FIRST AMENDMENT TO CREDIT AND SECURITY AGREEMENT

Exhibit 10.2

THIS FIRST AMENDMENT TO CREDIT AND SECURITY AGREEMENT (this “Agreement”), entered into as of September 8, 2016, is made and entered into by and among SCM SPECIALTY FINANCE OPPORTUNITIES FUND, L.P., a Delaware limited partnership (“Lender”) and TRANS-LUX CORPORATION, a Delaware corporation (“Trans-Lux”), TRANS-LUX DISPLAY CORPORATION, a Delaware corporation (“TDC”), TRANS-LUX MIDWEST CORPORATION, an Iowa corporation (“TMC”), TRANS-LUX ENERGY CORPORATION, a Connecticut corporation (“TEC”, and together with Trans-Lux, TDC, and TMC, individually and collectively, “Borrower”).

WHEREAS, Borrower and Lender are parties to that certain Credit and Security Agreement dated as of July 12, 2016 (as the same may from time to time be amended, restated, supplemented or otherwise modified, collectively, the “Credit Agreement”), pursuant to which, subject to the terms and conditions set forth therein, Lender has made certain credit facilities available to Borrower. The Credit Agreement and all instruments, documents and agreements executed in connection therewith, or related thereto are referred to herein collectively as the “Existing Loan Documents.”

WHEREAS, Borrower has requested and Lender has agreed to, among other things, amend the terms and conditions of the Existing Loan Documents pursuant to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the foregoing premises, the mutual covenants and conditions herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Defined Terms. Initially capitalized terms used herein and not defined herein that are defined in the Credit Agreement shall have the meanings assigned to them in the Credit Agreement (as amended hereby).

2. Amendments to Credit Agreement. The Credit Agreement is hereby amended as follows:

(a) Section 1.2 of the Credit Agreement is hereby amended by adding the following defined terms thereto in appropriate alphabetical order as follows:

“BFI Capital Subordinated Creditor” means BFI CAPITAL FUND II, LLC, a Delaware limited liability company, including its successors and assigns as permitted hereunder.

“BFI Capital Subordination Agreement” means that certain Mutual Lien Intercreditor Agreement dated as of September 8, 2016 by and between BFI Capital Subordinated Creditor and Lender and acknowledged by Trans-Lux.

“BFI Capital Subordinated Debt” means any Indebtedness of Borrowers incurred pursuant to the terms of the BFI Capital Subordinated Debt Documents.

“BFI Capital Subordinated Debt Documents” means (i) that certain Credit Agreement between Trans-Lux and BFI Capital Subordinated Creditor dated as of September 8, 2016, (ii) that certain Promissory Note in the principal sum of up to $750,000.00 made by Trans-Lux payable to the order of BFI Capital Subordinated Creditor, dated as of September 8, 2016, (iii) that certain Security Agreement between Trans-Lux and BFI Capital Subordinated Creditor dated as of September 8, 2016, and (iv) each of the other documents, instruments and agreements executed and delivered in connection therewith, each as amended, restated, supplemented or otherwise modified from time to time as permitted hereunder.

(b) The following defined terms contained in Section 1.2 of the Credit Agreement are hereby amended and restated in their entirety as follows:

“Subordination Agreement” means each agreement, including the Closing Date Subordination Agreement and BFI Capital Subordination Agreement, between Lender and another creditor of Borrowers, as the same may be amended, supplemented, restated or otherwise modified from time to time in accordance with the terms thereof, pursuant to which the Indebtedness owing from any Borrower(s) and/or the Liens securing such Indebtedness granted by any Borrower(s) to such creditor are subordinated in any way to the Obligations and the Liens created under the Loan Documents, the terms and provisions of such Subordination Agreements to have been agreed to by and be acceptable to Lender in the exercise of its sole discretion.

“Subordinated Debt” means any Indebtedness, including the Closing Date Subordinated Debt, the Note and Debenture Subordinated Debt and the BFI Capital Subordinated Debt, of Borrowers incurred pursuant to the terms of the Subordinated Debt Documents and with the prior written consent of Lender, all of which documents must be in form and substance acceptable to Lender in its sole discretion.

“Subordinated Debt Documents” means (i) any documents evidencing and/or securing Debt governed by a Subordination Agreement, including the Closing Date Subordinated Debt Documents and the BFI Capital Subordinated Debt Documents, and (ii) the Note and Debenture Subordinated Debt Documents, which are subordinated by their terms, all of which documents must be in form and substance acceptable to Lender in its sole discretion.

(c) Subsection (ix) of the definition of “Permitted Indebtedness” contained in Section 1.2 of the Credit Agreement is hereby amended and restated as follows:

(ix) the Closing Date Subordinated Debt, the Note and Debenture Subordinated Debt and the BFI Capital Subordinated Debt;

(d) The definition of “Permitted Liens” contained in Section 1.2 of the Credit Agreement is hereby amended by (i) deleting the “and” at the end of subsection (m), (ii) replacing the “.” at the end of subsection (n) with “; and” and (iii) adding a new subsection (o) immediately following subsection (n) to read as follows:

(o) Liens and encumbrances in favor of BFI Capital Subordinated Creditor pursuant to the BFI Capital Subordinated Debt Documents to the extent permitted under the BFI Capital Subordination Agreement.

(e) A new Section 6.16 is hereby added to the Credit Agreement in appropriate numerical order as follows:

6.16 BFI Capital Collateral Account.

Until all of obligations to BFI Capital Subordinated Creditor under the BFI Capital Subordinated Debt Documents have been indefeasibly paid in full in cash, and performed in favor of BFI Capital Subordinated Creditor and the BFI Capital Subordinated Debt Documents have been terminated, Borrower shall direct each Account Debtor relating to the Creditor’s Senior Collateral (as defined in the BFI Capital Subordination Agreement) to make payments to People’s United Bank account number 0337014602.

(f) Section 7.5 of the Credit Agreement is hereby amended by replacing “the Closing Date Subordination Agreement” therein with “the Closing Date Subordination Agreement and the BFI Capital Subordination Agreement”.

(g) Section 7.9 of the Credit Agreement is hereby amended by replacing each reference to “the Closing Date Subordinated Debt Documents,” therein with “the Closing Date Subordinated Debt Documents, the BFI Capital Subordinated Debt Documents,”.

(h) Section 7.12 of the Credit Agreement is hereby amended by adding subsection heading “(a)” at the beginning of the section, and adding new subsection (b) immediately following subsection (a) as follows:

(b) Notwithstanding anything to the contrary contained herein, so long as no Event of Default exists under the Loan Documents, Borrower may pay BFI Capital Subordinated Creditor the following amounts with respect to the obligations to BFI Capital Subordinated Creditor: regularly scheduled monthly interest payments as set forth in the BFI Capital Subordinated Creditor Debt Documents at a rate not to exceed 10.00% per annum (the “Regular Monthly Payments”). Regular Monthly Payments shall not include any prepayments of principal or interest. Furthermore, Borrower may (i) prepay the principal and/or interest as set forth in the BFI Capital Subordinated Creditor Debt Documents and/or (ii) pay BFI Capital Subordinated Creditor on the Maturity Date (as defined in the BFI Capital Subordinated Creditor Debt Documents) the balloon principal payment of the total outstanding principal amount of the indebtedness in an amount of up to $750,000, plus any accrued interest and other note related charges due and owing as set forth in the BFI Capital Subordinated Creditor Debt Documents (the “Final Balloon Payment”); provided, however, Borrower shall only be permitted to make such payment(s) to the extent Lender has received from Borrower a certificate, in form and substance reasonably satisfactory to Lender, signed on behalf of Borrower by a duly authorized officer of Borrower and dated as of the date of such payment(s) certifying, among other things, (i) that no Event of Default exists under the Loan Documents or would result from the making of such payment(s) and (ii) all supporting documentation.

(i) Section 8.1 of the Credit Agreement is hereby amended by (i) deleting the “or” at the end of subsection (l), (ii) replacing the “.” at the end of subsection (m) with “; or” and (iii) adding a new subsection (n) immediately following subsection (m) to read as follows:

(n) Any Credit Party is in default, which default is not cured within any applicable grace period or cure period or waived, under any BFI Capital Subordinated Debt Document.

3. Representations and Warranties. Borrower represents and warrants to Lender that, before and after giving effect to this Agreement:

(a) All warranties and representations made to Lender under the Credit Agreement and the Loan Documents are accurate in all material respects on and as of the date hereof as if made on and as of the date hereof, before and after giving effect to this Agreement.

(b) The execution, delivery and performance by each Credit Party of this Agreement and any assignment, instrument, document, or agreement executed and delivered in connection herewith and the consummation of the transactions contemplated hereby and thereby (i) have been duly authorized by all requisite action of the appropriate Credit Party and have been duly executed and delivered by or on behalf of such Credit Party; (ii) do not violate any provisions of (A) applicable law, statute, rule, regulation, ordinance or tariff, (B) any order of any Governmental Authority binding on any Credit Party or any of the Credit Parties’ respective properties the effect of which would reasonably be expected to have a Material Adverse Effect, or (C) the certificate of incorporation or bylaws (or any other equivalent governing agreement or document) of each Credit Party, or any agreement between any Credit Party and its shareholders, members, partners or equity owners or among any such shareholders, members, partners or equity owners; (iii) are not in conflict with, and do not result in a breach or default of or constitute an Event of Default, or an event, fact, condition, breach, Default or Event of Default under, any indenture, agreement or other instrument to which any Credit Party is a party, or by which the properties or assets of any Credit Party are bound, the effect of which would reasonably be expected to have a Material Adverse Effect; (iv) except as set forth herein, will not result in the creation or imposition of any Lien of any nature upon any of the properties or assets of any Credit Party, and (v) do not require the consent, approval or authorization of, or filing, registration or qualification with, any Governmental Authority or Credit Party unless otherwise obtained.

(c) This Agreement and any assignment, instrument, document, or agreement executed and delivered in connection herewith constitutes the legal, valid and binding obligation of each respective Credit Party, enforceable against such Credit Party in accordance with its respective terms.

(d) No Default or Event of Default has occurred and is continuing or would exist under the Credit Agreement or any of the Loan Documents, before and after giving effect to this Agreement.

4. Conditions Precedent. The amendments set forth in Section 2 shall be effective upon completion of the following conditions precedent (with all documents to be in form and substance satisfactory to Lender and Lender’s counsel):

(a) Lender shall have received this Agreement duly executed by Borrower;

(b) Lender shall have received the BFI Capital Subordination Agreement duly executed by all parties thereto, dated of even date herewith;

(d) Borrower shall have executed and/or delivered such additional documents, instruments and agreements as requested by Lender; and

(e) Payment of all fees, charges and expenses payable to Lender on or prior to the date hereof, if any, and an amendment fee which Borrowers hereby agree Lender has fully earned as of the date hereof in an amount equal to One Thousand Five Hundred and No/100 Dollars ($1,500). Borrower hereby authorizes Lender to charge such fees, charges and expenses against the Borrowing Base.

5. Miscellaneous.

(a) Reference to the Effect on the Credit Agreement. Upon the effectiveness of this Agreement, each reference in (i) the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of similar import or (ii) the other Loan Documents to “the Credit Agreement” shall mean and be a reference to the Credit Agreement as amended by this Agreement.

(b) Ratification. Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Credit Agreement and the Loan Documents effective as of the date hereof.

(c) Release. By execution of this Agreement, Borrower acknowledges and confirms that Borrower does not have any actions, causes of action, damages, claims, obligations, liabilities, costs, expenses and/or demands of any kind whatsoever, at law or in equity, matured or unmatured, vested or contingent arising out of or relating to this Agreement, the Credit Agreement or the other Loan Documents against any Released Party (as defined below), whether asserted or unasserted. Notwithstanding any other provision of any Loan Document, to the extent that such actions, causes of action, damages, claims, obligations, liabilities, costs, expenses and/or demands may exist, Borrower voluntarily, knowingly, unconditionally and irrevocably, with specific and express intent, for and on behalf of itself, its managers, members, directors, officers, employees, stockholders, Affiliates, agents, representatives, accountants, attorneys, successors and assigns and their respective Affiliates (collectively, the “Releasing Parties”), hereby fully and completely releases and forever discharges Lender, its Affiliates and its and their respective managers, members, officers, employee, Affiliates, agents, representatives, successors, assigns, accountants and attorneys (collectively, the “Indemnified Persons”) and any other Person or insurer which may be responsible or liable for the acts or omissions of any of the Indemnified Persons, or who may be liable for the injury or damage resulting therefrom (collectively, with the Indemnified Persons, the “Released Parties”), of and from any and all actions, causes of action, damages, claims, obligations, liabilities, costs, expenses and demands of any kind whatsoever, at law or in equity, matured or unmatured, vested or contingent, that any of the Releasing Parties has against any of the Released Parties, arising out of or relating to this Agreement, the Credit Agreement and the other Loan Documents which Releasing Parties ever had or now have against any Released Party, including, without limitation, any presently existing claim or defense whether or not presently suspected, contemplated or anticipated.

(d) Security Interest. Borrower hereby confirms and agrees that all security interests and liens granted to Lender continue in full force and effect and shall continue to secure the Obligations. All Collateral remains free and clear of any liens other than liens in favor of Lender and Permitted Liens. Nothing herein contained is intended to in any way impair or limit the validity, priority and extent of Lender’s existing security interest in and liens upon the Collateral.

(e) Costs and Expenses. Borrower agrees to pay on demand all usual and customary costs and expenses of Lender and/or its Affiliates in connection with the preparation, execution, delivery and enforcement of this Agreement and all other agreements and instruments executed in connection herewith, including, including without limitation reasonable attorneys’ fees and expenses of Lender’s counsel.

(f) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW PROVISIONS.

(g) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original, and such counterparts together shall constitute one and the same respective agreement. Signatures sent by facsimile or electronic mail shall be deemed originals for all purposes and shall bind the parties hereto.

(h) Loan Document. This Agreement and any assignment, instrument, document, or agreement executed and delivered in connection with or pursuant to this Agreement shall be deemed to be a “Loan Document” under and as defined in the Credit Agreement for all purposes.

[Signature Pages Follow.]

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the date first hereinabove written.

BORROWER:	TRANS-LUX CORPORATION, a Delaware corporation
	TRANS-LUX DISPLAY CORPORATION, a Delaware corporation
	TRANS-LUX MIDWEST CORPORATION, an Iowa corporation
	TRANS-LUX ENERGY CORPORATION, a Connecticut corporation


	By:	/s/ Xxxx Xxxxx
	Name:	Xxxx Xxxxx
	Title:	Vice President and Controller
	As Vice President and Controller of each of the above entities and, in such capacity, intending by this signature to legally bind each of the above entities

Signature Page to First Amendment to Credit and Security Agreement

LENDER:	SCM SPECIALTY FINANCE OPPORTUNITIES FUND, L.P., a Delaware limited partnership


	By:	/s/ Xxxxxxx X. Xxxx
	Name:	Xxxxxxx X. Xxxx
	Title:	Authorized Signatory

Signature Page to First Amendment to Credit and Security Agreement

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FIRST AMENDMENT TO CREDIT AND SECURITY AGREEMENT

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