THIRD AMENDMENT TO DEMAND SECURED PROMISSORY NOTE AND LOAN MODIFICATION AGREEMENT
Exhibit
10.1
THIRD
AMENDMENT TO DEMAND SECURED PROMISSORY NOTE
THIS
THIRD AMENDMENT TO DEMAND SECURED PROMISSORY NOTE AND LOAN MODIFICATION
AGREEMENT (the "Agreement"), is made as of this 3rd day of April, 2007, by
and
among BCI Communications, Inc., ("Borrower") and Berliner Communications, Inc.
f/k/a Novo Networks, Inc. and Xxxxxxx X. Xxxxxxxx, pursuant to his Validity
Guaranty (“Validity Guarantor”) (collectively, Berliner and Individual Guarantor
may be referred to as the “Guarantors”) and PRESIDENTIAL FINANCIAL CORPORATION
OF DELAWARE VALLEY, a New Jersey corporation (the "Lender").
RECITALS
Pursuant
to the Loan Agreement and Security Agreement dated February 22, 2005 ("Loan
Agreement"), as amended, between the Borrower and the Lender, the Lender agreed
to make available to the Borrower a line of credit in accordance with, and
subject to, the provisions of the Loan Agreement. The Borrower’s obligation to
repay the line of credit, with interest and other fees and charges, is evidenced
by a Demand Secured Promissory Note, dated February 22, 2005 (the "Promissory
Note"), as amended, in the principal amount of One Million Two Hundred and
Fifty
Thousand Dollars ($1,250,000.00). The indebtedness, obligations and liabilities
of the Borrower under and in connection with the line of credit are guaranteed
by the Guarantors pursuant to the terms of certain guaranty agreements, dated
February 22, 2005, executed by the Guarantors (collectively "Guaranty
Agreements"). The Loan Agreement, Promissory Note, the Addendum to Promissory
Note, the Second Amendment to Promissory Note, the Guaranty Agreements, and
all
documents now in existence from Borrower and the Guarantors, and hereafter
executed by the Borrower, the Guarantors or any other party, to evidence,
secure, or guaranty, in connection with the Borrower’s indebtedness and
obligations to Lender, including this amendment and documents executed in
connection herewith, are hereinafter referred to as the "Loan
Documents".
The
Second Amendment to Demand Secured Promissory Note and Loan Modification
Agreement, dated July 10, 2006, increased the total credit line to Two Million
Five Hundred Thousand Dollars ($2,500,000.00).
The
parties wish to increase the available line of credit under the Loan Documents
from Two Million Five Hundred Thousand Dollars ($2,500,000.00) to Eight Million
Dollars ($8,000,000.00), subject to the terms and conditions of this
Agreement.
The
parties wish to change the service charge rate, under the Loan Documents, from
1.00% every thirty days to 0.25% of the average daily loan balance for the
month, subject to the terms and conditions of this Agreement and of the Loan
Documents.
The
parties wish to change the monthly minimum charge from a monthly minimum service
charge requirement of $1,500.00 to a minimum monthly loan balance requirement
of
$1,500,000.
The
parties wish to decrease the interest rate charge under the Loan Documents
from
two
percent (2.0%)
per
annum above the prime rate of interest quoted in The
Wall Street Journal
to
one
point five percent (1.5%)
per
annum above the prime rate of interest quoted in The
Wall Street Journal.
AGREEMENTS
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements of the parties hereinafter set forth, it is hereby mutually agreed
as
follows:
1. Recitals.
Each of
the parties hereto acknowledges that the above recitals are true and correct
and
incorporated herein by reference.
2. Increase
in the Line of Credit.
The
parties agree to increase the line of credit available to the Borrower under
the
Loan Documents from $2,500,000.00 to $8,000,000.00 and hereby amend the
Promissory Note, the Loan Agreement and all other Loan Documents to reflect
the
increase in the principal amount of the line of credit from $2,500,000.00 to
$8,000,000.00.
3. Term
Extension.
The
parties agree to extend the term of the line of credit available to the Borrower
for period of 12 months from the date of this agreement under the terms of
the
Loan Documents, subject to extension as provided therein.
4. Service
Charge Change.
The
parties agree that the service charge due Lender under the Loan Documents shall
be a monthly service charge equal to 0.25% of the average daily loan balance
for
the month and hereby amend the Loan Documents accordingly.
5. Increase
in Monthly Minimum Service Charge.
The
parties agree to change the monthly minimum charge from a monthly minimum
service charge requirement of $1,500.00 to a minimum monthly loan balance
requirement of $1,500,000 and the Loan Documents are hereby amended
accordingly.
6. Decrease
in the interest rate. The
parties agree to decrease the interest rate charge under the Promissory Note
from two
percent (2.0%)
per
annum above the prime rate of interest quoted in The
Wall Street Journal
to
one
point five percent (1.5%)
per
annum above the prime rate of interest quoted in The
Wall Street Journal,
and the
Loan Documents are hereby amended accordingly.
7. Representations
and Warranties.
In
order to induce the Lender to enter into this Agreement and increase the line
of
credit pursuant hereto, the Borrower and each of the Guarantors (collectively
the "Obligors") represent and warrant to the Lender that as of the date hereof
(a) no event of default exists under the provisions of the Loan Documents,
(b)
all of the representations and warranties of the Obligors in the Loan Documents
are true and correct on the date hereof as if the same were made on the date
hereof, (c) the Collateral, as defined in the Loan Agreement, is free and clear
of all assignments, security interest, liens and other encumbrances of any
kind
and nature whatsoever, except for (i) those granted or permitted under the
provisions of the Loan Documents, (ii) those granted or permitted under the
provisions of that certain Amended Subordination and Inter-Creditor Agreement,
dated of even date herewith, between Lender and SIGMA Opportunity Fund, LLC,
SIGMA Berliner, LLC, OPERIS Partners I, LLC, and Pacific Asset Partners, and
(iii) those granted to J&J Leasing Partnership to secure a promissory note
grated to J&J Leasing Partnership as part of the Borrower’s acquisition of
Digital Communication Services, Inc. on February 28, 2007, with said promissory
note being secured by a first priority security interest in certain purchased
real estate, (d) the execution and performance by the Borrower under the Loan
Agreement, as amended, will not (i) violate any provision of law, any order
of
any court or other agency of government, or the organizational documents and/or
bylaws of Borrower, or (ii) violate any indenture, contract, agreement or other
instrument to which the Borrower is party, or by which its property is bound,
or
be in conflict with, result in a breach of or constitute (with due notice and/or
lapse of time) a default under, any such indenture, or imposition of any lien,
charge or encumbrance of any nature whatsoever upon any of the property or
assets of the Borrower, and (e) this Agreement constitutes the legal, valid
and
binding obligations of the Obligors enforceable in accordance with its
terms.
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8. Ratification
and No Novation; Validity of Loan Documents.
The
Obligors hereby ratify and confirm all of their obligations, liabilities and
indebtedness under the provisions of the Loan Documents, as the same may be
amended and modified by this Agreement, and agree to pay the indebtedness,
and
abide by the terms of the Loan Documents as and when required therein and as
amended and modified by this Agreement. The Lender and the Obligors each agree
that it is their intention that nothing in this Agreement shall be construed
to
extinguish, release or discharge or constitute, create or affect a novation
of,
or an agreement to extinguish (a) any of the obligations, indebtedness and
liabilities of the Obligors, or any other party under the provisions of the
Loan
Documents, or (b) any assignment or pledge to the Lender of, or any security
interest or lien granted to the Lender in, or on, any Collateral and security
for such obligations, indebtedness, and liabilities. The Obligors agree that
all
of the provisions of the Loan Agreement, the Promissory Note, and the other
Loan
Documents shall remain and continue in full force and effect, as the same may
be
modified and amended by this Agreement. In the event of any conflict between
the
provisions of this Agreement and the provisions of the other Loan Documents,
the
provisions of this Agreement shall control. Obligors have no existing claims,
defenses (personal or otherwise) or rights of setoff whatsoever with respect
to
the obligations of the Obligors under the Loan Documents. Each of the Obligors
furthermore agrees that each of them has no defense, counterclaim, offset,
cross-complaint, claim or demand of any nature whatsoever that can be asserted
as a defense against any claims of Lender or as a basis to seek affirmative
relief and/or damages of any kind from the Lender.
9. Applicable
Law, Binding Effect, etc.
This
Agreement shall be governed by the laws of the State of New Jersey and may
be
executed in any number of duplicate originals and counterparts, each of which,
and all taken together, shall constitute one and the same instrument. This
Agreement shall be binding upon, and inure to the benefit of, the Lender, the
Borrower, and each of the Guarantors and their respective successors, heirs
and
assigns.
10. Expenses.
Borrower hereby agrees to pay all out-of-pocket expense incurred by Lender
in
connection with the preparation, negotiation and consummation of this Agreement,
and all other documents related thereto (whether or not any borrowing under
the
Loan Agreement as amended shall be consummated), including, without limitation,
the fees and expenses of Lender’s counsel.
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11. Effectiveness
of this Agreement.
This
Agreement shall not be effective until the same is executed and accepted by
Lender in the State of New Jersey.
IN
WITNESS WHEREOF, the Lender, the Borrower, and each of the Guarantors have
caused this Agreement to be duly executed, under seal, as of the day and year
first above written.
| Attest: |
BORROWER:
BCI
Communications, Inc.
|
|||
| /s/ XXXXXXXX XXX | /s/ XXXX XXXXXXXX | (SEAL) | ||
|
Name: Xxxxxxxx Xxx
Title: General Counsel
|
Name:
Xxxx Xxxxxxxx
Title:
Chief Executive Officer
|
| Attest: |
GUARANTORS:
Berliner
Communications, Inc. f/k/a Novo Networks, Inc.
|
|||
| /s/ XXXXXXXX XXX | /s/ XXXX XXXXXXXX | (SEAL) | ||
|
Name: Xxxxxxxx Xxx
Title: General Counsel
|
Name:
Xxxx Xxxxxxxx
Title:
Chief Executive Officer
|
| Witness: |
Xxxxxxx
X. Xxxxxxxx
|
|||
| /s/ XXXXXXXX XXX | /s/ XXXXXXX X. XXXXXXXX | (SEAL) | ||
|
Name: Xxxxxxxx Xxx
|
Name: Xxxx Xxxxxxxx |
| LENDER: | ||||
| Attest: |
Presidential
Financial Corporation
of
Delaware Valley
|
|||
| /s/ XXXXX XXXXXX | /s/ XXXXXX X. XXXXXXX, XX. | (SEAL) | ||
|
Name/Title: Xxxxx Xxxxxx
AVP/Asst. Credit Mgr.
|
Name:
Xxxxxx X. Xxxxxxx, Xx.
Title:
President
|
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