September 4, 1998
JPE, Inc.
000 Xxxxxxxxxx Xxxxx
Xxxxx 000
Xxx Xxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxx and Xx. Xxxxx X. Xxxxx
RE: FORBEARANCE AGREEMENT AMONG COMERICA BANK, NBD BANK, NATIONAL BANK OF
CANADA, XXXXXX TRUST AND SAVINGS BANK, AND BANK ONE, DAYTON, N.A.
(COLLECTIVELY, THE "BANKS"), COMERICA BANK, AS AGENT FOR THE BANKS
("AGENT"), JPE, INC. ("COMPANY") AND ALLPARTS, INCORPORATED ("API"), DAYTON
PARTS, INC. ("DPI"), SAC CORPORATION, STARBOARD INDUSTRIES, INC. ("SBI"),
INDUSTRIAL & AUTOMOTIVE FASTENERS, INC. ("IAF"), PLASTIC TRIM, INC.
("PTI"), BRAKE, AXLE AND TANDEM COMPANY CANADA INC. AND JPE FINISHING, INC.
(COLLECTIVELY, "GUARANTORS") DATED AUGUST 10, 1998, AND AMENDED BY A FIRST
AMENDMENT DATED AUGUST 31, 1998 (AS AMENDED, THE "FORBEARANCE AGREEMENT")
Dear Xx. Xxxxxxx and Xx. Xxxxx:
Company and Guarantors have requested that Banks extend the forbearance provided
for in the Forbearance Agreement.
Subject to written acceptance by Company and Guarantors of the following terms
and conditions by 10:00 a.m. on September 8, 1998, Agent and Banks are willing
to grant certain accommodations and to forbear until September 11, 1998, subject
to earlier termination as provided below, from further action to collect the
Indebtedness:
1. All capitalized terms not defined in this second amendment to the
Forbearance Agreement ("Second Amendment") shall have the meanings
described in the Forbearance Agreement and/or the Loan Documents.
2. Except as modified by this Second Amendment, the Indebtedness and the
financing arrangements among Agent, Banks, Company and Guarantors shall
continue to be governed by the covenants, terms and conditions of the
Forbearance Agreement and the Loan Documents, which are ratified and
confirmed. The liens and security interests granted to Agent and Banks
under the Loan Documents and the Forbearance Agreement are also ratified
and confirmed by Company and Guarantors. This Second Amendment shall be
binding upon and shall inure to the benefit of Agent, Banks, Company and
Guarantors, and their respective successors and assigns.
3. Company and Guarantors acknowledge that Agent and Banks are under no
obligation to advance funds or extend credit to Company and Guarantors
under the Forbearance Agreement, as amended, the Credit Agreement or other
Loan Documents, or otherwise.
4. Subject to maintaining the advisory Advance Formula equal to or greater
than the aggregate of (i) Advances under the Revolving Credit and Swing
Line and (ii) the Letter of Credit Obligations, and provided there are no
defaults under the terms of the Forbearance Agreement, as amended, and no
further defaults under the Loan Documents, Banks may, in their sole
discretion, continue to advance to Company under the Revolving Credit Loan,
in accordance with the Loan Documents, as amended, through September 11,
1998. Company and Guarantors agree that:
(a) from August 31, 1998 forward, the portion of the funds borrowed by
Company for the benefit of PTI and/or SBI shall be limited to the
aggregate amount of funds collected by PTI and SBI and applied to the
Indebtedness from and after August 31, 1998 (both borrowings and
collections shall be computed on a cumulative basis); and
(b) neither Company nor any of the Guarantors shall make intercompany
transfers of any kind to or for the benefit of PTI and/or SBI, other
than as permitted by subparagraph (a) above.
5. COMPANY, GUARANTORS, AGENT AND BANKS ACKNOWLEDGE AND AGREE THAT THE RIGHT
TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH
PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH
COUNSEL OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THEIR MUTUAL
BENEFIT WAIVES ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF LITIGATION
REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED TO, THIS
SECOND AMENDMENT, THE FORBEARANCE AGREEMENT, THE LOAN DOCUMENTS OR THE
INDEBTEDNESS.
6. COMPANY AND GUARANTORS, IN EVERY CAPACITY, INCLUDING, BUT NOT LIMITED TO,
AS SHAREHOLDERS, PARTNERS, OFFICERS, DIRECTORS, INVESTORS AND/OR CREDITORS
OF COMPANY AND/OR GUARANTORS, OR ANY ONE OR MORE OF THEM, HEREBY WAIVE,
DISCHARGE AND FOREVER RELEASE AGENT, BANKS, AND THEIR EMPLOYEES, OFFICERS,
DIRECTORS, ATTORNEYS, STOCKHOLDERS AND SUCCESSORS AND ASSIGNS, FROM AND OF
ANY AND ALL CLAIMS, CAUSES OF ACTION, DEFENSES, COUNTERCLAIMS OR OFFSETS
AND/OR ALLEGATIONS COMPANY AND/OR GUARANTORS MAY HAVE, OR MAY HAVE MADE, OR
ARE BASED ON FACTS OR CIRCUMSTANCES ARISING, AT ANY TIME UP THROUGH AND
INCLUDING THE DATE OF THIS SECOND AMENDMENT, WHETHER KNOWN OR UNKNOWN,
AGAINST ANY OR ALL OF AGENT, BANKS, THEIR EMPLOYEES, OFFICERS, DIRECTORS,
ATTORNEYS, STOCKHOLDERS AND SUCCESSORS AND ASSIGNS.
Agent and Banks reserve the right to terminate their forbearance prior to
September 11, 1998 in the event of any new defaults under the Loan Documents or
a default under the Forbearance Agreement as amended by this Second Amendment,
in the event of further deterioration in the financial condition of Company or
Guarantors or further deterioration in Agent's or Banks' collateral position,
and/or in the event Agent or Banks, for any reason, believes that the prospect
of payment or performance is impaired.
Very truly yours,
COMERICA BANK, Agent
By: /s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
-------------------------
Its: Vice President
Special Assets Group
X.X. Xxx 00000
Xxxxxxx, Xxxxxxxx 00000-0000
(000) 000-0000
(000) 000-0000 Fax
COMERICA BANK NBD BANK
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------- -------------------------
Its: Vice President Its: Vice President
NATIONAL BANK OF CANADA XXXXXX TRUST and SAVINGS BANK
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxx
------------------------- -------------------------
Its: Vice President Its: Sr. Vice President
By: /s/ Xxxxx Xxxxx
-------------------------
Its: Vice President
BANK ONE, DAYTON, N.A.
By: /s/ Xxxxx X. Xxxxx
-------------------------
Its: Assistant Vice President
ACKNOWLEDGED AND AGREED:
JPE, INC. DAYTON PARTS, INC.
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------- -------------------------
Its: President Its: Vice President
Date: 9/4/98 Date: 9/4/98
ALLPARTS, INCORPORATED SAC CORPORATION
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------- -------------------------
Its: Vice President Its: Vice President
Date: 9/4/98 Date: 9/4/98
STARBOARD INDUSTRIES, INC. BRAKE, AXLE AND TANDEM
COMPANY CANADA INC.
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------- -------------------------
Its: Vice President Its: Vice President
Date: 9/4/98 Date: 9/4/98
INDUSTRIAL & AUTOMOTIVE JPE FINISHING, INC.
FASTENERS, INC.
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------- -------------------------
Its: Vice President Its: Vice President
Date: 9/4/98 Date: 9/4/98
PLASTIC TRIM, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------------
Its: Vice President
Date: 9/4/98
