EXHIBIT 4c
LOAN MODIFICATION AGREEMENT AND
AMENDMENT TO LOAN DOCUMENTS
THIS LOAN MODIFICATION AGREEMENT AND AMENDMENT TO LOAN
DOCUMENTS (this "Agreement") is being entered into as of the
20th day of January, 1997, by and between COMPASS BANK, an
Alabama state banking corporation ("Bank") and ALATENN
CREDIT CORP., a corporation (the "Borrower") and ATRION
CORPORATION, a corporation formerly known as "AlaTenn
Resources, Inc." (the "Guarantor").
P R E A M B L E
The Borrower is the maker of a certain $10,000,000.00
Master Revolving Promissory Note (Facility 1) dated as of
January 20, 1995 (as amended, the "Facility 1 Note") and a
certain $10,000,000 Master Revolving Promissory Note
(Facility 2) dated as of January 20, 1995 (as amended, the
"Facility 2 Note", or together with the Facility 1 Note, the
"Notes"), which together evidence a certain $20,000,000.00
loan from the Bank to the Borrower (the "Loan"). The Loan
was extended pursuant to a certain Credit Agreement by and
between the Bank and the Borrower dated as of January 20,
1995 (as amended, the "Credit Agreement"), and is secured
by, among other things, that certain Collateral Assignment
and Pledge of Master Promissory Notes from Borrower to Bank
dated as of January 20, 1995 and is guaranteed by the
Guarantor. The Bank and the Borrower have agreed to renew
and modify the Loan, and to amend the documents and
instruments evidencing, securing, relating to, guaranteeing
or executed or delivered in connection with the Loan
(collectively, as heretofore amended, the "Loan Documents").
A G R E M E N T
NOW, THEREFORE, in consideration of the premises, the
mutual agreements of the parties as set forth herein, and
for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and to induce
Bank to renew and modify the Loan, the parties, intending to
be legally bound hereby, agree as follows:
A. Modification of Loan. The maturity date of the
Loan shall be extended to April 20, 1997.
B. Amendment of Credit Agreement. The Credit
Agreement shall be and the same hereby is amended as
follows:
(i) By revising Section 5.13 thereof to read in its
entirety as follows:
5.13 Liens (Negative Pledge). The
Borrower will not create, incur or
suffer to exist, nor shall Borrower
allow any member of the Group to
create, incur or suffer to exist, any
Lien in, of or upon any of their
Properties except for Permitted Liens
and except for margin stock (as defined
in Regulation U of the Federal Reserve
Board) owned by Borrower or any Group
member.
(ii) By revising Section 5.2 to read in its entirety
as follows:
5.2 Use of Proceeds. The Borrower
will, and will cause each member of the
Group to, use the proceeds of the
Advances only for corporate purposes of
the Group. The Borrower will not, nor
will it permit any member of the Group
to, use any of the proceeds of the
Advances, except for up to
$5,000,000.00 of the proceeds of
Facility 1, to purchase or carry any
"margin stock" (as defined in
Regulation U of the Federal Reserve
Board).
(iii) By adding a new Section 5.2A which
shall read in its entirety as follows:
"5.2A Right of First Refusal. Lender
shall have and is hereby granted a
right of first refusal on any loan or
financial arrangement contemplated by
Borrower or any Group member which
would provide financing secured by any
margin stock (as defined by the Federal
Reserve Board) owned by Borrower or any
Group member or by a Permitted Lien of
the type described in Paragraph (g) of
the definition thereof set forth in
Article I hereof, on the same terms and
conditions as offered by any reputable
financial institution in any bona fide
written commitment delivered to
Borrower; provided, however, that
Lender shall have no obligation to make
any such financing available to
Borrower or any Group member. Borrower
shall notify Lender in writing within
five (5) business days of its receipt
of any such commitment from another
financial institution, accompanied by a
copy of such commitment. Lender shall
within twenty (20) business days of its
receipt of such notice and commitment,
advise Borrower whether Lender will
make financing available to Lender on
the terms and conditions contained in
the commitment. In the event that
Lender fails to reply within such
twenty (20) business day period or, if
before the expiration of such period,
Lender shall notify Borrower of
Lender's election not to make such
financing available, Borrower shall be
entitled to proceed to close such
financing with such other financial
institution; provided, however, that
Borrower's entering into such financing
with such other financial institution
does not otherwise violate any of the
other terms of this Agreement.
(iv) By adding a new Section 5.16A which shall read in
its entirety as follows:
5.16A Funded Debt. The Borrower shall
not, nor will it permit any member of
the Group to, incur or be liable in any
manner for any Indebtedness, obligation
or liability in excess of an aggregate
of $1,000,000.00 to any one or more
financial institutions or other lenders
other than existing Indebtedness
reflected on the financial statements
of the Group as at September 30, 1996,
and the Indebtedness to Bank under
Facility 1 and Facility 2 hereunder and
Indebtedness secured by Permitted Liens
of the types described in paragraphs
(g) and (h) of the definition thereof
set forth in Article I hereof.
(v) By deleting from Section 5.14A the amount
"$27,110,000" and inserting in place thereof the
amount "$29,297,000."
(vi) By deleting from Section 5.14 thereof the amount
"$10,000,000" and inserting in place thereof the
amount "$13,197,000."
(vii) By adding a new Section 5.16B which shall
read in its entirety as follows:
5.16B Minimum Annual Increase in Net
Worth. The Group's Consolidated Net
Worth (as defined under Section 5.14A
above) in each fiscal year, beginning
with fiscal year 1997, shall increase
by $1,000,000 over the Group's
Consolidated Net Worth for the
immediately preceding fiscal year.
(viii) By deleting from Section 2.12 thereof the
words "10 business days" and inserting in
place thereof the words "20 business days."
C. Amendment of Notes. The Notes shall be and the
same hereby are amended by changing the maturity dates
thereof to April 20, 1997.
D. Effect on Loan Documents. Each of the Loan
Documents shall be deemed amended as set forth hereinabove
and to the extent necessary to carry out the intent of this
Agreement. Without limiting the generality of the
foregoing, each reference in the Loan Documents to the
"Notes", the "Credit Agreement", or any other "Loan
Documents" shall be deemed to be references to said docu-
ments, as amended hereby. Except as is expressly set forth
herein, all of the Loan Documents shall remain in full force
and effect in accordance with their respective terms and
shall continue to evidence, secure, guarantee or relate to,
as the case may be, the Loan.
E. Representations and Warranties. Each
representation and warranty contained in the Loan Documents
is hereby reaffirmed as of the date hereof. The Borrower
hereby represents, warrants and certifies to Bank that no
Event of Default nor any condition or event that with notice
or lapse of time or both would constitute an Event of
Default, has occurred and is continuing under any of the
Loan Documents or the Loan, and that Borrower has no offsets
or claims against Bank arising under, related to, or
connected with the Loan, the Credit Agreement or any of the
other Loan Documents.
F. Additional Documentation; Expenses. Borrower
shall provide to Bank a certified resolution of the Borrower
properly authorizing the transactions contemplated hereby
and the execution of this Agreement and all other documents
and instruments being executed in connection herewith and
all other documents and instruments required by Bank, all in
form and substance satisfactory to Bank. Borrower shall pay
any recording and all other expenses incurred by Bank and
Borrower in connection with the modification of the Loan and
any other transactions contemplated hereby, including
without limitation, title or other insurance premiums,
survey costs, legal expenses, recording fees and taxes.
G. Execution by Guarantor. Guarantor has executed
this Agreement to evidence its consent to the modification
and amendments as described herein, and to acknowledge the
continuing effect of its Guaranty and the obligations conta-
ined therein.
IN WITNESS WHEREOF, the undersigned have caused this
instrument to be duly executed as of the date first set
forth above.
BORROWER:
ALATENN CREDIT CORP.
By: /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Its: President
By: /s/ Xxxxxxx Xxxxxxxxxx
Xxxxxxx Xxxxxxxxxx
Its: Secretary
GUARANTOR:
ATRION CORPORATION
(f/k/a ALATENN RESOURCES, Inc.)
By: /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Its: President
BANK:
COMPASS BANK
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx
Its: Commercial Loan Officer
