TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT



ThisAMENDMENT NO. 7 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this "Amendment"), dated as of August 7, 2020 (effective as of April 30, 2020), is by and among U.S. Bank National Association, as Bank ("Bank"), and SigmaTron International, Inc., a Delaware corporation ("Borrower").



W I T N E S S E T H:



WHEREAS, Borrower and Bank are parties to that certain Amended and Restated Loan and Security Agreement dated as of December 21, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"; capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement); and



WHEREAS, Borrower has requested that Bank amend the Credit Agreement as set forth herein and Bank is willing to do so on the terms and subject to the conditions set forth herein;



NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties hereto agree as follows:



1.    Amendments to Credit Agreement.  In reliance upon the representations and warranties of Borrower set forth in Section 2 below and subject to the conditions to effectiveness set forth in Section 3 below, the Credit Agreement is hereby amended as follows:



(a)    Section 1.1 of the Credit Agreement is hereby amended by amending and restating the following definitions as follows:



"Adjusted EBITDAR" means, with respect to any fiscal period, the total (without duplication), in Dollars, for Borrower and its Subsidiaries on a consolidated basis and as determined in accordance with GAAP consistently applied, of: (a) EBITDAR for such period, minus (b) the aggregate cash amount of income and franchise taxes paid during such period, minus (c) all Capital Expenditures for such period, exclusive of those Capital Expenditures made from funds borrowed by Borrower or pursuant to any Capital Lease (for purposes of this clause (c) "funds borrowed" will not include funds borrowed from Bank as a Revolving Loan), minus (d) all dividends and distributions paid in cash, and all cash paid in connection with redemptions or repurchases of any Capital Stock, during such period.



"EBITDA" means, with respect to any fiscal period, the total (without duplication), in Dollars, for Borrower and its Subsidiaries on a consolidated basis and as determined in accordance with GAAP consistently applied, of: (a) Net Income for such period, plus (b) in each case to the extent deducted in calculating Net    Income    for    such    period,    (i) interest    expense,    (ii) income    taxes, (iii) depreciation  and  amortization,  (iv) non-cash  extraordinary  losses,  and (v) Qualifying Expenses incurred during the fiscal quarter ending July 31, 2020 in an aggregate amount not to exceed $4,385,000, minus (c) in each case to the extent included in calculating Net Income for such period (i) extraordinary gains and (ii) interest income. EBITDA, for purposes of this Agreement, will be calculated utilizing a first in-first out method of cost accounting for Inventory.  For the purposes of calculating EBITDA, any amounts forgiven under the Program will not be


 

considered extraordinary gains.



(b)    Section 1.1 of the Credit Agreement is hereby amended by deleting the following defined terms: "Excluded Portion" and "Included Portion".



(c)    Section 8.1 of the Credit Agreement is hereby amended by deleting the proviso at the end of such section.



2.    Representations and Warranties.Borrower hereby represents and warrants to Bank that as of the date hereof:



(a)    The execution, delivery and performance of this Amendment has been duly authorized by all requisite corporate action on the part of Borrower;



(b)    No Default or Event of Default has occurred and is continuing or shall be caused by the transactions contemplated by this Amendment; and



(c)    The representations and warranties set forth in the Credit Agreement, as amended hereby, and in the other Loan Documents, as amended to date, are true and correct in all material respects as of the date hereof, with the same effect as though made on the date hereof (except to the extent such representations and warranties expressly refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date).



3.    Conditions Precedent to Effectiveness. The effectiveness of this Amendment is subject to the prior or concurrent consummation of each of the following conditions:



(a)    Bank shall have received a copy of this Amendment executed by Borrower; and



(b)    No Default or Event of Default shall have occurred or be continuing aftergiving effect to this Amendment.



4.    Miscellaneous.



(a)    Governing Law. THIS AMENDMENT SHALL BE SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.



(b)    Counterparts. This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such

counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by facsimile, .pdf or other similar method of electronic transmission shall be equally effective as delivery of a manually executed counterpart.



(c)    Reference to Credit Agreement. Each reference in the Credit Agreement  to "this Agreement," "hereunder," "hereof," "herein" or words of like import, and each reference in the Credit Agreement or in any other Loan Documents, or other agreements, documents or other instruments executed and delivered pursuant to the Credit Agreement, shall mean and be a reference to the Credit Agreement as amended by this Amendment.

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(d)    Costs and Expenses. Borrower acknowledges that Section 10.3 of the Credit Agreement applies to this Amendment and the transactions, agreements and documents contemplated hereunder.



(e)    Release.



(i)    In consideration of the agreements of Bank contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, on behalf of itself and its successors and assigns, and its present and former members, managers, shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Borrower and all such other Persons being hereinafter referred to collectively as the "Releasing Parties" and individually as a "Releasing Party"), hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges Bank, and its successors and assigns, and its present and former shareholders, members, managers, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Bank and all such other Persons being hereinafter referred to collectively as the "Releasees" and individually as a "Releasee"), of and from any and all demands, actions, causes of action, suits, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a "Claim" and collectively, "Claims") of every kind and nature, known or unknown, suspected or unsuspected, at law or in equity, which any Releasing Party or any of its successors, assigns, or other legal representatives may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the date of this Amendment, including, without limitation, for or on account of, or in relation to, or in any way in connection with this Amendment, the Credit Agreement, and any of the other Loan Documents or any of the transactions hereunder or thereunder. Releasing Parties hereby represent to the Releasees that they have not assigned or transferred any interest in any Claims against any Releasee prior to the date hereof.



(ii)   Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense to any Claim and may be

used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.



(iii)  Borrower agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered will affect in any manner the final, absolute and unconditional nature of the release set forth above.



[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their duly authorized officers as of the date first above written.





 

 

 



BORROWER

 



 

 

 



SIGMATRON INTERNATIONAL, INC.

 



 

 

 



 

 

 



By:

/s/ Gary R. Fairhead

 



Name:

Gary R. Fairhead

 



Title:

CEO

 



 

 

 



 

 

 



U.S. BANK NATIONAL ASSOCIATION,

 



as Bank

 



 

 

 



By:

/s/ Ari Kaplan

 



Name:

Ari Kaplan

 



Title:

Senior Vice President

 




Exhibit 103

Exhibit 10.3

 

AMENDMENT NO. 8 TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT



This AMENDMENT NO. 8 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this "Amendment"), dated as of September 8, 2020 (effective as of August 1, 2020), is by and among U.S. Bank National Association, as Bank ("Bank"), and SigmaTron International, Inc., a Delaware corporation ("Borrower").



W I T N E S S E T H:



WHEREAS, Borrower and Bank are parties to that certain Amended and Restated Loan and Security Agreement dated as of December 21, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"; capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement); and



WHEREAS, Borrower has requested that Bank amend the Credit Agreement as set forth herein and Bank is willing to do so on the terms and subject to the conditions set forth herein;



NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties hereto agree as follows:



1.    Amendments to Credit Agreement. In reliance upon the representations and warranties of Borrower set forth in Section 2 below and subject to the conditions to effectiveness set forth in Section 3 below, the Credit Agreement is hereby amended as follows:



(a)    Section 1.1 of the Credit Agreement is hereby amended by inserting the following new defined terms in their appropriate alphabetical order as follows:



Eighth Amendment Effective Date means August 1, 2020.



(b)    Section 7.5(g) of the Credit Agreement is hereby amended is amended and restated as follows:



(g)    other Investments not to exceed $4,000,000.



(c)    Section 8.2 of the Credit Agreement is hereby amended and restated as follows:



8.2 Minimum Availability. At all times on and after the Eighth Amendment Effective Date, Borrower will not permit Availability to be less than an amount equal to 20% of the Revolving Line Cap.



2.    Representations and Warranties. Borrower hereby represents and warrants to Bank that as of the date hereof:



(a)    The execution, delivery and performance of this Amendment has been duly authorized by all requisite corporate action on the part of Borrower;



(b)    No Default or Event of Default has occurred and is continuing or shall be caused by the transactions contemplated by this Amendment; and


 



(c)    The representations and warranties set forth in the Credit Agreement, as amended hereby, and in the other Loan Documents, as amended to date, are true and correct in all material respects as of the date hereof, with the same effect as though made on the date hereof (except to the extent such representations and warranties expressly refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date).



3.    Conditions Precedent to Effectiveness. The effectiveness of this Amendment is subject to the prior or concurrent consummation of each of the following conditions:



(a)    Bank shall have received a copy of this Amendment executed by

Borrower; and



(b)    No Default or Event of Default shall have occurred or be continuing after giving effect to this Amendment.



4.    Miscellaneous.



(a)    Governing Law. THIS AMENDMENT SHALL BE SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.



(b)    Counterparts. This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by facsimile, .pdf or other similar method of electronic transmission shall be equally effective as delivery of a manually executed counterpart.



(c)    Reference to Credit Agreement. Each reference in the Credit Agreement  to "this Agreement," "hereunder," "hereof," "herein" or words of like import, and each reference in the Credit Agreement or in any other Loan Documents, or other agreements, documents or other instruments executed and delivered pursuant to the Credit Agreement, shall mean and be a reference to the Credit Agreement as amended by this Amendment.



(d)    Costs and Expenses. Borrower acknowledges that Section 10.3 of the Credit Agreement applies to this Amendment and the transactions, agreements and documents contemplated hereunder.

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(e)    Release.



(i)    In consideration of the agreements of Bank contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, on behalf of itself and its successors and assigns, and its present and former members, managers, shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Borrower and all such other Persons being hereinafter referred to collectively as the "Releasing Parties" and individually as a "Releasing Party"), hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges Bank, and its successors and assigns, and its present and former shareholders, members, managers, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents, legal representatives and other representatives (Bank and all such other Persons being hereinafter referred to collectively as the "Releasees" and individually as a "Releasee"), of and from any and all demands, actions, causes of action, suits, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a "Claim" and collectively, "Claims") of every kind and nature, known or unknown, suspected or unsuspected, at law or in equity, which any Releasing Party or any of its successors, assigns, or other legal representatives may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the date of this Amendment, including, without limitation, for or on account of, or in relation to, or in any way in connection with this Amendment, the Credit Agreement, and any of the other Loan Documents or any of the transactions hereunder or thereunder. Releasing Parties hereby represent to the Releasees that they have not assigned or transferred any interest in any Claims against any Releasee prior to the date hereof.



(ii)    Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense to any Claim and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.



(iii)    Borrower agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered will affect in any manner the final, absolute and unconditional nature of the release set forth above..



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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their duly authorized officers as of the date first above written.





 

 



BORROWER:



 

 



SIGMATRON INTERNATIONAL, INC.



 

 



By:

/s/ Gary R. Fairhead



Name:

Gary R. Fairhead



Title:

CEO



 

 



U.S. BANK NATIONAL ASSOCIATION,



as Bank



 

 



By:

/s/ Ari Kaplan



Name:

Ari Kaplan



Title:

Senior Vice President



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