BNY FACTORING LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
as of July 22, 1999
TII INDUSTRIES, INC.
TII CORPORATION
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Re: Consent and Amendment
Gentlemen:
Reference is made to the Revolving Credit, Term Loan and Security
Agreement dated April 30, 1998 (the "Industries Loan Agreement") among and BNY
Factoring LLC, as successor to BNY Financial Corporation ("BNYF"), TII
Industries, Inc. ("Industries") and TII Corporation ("Corporation") and each of
the notes, instruments, mortgages, agreements and other documents executed
and/or delivered in connection therewith (all of the foregoing, together with
the Industries Loan Agreement, collectively, the "Loan Agreements"), as the same
now exists or hereafter be amended, restated, renewed, extended, supplemented or
otherwise modified, (collectively, the "Loan Documents"). All capitalized terms
not otherwise defined herein shall have the meanings ascribed to such terms as
set forth in the Loan Agreements.
Industries and Corporation have requested certain amendments to the
Loan Agreements, and Industries has requested that BNYF consent to the
repurchase by Industries of all of Industries Series C Convertible Preferred
Stock with the proceeds of certain matured funds in the possession of BNYF for
an aggregate amount not to exceed $3,600,000 (the "Stock Repurchase"), and BNYF
is willing to do so subject to the terms and provisions of this Letter Re:
Consent and Amendment (the "Agreement").
In consideration of the foregoing, the parties hereby agree as follows:
1. Subject to the terms and conditions set forth herein, BNYF hereby
consents to the Stock Repurchase and agrees to make available to Industries an
amount not to exceed $3,600,000; provided that (i) such funds shall be used
solely for the purpose of paying for the Stock Repurchase and reasonable and
customary costs incidental thereto, and (ii) after giving effect to the Stock
Repurchase, there shall be no Revolving Advances outstanding under the Loan
Agreements.
2. Paragraph 6.5 of the Industries Loan Agreement is hereby amended
and restated in its entirety to read as follows:
"6.5 Net Worth. Cause to be maintained at all times a consolidated Net
Worth in an amount not less than $21,000,000 ("Minimum Net Worth"). For
each of Borrowers' fiscal quarters during the Term commencing with the
fiscal quarter beginning on June 30, 1999, Minimum Net Worth shall be
increased by an amount equal to fifty percent (50%) of Net Income for
each such quarter."
3. Except as specifically set forth herein, no other changes or
modifications to the Loan Documents are intended or implied, and in all other
respects, the Loan Documents shall continue to remain in full force and effect
in accordance with their respective terms as of the date hereof. Except as
specifically set forth herein, nothing contained herein shall evidence a waiver
or amendment by BNYF of any other provision of the Loan Documents nor shall
anything contained herein be construed as a consent by BNYF to any transaction
other than that specifically consented to herein.
4. The terms and provisions of this Agreement shall be for the benefit
of the parties hereto and their respective successors and assigns; no other
person, firm, entity or corporation shall have any right benefit or interest
under this Agreement. This Agreement may be signed in counterparts, each of
which shall be an original and all of which when taken together shall constitute
one agreement. In making proof of this Agreement, it shall not be necessary to
produce or account for more than one counterpart signed by the party to be
charged.
5. This Agreement sets forth the entire agreement and understanding of
the parties with respect to the matter set forth herein. This Agreement cannot
be changed, modified, amended or terminated except in writing executed by the
party to be charged.
Very truly yours,
BNY FACTORING LLC
By:
Title:
ACKNOWLEDGED AND AGREED:
TII INDUSTRIES, INC.
TII CORPORATION
By:
Title: Of Each
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The terms and provisions of the foregoing are hereby acknowledged and consented
to:
CROWN TOOL & DIE COMPANY, INC.
By:
Title:
TII-DITEL, INC.
By:
Title:
TII-DOMINICANA, INC.
By:
Title:
TII INTERNATIONAL, INC.
By:
Title:
TELECOMMUNICATIONS INDUSTRIES, INC.
By:
Title:
