EXHIBIT 4.3
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October 17, 2002
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Nematron Corporation
0000 Xxxxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx, President and CEO
Re: Loans by LaSalle Business Credit, Inc.
Dear Xx. Xxxxxx:
Reference is made to that certain Xxxxxxx and Restated Loan
and Security Agreement dated as of June 30, 2000, as heretofore and hereafter
amended, amended and restated or otherwise modified from time to time (the
"Agreement"), by and between Nematron Corporation ("Borrower") and LaSalle
Business Credit, Inc. ("Lender"). Each term set out herein and not otherwise
defined shall have the meaning ascribed to such term in the Agreement.
By our letters to you dated October 3, 2001 and February 18,
2002, we notified you that Borrower is and remains in default (collectively, the
"Defaults") under the Agreement. The Defaults have not been cured or waived. The
terms of the Agreement provide that Lender may, as a result of any Event of
Default, including any Default, accelerate the payment of all Liabilities.
Borrower acknowledges the existence of each Default.
Xxxxxx has requested that Xxxxxxxx obtain alternative
financing, and Xxxxxxxx hereby agrees to use its best efforts to obtain such
alternate financing. Xxxxxxxx has therefore requested that Xxxxxx not
immediately accelerate the payment of the Liabilities, and that Lender, for the
moment, allow both parties to the Agreement to proceed under the terms of the
Agreement. In the event Borrower and each guarantor set forth herein executes
this letter and returns same to Lender on or before October 25, 2002, Xxxxxx
hereby agrees to allow both parties to proceed under the terms of the Agreement
(as such terms are amended herein) until further notice to Xxxxxxxx, provided as
follows:
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(a) That there occurs no additional Event of Default;
(b) That there occurs no material adverse change (as determined by Lender
in its sole discretion) in Borrower or in its business;
(c) That Borrower shall use its continuing best efforts to refinance all of
the Liabilities with another lender as soon as practicable; and
(d) That Borrower agrees that the Agreement is hereby amended as follows:
(i) The definition of "Revolving Loan Commitment" is hereby amended and
restated to read in its entirety as follows: ""Revolving Loan Commitment"
shall mean One Million Five Hundred Thousand Dollars ($1,500,000)."
(ii) The definition of "Total Commitment" is hereby amended and restated to read
in its entirety as follows: ""Total Commitment" shall mean One Million Five
Hundred Thousand Dollars ($1,500,000)."
(iii)Paragraph 4 of the Agreement is hereby amended by deleting the amount "Two
Million Five Hundred Thousand Dollars ($2,500,000)" and inserting the
amount "Two Hundred Fifty Thousand Dollars ($250,000)" in lieu thereof.
Borrower hereby (a) ratifies and affirms its obligations under
the Agreement; (b) denies and waives the existence of any defenses relating to
its obligations under the Agreement; and (c) waives and releases any claims or
causes or action against Lender which may now or hereafter be available to it
arising out of (i) the administration of the Agreement or the Other Agreements,
(ii) the negotiation and execution of this letter, or (iii) any other matter
pertaining to the Agreement or the Other Agreements.
Each of the undersigned guarantors hereby (a) ratifies and
affirms its individual and several obligations under its respective Continuing
Unconditional Guaranty executed by each guarantor in favor of Lender; (b)
acknowledges and confirms that each Continuing Unconditional Guaranty continues
in full force and effect notwithstanding this letter; (c) denies and waives the
existence of any defenses relating to any of such Continuing Unconditional
Guaranties; and (d) waives and releases any claims or causes or action against
Lender which may now or hereafter be available to any guarantor arising out of
(i) the administration of the Agreement or the Other Agreements, (ii)
negotiation and execution of this letter, or (iii) any other matter pertaining
to the Agreement or the Other Agreements; provided, however, that the failure of
any guarantor to execute this letter shall not release such guarantor or any
other guarantor of its respective obligations under any of the Continuing
Unconditional Guaranties.
By this letter Lender does not waive any Default, nor any
previous Events of Default about which you have been notified. This letter is
being written with Lender reserving all of its rights to exercise any and all of
Xxxxxx's remedies, as provided in the Agreement and in all the Other Agreements,
at such time and in such manner as provided therein. Nothing herein shall be
construed or interpreted as being a waiver of any of Lender's rights or remedies
(as provided to Lender under the terms of the Other Agreements, the Uniform
Commercial Code or otherwise), by virtue of its forbearance to date (it being
understood that Lender has no obligation to continue to forbear) or extension
with respect thereto.
Very truly yours,
LASALLE BUSINESS CREDIT, INC.
By /s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx, First Vice President
Accepted and agreed to this day of October, 2002.
NEMATRON CORPORATION
By s/s Xxxxx X. Xxxxxxx
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Its Secretary
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Consented and agreed to by
the following guarantors of
the obligations of Nematron Corporation
to LaSalle Business Credit, Inc.
A-OK CONTROLS ENGINEERING, INC. OPTIMATION, INC.
By /s/ Xxxxx X. Xxxxxxx By /s/ Xxxxx X. Xxxxxxx
Its Secretary Its Secretary
Date: October 24, 2002 Date: October 24, 2002
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