FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
FOURTH
AMENDMENT TO
AMENDED
AND RESTATED CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO AMENDED AND
RESTATED CREDIT AGREEMENT (this “Fourth Amendment”) dated as of
the 17th day of July, 2009, is by and between BIOANALYTICAL SYSTEMS, INC.
(“Borrower”) and
NATIONAL CITY BANK (“Bank”);
W
I T N E S S E T H:
WHEREAS, as of January 4, 2005, the
parties hereto entered into a certain Credit Agreement, as amended (as amended,
the “Agreement”);
WHEREAS, the parties desire to further
amend the Agreement, subject to the terms contained therein;
NOW, THEREFORE, in consideration of the
premises, and the mutual promises herein contained, the parties agree that the
Agreement shall be, and it hereby is, amended as provided herein and the parties
further agree as follows:
PART
I. AMENDATORY PROVISIONS
Article
2. Credit
2.1 Line of Credit
Commitment. Section 2.1 of the Agreement is hereby amended by
substituting the following new Section 2.1 in lieu of the existing Section
2.1:
2.1 Line of Credit
Commitment. Subject to the terms and conditions of this
Agreement, Bank shall make Advances under the Line of Credit available to
Borrower in a maximum principal amount equal to the lesser of: (a) Three Million
Dollars ($3,000,000), or (b) the Borrowing Base. Advances under the
Line of Credit shall be evidenced by the Replacement Credit Note in the form
attached hereto. All Advances under the Line of Credit (whether
currently outstanding or to be made) shall constitute Eurodollar Rate
Advances.
2.2 Interest; Unused Fees and Rate
Selection. Section 2.2 of the Agreement is hereby amended by
substituting the following new Section 2.2 in lieu of the existing Section
2.2:
2.2.1. Line of Credit –
Interest. Prior to maturity or Default, the outstanding
principal balance of Advances under the Line of Credit shall bear interest at a
per annum rate equal to LIBOR plus Five Percent
(5%). In the event that LIBOR shall become unavailable, the
outstanding principal balance of Advances under the Line of Credit shall bear
interest at a per annum rate equal to the Prime Rate plus Two Percent
(2%).
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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2.2.2. General. Interest
shall be due and payable for the exact number of days principal is outstanding
and shall be calculated on the basis of a three hundred sixty (360) day
year. Any change in the interest rates occasioned by a change in
LIBOR shall be effective on the same day as the change in
LIBOR. After the maturity of any Facility, whether by acceleration or
otherwise, and while and so long as there shall exist any uncured Default, the
Facilities shall bear interest at a per annum rate equal to Four Percent (4%)
above the otherwise applicable rates.
2.2.3. Unused Fee/Reduction of Line of
Credit Commitment. Borrower shall pay to Bank from and after
the date hereof until the date on which Bank’s commitment under the Line of
Credit is terminated in whole, an unused fee accruing at the rate of the
Applicable Fee per annum on the average daily unborrowed portion of the Line of
Credit minus outstanding Letters of Credit. All such unused fees
payable under this clause shall be payable quarterly in arrears on the last day
of each fiscal quarter of Borrower occurring after the date hereof (with the
first such payment being calculated for the period from the date hereof and
ending on March 31, 2005), and, in addition, on the date on which the Bank’s
commitment under the Line of Credit is terminated in whole. Such
unused fee shall be calculated on the basis of the actual number of days elapsed
and a three hundred sixty (360) day year. Borrower may permanently
reduce the Bank’s commitment under the Line of Credit, in whole or in part, in
integral multiples of One Million Dollars ($1,000,000), upon at least three (3)
Banking Days’ written notice to Bank, which notice shall specify the amount of
any such reduction; provided, however, that the amount of Bank’s commitment
under the Line of Credit may not be reduced below the aggregate principal amount
outstanding thereunder.
2.2.4. Interest Rate Selection – Eurodollar
Rate Option. [Intentionally left blank].
2.4 Issuance of Letters of
Credit. Section 2.4 of the Agreement is hereby amended by
substituting the following new Section 2.4 in lieu of the existing Section
2.4:
2.4 Issuance of Letters of
Credit. Subject to the terms and conditions hereof, the Line
of Credit, at the option of Borrower upon delivery of a proper Letter of Credit
Application, in the form prescribed by Bank, may also be utilized in the form of
Letters of Credit issued by Bank for the account of Borrower. Each
Letter of Credit shall have an expiration date not later than the earlier of
twelve (12) months from the date of issuance, or the Line of Credit Maturity
Date. The aggregate of the Letters of Credit outstanding at any time
plus the aggregate
amount of unreimbursed drawings under the Letters of Credit shall not exceed the
lesser of the unborrowed available portion of the Line of Credit or Seven
Hundred Fifty Thousand Dollars ($750,000.00). The amount of any
Letter of Credit outstanding at any time for all purposes hereof shall be the
maximum amount which could be drawn thereunder under any circumstances from and
after the date of determination. The Letters of Credit and each
unreimbursed drawing thereunder shall count against and reduce the available
amount under the Line of Credit by the amount of any Letter of Credit
outstanding unless and until such Letter of Credit expires by its terms or
otherwise terminates or the amount of a drawing thereunder is reimbursed, in
which event the Line of Credit shall be reinstated by the amount of such Letter
of Credit or the amount of such reimbursement, as the case may
be. Each such Letter of Credit shall conform to the general
requirements of Bank for the issuance of such credits, as to form and substance,
shall be subject to the Uniform Customs and Practices for Documentary Credits
(1993 Revision) International Chamber of Commerce Publication No. 500 or
International Standby Practices Publication 590 of the International Chamber of
Commerce and shall be a letter of credit which Bank may lawfully
issue. If and to the extent a drawing is at any time made under any
Letter of Credit, Borrower agrees to pay to Bank immediately and unconditionally
upon demand for reimbursement, in lawful money of the United States, an amount
equal to each amount which shall be so drawn, together with interest from the
date of such drawing to and including the date such payment is reimbursed to
Bank or converted to an Advance under the Line of Credit as provided
herein. Until demand for reimbursement, such interest shall be
calculated at a variable per annum rate equal to LIBOR plus Five Percent (5%), and
interest shall be calculated after such demand at a variable per annum rate
equal to LIBOR plus Nine
Percent (9%). In the event that LIBOR shall become unavailable, such
interest shall be calculated at a variable per annum rate equal to the Prime
Rate plus Two Percent
(2%), and interest shall be calculated after such demand at a variable per annum
rate equal to the Prime Rate plus Six Percent
(6%). All such interest shall be calculated on the basis that an
entire year’s interest is earned in three hundred sixty (360)
days. Bank shall convert automatically the reimbursement obligations
of Borrower arising out of any such drawing into Advances under the Line of
Credit so long as the Line of Credit has not expired, and Borrower hereby
irrevocably authorizes Bank to refinance, without notice to Borrower, the
reimbursement obligation of Borrower arising out of any such drawing into
Advances under the Line of Credit, evidenced by the Credit Note and for all
purposes under, on and subject to the terms and conditions of this Agreement,
without regard to the conditions precedent to making an Advance under the Line
of Credit or to any requirement of this Agreement that each Advance be a minimal
amount or multiple. This Agreement and the other Loan Documents shall
supersede any terms of any letter of credit applications or other documents
which are irreconcilably inconsistent with the terms hereof or
thereof. Borrower agrees to pay to Bank, at the time of issuance,
Letter of Credit fees equal to the Applicable Fee of the face amount of each
commercial Letter of Credit and the Applicable Fee per annum of each standby
Letter of Credit. Such Letter of Credit fees shall be due and payable
upon issuance and thereafter quarterly in advance on the first day of each
calendar quarter and shall be calculated on the basis that an entire year
consists of three hundred sixty (360) days. Such fees shall not be
reduced or refundable for any reason. Borrower shall also pay Bank’s
reasonable and customary costs of issuing, servicing, and negotiating draws
under the Letters of Credit. Borrower hereby authorizes Bank to
collect such fees by deducting the amount thereof from any account of Borrower
at Bank.
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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2.9.1. Line of
Credit. Section 2.9.1 of the Agreement is hereby amended by
substituting the following new Section 2.9.1 in lieu of the existing Section
2.9.1:
Borrower
shall give Bank email, telex or telegraphic notice of its intention to borrow
under the Line of Credit (a “Borrowing Base Request”) by not later than 10:00
a.m. (Indianapolis time) on the proposed borrowing date, which shall be a
Banking Day. With each draw request, Borrower shall submit the
necessary documentation including, but not limited to, a Borrowing Base
reconciliation and any accompanying backup documentation, such as sales
journals, copies of invoices, or other supporting information as deemed
reasonably necessary by the Bank in its sole discretion (collectively, the
“Borrowing Base
Documentation”). It shall be an Event of Default if any
Borrowing Base Documentation contains any misrepresentations. Each
Borrowing Base Request once received by Bank shall be irrevocable, subject to
Section 2.13 hereof. Borrower agrees that Bank may rely on any such
email, telex or telegraphic Borrowing Base Request made by any Person whom Bank
in good faith believes to be authorized. Each Borrowing Base Request,
including the accompanying Borrowing Base report, shall in and of itself
constitute a representation and warranty on behalf of Borrower that no Default
or Unmatured Default (except the Waived Default expressly waived herein, as
provided by Article 6) has occurred and is continuing or would result from the
making of the Advance requested by the Borrowing Base Request and that the
requested Advance shall not cause the principal balance of the Line of Credit to
exceed the maximum amount available under the Line of Credit from time to
time. Provided that there is availability under the Line of Credit,
Bank shall use its commercially reasonable best efforts to deposit each Advance
into the Operating Account (as such term is defined in paragraph 5.2.15) no
later than 2:00 p.m. (Indianapolis time) on the Banking Day upon which the
Borrower makes a Borrowing Base Request.
Article 5.
Covenants
5.2.15 Banking
Relationship. Section 5.2.15 of the Agreement is hereby
amended by substituting the following new Section 5.2.15 in lieu of the existing
Section 5.2.15:
Maintain
all of its banking accounts with Bank except for the Excluded Account (as
defined below), including, without limitation, operating, lockbox and autoline
accounts (collectively, the “Operating Account”). "Excluded Accounts"
shall be accounts maintained in West Lafayette, IN, Evansville, IN and
McMinnville, OR (locations where Bank does not have branches) for use in local
transactions. The balances of funds in those accounts will not exceed
$10,000 each in West Lafayette and Evansville, and $5,000 in McMinnville
(collectively, the “Excluded Account
Cap”). Borrower shall also maintain a segregated depository
account at Bank in Bank’s name as account number ______________(the “Cash Collateral
Account”). “Excluded Payments”
shall mean deposits made into the Excluded Accounts, provided that such deposits
do not cause the balance of the respective Excluded Account to exceed the
Excluded Account Cap. Borrower agrees that all receipts from the sale
of inventory, collection of accounts, and all other revenues (collectively, the
“Cash
Collateral”) shall be immediately deposited into the Cash Collateral
Account. Borrower shall not commingle any of the Cash Collateral with
any other funds or assets, and will deliver the Cash Collateral (including all
checks and other instruments representing proceeds of Borrower’s inventory,
accounts receivable and all other revenues, but not including any Excluded
Payments) in the form received by Borrower no later than the first business day
after the same are received by Borrower. Until so delivered, all such
cash, checks, deposits and other property shall be held in trust by Borrower for
the benefit of Bank. Borrower shall have no legal or equitable title
to the Cash Collateral Account or any funds thereto. Bank shall
credit the Cash Collateral deposited into the Cash Collateral Account to the
Obligations on the first Banking Day following receipt of collected funds and
reduce the Obligations by such amounts. Notwithstanding any other
provision of this Agreement, at any time and from time to time when the
Obligations of Borrower to Bank are paid in full, including all reasonable
attorneys’ fees and other reasonable expenses incurred by Bank in connection
with the Obligations, Bank will transfer all remaining funds in the Cash
Collateral Account to the Operating Account. Bank shall have
authority to endorse in the name of Bank and/or Borrower any check or similar
instrument payable to Borrower that may come into the possession of Bank as Cash
Collateral.
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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5.2.17 Inventory and Appraisal
of Equipment: The following is hereby added to the Agreement
as Section 5.2.17:
On or
before August 15, 2009, provide Bank with a complete inventory of all equipment
owned or leased by Borrower and BAS Evansville, Inc. Such inventory
shall indentify any and all security interests held by lenders in each item of
equipment and whether such equipment is being leased. For each piece
of equipment that is neither being leased nor subject to any security interests
other than a security interest held by Bank and/or National City Leasing
Corporation, Borrower shall submit an appraisal provided by an accredited
appraiser acceptable to Bank in its sole discretion to Bank on or before August
15, 2009. The appraisal shall include both a fair market valuation
and a liquidation valuation.
5.2.18 Field Exam: The
following is hereby added to the Agreement as Section 5.2.18:
Allow
Bank to conduct a field exam(s) of Borrower and/or BAS Evansville, Inc. at the
reasonable discretion of the Bank. Representatives and agents of
Bank, may enter upon the premises of Borrower and/or BAS Evansville, Inc. at any
time during their business hours. Such representatives are authorized to copy
and preserve all corporate records and shall have access to all manufacturer
systems and web based interfaces as determined in their sole discretion, and,
further may observe the Borrower’s compliance with the terms and provisions of
this Agreement, and the Loan Documents, and may verify sales, payments, and the
terms of any sale with customers and any third party, but shall not in any
respect participate in the management of the day-to-day business operations of
the Borrower and/or BAS Evansville, Inc. So long as any of the
Obligations are outstanding, or any Obligation may arise pursuant to the Loan
Documents, the Bank may conduct field exams and/or audits of the Borrower and/or
BAS Evansville, Inc., the frequency of which is solely within the discretion of
the Bank. In addition, the Borrowers shall use their best efforts to
accommodate the Bank with the observation and investigation permitted hereby.
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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5.3.2
Fixed Charge Coverage
Ratio. Section 5.3.2 of the Agreement is hereby amended by
substituting the following new Section 5.3.2 in lieu of the existing Section
5.3.2:
5.3.2
Fixed Charge Coverage
Ratio. Maintain its Fixed Charge Coverage Ratio at not less than
1:00 to 1:00 as of June 30, 2009 (calculated by annualizing results for the
three (3) month period ended June 30, 2009 by multiplying the numerator and
denominator in the Fixed Charge Coverage Ratio by four (4)), at not less than
1.25 to 1:00 as of September 30, 2009 (calculated by annualizing the results for
the six (6) month period ended September 30, 2009 by multiplying the numerator
and denominator in the Fixed Charge Coverage Ratio by two (2)), and at not less
than 1.50 to 1.00 as of December 31, 2009 (calculated by annualizing the nine
(9) month period ended December 31, 2009 by multiplying the numerator and
denominator in the Fixed Charge Coverage Ratio by one and thirty-three one
hundredths (1.33)).
5.3.3
Tangible Net
Worth. Section 5.3.3 of the Agreement is hereby amended by
substituting the following new Section 5.3.3 in lieu of the existing Section
5.3.3:
5.3.3
Tangible Net
Worth. Maintain its Tangible Net Worth (determined as of the end of
the fiscal quarter) at not less than Twelve Million Dollars ($12,000,000) as of
June 30, 2009, and increasing as of the last day of each fiscal quarter
thereafter by an amount equal to Fifty Percent (50%) of Borrower's net income
(without reduction for any net losses for such fiscal
quarter).
PART
II. WAIVER
Subject to the satisfaction of Part IV hereof, Bank hereby waives, for the
fiscal periods ending December 31, 2008, March 31, 2009 and June 30, 2009,
compliance with the provisions of Section 5.3.2 (Fixed Charge Coverage Ratio) of
the Agreement, and further waives, for the fiscal periods ending March 31, 2009
and June 30, 2009, compliance with the provisions of Section 5.3.3 (Tangible Net
Worth) of the Agreement, the merger of BASi Northwest Laboratory, Inc. with and
into the Borrower, the dissolution of BASi Maryland, Inc., as well as any
Default or Unmatured Default by Borrower for noncompliance therewith
(collectively, the “Waived Default”). These waivers shall be in force and
effect solely for the referenced period, unless otherwise agreed by Bank in the
exercise of its sole discretion. Notwithstanding the terms of this
Section, Bank is not waiving any default by the Borrower resulting from
Borrower’s failure to comply with Section 5.3.2 and 5.3.3 as amended by this
Fourth Amendment for the period ending on June 30, 2009.
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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PART
III. CONTINUING EFFECT
Except as
expressly modified herein:
(a) All
terms, conditions, representations, warranties and covenants contained in the
Agreement shall remain the same and shall continue in full force and effect,
interpreted, wherever possible, in a manner consistent with this Fourth
Amendment; provided, however, in the event
of any irreconcilable inconsistency, this Fourth Amendment shall
control;
(b) The
representations and warranties contained in the Agreement shall survive this
Fourth Amendment in their original form as continuing representations and
warranties of Borrower; and
(c) Capitalized
terms used in writing by Bank, and not specifically herein defined, shall have
the meanings ascribed to them in the Agreement.
In
consideration hereof, Borrower represents, warrants, covenants and agrees
that:
(aa) Except
to the extent set forth above, each representation and warranty set forth in the
Agreement, as hereby amended, remains true and correct as of the date hereof in
all material respects, except to the extent that such representation and
warranty is expressly intended to apply solely to an earlier date and except for
changes reflecting transactions permitted by the Agreement;
(bb) There
currently exist no offsets, counterclaims or defenses to the performance of the
Obligations (such offsets, counterclaims or defenses, if any, being hereby
expressly waived);
(cc) Except
as expressly waived in writing by Bank, there has not occurred any Default or
Unmatured Default; and
(dd) After
giving effect to this Fourth Amendment and any transactions contemplated hereby,
no Default or Unmatured Default is or will be occasioned hereby or
thereby.
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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PART
IV. CONDITIONS PRECEDENT
Notwithstanding anything contained in
this Fourth Amendment to the contrary, Bank shall not have any obligation under
this Fourth Amendment until each of the following conditions precedent have been
fulfilled to the satisfaction of Bank:
(a) Bank
shall have received this Fourth Amendment, duly executed in the form prescribed
by Bank;
(b) Bank
shall have received a Reaffirmation of Guaranty, in the form prescribed by Bank,
duly executed by each Guarantor in existence as of the date hereof;
(c) Bank
shall have received the Replacement Promissory Note duly executed in the form
prescribed by Bank;
(d) Bank
shall have received a duly executed certificate of the Secretary of Borrower (i)
certifying as to attached copies of Resolutions of the Board of Directors of
Borrower authorizing the execution, delivery and performance of this Fourth
Amendment, and (ii) certifying as complete and correct as to attached copies of
the Articles of Incorporation and By-laws of Borrower or certifying that such
Articles of Incorporation or By-laws have not been amended (except as shown)
since the previous delivery thereof to Bank;
(e) Borrower
shall have paid Bank a $7,500 non-refundable waiver fee; and
(f) All
legal matters incident to this Fourth Amendment shall be reasonably satisfactory
to Bank and its counsel.
PART
V. EXPENSES
Borrower shall reimburse Bank for all
reasonable legal fees and other expenses incurred by Bank in connection with
this Fourth Amendment and the transactions contemplated hereby. Bank
is hereby authorized to debit Borrower’s operating account maintained at Bank
for such legal fees and expenses.
PART
VI. COUNTERPARTS
This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one agreement.
[signatures
on following pages]
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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IN WITNESS WHEREOF, Borrower and Bank
have caused this Fourth Amendment to be executed by their respective officers
duly authorized as of the date first above written.
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“BORROWER”
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BIOANALYTICAL
SYSTEMS, INC.
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By:
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/s/ Xxxxxxx X. Xxx | ||
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Printed:
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Xxxxxxx X. Xxx | ||
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Its:
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VP - Finance | ||
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STATE
OF INDIANA
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)
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)SS:
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COUNTY
OF Tippecanoe
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)
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Personally appeared before me, a Notary
Public in and for said County and State, Xxxxxxx X. Xxx of said corporation,
known to me as the person named herein, who after being duly sworn upon his
oath, stated to me that he has been duly authorized and empowered to execute the
foregoing Agreement on behalf of said corporation.
In Witness Whereof, I have hereunto set
my hand and Notarial Seal, this 17th day of July, 2009.
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My
Commission Expires:
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/s/ Xxxx X. Xxxxxx-Xxxxxx | ||
| 3/17/2016 |
Notary
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My
County of Residence:
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Xxxx X. Xxxxxx-Xxxxxx | ||
| Tippecanoe |
Printed
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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“BANK”
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NATIONAL
CITY BANK
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By:
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/s/ Xxxx X. Xxxxxxx | ||
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Its:
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Vice President | ||
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FOURTH
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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