AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT TO LOAN AND SECURITY AGREEMENT (the "Amendment") is made
and entered into as of the 24th day of February, 1998, between NATIONSBANK,
N.A. (hereinafter referred to as "Lender"), and INTERNATIONAL COMFORT
PRODUCTS CORPORATION (USA))(hereinafter referred to as "Borrower").
W I T N E S S E T H
WHEREAS, Borrower and Lender entered into that certain Loan and Security
Agreement, dated as of July 18, 1997 (as amended, restated or modified from
time to time, the "Loan Agreement"), pursuant to which Lender agrees to
extend certain Revolving Credit Loans to the Borrower, subject to the terms
and conditions of the Loan Agreement; and
WHEREAS, Borrower has formed a Subsidiary for the purpose of merging
with United Electric Company ("United"), and, as required pursuant to Section
10.2 of the Loan Agreement, Borrower has requested that Lender grant its
consent to the merger of the new Subsidiary with United; and
WHEREAS, Borrower and Lender desire to enter into this Amendment for the
purpose of granting the consents described above and for the purpose of
amending the definition of Tangible Net Worth.
NOW, THEREFORE, in consideration of the foregoing premises, and other
good and valuable consideration, the receipt and legal sufficiency of which
is hereby acknowledge, the parties hereby agree as follows:
1. All capitalized terms used herein and not otherwise expressly
defined herein shall have the respective meanings given to such terms in the
Loan Agreement.
2. Lender acknowledges that Borrower has formed UEC Merger
Corporation, a Delaware corporation, which is a wholly-owned Subsidiary of
Borrower. Lender hereby acknowledges that UEC Merger Corporation will be
merging into United pursuant to the terms and conditions of that certain
Agreement and Plan of Merger, dated January 23, 1998 (the "United Merger").
Lender hereby consents to the United Merger and acknowledges that United will
be the entity surviving the merger, subject, however, to Borrower's delivery
to Lender of evidence of compliance with the financial covenants set forth in
Article 10 of the Loan Agreement (as amended by this Amendment) on a pro
forma basis after giving effect to the United Merger.
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3. Section 1.1 of the Loan Agreement is amended by deleting the
definition of Tangible Net Worth and substituting the following in lieu
thereof:
"Tangible Net Worth" means, as applied to any Person, the Net Worth
of such Person at the time in questions, after deducting therefrom all
accounts receivable and other obligations due from Affiliates (provided
that, to and including December 30, 1998, up to $10,000,000 of
receivables due from International Comfort Products Corporation (Canada)
may be included in "Tangible Net Worth") and the amount of all
intangible items reflected therein, including all unamortized debt
discount and expense, unamortized research and development expense,
unamortized deferred charges, goodwill, Intellectual Property,
unamortized excess cost of investment in Subsidiaries over equity at
dates of acquisition, and all similar items which should properly be
treated as intangibles in accordance with GAAP.
4. The Borrower hereby restates, ratifies and reaffirms each and every
term, condition, representation and warranty heretofore made by it under or
in connection with the execution and delivery of the Loan Agreement as
amended hereby and the other Loan Documents as fully as though such
representations and warranties had been made ont he date hereof and with
specific reference to this Amendment and the Loan Documents.
5. As amended hereby, the Loan Agreement shall be and remain in full
force and effect, and shall constitute the legal, valid, binding and
enforceable obligations of the Borrower to the Lender.
6. The Borrower agrees to pay on demand all costs and expenses of the
Lender in connection with the preparation, execution, delivery and
enforcement of this Amendment and all other Loan Documents and any other
transactions contemplated hereby, including, without limitation, the
reasonable fees and out-of-pocket expenses of legal counsel to the Lender.
7. To induce the Lender to enter into this Amendment, the Borrower
hereby (i) represents and warrants that, as of the date hereof, and after
giving effect to the terms hereof, there exists no Event of Default (or any
event which, with the giving of notice or the passage of time, or both, would
constitute an Event of Default) under the Loan Agreement or any of the Loan
Documents; and (ii) acknowledges and agrees that to Borrower's knowledge no
right of offset, defense, counterclaim, claim, causes of action or objection
in favor of the Borrower against the Lender exists arising out of or with
respect to any of the indebtedness, the Loan Agreement, or any of the other
Loan Documents, or with respect to the administration or funding of the
indebtedness.
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8. The Borrower agrees to take such further action as the Lender shall
reasonably request in connection herewith to evidence the amendments herein
contained to the Loan Agreement.
9. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which, when so
executed and delivered, shall be deed to be an original and all of which
counterparts, taken together, shall constitute but one and the same
instrument.
10. This Amendment shall be binding upon and inure to the benefit of
the successors and permitted assigns of the parties hereto.
11. This Amendment shall be governed by, and construed in accordance
with, the laws of the State of Georgia, other than its laws respecting choice
of law.
IN WITNESS WHEREOF, the Borrower and the Lender have caused this
Amendment to be duly executed under seal, all as of the date first above
written.
INTERNATIONAL COMFORT PRODUCTS
CORPORATION (USA)
By:
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Name:
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Title:
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Attest:
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Name:
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Title:
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NATIONSBANK, N.A.
By:
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Title:
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