EXHIBIT 10.46
Manufacturers and Traders Trust Company
M&T Place, 000 Xxxx Xxxxxx
X.X. Xxx 00000, Xxxxxxxxx, XX 00000
February 19, 1999
Xx. Xxxxxx XxXxxxxxx
Senior Vice President & CFO
CVC Products, Inc.
000 Xxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Re: Loan Agreement Dated March 31, 1998
Dear Xxxxxx:
Reference is made to the Loan Agreement (the "Agreement") dated March 31, 1998,
amended as per Letter Agreement dated September 30, 1998, between CVC Products,
Inc. (the "Borrower") and M&T Bank (the "Bank"). We hereby further amend the
agreement as follows:
Insert #1 - b (viii) "Borrowing Base", shall also include a sub-limit for
demonstration inventory/equipment at an advance rate of 25% to a maximum of
$1,000,000.00 and to also include up to $500,000.00 in a second collateral
mortgage against the value of the company's real estate at 000 Xxx Xxxx,
Xxxxxxxxx, Xxx Xxxx. The $500,000.00 collateral mortgage availability is subject
to completion of an increase in the Bank's mortgage lien by $500,000.00.
b (ix) - Borrower will submit Borrowing Base Certificate within 30 days after
the end of each calendar month and as further detailed in this paragraph of the
agreement.
Insert #6, b - Tangible Net Worth covenant as amended in September 30, 1998,
letter shall strike the final phrase "plus the increase in tangible net worth as
a result of any private equity placement or public offering".
Paragraph d - Cash flow ratio as of January 31, 1999, 1.30:1.
Paragraph g - Capital expenditure limitation for fiscal year ending September
30, 1999, or any fiscal year thereafter shall be $6,000,000.00 and shall be
calculated net of any cash proceeds from the sale of any demonstration tools
which are capitalized in Borrower's fixed assets.
Xx. Xxxxxx XxXxxxxxx
Senior Vice President & CEO
CVC Products, Inc.
February 19, 1999
Page 2
We will have Xxxxx, Xxxxxx prepare amended loan documentation and the new
collateral mortgage once you have completed your due diligence and analysis with
respect to the pending Commonwealth Scientific merger as it may relate to any
loan covenants in the agreement. The Borrower will pay all fees and expenses
incurred in loan documentation, including closing costs, attorneys' fees,
environmental audit, etc. associated with this transaction. Borrower
acknowledges that not every ancillary provision imposing duties, burdens, or
limitations on Borrower and to be contained in the final documentation customary
for these types of transactions can be set forth in this letter.
Except as amended above, all other covenants, financial covenants, terms and
conditions of this agreement remain in effect. This amendment shall be
conditioned upon the acceptance by the Borrower and the Guarantor as indicated
below.
Sincerely,
MANUFACTURERS AND TRADERS TRUST COMPANY
/s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Vice President
WEH/ac
Accepted as of March 8, 1999
CVC PRODUCTS, INC.
/s/ Xxxxxx XxXxxxxxx
-----------------------------
Borrower
CVC PRODUCTS, INC.
/s/ Xxxxxx XxXxxxxxx
-----------------------------
Guarantor
