EXHIBIT 10.54
AMENDMENT TO LOAN AND SECURITY AGREEMENT
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This Amendment to Loan and Security Agreement ("Amendment") is made as of
March 16, 1998, by and between THE CIT GROUP/EQUIPMENT FINANCING, INC.
("Lender") and DSN CORPORATION ("Borrower").
WHEREAS, Lender and Borrower entered into a Loan and Security Agreement
dated as of October 31, 1994, as amended, a Loan and Security Agreement dated as
of April 5, 1995, as amended, and a Loan and Security Agreement dated as of
November 15, 1995, as amended (collectively, "Loan Agreement") pursuant to which
Lender made certain loans and advances (collectively, "Loans") to Borrower upon
the terms and conditions set forth in the Loan Agreements and the related Loan
Documents; and
WHEREAS, pursuant to that certain Amendment to Loan and Security Agreement
dated as of November 2, 1997, Lender agreed to, among other things, the
establishment of minimum Adjusted Tangible Net Worth amounts and Debt to Worth
Ratios for ClimaChem, Inc. ("ClimaChem"); and
WHEREAS, Borrower has requested that Lender waive ClimaChem's noncompliance
ClimaChem's Adjusted Tangible Net Worth and Debt to Worth Ratio as at December
31, 1997, and that Lender agree to reset such covenants on a quarterly basis for
1998;
WHEREAS, Lender has agreed to the waiver and modification to the Loan
Agreements as set forth in this Amendment.
NOW, THEREFORE, in consideration of the terms and conditions herein, and of
any loans or other credit facilities heretofore, now or hereafter made to or for
the benefit of Borrower by Lender, the parties hereto agree to the following
amendment to each of the Loan Agreements:
1. Tangible Net Worth. Section 6.10 of each of the Loan Agreements is
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amended and restated in its entirety to read as follows:
"Tangible Net Worth. ClimaChem shall maintain at all times, on a
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consolidated basis, a minimum Adjusted Tangible Net Worth and shall
not exceed a Debt to Worth Ratio as provided in Exhibit "A" attached
hereto. Such financial covenant shall be measured as of the dates
provided in Exhibit "A." The term "Tangible Net Worth" is defined as
total stockholder equity after deducting any treasury stock plus
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deferred income tax liability less all assets that are considered
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intangible assets under GAAP."
2. Representations and Warranties. Borrower represents and warrants as
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follows:
(a) Each of the representations and warranties contained in each of
the Loan Agreements is, except where date specific to a different time,
hereby reaffirmed as of the date hereof, each as if set forth herein;
(b) The execution, delivery and performance of this Amendment are
within Borrower's powers, have been duly authorized by all necessary
action, have received all necessary approvals, if any, and do not
contravene any law or any contractual restrictions binding on Borrower;
(c) This Amendment is a legal, valid and binding obligation of
Borrower, enforceable against Borrower in accordance with its terms; and
(d) No event has occurred and is continuing or would result from this
Amendment which constitutes a Default or Event of Default under the Loan
Agreements, as amended and modified hereby.
3. Further Assurances. Borrower shall, at its expense, do, execute and
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deliver to Lender such further acts and documents as the Lender shall, from time
to time, require for assuring and confirming to Lender the rights created or
intended to be created in connection with this Amendment or for carrying out the
intention or facilitating the performance of the terms of any Loan Document or
for assuring the validity, perfection, priority or enforceability of any Lien
under any Loan Document.
4. Miscellaneous. This Amendment shall be part of each of the Loan
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Agreements, the terms of which are incorporated herein, and the breach of any
representation, warranty or covenant contained herein, shall constitute an Event
of Default under each of the Loan Agreements and Lender shall be entitled to
exercise all rights and remedies it may have under the Loan Agreements and
applicable law. Borrower agrees to pay all costs, expenses and attorneys' fees
incurred by Lender in connection with the negotiation and preparation of this
Amendment and any other documents in connection herewith and in carrying out or
enforcing the terms of this Amendment. Lender is not waiving any rights under
any of the Loan Agreements and, except as previously provided herein or as
previously modified in a writing signed by Lender, all of the terms, covenants,
and conditions of each of the Loan Agreements remain unmodified and in full
force and effect. Capitalized terms used herein and not otherwise defined shall
have the same meaning as set forth in the Loan Agreements. This Amendment may
be executed in counterparts, which counterparts, when so executed and delivered,
shall together constitute but one original.
5. Effective Date. This Amendment shall be effective upon execution by
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the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to be
effective as of the first date above written.
"Borrower" "Lender"
DSN CORPORATION THE CIT GROUP/EQUIPMENT
FINANCING, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxx, Jr.
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Its: President Its: Vice President
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In order to induce Lender to execute the above Amendment, each of the
undersigned hereby represents, warrants and agrees that the undersigned has
reviewed and approved the Amendment and agrees that nothing contained therein
shall diminish, alter, amend or otherwise affect the undersigned's obligations
under its Guaranty to Lender ("Guaranty"). Each of the undersigned further
confirms that its Guaranty shall continue in full force and effect and agrees
that it continues to be liable under such Guarantor in accordance with the tenor
and effect thereof. Each of the undersigned consents to the transactions
contemplated in connection with the Amendment. Each of the undersigned further
confirms that it has no defense, counterclaim or offset right whatsoever with
respect to its obligations under its Guaranty.
LSB CHEMICAL CORP.,
an Oklahoma corporation
By: /s/ Xxxx X. Xxxxxx
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Its: V. P.
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CLIMACHEM, INC.
an Oklahoma corporation
By: /s/ Xxxx X. Xxxxxx
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Its: V. P.
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EXHIBIT "A"
Tangible Net Worth Debt to Worth Ratio
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. March 31, 1998 27,487,000 6.235:1
. June 30, 1998 29,923,000 5.637:1
. September 30, 1998 31,559,000 5.130:1
. December 31, 1998 32,674,000 4.907:1
