FIFTH AMENDMENT TO THE LOAN AGREEMENT
Exhibit 10.1
FIFTH
AMENDMENT TO THE LOAN AGREEMENT
THIS
Amendment to Loan Agreement made this 30th day of June, 2008, by and between
M-TRON INDUSTRIES, INC.,
a Delaware corporation (“M-TRON”), and PIEZO TECHNOLOGY, INC., a
Florida corporation (collectively, the “Borrowers”), and FIRST NATIONAL BANK OF OMAHA
(the “Bank”), a national banking association established at Omaha,
Nebraska.
WHEREAS,
M-TRON has existing term loans with the Bank evidenced by term note number
855891-1 with a due date of January 24, 2013, pursuant to an existing additional
loan agreement with the Bank, which shall remain in full force in accordance
with its terms; and
WHEREAS,
M-TRON has an existing revolving line of credit with the Bank evidenced by
revolving note number 855893-1 with a due date of June 30, 2009 pursuant to an
existing additional loan agreement with the Bank, which shall be paid in full
from the proceeds of the Revolving Note; and
Whereas,
the Borrowers have requested the Bank to lend to the Borrowers the sum of
$5,500,000 revolving line of credit (the “Revolving Loan”) and $1,310,280 term
loan (“Term Loan”) (collectively referred to as the “Loans”); and
WHEREAS,
the Bank is willing to provide such credit facilities to the Borrowers upon the
terms and conditions herein set forth.
WHEREAS,
BANK and BORROWER executed a written Loan Agreement dated October 14, 2004 which
was subsequently amended May 31, 2005, June 30, 2006, October 3, 2006, and June
30, 2007 (the Loan Agreement together with all amendments is herein called the
“AGREEMENT”); and
WHEREAS,
the parties hereto desire to amend the AGREEMENT.
Now,
therefore, in consideration of the AGREEMENT, and their mutual promises made
herein, BANK and BORROWERS agree as follows:
1. Terms
which are typed herein as all capitalized words and are not defined herein shall
have the same meanings as when described in the AGREEMENT.
2. Article I.
Section 1.01. Defined Terms “Revolving Loan Termination Date”
(a) and “Term Loan Termination Date” (b) of the AGREEMENT are hereby
amended to read, effective immediately:
(a) June
30, 2009
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(b)
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January
24, 2013
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3. Article II
Section 2.12, Repayment of Revolving Note is hereby amended to read,
effective immediately:
The
Revolving Note shall be due and payable on June 30, 2009. Interest
only shall be payable monthly on the Revolving Note. All outstanding
principal and interest shall be due and payable on June 30, 2009.
4. Article VIII,
Section 8.01 Minimum Working Capital is hereby deleted from the AGREEMENT,
effective immediately.
5. Article VIII,
Section 8.02 Minimum Tangible Net Worth is hereby amended, effective
immediately:
The
Borrower will maintain at all times a tangible net worth of not less than
$7,000,000.00 measured quarterly.
6. Article VIII,
Section 8.03 Capital Expenditures is hereby deleted from the AGREEMENT,
effective immediately.
7. Article VIII,
Section 8.04 Current Ratio is hereby amended to read effective
immediately:
At all
times after June 30, 2008, the Borrower will maintain a ratio of current assets
to current liabilities of not less than 1.5 to 1.0 measured
quarterly.
8. Article VIII,
Section 8.05 is hereby amended to read effective immediately:
The
Borrower will maintain at all times a maximum Leverage Ratio of 2.75:1.00
measured quarterly.
9. BORROWER
certifies by its execution hereof that all of the representations and warranties
set forth in the AGREEMENT are true as of this date, and that no EVENT OF
DEFAULT under the AGREEMENT, and no event which, with the giving of notice or
passage of time or both, would become such an EVENT OF DEFAULT, has occurred as
of execution hereof, except as disclosed to BANK. All other terms and
conditions of the AGREEMENT not affected or amended by this AGREEMENT, are
hereby ratified and confirmed.
10. GUARANTOR
acknowledges and consents to the foregoing amendment, and agrees and confirms
that his separate guarantee of BORROWER’s obligations to BANK are, and continue
to be, valid and binding obligations of GUARANTOR.
11. Except
as herein amended, the AGREEMENT continues to be the valid, binding obligation
of BORROWER.
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
respective officers thereunto duly authorized, as of the date first above
written.
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M-TRON
INDUSTRIES, INC.
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FIRST
NATIONAL BANK OF OMAHA
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By:
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/s/
Xxxxxx Xxxxxxx
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By:
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/s/
Xxxxxx Xxxxxxx
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Its:
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President
& CEO
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Its:
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Officer
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By:
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Its:
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PIEZO
TECHNOLOGY, INC.
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By:
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/s/
Xxxxxx Xxxxxxx
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Its:
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Chairman
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By:
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Its:
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ACKNOWLEDGED
BY GUARANTOR:
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THE
LGL GROUP, INC., fka XXXXX CORPORATION
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By:
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/s/
Xxxxxx Xxxxxxx
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Its:
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President
& CEO
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By:
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/s/
Xxxxxx Xxxxxx
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Its:
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CFO
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