Exhibit 10.6(k)
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LETTER AMENDMENT TO THE REVOLVING CREDIT AND
LETTER OF CREDIT AGREEMENT
Letterhead of Mercantile Safe Deposit & Trust Company
Xxxxxx X. Xxxxxxx
Senior Vice President
(000) 000-0000
(000) 000-0000 (fax)
March 11, 2002
Xx. Xxxx X. Xxxx, President
Environmental Elements Corporation
P. O. Box 1318
Xxxxxxxxx, Xxxxxxxx 00000
Dear Xxxx:
Reference is made to the Revolving Credit and Letter of Credit Agreement
dated November 24, 1993 as amended by and among Environmental Elements
Corporation and Mercantile-Safe Deposit & Trust Company. The Mercantile Board
of Directors has approved the following revisions to the Agreement:
1. The maturity date will be extended two years from April 1, 2002 to April
1, 2004.
2. The monthly borrowing base calculation that is used to determine the
portion of the $15,000,000 facility that can be accessed for borrowings
and letters of credit shall be revised. The new calculation will be
based on 80% of eligible accounts receivable, 50% of retainage, and 50%
of unbilled costs under 120 days.
3. It shall constitute a default under the Agreement if Environmental
Elements Corporation has a pretax profit of less than $500,000 for the
six month period ending September 30, 2002. Also, a default will occur
if EEC has a pretax profit of less than $500,000 for the six month
period from October 1, 2002 to March 31, 2003.
Please do not hesitate to contact me if you have any questions concerning the
above terms. By copy of this letter, I am requesting that J. Xxxxxxx Xxxxxxx,
Esq. draft an amendment to the loan documentation reflecting the changes.
Very truly yours,
Xxxxxx X. Xxxxxxx
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