Exhibit 4.2
NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
This Ninth Amendment to Loan and Security Agreement (the "Ninth
Amendment") is made as of December 27, 2002, by and between TransPro, Inc.
("TransPro"), Ready Aire, Inc., GO/XXX Industries, Inc. ("GO/XXX"), and G&O
Manufacturing Company, Inc. as borrowers (individually, each a "Borrower" and
collectively, the "Borrowers"), GO/XXX de Mexico, SA de C.V. and Radiadores GDI,
SA de C.V., (each an "Obligor", and collectively, the "Obligors", as defined in
the Loan Agreement (defined hereinafter)) and CONGRESS FINANCIAL CORPORATION
(NEW ENGLAND), as lender (the "Lender").
WHEREAS, the Lender and Borrowers entered into that certain Loan and
Security Agreement dated as of January 4, 2001, as amended (the "Loan
Agreement");
WHEREAS, GO/XXX pledged substantially all of the assets possessed and
used by the Obligors to provide in-bond manufacturing services for the benefit
of GO/XXX as security for the Borrowers' obligations under the Financing
Agreements pursuant to that certain Pledge Contract Without Transmission of
Possession dated as of January 31, 2001 ("Pledge Contract");
WHEREAS, the Borrowers have requested that the Lender agree to increase
the Maximum Credit and Revolving Loan Ceiling, to amend certain other provisions
of the Loan Agreement and to consent to the Borrowers' purchase of substantially
all of the aftermarket related assets ("Transferred Assets") of the heater
products business of Fedco Corporation ("Seller") pursuant to that certain Asset
Purchase Agreement dated as of December 27, 2002 ("Asset Purchase Agreement")
and the instruments, agreements, and documents entered into pursuant thereto
and/or in connection therewith (collectively, the "Purchase Agreements");
WHEREAS, the Lender has agreed to increase the Maximum Credit and
Revolving Loan Ceiling, to amend certain other provisions of the Loan Agreement
and to consent to the Borrowers' purchase of the Transferred Assets pursuant to
the Asset Purchase Agreement and the Purchase Agreements subject to the terms
and conditions hereof;
NOW THEREFORE, based on these premises, and in consideration of the
mutual promises contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged by the parties, the
Borrowers, the Obligors and the Lender hereby agree as follows:
1. Amendments to Loan Agreement.
1.1. Preamble to Loan Agreement. The Preamble to the Loan
Agreement, immediately preceding the recitals, hereby is deleted in its entirety
and the following is substituted in lieu thereof:
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"This Loan and Security Agreement dated January 4, 2001 is
entered into by and between Congress Financial Corporation (New
England), a Massachusetts corporation ("Lender") and TransPro,
Inc., a Delaware corporation ("TransPro"), Ready Aire, Inc., a
Texas corporation ("Evap"), GO/XXX Industries, Inc., a Delaware
corporation ("GDI" or "GO/XXX") and G&O Manufacturing Company,
Inc. ("G&O") (TransPro, Evap, GDI and G&O are each referred to
herein as a "Borrower" and are collectively referred to as
"Borrowers")."
1.2. Definition of Applicable Eurodollar Margin. Section 1 of the
Loan Agreement is hereby amended to insert the following definition of
"Applicable Eurodollar Margin" as Section 1.3A after Section 1.3:
"1.3A 'Applicable Eurodollar Margin' shall mean the rate set
forth below as determined by the ratio ('Fixed Charge Ratio') of
TransPro's consolidated EBITDA (as defined below) to consolidated
Fixed Charges (as defined below) for the most recent fiscal year
of the Borrowers:
Fixed Charge Ratio Applicable Eurodollar Margin
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Greater than or equal to 1.25x 2.25%
Greater than or equal to
1.00x and less than 1.25x 2.50%
Less than 1.00x 2.75%
The Applicable Eurodollar Margin shall be 2.5% until Lender's
receipt of Borrowers' audited financial statements satisfying the
requirements of Section 9.6(a)(ii) of the Loan Agreement for
Borrower's fiscal year ending December 31, 2002 and shall
thereupon be adjusted, effective upon the first day of the
calendar month after receipt of such financial statements based
upon Borrowers' Fixed Charge Ratio for its fiscal year ending
December 31, 2002. Subsequent adjustments shall be effective in
like manner based upon Borrowers' audited financial statements for
subsequent fiscal years.
For purposes of this definition the following defined terms
shall have the following meanings:
'EBITDA' shall mean the sum, without duplication, of the
following as determined on a consolidated basis in accordance
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with GAAP for TransPro and its wholly owned subsidiaries: (a) Net
Income, plus (b) interest expense on all indebtedness, (c) taxes
on income, (d) depreciation expense, (e) amortization expense and
(f) gain or loss from the sale of assets, other than sales in the
ordinary course of business.
'Fixed Charges' shall mean the sum of the following, as
determined on a consolidated basis in accordance with GAAP for
TransPro and its wholly owned subsidiaries: (a) cash interest
expense, plus (b) capital expenditures, plus (c) scheduled or
other required payments of principal on indebtedness, plus (d)
dividends and distributions, plus (e) cash taxes paid.
'Net Income' shall mean the net income (or loss) of TransPro
and wholly owned subsidiaries on a consolidated basis determined
in accordance with GAAP."
1.3. Definition of Interest Rate. The definition of "Interest
Rate" set forth in Section 1.31 of the Loan Agreement hereby is deleted in its
entirety and the following definition is substituted in lieu thereof:
"1.31 'Interest Rate' shall mean, as to Prime Rate Loans, a
rate of zero percent (0.00%) per annum in excess of the Prime Rate
and, as to Eurodollar Rate Loans, a per annum rate equal to the
Applicable Eurodollar Margin plus the Adjusted Eurodollar Rate
(based on the Eurodollar Rate applicable for the Interest Period
selected by Borrowers as in effect three (3) Business Days after
the date of receipt by Lender of the request of Borrowers for such
Eurodollar Rate Loans in accordance with the terms hereof, whether
such rate is higher or lower than any rate previously quoted to
Borrowers); provided, that, the Interest Rate shall mean the rate
of three percent (3%) per annum in excess of the rate applicable
to Prime Rate Loans immediately prior to the event described below
and three percent (3%) per annum in excess of the rate applicable
to Eurodollar Rate Loans immediately prior to the event described
below, at Lender's option, without notice, (a) for the period (i)
from and after the date of termination or non-renewal hereof until
Lender has received full and final payment of all obligations
(notwithstanding entry of a judgment against any Borrower) and
(ii) from and after the date of the occurrence of an Event of
Default for so long as such Event of Default is continuing as
determined by Lender, and (b) on the Revolving Loans at any time
outstanding in excess of the amounts available to Borrowers under
Section 2 (whether or not such excess(es), arise or are made with
or without Lender's knowledge or consent and whether made before
or after an Event of Default), provided that if such excess is the
sole and direct result of an adjustment made by Lender to the
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criteria for Eligible Accounts or Eligible Inventory or to
Availability Reserves, the higher rate of interest provided herein
shall not go into effect until ten (10) days after such adjustment
by Lender became effective and provided that Borrowers shall not
have eliminated such excess within such ten (10) day period. The
Interest Rate shall be subject to further adjustment as provided
in Section 3.1(e) hereof."
1.4. Definition of Maximum Credit. The definition of "Maximum
Credit" set forth in Section 1.37 of the Loan Agreement hereby is
deleted in its entirety and the following definition is
substituted in lieu thereof:
"1.37 'Maximum Credit' shall mean the amount of
$80,000,000.00."
1.5. Definition of Revolving Loan Ceiling. The definition of
"Revolving Loan Ceiling" set forth in Section 1.50 of the Loan Agreement hereby
is deleted in its entirety and the following definition is substituted in lieu
thereof:
"1.50 'Revolving Loan Ceiling' shall mean the amount of
$77,000,000.00."
1.6. Revolving Loans. Section 2.1(a)(i) of the Loan Agreement
hereby is deleted in its entirety and the following is substituted in lieu
thereof:
"(i) the sum of (A) eighty-five percent (85%) of the Net
Amount of Eligible Accounts of GO/XXX to the extent that dilution
does not exceed five percent (5%), provided that Lender may reduce
such advance rate one percent for each percent by which dilution
with respect to GO/DAN's Accounts exceeds five percent (5%) plus,
(B) seventy-five percent (75%) of the Net Amount of Eligible
Accounts of Evap plus, (C) eighty percent (80%) of the Net Amount
of Eligible Accounts of the G&O Division, plus"
1.7. Term Loan. Section 2.3 of the Loan Agreement hereby is
deleted in its entirety and the following is substituted in lieu thereof:
"2.3 Term Loan. The Borrowers issued that certain Amended and
Restated Term Promissory Note in the initial principal amount of
Four Million Three Hundred Seventy Thousand Dollars ($4,370,000)
on March 14, 2001 ("Initial Term Note") to evidence the Term Loan
made by the Lender to the Borrowers as of such date. From March
14, 2001 through the date of the Ninth Amendment, the Borrowers
have made certain interest and principal payments with respect to
such Term Loan, reducing the outstanding obligations under the
Initial Term Note to less than Three Million Dollars ($3,000,000).
On the date of the Ninth
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Amendment, Lender shall make an additional Term Loan to the
Borrowers ("December 2002 Term Loan"), increasing the aggregate
amount of the Term Loan outstanding to Three Million Dollars
($3,000,000). To combine the obligations owed by the Borrowers to
the Lender pursuant to the Initial Term Note and the December 2002
Term Loan, the Borrowers have amended, restated and replaced the
Initial Term Note with the Second Amended and Restated Term
Promissory Note dated as of the date of the Ninth Amendment,
issued in the initial principal amount of Three Million Dollars
($3,000,000) (the "Term Promissory Note"). The Term Promissory
Note (a) shall be repaid, together with interest and other
amounts, in accordance with this Agreement, the Term Promissory
Note, and the other Financing Agreements, and (b) shall be secured
by all the Collateral. The principal amount of the Term Loan shall
be repaid in thirty-six (36) consecutive monthly installments (or
earlier as provided herein) payable on the first day of each month
commencing on February 1, 2003, of which, the first thirty-five
(35) installments shall each be in the amount of $75,000 and the
last installment shall be due on the Renewal Date and shall be in
the amount of the entire unpaid balance of the Term Loan."
1.8. Availability Reserves. Section 2.4 of the Loan Agreement
hereby is deleted in its entirety and the following is substituted in lieu
thereof:
"2.4 Availability Reserves. All Revolving Loans otherwise
available to Borrowers pursuant to the lending formulas and
subject to the Maximum Credit and other applicable limits
hereunder shall be subject to Lender's continuing right to
establish and revise, in good faith, Availability Reserves,
including, without limitation, Availability Reserves in an amount
equal to the amount by which dilution with respect to GO/DAN's
Accounts (as determined in accordance with Section 2.1(b)(i)(A))
in excess of five percent (5%)."
1.9. Term. The first sentence of Section 12(a) of the Loan
Agreement hereby is deleted in its entirety and the following sentence is
substituted in lieu thereof:
"(a) This Agreement and the other Financing Agreements shall
become effective as of the date set forth on the first page hereof
and shall continue in full force and effect until December 27,
2005 (the "Renewal Date"), and from year to year thereafter,
unless sooner terminated pursuant to the terms hereof."
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1.10. Early Termination Fee. Section 12(c) of the Loan Agreement
hereby is deleted in its entirety and the following is substituted in lieu
thereof:
"(c) If for any reason this Agreement is terminated prior to
the end of the then current term or renewal term of this
Agreement, in view of the impracticality and extreme difficulty of
ascertaining actual damages and by mutual agreement of the parties
as to a reasonable calculation of Lender's lost profits as a
result thereof and as a result of Lender's willingness to
foregoing certain fees that would otherwise be payable in a
financing of this kind at the inception and during the term of
this Agreement, Borrowers agree to pay to Lender, upon the
effective date of such termination, an early termination fee in
the amount set forth below if such termination is effective in the
period indicated:
Amount Period
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(i) 1% of Maximum Credit from December 27, 2002 to and
including December 27, 2004;
and
(iii) 0.5% of Maximum Credit December 27, 2004 and
thereafter provided that this
provision shall not constitute
a commitment by Lender to
extend the term beyond the
Renewal Date.
Such early termination fee shall be presumed to be the amount
of damages sustained by Lender as a result of such early
termination and each Borrower agrees that it is reasonable under
the circumstances currently existing. In addition, Lender shall be
entitled to such early termination fee upon the occurrence of any
Event of Default described in Sections 10.1(g) and 10.1(h) hereof,
even if Lender does not exercise its right to terminate this
Agreement, but elects, at its option, to provide financing to
Borrowers or permit the use of cash collateral under the United
States Bankruptcy Code. Lender agrees that if Borrowers refinance
all of the Obligations with Wachovia Bank, National Association,
the parent of the Lender, or if all of the Obligations are
refinanced with the proceeds of an unsecured loan, each, at a time
when no Event of Default has occurred and is continuing, the
applicable early termination fee due Lender minus the portion of
the early termination fee due the Participant(s) shall not be
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required to be paid. The early termination fee provided for in
this Section 12.1 shall be deemed included in the Obligations."
2. Fees.
2.1. Line Increase Fee. Borrowers shall pay a line increase fee to
Lender, fully earned on the date hereof, in an amount equal to One Hundred
Twelve Thousand Five Hundred Dollars ($112,500) ("Line Increase Fee").
2.2. Renewal Fee. Borrowers shall pay a renewal fee to Lender,
fully earned on the date hereof, in an amount equal to Two Hundred Fifty
Thousand Dollars ($250,000) ("Renewal Fee"), provided that One Hundred Twenty
Five Thousand Dollars ($125,000) of the Renewal Fee shall be payable on the date
hereof ("First Installment of Renewal Fee") and that One Hundred Twenty Five
Thousand Dollars ($125,000) of the Renewal Fee shall be payable one year after
the date hereof ("Second Installment of Renewal Fee").
3. $5,000,000 Participant Loan. Lender will use good faith efforts to
place a $5,000,000 participation with a Participant satisfactory to the Lender
and the existing Participant(s). This participation shall reduce the amount of
Loans that Lender and the existing Participant(s) are obligated to make to the
Borrowers by an amount equal to the amount of the participation and in the
discretion of such new participant may be used to provide up to $5,000,000 (in
which Lender and existing Participant(s) will not participate) in a subline
collateralized with Borrowers' and their subsidiaries' Mexican assets subject to
documentation and such conditions as such new participant shall require.
4. Consent.
4.1. Consent to Acquisition of Assets. Subject to the terms and
conditions hereof and notwithstanding Section 6.6 of the Loan Agreement, Lender
hereby consents to the Borrowers' use of a portion of the proceeds of the Loans
to purchase the Transferred Assets pursuant to the Asset Purchase Agreement and
the Purchase Agreements for the aggregate sum of Eight Million Dollars
($8,000,000).
4.2. Consent to Consignment Relationship. Lender hereby consents
to Borrowers entering into the Consignment Sale Agreement and the Consignment
Security Agreement (collectively, "Consignment Agreements") with Outokumpu
Copper Strip AB, Vasteras, Sweden, on its own account and on behalf of Outokumpu
Copper Strip BV, Zutphen the Netherlands, Outokumpu Copper Strip AB, Finspong
Sweden (collectively, the "Consignor") whereby Borrowers may grant to Consignor
a security interest in certain consigned goods and the proceeds thereof subject
to the terms, conditions and limitations set forth in the Consignment
Agreements.
5. Conditions Precedent. The following are conditions precedent to the
agreements of the Lender:
5.1. payment to Lender in immediately available funds of (i) the
Line Increase Fee, (ii) the First Installment of Renewal Fee and (iii) all
expenses, including,
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without limitation, attorneys' fees and disbursements, incurred by the Lender
through the date hereof, in accordance with Section 10 hereof;
5.2. receipt by Lender of this Agreement, duly executed by the
Borrowers and Obligors;
5.3. receipt by Lender of the Second Amended and Restated Term
Promissory Note, dated as of even date hereof, issued by Borrowers to Lender in
the initial principal amount of $3,000,000, in form and substance satisfactory
to Lender ("Term Promissory Note");
5.4. receipt by Lender of the Patent Security Agreement, in form
and substance satisfactory to Lender, dated as of even date hereof, duly
executed by GO/XXX ("Patent Security Agreement");
5.5. receipt by Lender of the Asset Purchase Agreement and each of
the Purchase Agreements, each, in form and substance satisfactory to Lender,
duly executed by the Borrowers and Seller;
5.6. evidence that the execution, delivery and performance of this
Agreement, the Term Promissory Note, the First Amendment to Pledge Contract, the
Patent Security Agreement, the Asset Purchase Agreement and each of the Purchase
Agreements by Borrowers and Obligors, as applicable, have been duly authorized
by all necessary corporate action;
5.7. current agings of receivables, current perpetual inventory
records and/or rollforwards of accounts and inventory through the date hereof,
together with supporting documentation, and other documents and information from
Seller that will enable Lender to accurately identify and verify the eligible
collateral on or before the date hereof in a manner satisfactory to Lender,
including, without limitation, documentation with respect to inventory in
transit, goods in bonded warehouses and/or at other third-party locations;
5.8. a legal opinion by Borrowers' counsel, in form and substance
satisfactory to Lender, which opines that, among other things, (i) this Ninth
Amendment, the Term Promissory Note, the First Amendment to Pledge Contract, the
Patent Security Agreement, all of the other Financing Agreements, the Asset
Purchase Agreement and each of the Purchase Agreements are duly enforceable,
(ii) the Borrowers and/or Obligors are duly authorized to execute and perform
this Ninth Amendment, the Term Promissory Note, the First Amendment to Pledge
Contract, the Patent Security Agreement, all of the other Financing Agreements
executed in connection herewith and therewith, the Asset Purchase Agreement and
each of the Purchase Agreements, as applicable, and (iii) the Borrowers and
Obligors are duly incorporated and are in good standing in their state or
jurisdiction of incorporation;
5.9. excess availability under the lending formulas set forth in
the Loan Agreement, subject to sublimits and reserves, shall be in an amount
satisfactory to Lender as of the date hereof, after (i) the payment of the fees
assessed and the
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expenses incurred by the Lender in connection with the negotiation,
documentation and execution of this Ninth Amendment, the Term Promissory Note,
the Patent Security Agreement and the First Amendment to Pledge Contract, (ii)
the application of the proceeds of the Loans made by Lender on or before the
date hereof, and (iii) the deduction for past due payables and other
obligations; and
5.10. accounts payable of the Borrowers shall be at a level and in
a condition reasonably acceptable to Lender.
6. Conditions Subsequent. The Borrowers shall satisfy the following
conditions on or before the following dates (the failure to satisfy such
condition(s) by such date(s) shall constitute an Event of Default without notice
or grace):
6.1. Within thirty (30) days after the date hereof, the Borrowers
shall cause the Lender to receive a duly executed landlord waiver, in form and
substance satisfactory to Lender, for each location which is leased by the
Borrowers and at which Collateral is located (for which the Lender has not yet
received a fully executed landlord waiver, in form and substance satisfactory to
Lender);
6.2. Within thirty (30) days after the date hereof, the Borrowers
shall cause the Lender to receive a warehouse agreement, in form and substance
satisfactory to Lender, duly executed by each of the following warehousers (for
each of the following locations where Collateral is stored): (i) Bison Storage &
Warehouse Corp., 0000 Xxxxxxx Xxxxxx, Xxxxxxx, XX 00000 and (ii) TMSI Logistics,
000 Xxxxxx Xxxxxx, Xxxxxxxxxxx, XX 00000; and
6.3. Within thirty (30) days after the date hereof, the Borrowers
shall cause the Lender to receive a copy of the First Amendment to Pledge
Contract Without Transmission of Possession, in form and substance satisfactory
to Lender, duly executed by the Obligors and GO/XXX ("First Amendment to Pledge
Contract").
7. Representations and Warranties. Each Borrower and Obligor jointly
and severally represents and warrants to Lender the following, as applicable:
7.1. Organization and Qualification. Each of the Borrowers and
Obligors is duly incorporated or formed, as applicable, validly existing, and in
good standing under the laws of their respective jurisdictions of incorporation
or formation, as applicable. Each Borrower and Obligor is duly qualified to do
business and is in good standing as a foreign corporation in all states and
jurisdictions in which the failure to be so qualified would have a material
adverse effect on the financial condition, business or properties of such
Borrower or Obligor.
7.2. Power and Authority. Each Borrower and Obligor is duly
authorized and empowered to enter, deliver, and perform this Ninth Amendment,
the Term Promissory Note, the First Amendment to Pledge Contract, the Patent
Security Agreement, the Asset Purchase Agreement and each of the Financing
Agreements and Purchase Agreements to which it is a party. The execution,
delivery, and performance of this Ninth Amendment, the Term Promissory Note, the
First Amendment to Pledge
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Contract, the Patent Security Agreement, each of the other Financing Agreements,
the Asset Purchase Agreement and each of the Purchase Agreements have been duly
authorized by all necessary corporate action of each of the Borrowers and
Obligors, as applicable. The execution, delivery and performance of this Ninth
Amendment, the Term Promissory Note, the First Amendment to Pledge Contract, the
Patent Security Agreement, each of the other Financing Agreements, the Asset
Purchase Agreement and each of the Purchase Agreements do not and will not (i)
require any consent or approval of the shareholders of the Borrowers or the
Obligors; (ii) contravene the charter or by-laws of any of the Borrowers or
Obligor; (iii) violate or cause any Borrower or Obligor to be in default under,
any provision of any law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award in effect having applicability to such Borrower
or Obligor; (iv) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which any Borrower or Obligor is a party or by which such
Borrower's or Obligor's properties may be bound or affected, which breach or
default is reasonably likely to have a material adverse effect on the financial
condition, business or properties of such Borrower or Obligor; or (v) result in,
or require, the creation or imposition of any lien (other than the liens set
forth in Schedule 8.4 to the Loan Agreement) upon or with respect to any of the
properties now owned or hereafter acquired by any Borrower or Obligor.
7.3. Legally Enforceable Agreement. This Ninth Amendment, the Term
Promissory Note, the First Amendment to Pledge Contract, the Patent Security
Agreement, each of the other Financing Agreements delivered pursuant to or in
connection with this Ninth Amendment, the Asset Purchase Agreement and each of
the Purchasing Agreements is, a legal, valid and binding obligation of each
Borrower and Obligor, as applicable, enforceable against each Borrower or
Obligor, as applicable, in accordance with its respective terms subject to
bankruptcy, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally.
7.4. Continuous Nature of Representations and Warranties. Each
Borrower confirms and agrees that, except for the amendments to the Loan
Agreement provided herein and in the other previously executed amendments to the
Loan Agreement, (a) all representations and warranties contained in the Loan
Agreement and in the other Financing Agreements are on the date hereof true and
correct in all material respects (except for changes that have occurred as
permitted by the covenants in Section 9 of the Loan Agreement), (b) all
Information Certificates delivered in conjunction with the Loan Agreement remain
true and correct in all material respects, and (c) it is unconditionally,
absolutely, and jointly and severally liable for the punctual and full payment
of all Obligations, including, without limitation, all termination fees under
Section 12.1(c) of the Loan Agreement (as amended hereby), charges, fees,
expenses and costs (including attorneys' fees and expenses) under the Financing
Agreements, and that no Borrower has any defenses, counterclaims or setoffs with
respect to full, complete and timely payment of all Obligations.
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7.5. Asset Purchase Agreement. Borrowers represent, warrant, and
covenant that (a) Borrowers have furnished to Lender a true, complete, and
accurate copy of the Asset Purchase Agreement (together with the schedules and
exhibits thereto), Borrowers shall promptly furnish to Lender a true, complete,
and accurate copy of any amendments to the Asset Purchase Agreement (together
with schedules and exhibits thereto) for Lender's review and approval, not to be
unreasonably delayed or withheld, and Borrowers will furnish to Lender, within
ten (10) days of the execution and delivery thereof true, complete, and accurate
copies of all Purchase Agreements), (b) prior to the closing under the Purchase
Agreements, all material conditions precedent to the effectiveness of the
Purchase Agreements shall have been satisfied and not waived and the Purchase
Agreements shall have been duly executed and delivered by Borrowers and Seller
and shall be in full force and effect, (c) no consent, approval, authorization,
order, or filing with any governmental agency or body or any other person is
required of Borrowers or Seller for or in connection with the valid and lawful
transfer of assets from Seller to Borrowers, except for such consents as shall
have been obtained by Borrowers prior to the closing thereunder; (d) no
employees are being transferred or hired from the Seller, and no new locations
where Collateral may be held or stored are being established in connection with
the transactions contemplated by the Purchase Agreements, (e) no liabilities are
being assumed by Borrowers pursuant to the Purchase Agreements, except for the
assumed liabilities set forth in the Asset Purchase Agreement or as may
otherwise be disclosed to and approved by Lender; and (f) no Default or Event of
Default shall exist or have occurred and be continuing on the closing date under
the Asset Purchase Agreement.
7.6. Amendment to Asset Purchase Agreement. Borrowers and Lender
further agree as follows: (a) Borrowers shall not enter into any amendment to
the Asset Purchase Agreement without Lender's prior review and approval (with
such approval not to be unreasonably delayed or withheld); (b) Borrowers shall
provide Lender with evidence, in form and substance reasonably satisfactory to
Lender, that Lender shall have, following the closing under the Asset Purchase
Agreement, valid, perfected, first priority security interests in and liens upon
the Transferred Assets, subject only to the security interests and liens
permitted under the Financing Agreements, including, without limitation, that
Borrowers and/or Lender shall have received all authorizations to file UCC-3
terminations and amendments to financing statements to reflect the release of
all security interests and liens in the Transferred Assets; (c) all requisite
action and proceedings of Borrowers in connection with the Purchase Agreements
and the further actions contemplated by this Ninth Amendment shall be reasonably
satisfactory in form and substance to Lender; (d) Borrowers shall promptly
notify Lender of any amendments to any schedules of trademarks, trademark
applications and other Intellectual Property acquired in connection with the
Purchase Agreements, and will obtain and deliver duly executed instruments
reasonably satisfactory to Lender for filing with the U.S. Patent and Trademark
Office evidencing Lender's security interest therein following the closing under
the Asset Purchase Agreement; and (e) to the extent not included in the
schedules and exhibits to the Asset Purchase Agreement, Borrowers shall promptly
provide Lender with true, complete, and accurate copies of all License
Agreements and Material Contracts that are being assumed by Borrowers in
connection with the execution and performance of
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the Purchase Agreements, and all such License Agreements and Material Contracts
shall be in form and substance reasonably satisfactory to Lender.
7.7. No Material Adverse Change. Since September 16, 2002, the
date of the last field examination conducted by the Lender, there has been no
material adverse change in the business, operations, profits, prospects or
condition, financial or otherwise, of any of the Borrowers (as shown on the
consolidated balance sheet of the Borrowers) or Obligors as of such date and no
change in the aggregate value or condition of property and assets owned by the
Borrowers or Obligors, except changes (i) which are disclosed in this Ninth
Amendment or (ii) which occurred in the ordinary course of business, provided
that none of such changes, individually or in the aggregate, constitute a
material adverse change in the aggregate value or condition of the Borrowers' or
Obligors' property and assets.
8. Acknowledgement of Obligations. Each Obligor, for value received,
hereby assents to the Borrowers' execution and delivery of this Ninth Amendment,
the Term Promissory Note, the First Amendment to Pledge Contract, the Patent
Security Agreement, the Asset Purchase Agreement and each of the Purchase
Agreements and to the performance by the Borrowers of their respective
agreements and obligations hereunder and thereunder. The Borrowers' performance
and/or consummation of any transaction or matter contemplated under this Ninth
Amendment, the Term Promissory Note, the First Amendment to Pledge Contract, the
Patent Security Agreement, the Asset Purchase Agreement and/or any of the
Purchase Agreements shall not limit, restrict, extinguish or otherwise impair
any of the Obligors' obligations to Lender with respect to the Financing
Agreements, as applicable.
9. Confirmation of Liens. Each Borrower and Obligor acknowledges,
confirms and agrees that the Financing Agreements, as amended hereby, are
effective to grant to Lender duly perfected, valid and enforceable first
priority security interests in and liens on the Collateral described therein,
except for liens referenced in Sections 8.4 and 9.8 and Schedule 8.4 (as amended
hereby), each, of the Loan Agreement, and that the locations for such Collateral
specified in the Financing Agreements have not changed except as provided herein
or as previously disclosed to the Lender. Each Borrower and Obligor further
acknowledges and agrees that all Obligations of the Borrowers are and shall be
secured by the Collateral.
10. Miscellaneous. All capitalized terms not otherwise defined herein
shall have the meanings ascribed to them in the Financing Agreements. Borrowers
hereby agree to pay to Lender all reasonable attorney's fees and costs which
have been incurred or may in the future be incurred by Lender in connection with
the negotiation, preparation, performance and enforcement of this Ninth
Amendment, the Term Promissory Note, the First Amendment to Pledge Contract, the
Patent Security Agreement and any other documents and agreements prepared in
connection with this Ninth Amendment, the Term Promissory Note, the
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Patent Security Agreement and the First Amendment to Pledge Contract. The
undersigned confirm that the Financing Agreements remain in full force and
effect without amendment or modification of any kind, except for as set forth in
this Ninth Amendment, the Term Promissory Note, the Patent Security Agreement
and the First Amendment to Pledge Contract (and as set forth in any previously
executed amendments to the Loan Agreement). The Borrowers and Obligors further
confirm that no Event of Default or events which with notice or the passage of
time or both would constitute an Event of Default have occurred and are
continuing. The execution and delivery of this Ninth Amendment, the Patent
Security Agreement and the First Amendment to Pledge Contract by Lender shall
not be construed as a waiver by Lender of any Event of Default under the
Financing Agreements. This Ninth Amendment, the Term Promissory Note, the Patent
Security Agreement and the First Amendment to Pledge Contract, each, shall be
deemed to be a Financing Agreement and, together with the other Financing
Agreements, constitute the entire agreement between the parties with respect to
the subject matter hereof and supersedes all prior dealings, correspondence,
conversations or communications between the parties with respect to the subject
matter hereof.
REST OF PAGE LEFT INTENTIONALLY BLANK
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Signature page to Ninth Amendment to Loan Agreement
IN WITNESS WHEREOF, the Borrowers, the Obligors, and the Lender have
executed this Ninth Amendment as of the date first above written, by their
respective officers hereunto duly authorized, under seal.
BORROWERS:
----------
WITNESS TRANSPRO, INC.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
READY AIRE, INC.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
GO/XXX INDUSTRIES, INC.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
G&O MANUFACTURING COMPANY, INC.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
OBLIGORS:
--------
GO/XXX de MEXICO SA de C.V.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
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Signature page to Ninth Amendment to Loan Agreement
RADIADORES GDI, SA de C.V.
/s/ R.E.Xxxxxxx By: /s/ X.X.Xxxxx
------------------- -------------------------------
Title:Vice President
LENDER
CONGRESS FINANCIAL CORPORATION (NEW ENGLAND)
By: /s/Xxxx X. Xxxxxx
------------------- -------------------------------
Title:Vice President
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