Exhibit 10(a)
AMENDMENT NO. 3
TO
CREDIT AND SECURITY AGREEMENT
AMENDMENT NO. 3 to CREDIT AND SECURITY AGREEMENT (this "Amendment"),
dated as of May 14, 1999, by and between ASTREX, INC. ("Borrower"), X.X.
XXXXXXX, INC ("TFCI") and FLEET NATIONAL BANK (the "Lender" or "Bank"). All
capitalized terms unless defined herein shall have the meanings assigned to them
in the Credit Agreement (as defined below).
WITNESSETH:
WHEREAS, the Borrower, TFCI and the Bank executed and delivered a
certain Credit and Security Agreement, dated as of July 9, 1997, which was
amended by an Amendment No. 1, dated as of August 31, 1998 and by an Amendment
No. 2, dated as of December 18, 1998 (as so amended, the "Credit Agreement");
and
WHEREAS, the Credit Agreement provides for, among other things, a
$3,500,000 revolving credit facility; and
WHEREAS, the Borrower and TFCI have requested that the Lender (i)
reduce the amount of such revolving credit facility to $3,150,000, (ii) make a
$850,000 term loan to the Borrower, and (iii) extend the maturity date and
termination date of such revolving credit facility from July 7, 2000 to April
30, 2002 and provide that the maturity date for such term loan be April 30,
2002; and
WHEREAS, the Lender has agreed to such requests provided that, among
other conditions precedent, (a) the Borrower and TFCI execute and deliver this
Amendment No. 3, (b) the Borrower executes and delivers a $3,150,000 Second
Amended and Restated Revolving Credit Promissory Note in the form of Exhibit A-1
attached hereto and hereby made a part hereof (the "Revolving Credit Note"), and
an $850,000 Term Loan Promissory Note in the form of Exhibit A-2 attached hereto
and hereby made a part hereof (the "Term Loan Note", together with the Revolving
Credit Note, the "Notes"), (c) Avest (as defined in the Credit Agreement)
executes and delivers a first mortgage against the Plainview Real Estate (as
defined in the Credit Agreement) in the form of Exhibit B attached hereto and
hereby made a part hereof (the "Mortgage") to secure payment of Avest's
obligations under the Guaranty Agreement, dated as of July 1997, between Avest
and the Bank, as amended, supplemented or otherwise modified from time to time,
to the extent such obligations relate to the indebtedness evidenced by the
Term Loan Note, and (d) TFCI and Avest execute and deliver a Guaranty
Confirmation Agreement (with Modifications) (the "Guaranty Confirmation
Agreement").
NOW THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower and the Lender hereby agree as follows:
PART I. WAIVER
Section 1. The Lender hereby waives the Event of Default (as defined in
the Credit Agreement) under the Credit Agreement resulting from the breach by
the Borrower of the covenant set forth in Section 5.12 of the Credit Agreement
for the Elapsed Fiscal Period ending as of December 31, 1998. This waiver is
limited to the express terms set forth above, and does not apply to any Elapsed
Fiscal Period other than December 31, 1998, nor to any covenant other than as
specifically identified above, and the Lender's giving of this waiver does not
obligate the Lender to grant any other waiver on any other occasion.
PART II. AMENDMENTS TO THE CREDIT AGREEMENT
Section 1. (a) Any and all references to the parenthetical "(Revolver)"
in the title of the Credit Agreement (whether referenced in the Credit Agreement
or any other Financing Document) are hereby amended by deleting such
parenthetical.
(b) Sections 2.12, 3.3, 7.2 (in seven places), 8.5(b) and the
opening paragraphs to Articles 2, 4 and 5 of the Credit Agreement are hereby
amended by deleting the phrase "Revolving Credit Loans" and inserting in lieu
thereof the word "Loans". The opening paragraphs to Articles 4 and 5 of the
Credit Agreement and Section 7.2 (in two places) of the Credit Agreement are
hereby amended by deleting the phrase "Revolving Credit Facility" and inserting
in lieu thereof the phrase "Revolving Credit Facility and Term Loan Facility."
Section 6.4 of the Credit Agreement is hereby amended by deleting the phrase
"Revolving Credit Facility" and inserting in lieu thereof the phrase "Revolving
Credit Facility or Term Loan Facility." Section 6.8(d) of the Credit Agreement
is hereby amended by deleting the phrase "revolving credit facility" and
inserting in lieu thereof the phrase "revolving credit facility and the term
loan facility."
(c) The definition of "Revolving Credit Default Rate" in
Appendix A of the Credit Agreement is hereby deleted. The following new
definition is hereby inserted in Appendix A of the Credit Agreement after the
definition of "Default" and before the definition of "Elapsed Fiscal Period":
"Default Rate": a rate per annum equal to the Prime Rate plus
two (2%) percent (i.e., 200 basis points).
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Any and all references to "Revolving Credit Default Rate" in the Credit
Agreement (including in Appendix A thereto and including in the definition
itself) or any other Financing Document are hereby amended to read "Default
Rate".
(d) All references to the term "Note" in Sections 1.4, 2.2,
7.2, 8.5, 8.6, 8.12, 8.14, 8.19, and 8.20, and in the definition of "Financing
Documents" in Appendix A, of the Credit Agreement are hereby deleted and in lieu
thereof shall be substituted the term "Notes". All references to the term "the
Note" contained in Sections 7.1(b), 8.7, 8.15 and 8.18 of the Credit Agreement
are hereby deleted and in lieu thereof shall be inserted the phrase "any Note".
References in Sections 3.1(a)(v) and (vi) to the "Note" are hereby deleted and
in lieu thereof shall be substituted the phrase "Revolving Credit Note".
Section 2. Section 1.2 of the Credit Agreement is hereby amended by
deleting the phrase "(each a "Loan" or "Revolving Credit Loan" and collectively
the "Loans" or "Revolving Credit Loans")" and inserting in lieu thereof the
phrase "(each a "Revolving Credit Loan" and collectively the "Revolving Credit
Loans")".
Section 3. The following new Section 1.2A to the Credit Agreement is
hereby added in its entirety after Section 1.2 and before Section 1.3:
1.2A Term Loan. Subject to the terms and conditions of this
Agreement and in reliance on the representations and warranties of the
Borrower contained herein, the Lender agrees to loan to the Borrower,
and the Borrower agrees to borrow from the Lender, a term loan (the
"Term Loan"; collectively with the Revolving Credit Loans, each a
"Loan" and collectively the "Loans") in the aggregate principal amount
of Eight Hundred Fifty Thousand Dollars ($850,000).
Section 4. Section 1.3 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
1.3 The Notes. The Revolving Credit Loans, and the obligation
of the Borrower to repay the Revolving Credit Loans with interest,
shall be evidenced by a second amended and restated revolving credit
promissory note (such promissory note is hereinafter referred to as the
"Revolving Credit Note" which defined term shall also include such
promissory note as it may be extended or otherwise amended,
supplemented, or modified from time to time and also any notes (if any)
given in extension, renewal, or substitution of such promissory note)
in substantially the form of Exhibit A-1 attached hereto. The Term
Loan, and the obligation of the Borrower to repay the Term Loan with
interest, shall be evidenced by a term loan promissory note (such
promissory note is hereinafter referred to as the "Term Loan Note"
which defined term shall also include such promissory note as it may be
extended or otherwise amended, supplemented, or modified from time to
time and also any notes (if any) given in
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extension, renewal, or substitution of such promissory note) in
substantially the form of Exhibit A-2 attached hereto. The term "Notes"
shall collectively mean the Revolving Credit Note and the Term Loan
Note.
Section 5. The first paragraph of Section 1.4 of the Credit Agreement
is hereby amended and restated to read in its entirety as follows:
The aggregate unpaid principal balance of the Prime Rate Revolving
Credit Portion and the Prime Rate Term Loan Portion outstanding from
time to time shall bear interest at a rate per annum equal to the Prime
Rate in effect from time to time. If Borrower properly exercises its
applicable LIBOR Option in accordance with Section 1.6(b) below, the
aggregate unpaid principal balance of the Libor Revolving Credit
Portions and the Libor Term Loan Portion outstanding from time to time
shall bear interest at a rate per annum equal to the sum of (i) the
Libor Rate applicable to each Libor Revolving Credit Portion or Libor
Term Loan Portion, as the case may be, for the corresponding Interest
Period plus (ii) one and one-half percent (1.5%) (i.e., 150 basis
points). Anything contained in this Agreement to the contrary
notwithstanding, during any period in which an Event of Default is
continuing, the interest rate hereunder and under the Notes shall, at
the option of the Lender, be increased to a rate per annum equal to the
Default Rate and any interest accruing at such Default Rate shall be
payable on demand.
Section 6. Section 1.5 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
1.5 Payment of Principal and Interest and Other Amounts. The
Borrower shall pay the unpaid principal of all Revolving Credit Loans
on the Revolving Credit Maturity Date and of the Term Loan on the Term
Loan Maturity Date. Interest on the Revolving Credit Loans shall be due
and payable, in arrears, on each Revolving Credit Interest Payment Date
and also on the Revolving Credit Maturity Date. Interest on the Term
Loan shall be due and payable, in arrears, on each Term Loan Interest
Payment Date and also on the Term Loan Maturity Date. (The Lender in
its sole and absolute discretion may make a Revolving Credit Loan to
cover an interest payment due on a Revolving Credit Interest Payment
Date and/or on a Term Loan Interest Payment Date; provided, that it is
understood and agreed that the Lender shall have no obligation to do
so). All payments of principal, interest, and other amounts due
hereunder or under any of the Notes shall be made without any
deductions whatsoever, including, but not limited to, any deduction for
any set-off, recoupment, or counterclaim. All payments shall be made in
United States Dollars and immediately available funds. Unless the
Lender otherwise agrees (and subject to Section 1.8 below), all
payments shall first be applied to fees, costs and expenses which the
Borrower is obligated to pay under the Financing Documents, then to
accrued and unpaid interest and then to unpaid principal (nothing
contained herein shall limit the rights of the Lender under Section
7.4). If any payment hereunder or under
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any of the Notes or other Financing Documents shall be specified to be
made upon a day which is not a Business Day, it shall (subject to the
provisions regarding Business Days in the definition of Interest
Period) be made on the next succeeding day which is a Business Day and
such extension of time shall in such case, to the extent applicable, be
included in computing any interest in connection with such payment. The
records of the Lender shall be prima facie evidence of the making of
any Loans, any accrued interest thereon, the amount of Loans bearing
interest at the Prime Rate or with reference to the Libor Rate, and all
principal and interest payments made in respect thereof; provided, that
no failure of the Lender to timely record any transaction, or any error
in any such recordation, shall in any way affect or impair any
liability or other obligation of the Borrower to the Lender.
Section 7. Subsections 1.6 (a) and (b) of the Credit Agreement are
hereby amended and restated to read in their entirety as follows:
(a) The Borrower shall give the Lender written (or, if
acceptable to the Lender, telephonic) notice (i) of the amount and date
of each Revolving Credit Loan requested under the Revolving Credit
Facility and (ii) its intention to borrow the Term Loan, received no
later than 12:00 p.m. on the date on which the requested Loan is to be
made, provided, that if all or any portion of any such Loan is to be
included (as of the making of such Loan) as part (or all) of a Libor
Revolving Credit Portion or Libor Term Loan Portion, respectively,
Borrower shall give the Lender at least two (2) Business Days prior
notice of such requested Loan and give to Lender a LIBOR Request
pursuant to Section 1.6(b) below. Such notice (in the case of a
Revolving Credit Loan) shall be accompanied by a true and correct and
current Borrowing Base Certificate (if acceptable to the Lender, the
Borrowing Base Certificate can also serve as notice of the request of
the Loan). Such Notice shall specify the proposed effective date and,
in the case of a Revolving Credit Loan, the amount of such Loan. (If
requested by Lender (at its option) telephonic notice shall be followed
by written confirmation.) No failure to give any such notice (or
confirmation) or supply any such certificate shall impair the
obligation of the Borrower to repay any Loan made by the Lender.
The Lender may assume that any person whom the Lender in good
faith believes is an employee or officer of the Borrower and who
requests any Loan is authorized to do so on behalf of the Borrower
unless the Lender has received prior specific written notice from the
Borrower to the contrary. Lender shall have no responsibility to verify
the origin of any oral, electronic or other communication.
(b) (i) Upon the conditions that: (1) Lender shall have
received a LIBOR Request from Borrower at least two (2) Business Days
prior to the first day of the Interest Period requested, (2) there
shall have occurred no change in Applicable Law which would make it
unlawful for Lender to obtain deposits of U.S. Dollars in the London
interbank foreign currency deposits market, (3) as of the date of the
LIBOR Request and
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the first day of the Interest Period, there shall exist no Default or
Event of Default, (4) Lender is able to determine the Libor Rate in
respect of the requested Interest Period and (5) as of the first date
of the Interest Period, there is no more than three (3) outstanding
LIBOR Revolving Credit Portions and LIBOR Term Loan Portions, including
the LIBOR Revolving Credit Portion or LIBOR Term Loan Portion being
requested, then interest on the LIBOR Revolving Credit Portion or LIBOR
Term Loan Portion requested during the Interest Period requested will
be based on the applicable LIBOR Rate. No LIBOR Revolving Credit
Portion or LIBOR Term Loan Portion shall be less than $500,000.00.
(ii) Each LIBOR Request shall be irrevocable and
binding on Borrower. Borrower shall indemnify Lender for any loss,
penalty or reasonable expense incurred by Lender due to failure on the
part of Borrower to fulfill, on or before the date specified in any
LIBOR Request, the applicable conditions set forth in this Agreement,
or due to any other failure to make a borrowing requested in a LIBOR
Request or due to the prepayment or payment (including without
limitation any payment after acceleration) of the applicable LIBOR
Revolving Credit Portion or LIBOR Term Loan Portion prior to the last
day of the applicable Interest Period, including, without limitation,
any loss (including loss of anticipated profits) or expense incurred by
reason of the liquidation or redeployment of deposits or other funds
acquired by Lender to fund or maintain the applicable LIBOR Revolving
Credit Portion (or requested LIBOR Revolving Credit Portion) or LIBOR
Term Loan Portion (or requested LIBOR Term Loan Portion).
(iii) If any change in any Legal Requirement shall
(1) make it unlawful for Lender to fund through the purchase of U.S.
Dollar deposits any LIBOR Revolving Credit Portion or LIBOR Term Loan
Portion or otherwise give effect to its obligations as contemplated
under this Section 1.6(b) (or other applicable provision hereof) or (2)
shall impose on Lender any additional restrictions on the amount of
such a category of liabilities or assets which Lender may hold, then,
in each such case, Lender may, by notice thereof to Borrower, terminate
the LIBOR Option. If any change in any Legal Requirement shall impose
on Lender (or Lender's holding company) any additional costs (not
already taken into account under Eurocurrency Reserve Requirements)
based on or measured by the excess above a specified level of the
amount of a category of deposits or other liabilities of Lender which
includes deposits by reference to which the LIBOR Rate is determined as
provided herein or a category of extensions of credit or other assets
of Lender which includes any LIBOR Revolving Credit Portion or LIBOR
Term Loan Portion or there shall be imposed on Lender (or Lender's
holding company) or the London interbank market any other condition
(with respect to a Legal Requirement or otherwise and including without
limitation any conditions relating to capital adequacy) with respect to
or affecting this Agreement or the Loans and the result of such
condition is to impose any additional costs on the Lender (including,
without limitation, any reduction in Lender's return), then Borrower
shall, upon demand of Lender, pay to Lender the amount of any and all
such additional costs. Also, at the Lender's option, the
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LIBOR Revolving Credit Portion or LIBOR Term Loan Portion subject
thereto shall immediately bear interest thereafter at the rate and in
the manner provided for Prime Rate Revolving Credit Portions or the
Prime Rate Term Loan Portion, as the case may be, pursuant to Section
1.4 above. Borrower shall indemnify Lender against any loss, penalty or
expense incurred by Lender due to liquidation or redeployment of
deposits or other funds acquired by Lender to fund or maintain any
LIBOR Revolving Credit Portion or LIBOR Term Loan Portion that is
terminated under this paragraph.
(iv) Lender shall receive payments of amounts of
principal of and interest with respect to the LIBOR Revolving Credit
Portions and LIBOR Term Loan Portion free and clear of, and without
deduction for, any Taxes. If (1) Lender shall be subject to any Tax in
respect of any LIBOR Revolving Credit Portions or LIBOR Term Loan
Portion or any part thereof or (2) Borrower shall be required to
withhold or deduct any Tax from any such amount, the LIBOR Rate
applicable to such LIBOR Revolving Credit Portion or LIBOR Term Loan
Portion shall be adjusted by Lender to reflect all additional costs
incurred by Lender in connection with the payment by Lender or the
withholding by Borrower of such Tax and Borrower shall provide Lender
with a statement detailing the amount of any such Tax actually paid by
Borrower. Determination by Lender of the amount of such costs shall, in
the absence of manifest error, be conclusive. If after any such
adjustment any part of any Tax paid by Lender is subsequently recovered
by Lender, Lender shall reimburse Borrower to the extent of the amount
so recovered. A certificate of an officer of Lender setting forth the
amount of such recovery and the basis therefor shall, in the absence of
manifest error, be conclusive.
(v) Any amounts owed by Borrower under this Section
1.6(b) shall be due and payable upon demand. The Lender shall supply a
certificate(s) or statement(s) to the Borrower setting forth any
amount(s) so owed under this Section 1.6(b) and such certificate or
statement shall be conclusive and binding upon the Borrower absent
manifest error. Any amount(s) showing as owed in such certificate(s) or
statement(s) shall be due and payable by the Borrower within fifteen
(15) days after the applicable certificate or statement is sent.
Section 8. Section 1.7 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
1.7 Optional and Mandatory Prepayments. (a) The Borrower may
optionally prepay the principal of Loans, in whole or in part, at any
time, (i) in the case of any prepayment of the Prime Rate Revolving
Credit Portion or the Prime Rate Term Loan Portion, without penalty or
premium and (ii) in the case of any prepayment of any Libor Revolving
Credit Portion or Libor Term Loan Portion, accompanied by any
payment(s) required by Section 1.6 above. The Borrower shall specify
whether it is prepaying the Revolving Credit Loans or the Term Loan.
All prepayments of the
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Revolving Credit Loans shall first be applied to the Prime Rate
Revolving Credit Portion and then to the Libor Revolving Credit
Portion. All prepayments of the Term Loan shall first be applied to the
Prime Rate Term Loan Portion and then to the Libor Term Loan Portion.
No prepayments of the Term Loan may be reborrowed. Amounts prepaid
prior to the Revolving Credit Loan Termination Date on account of the
Revolving Credit Loans may, upon the terms and subject to the
conditions of this Agreement, be reborrowed prior to such Revolving
Credit Termination Date.
(b) Borrower shall make any payments or prepayments required
by Section 4.3 below or by any provision of any other applicable
Financing Document. Without limiting the generality of the foregoing,
the Borrower acknowledges and agrees to any provisions of the Mortgage
with respect to the payment or prepayment of the Term Loan.
(c) Pursuant to Section 1.8 below, all payments with respect
to Receivables or other Collateral shall be applied to the mandatory
prepayment of the Revolving Credit Loans (and, if there is an Event of
Default, the Term Loan). All such prepayments shall first be applied to
the Prime Rate Revolving Credit Portion and then to the LIBOR Revolving
Credit Portion (and, in the case of a prepayment of the Term Loan,
first to the Prime Rate Term Loan Portion and then to the Libor Term
Loan Portion).
(d) To the extent that at any time the aggregate unpaid
principal amount of the Revolving Credit Loans shall exceed the
Borrowing Base or otherwise shall exceed the Revolving Credit Maximum
Amount, the Borrower shall immediately prepay the Revolving Credit
Loans (with such prepayment to be in the amount of such excess). The
Borrower shall specify in writing that a prepayment is being made
pursuant to this Section 1.7(d).
Section 9. The following new Section 2.19 to the Credit Agreement is
hereby added in its entirety after Section 2.18 and before Article 3:
2.19 Year 2000 Matters. Borrower has reviewed the "Year 2000
Risk" (that is the risk that computer applications used by Borrower
and/or its suppliers, vendors and customers may be unable to recognize
and perform without error date-sensitive functions involving certain
dates prior to and any date after December 31, 1999) and represents
that it is taking such action as may be necessary to ensure that the
Year 2000 risk will not adversely affect its business operations and/or
financial condition.
Section 10. The following new Section 3.1A to the Credit Agreement is
hereby added in its entirety after Section 3.1 and before Section 3.2 (and the
Lender's agreement to enter into the amendments set forth in this Amendment is
contingent upon the conditions listed therein having been satisfied by the
Borrower):
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3.1A Term Loan. The making of the Term Loan shall be subject
to the Borrower fulfilling the following conditions precedent:
(a) The Borrower and TFCI shall execute and deliver an
Amendment No. 3 to Credit and Security Agreement ("Amendment No. 3"),
the Borrower shall execute and deliver the Notes, Avest shall executed
and deliver the Mortgage and any related financing statements required
by the Lender, and the Borrower, TFCI and Avest shall execute and
deliver such other documents as the Bank may reasonably require.
(b) TFCI and Avest shall execute and deliver a Guaranty
Confirmation Agreement in form and substance reasonably satisfactory to
the Lender.
(c) Each of the Borrower, TFCI and Avest shall cause the
delivery of a certificate of its corporate secretary or assistant
secretary (i) certifying (and attaching) resolutions adopted by its
Board of Directors authorizing the execution, delivery and performance
of Amendment No. 3, the Mortgage (in the case of Avest), the Notes (in
the case of the Borrower), the Guaranty Confirmation Agreement (in the
case of TFCI and Avest) and all related documentation, (ii) certifying
that no amendments have been made to the Borrower's or TFCI's or
Avest's, as the case may be, certificate of incorporation or by-laws
since July 9, 1997 (or, if such changes have been made, attaching
copies of the relevant amendment documents), and (iii) certifying as to
the incumbency (and signature) of any officer of the Borrower or TFCI
or Avest, as the case may be, which executes and delivers Amendment No.
3, the Notes, the Mortgage or the Guaranty Confirmation Agreement, each
as the case may be; and a certificate from the Secretary of State of
its state of incorporation, and, if applicable, each of the Foreign
Jurisdictions, with respect to its good standing.
(d) UCC search reports are delivered to the Bank with respect
to filings made against the Borrower or TFCI or Avest; and a title
search report (including related tax, municipal and flood zone
searches) is delivered to the Bank with respect to the Plainview Real
Estate.
(e) The Borrower shall pay the fees and disbursements of
Messrs. Xxxx Xxxxx & Xxxxxxx LLP, special counsel to the Lender,
incurred in connection with Amendment No. 3 and any related documents
and matters.
(f) The Borrower shall deliver to the Lender an as built ALTA
survey of the Plainview Real Estate certified to the Lender and the
Title Company (as defined below) by a surveyor satisfactory to the
Lender, satisfactory to the Lender in its sole discretion.
(g) The Borrower shall deliver to the Lender at closing the
following items satisfactory to the Lender in its sole discretion:
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(i) an ALTA form mortgagee's title insurance
policy or unqualified binder issued to the
Lender by First American Title Insurance
Company (the "Title Company") in the amount
of $850,000 insuring the first priority of
Lender's lien on the Plainview Real Estate
free and clear of all defects and
encumbrances except Permitted Encumbrances
(as defined in the Mortgage), and including
any and all endorsements requested by the
Lender, together with evidence that all
premiums, charges and mortgage taxes
relating thereto have been paid in full.
(ii) any and all affidavits required by the title
company or title agent in connection with
the issuance of the title insurance,
executed by Borrower, and any and all
Mortgage tax affidavits or other documents
required in connection with the recording of
the Mortgage, executed by Borrower.
(h) The Borrower and Avest shall deliver to the Lender at
closing certificates of insurance and loss payable clauses, meeting the
requirements of Section 4.3 of the Credit Agreement, Section 5 of the
Mortgage and all other applicable requirements of any other Financing
Document.
(i) The Borrower shall deliver to the Lender at closing an
appropriate written notice of its intent to borrow the Term Loan.
(j) The Borrower, TFCI and Avest shall deliver to the Lender
at closing all such other certificates, reports, statements, opinions
of counsel, instruments, assurances, agreements, or other documents as
the Lender may reasonably request.
(k) All legal matters incident to the transactions
contemplated by Amendment No. 3 and the other Financing Documents to be
executed hereunder shall be satisfactory to the Lender and Messrs. Xxxx
Xxxxx & Xxxxxxx, special counsel for the Lender.
(l) Borrower shall pay a fee of $2,500 to the Lender.
Section 11. Section 3.2 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
3.2 All Loans. The making of each Revolving Credit Loan
(whether the initial Revolving Credit Loan or any subsequent Revolving
Credit Loan) and the making of the Term Loan shall be subject to the
following additional conditions precedent:
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(a) Representations and Warranties True and Correct;
No Event of Default. (i) All of the representations and warranties made
or deemed to be made under this Agreement or any other Financing
Document shall be true and correct at the time of the disbursement of
such Revolving Credit Loan or the Term Loan, as the case may be (except
for the representation or warranty contained in Section 2.4 with
respect to distributions to the extent it is no longer true by reason
of a distribution made in accordance with, and permitted by, Section
5.7 below), with and without giving effect to the making of such
Revolving Credit Loan or the Term Loan, as the case may be, and the
application of the proceeds thereof, and (ii) no Event of Default or
Default, shall have occurred and be continuing at such time, with and
without giving effect to the making of such Loan and the application of
the proceeds thereof. The Lender may, without waiving this condition,
consider it fulfilled, and a representation and warranty by the
Borrower to such effect made to the Lender, if no written notice to the
contrary is received by the Lender from the Borrower prior to the
making of the such Loan.
(b) Documents in Full Force and Effect. All Financing
Documents shall remain in full force and effect and not be terminated.
The Lender may, without waiving this condition, consider it fulfilled,
and a representation and warranty by the Borrower to the Lender to such
effect made, if no written notice to the contrary is received from the
Borrower prior to the making of the applicable Loan.
(c) Corporate Actions in Full Force and Effect. The
corporate actions of the Borrower referred to in Section 3.1(a) shall
remain in full force and effect and the incumbency of officers shall be
as stated in the certificates of incumbency delivered pursuant to
Section 3.1(a) or as subsequently modified and reflected in a
certificate of incumbency delivered to the Lender. The Lender may,
without waiving this condition, consider it fulfilled, and a
representation and warranty by the Borrower to the Lender to such
effect made, if no written notice to the contrary is received from the
Borrower prior to the making of the applicable Loan.
(d) No Material Adverse Change. There has been no
material adverse change in the business, assets, liabilities, financial
condition, results of operations or business prospects of the Borrower
or any Guarantor since the date of any financial statements delivered
to the Lender prior to or after the date of this Agreement. The Lender
may, without waiving this condition, consider it fulfilled, and a
representation and warranty by the Borrower to the Lender to such
effect made, if no written notice to the contrary is received from the
Borrower prior to the making of the applicable Loan.
(e) Request and Borrowing Base Certificate. The
Borrower shall have requested the applicable Loan and Borrower shall
have also supplied and/or executed any other applicable documentation,
including, in the case of a Revolving Credit Loan, a
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Borrowing Base Certificate, in accordance with the applicable terms and
provisions hereof.
(f) Not Exceed Revolving Credit Maximum Amount. In
the case of any Revolving Credit Loan, immediately prior to and after
the applicable Revolving Credit Loan is made, the sum of outstanding
Revolving Credit Loans shall not exceed the Revolving Credit Maximum
Amount. The Lender may, without waiving this condition, consider it
fulfilled, and a representation and warranty by the Borrower to the
Lender to such effect made, if no written notice to the contrary is
received from the Borrower prior to the making of the applicable
Revolving Credit Loan.
Section 12. Each of Sections 5.11 and 5.12 of the Credit Agreement is
hereby clarified by deleting the phrase "Elapsed Fiscal Year (commencing" and
inserting in lieu thereof the phrase "Elapsed Fiscal Period (commencing". In
addition, Section 5.12 of the Credit Agreement is hereby amended and restated to
read in its entirety as follows:
5.12 Minimum Interest Coverage. Permit the Interest Coverage
Ratio for any Elapsed Fiscal Period (commencing with the Elapsed Fiscal
Period ending September, 1997), except for the Elapsed Fiscal Period
ending March 31, 1999, to be less than 1.50 to 1.00, or permit the
Interest Coverage Ratio for the Elapsed Fiscal Period ending March 31,
1999, to be less than 1.15 to 1.00.
Section 13. A new Section 7.1(n) is hereby added to read in its
entirety as follows:
(n) The obligation of the Lender to make the Revolving Credit
Loans is terminated for any reason.
Section 14. Section 7.3(v) is hereby amended and restated to read in
its entirety as follows:
(v) The Lender may require the Borrower to cause Avest to grant a
mortgage, in addition to the Mortgage, to the Lender (in form and
substance satisfactory to Lender) with respect to the Plainview Real
Property to secure the Secured Obligations other than the Term Loan,
and Borrower or Avest shall pay all mortgage, recording an other taxes,
fees or charges in connection with such mortgage.
Section 15. Section 8.17 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
8.17 Loss, Theft, Etc. of Note. Upon receipt by the Borrower
of reasonably satisfactory evidence of the loss, theft, mutilation or
destruction of any of the Notes, and in the case of any such loss,
theft or destruction upon delivery of a bond of indemnity in
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such form and amount as shall be reasonably satisfactory to the
Borrower, or in the event of such mutilation upon surrender and
cancellation of the applicable Note, the Borrower will execute and
deliver without expense to the holder thereof, a new Note, of like
tenor, in lieu of such lost, stolen, destroyed or mutilated Note;
provided, however that if any Institutional Holder is the then owner of
any such lost, stolen or destroyed Note, then the affidavit of an
authorized officer of such owner, setting forth the fact of loss, theft
or destruction and of its ownership of such Note at the time of such
loss, theft or destruction shall be accepted as reasonably satisfactory
evidence thereof and no further indemnity shall be required as a
condition to the execution and delivery of a new Note other than the
written agreement of such owner to indemnify the Borrower.
Section 16. The following new Sections 8.21, 8.22, 8.23 and 8.24 to the
Credit Agreement are hereby added in their entirety after Section 8.20 and
before the "IN WITNESS WHEREOF" paragraph:
8.21 Pledge to Federal Reserve Bank. Without limiting the
generality of the Bank's rights under Section 8.5, it is hereby agreed
that the Bank may at any time pledge all or any portion of its rights
under the Financing Documents, including all or any portion of any or
all of the Notes, to any of the twelve (12) Federal Reserve Banks
organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section
341. No such pledge or enforcement thereof shall release the Bank from
its obligations under any of the Financing Documents.
8.22 Appraisals. From time to time, at the Bank's option, the
Bank may obtain an appraisal of the Plainview Real Estate or an
appraisal of any other property, whether real or personal, of Borrower
and any Guarantor that secures the Secured Obligations, which the Bank
in its sole, unfettered discretion deems necessary, and Borrower and
each Guarantor shall, jointly and severally, pay to the Bank
immediately upon demand all costs of such appraisals, but not more than
one every two (2) years provided, however, that if the Bank, in its
sole and unfettered discretion determines that there has been a
material adverse change in the Plainview Real Estate, the Borrower, the
Guarantor, or market conditions, the Borrower and each Guarantor shall,
jointly and severally, pay to the Bank immediately upon demand all
costs of such appraisals, but not more than one annually. Borrower and
each Guarantor shall permit the Bank and its agents, employees,
representatives and appraisers such access to the Plainview Real Estate
and to such other property and to the books and records of Borrower and
each Guarantor other than natural persons relating thereto as may be
necessary or convenient to perform such appraisals.
8.23 Reports. The Bank may require at any time, at Borrower's
expense, a written report of a site assessment and environmental audit
with respect to the Plainview Real Estate in scope, form and substance
satisfactory to the Bank, prepared by an independent, competent and
qualified engineer selected by the Bank, in the Bank's sole and
unfettered discretion, showing that the engineer made all appropriate
inquiry
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consistent with good commercial and customary practice, that no
evidence or indication came to light which would suggest there was a
release of Hazardous Materials on the Plainview Real Estate which would
necessitate an environmental response action and that the Plainview
Real Estate complies with and does not deviate from, Applicable Law,
including any licenses, permits or certificates required thereunder.
8.24 Indemnification. The Borrower and TFCI, jointly and
severally, agree, to the extent (if at all) the Bank is not indemnified
under Section 8.7 above, to defend, indemnify and hold harmless the
Bank and any participants, successors or assigns of the Bank and the
officers, directors, employees and agents of each of them (each a "Bank
Party") from and against any and all losses, claims, liabilities,
asserted liabilities, costs and expenses, including, without
limitation, costs of litigation and reasonable attorneys' fees (whether
in-house or outside counsel), incurred in connection with any and all
claims or proceedings against any Bank Party (whether brought by
private party or related to an action, proceeding or investigation
instituted by any federal, state or local governmental agency related
to any suspected or actual violation of Applicable Law with respect to
any real property, including the Plainview Real Estate, owned or
operated by the Borrower or any Guarantor and/or business conducted
thereon) for bodily injury, property damage, abatement or remediation,
environmental damage or impairment or any other injury of damage
(including all foreseeable and unforeseeable consequential damage) or
any diminution in value of any real property, including the Plainview
Real Estate, resulting from or relating, directly or indirectly, to (a)
the Release, threatened Release, existence or removal of any Hazardous
Materials on, into, from, through or under any real property, including
the Plainview Real Estate, owned or operated by the Borrower or any
Guarantor (whether or not such Release was caused by Borrower, any
Guarantor, a tenant, subtenant, prior owner or tenant or any other
person and whether or not the alleged liability is attributable to the
handling, storage, generation, transportation or disposal of Hazardous
Materials or the mere presence of such Hazardous Materials) or (b) the
breach or alleged breach of Applicable Law by Borrower or any
Guarantor. THE AGREEMENT OF THE BORROWER AND EACH GUARANTOR UNDER THIS
PARAGRAPH SHALL SURVIVE THE PAYMENT IN FULL OF THE NOTE, THE
TERMINATION OF THE MORTGAGE, THE TERMINATION OF ANY OTHER FINANCING
DOCUMENT (INCLUDING, WITHOUT LIMITATION, FOR THE AVOIDANCE OF DOUBT, BY
REASON OF THE FORECLOSURE OF THE MORTGAGE OR CONVEYANCE IN LIEU OF
FORECLOSURE) OR THE RELEASE OF ANY COLLATERAL.
Section 17. The definitions of "Consolidated Current Liabilities",
"Financing Documents", "Interest Expense", "LIBOR Option" or "Libor Option", and
"Permitted Indebtedness" in Appendix A of the Credit Agreement are hereby
amended by deleting the phrase "Revolving Credit Loans" and inserting in lieu
thereof the word "Loans". The definitions of "Eurocurrency Reserve Requirement",
"Interest Period", "LIBOR Request" or "Libor
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Request" (in two places), and "Tax" in Appendix A of the Credit Agreement are
hereby amended by deleting the phrase "Libor Revolving Credit Portion" and
inserting in lieu thereof the phrase "Libor Revolving Credit Portion or Libor
Term Loan Portion". Clause (3) of the definition of "Interest Period" in
Appendix A of the Credit Agreement is hereby amended by deleting the phrase
"Revolving Credit Maturity Date" (in two places) and inserting in lieu thereof
the phrase "Revolving Credit Maturity Date or Term Loan Maturity Date, as the
case may be".
Section 18. (a) The definition of the term "Borrowing Base" in Appendix
A of the Credit Agreement is hereby amended and restated to read in its entirety
as follows:
"Borrowing Base": as of any particular time, the sum of (i)
eighty-five percent (85%) of the amount of the then Eligible
Receivables and (ii) the lesser of (a) twenty-five percent (25%) of the
amount of the then Eligible Inventory or (b) $1,000,000.00, less (iii)
until the Prior Judgement (as defined in Section 43 of the Mortgage)
and the Prior Judgement Lien (as defined in Section 43 of the Mortgage)
no longer have any legal effect and the exception for same in the title
insurance policy issued to the Bank insuring the lien of the Mortgage
is removed by the title insurance company, $120,000.00; provided that
it is further understood and agreed that for purposes of calculating
the Borrowing Base, (1) Eligible Inventory of TFCI shall not exceed
$500,000, (2) Eligible Receivables of TFCI shall not exceed $500,000
and (3) Eligible Inventory at the Massachusetts Site shall not exceed
$500,000. The Lender shall have the right to decrease any such
percentages provided that the Lender acts in good faith in doing so.
(b) The definition of the term "Borrowing Base Certificate" in
Appendix A of the Credit Agreement is hereby amended by deleting the phrase
"Exhibit C" and inserting in lieu thereof the phrase "Exhibit B".
Section 19. Section (vii)(c) of the definition of the term "Eligible
Receivables" in Appendix A of the Credit Agreement is hereby amended by adding
to the end thereof, just before the semicolon, the following: "or such Account
is insured by credit insurance satisfactory to the Lender."
Section 20. The definition of the term "Financing Documents" in
Appendix A of the Credit Agreement is hereby amended by adding after the phrase
"landlord waiver(s)," the phrase "the Mortgage, any and all swap or hedging
agreements between the Borrower and the Lender and any related documents,".
Section 21. The following new definition is hereby added in its
entirety to Appendix A of the Credit Agreement after the definition of "LIBOR
Revolving Credit Portion" or "Libor Revolving Credit Portion" and before the
definition of "Lien":
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"LIBOR Term Loan Portion" or "Libor Term Loan Portion": that
portion of the Term Loan specified in a LIBOR Request (including any
applicable portion of the Term Loan which is being borrowed by Borrower
concurrently with such LIBOR Request) which is not less than $500,000
and is an integral multiple of $100,000 which does not exceed the
outstanding balance of the Term Loan not already subject to a LIBOR
Option and, which, as of the date of the LIBOR Request specifying such
LIBOR Term Loan Portion, has met the conditions for basing interest on
the LIBOR Rate in Section 1.6(b) of the Credit Agreement and the
Interest Period of which has commenced and not terminated.
Section 22. The definition of the term "Loan" and "Loans" in Appendix A
of the Credit Agreement is hereby amended by deleting the reference to "Section
1.2" and inserting in lieu thereof a reference to "Section 1.2A".
Section 23. The following new definition is hereby added in its
entirety to Appendix A of the Credit Agreement after the definition of "Material
Adverse Effect" and before the definition of "Natural Resources":
"Mortgage":" the mortgage by Avest, Inc. to Lender against the
Plainview Real Estate in the form of Exhibit B attached hereto and made
a part hereof, as such mortgage may be amended, supplemented or
otherwise modified from time to time.
Section 24. The following new definition is hereby added in its
entirety to Appendix A of the Credit Agreement after the definition of "Natural
Resources" and before the definition of "Obligor Legal Opinion":
"Notes": as that terms is defined in Section 1.3 of the Credit
Agreement.
Section 25. The definition of the term "Permitted Uses" in Appendix A
of the Credit Agreement is hereby amended and restated to read in its entirety
as follows:
"Permitted Uses": (a) as to the proceeds of the Term Loan,
pay-down of the Revolving Credit Loans, and (b) as to the proceeds of
the Revolving Credit Loans, general working capital purposes of the
Borrower; provided that (i) the proceeds of the initial Revolving
Credit Loan shall first be used to pay off any Indebtedness to the
Existing Lender and (ii) the Borrower may, in the ordinary course of
its business, loan a portion of the proceeds of Revolving Credit Loans
to TFCI provided that such loans to TFCI shall be no greater than the
approximate amount of the proceeds of Revolving Credit Loans
attributable to Eligible Receivables and Eligible Inventory of TFCI.
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Section 26. The following new definition is hereby added in its
entirety to Appendix A of the Credit Agreement after the definition of "Prime
Rate Revolving Credit Portion" and before the definition of "Receivables":
"Prime Rate Term Loan Portion": that portion of the Term Loan
that is not subject to a LIBOR Option or is not otherwise bearing
interest with reference to the LIBOR Rate.
Section 27. The definition of the term "Revolving Credit Loan" or
"Revolving Credit Loans" in Appendix A of the Credit Agreement is hereby amended
and restated to read as follows:
"Revolving Credit Loan" and "Revolving Credit Loans": as those
terms are respectively defined in Section 1.2 of the Credit Agreement
including any Prime Rate Revolving Credit Portion and any LIBOR
Revolving Credit Portion(s).
Section 28. The definition of the term "Revolving Credit Loan
Termination Date" in Appendix A of the Credit Agreement is hereby amended by
deleting the date "July 7, 2000" and inserting in lieu thereof the date "April
30, 2002".
Section 29. The definition of the term "Revolving Credit Maturity Date"
in Appendix A of the Credit Agreement is hereby amended by deleting the date
"July 7, 2000" and inserting in lieu thereof the date "April 30, 2002".
Section 30. The definition of the term "Revolving Credit Maximum
Amount" in Appendix A of the Credit Agreement is hereby amended by deleting the
phrase "(i) Three Million Five Hundred Thousand Dollars ($3,500,000) or" and
inserting in lieu thereof the phrase "(i) Three Million One Hundred Fifty
Thousand Dollars ($3,150,000) or".
Section 31. The first paragraph of the definition of "Secured
Obligations" in Appendix A of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
(a) all indebtedness, obligations and liabilities of the Borrower to
the Lender under this Agreement or the Notes (including, but not
limited to, any and all principal, interest, and all amounts under
Section 8.7 of the Credit Agreement) or any other Financing Documents,
whether now existing or hereafter arising and whether for payment or
performance; and (b) all other indebtedness, obligations, and
liabilities of Borrower to the Lender of every kind, nature and
description, direct or indirect, secured or unsecured, joint or
several, absolute or contingent, due or to become due, whether for
payment or performance, now existing or hereafter arising (including,
but not limited to, any and all future advances), regardless of how the
same arise or by what instrument, agreement, or book account they may
be evidenced, or whether evidenced by any instrument,
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agreement, or book account, including, but not limited to, all loans
(including any loan by renewal or extension), all other indebtedness,
all guarantees, all reimbursement obligations or other obligations
relating to letters of credit and the like, and all obligations under
swap and hedging agreements and other swap and hedging arrangements and
the like; provided that, with respect to TFCI and the Security Interest
it grants hereunder in its Collateral, Secured Obligations shall also
mean, in addition to the above, all indebtedness, obligations, and
liabilities of TFCI to the Lender of every kind, nature and
description, direct or indirect, secured or unsecured, joint or
several, absolute or contingent, due or to become due, whether for
payment or performance, now existing or hereafter arising (including,
but not limited to, any and all future advances), regardless of how the
same arise or by what instrument, agreement, or book account they may
be evidenced, or whether evidenced by any instrument, agreement, or
book account, including, but not limited to, all loans (including any
loan by renewal or extension), all other indebtedness, all guarantees,
all reimbursement obligations or other obligations relating to letters
of credit and the like, and all obligations under swap and hedging
agreements and other swap and hedging arrangements and the like,
including without limitation any guaranty of TFCI under any of the
Financing Documents.
Section 32. The following new definitions are hereby added in their
entirety to Appendix A of the Credit Agreement after the definition of "Telerate
Page 3750" and before the definition of "Trade Debt":
"Term Loan": as that term is defined in Section 1.2A of the
Credit Agreement including any Prime Rate Term Loan Portion and any
LIBOR Term Loan Portion.
"Term Loan Facility": the term loan borrowing facility
established pursuant to the Credit Agreement.
"Term Loan Interest Payment Date": (i) with respect to the
Prime Rate Term Loan Portion, the first day of each and every month,
commencing on the date hereof; and (ii) with respect to any Libor Term
Loan Portion, the last day of the applicable Interest Period and also,
in the case of an Interest Period of 6 months, that date which is three
months after the first day of such Interest Period.
"Term Loan Maturity Date": April 30, 2002.
"Term Loan Note": as defined in Section 1.3 of the Credit
Agreement.
Section 33. Exhibit A to the Credit Agreement is hereby deleted.
Exhibits A-1 and A-2 attached hereto shall be and become, for all purposes,
Exhibits A-1 and A-2 to the Credit Agreement.
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PART III. REPRESENTATIONS AND WARRANTIES
Section 1. To induce the Lender to enter into this Agreement and to
make the Term Loan, each of the Borrower and TFCI hereby represents and warrants
and covenants to the Lender that:
(i) The execution, delivery and performance by the Borrower and TFCI of
this Amendment, the Notes (in the case of the Borrower), the Guaranty
Confirmation Agreement (in the case of TFCI) and any related documents
have been duly authorized by all necessary corporate action on the part
of the Borrower or TFCI, as the case may be, and do not violate,
conflict with, or result in a breach of the certificate of
incorporation or by-laws of Borrower or TFCI, as the case may be, or
any agreement or instrument or court order or judgment to which
Borrower or TFCI, as the case may be, is a party or which is binding
upon Borrower or TFCI, as the case may be, or any of their properties.
This Amendment, the Notes (in the case of the Borrower) and any related
documents to which the Borrower or TFCI is a party are the respective
legal, valid and binding obligations of the Borrower, or TFCI, as the
case may be, enforceable in accordance with their respective terms.
(ii) The Credit Agreement as amended hereby and all other Financing
Documents (as defined in the Credit Agreement) to which the Borrower or
TFCI, as the case may be, is a party are the respective legal, valid
and binding obligations of the Borrower or TFCI, as the case may be,
enforceable in accordance with their respective terms.
(iii) The security interests granted by the Borrower and TFCI, pursuant
to the Credit Agreement, in the Collateral (as defined in the Credit
Agreement) remain in full force and effect and secure the payment and
performance of all Secured Obligations (as defined in the Credit
Agreement).
(iv) Neither the Borrower nor TFCI, as of the date hereof, has any
claim, defense, counterclaim, or right of offset against the Lender,
whether relating to the Credit Agreement or otherwise.
(v) All representations and warranties of the Borrower or TFCI, as the
case may be, under the Credit Agreement and the other Financing
Documents to which it is a party are true and correct as of the date
hereof.
(vi) All interests of the Borrower, as lessee, in the Plainview Real
Estate are subordinate to the Mortgage.
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PART IV. CONDITIONS PRECEDENT
Section 1. The making of the Term Loan shall be subject to the Borrower
fulfilling the conditions precedent relating thereto as set forth in the Credit
Agreement, as amended hereby.
PART V. MORTGAGE AND LEASE MATTERS
Section 1. The Borrower hereby acknowledges, consents to, and agrees to
comply with all of the applicable provisions of, the Mortgage, including
specifically, but without limitation, the provisions of Section 12 thereof.
PART VI. MISCELLANEOUS
Section 1. The Borrower shall pay the fees and disbursements of the
Lender's legal counsel incurred in connection with this Amendment and any
related documents and matters.
Section 2. Except as amended hereby, the Credit Agreement shall remain
in full force and effect.
Section 3. This Amendment (i) may be executed in any number of
counterparts, each of which shall be deemed to be an original but all of which
together shall be considered one instrument and (ii) shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
Section 4. This Amendment shall be construed in accordance with and
governed by the laws of the State of Connecticut.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized officers as of the day and year
first above written.
WITNESSES: ASTREX, INC.
/s/ Xxxx Xxxxx By: /s/ Xxxxxxx XxXxxxx
---------------------------- -----------------------------
Name: Xxxx Xxxxx Xxxxxxx XxXxxxx
President
/s/ Xxxx Xxxxxxxxx
----------------------------
Name: Xxxx Xxxxxxxxx
WITNESSES: X.X. XXXXXXX, INC.
/s/ Xxxx Xxxxx By: /s/ Xxxxxxx XxXxxxx
---------------------------- -----------------------------
Name: Xxxx Xxxxx Xxxxxxx XxXxxxx
President
/s/ Xxxx Xxxxxxxxx
----------------------------
Name: Xxxx Xxxxxxxxx
WITNESSES: FLEET NATIONAL BANK
/s/ Xxxxx Xxxxxx By: /s/ Xxxxxxx Xxxxxxxxxx
---------------------------- ------------------------------
Name: Xxxxx Xxxxxx Name: Xxxxxxx Bochiccio
Title: Vice President
/s/ Xxxxxxx Xxxx
----------------------------
Name: Xxxxxxx Xxxx
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XXXXXXX X-0
The Revolving Credit Note
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EXHIBIT A-2
The Term Loan Note
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EXHIBIT B
The Mortgage
-24-
