EXHIBIT 10.21
AMENDMENT TO NOTE PURCHASE AGREEMENT
THIS AMENDMENT (the "Amendment") to the Note Purchase Agreement dated
as of June 9, 1995 entered into as of this ____ day of November 1998, by and
among Top Source Technologies, Inc. (the "Company"), the purchasers listed on
Exhibit A hereto (the "Mellon Purchasers") and Mellon Private Asset Management,
formerly known as Ganz Capital Management, Inc. (the "Agent"). Capitalized terms
used herein and not otherwise defined shall have the same meaning set forth in
the Note Purchase Agreement (the "Agreement").
WHEREAS, the Company, the Mellon Purchasers and the Agent entered into the
Agreement as of June 9, 1995; and
WHEREAS, the Company, the Mellon Purchasers and the Agent wish to
modify certain terms and conditions contained in the Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
consideration contained in this Agreement, the parties agree as follows:
A. Waiver of Certain Provisions. The Agent waives certain provisions of the
Agreement as follows:
(a) The ratio of Indebtedness to equity contained in Section
8.1(a) of the Agreement shall be waived through and including September
30, 1999.
(b) Notwithstanding the provisions of Section 8.1(b) of the
Agreement, the Company may make Restricted Payments for the purpose of
paying cash dividends on Preferred Stock sold after November 1, 1998
and for the purpose of redeeming any Preferred Stock.
(c) Upon the making of the payments provided in Section 2(a)
and 2(b) of this Amendment, notwithstanding the provisions of Sections
8.2 and 8.7 of the Agreement, the Company and its Subsidiary, Top
Source Automotive, Inc. ("TSA"), may sell the assets of Top Source
Automotive, Inc. to NCT Audio
Products, Inc. ("NCT").
2. Prepayment of Notes.
(a) On or before December ___, 1998, the Company shall pay
each of the Mellon Purchasers $.33 for each $1.00 of principal amount
of the Notes held by such Mellon Purchaser.
(b) If, as and when the stockholders of the Company approve
the sale of assets of TSA to NCT, the Company shall pay to each of the
Mellon Purchasers $.37 for each $1.00 of principal amount of Notes held
by such Mellon Purchaser.
3. Modification of the Notes. After the making of the payments referred
to in Section 2(b) above, the remaining Notes held by the Mellon Purchasers
shall be modified by reducing the conversion price from $10.00 per share to
$2.00 per share, subject to adjustment as provided in the Agreement, and by
reducing the interest rate from 9% per annum to 5% per annum (which reduction
shall not be retroactive). The Agent represents that it has the authority to act
in this regard on behalf of the Mellon Purchasers.
4. Disclosure. The Agent represents that it has received a copy of the
Company's Proxy Statement dated November 6, 1998 and such Proxy Statement has
been made available to the Mellon Purchasers either directly or through access
on the Internet on the Securities and Exchange Commission Website, xxx.xxx.xxx.
5. Status of the Agreement. The Agreement is ratified and confirmed and
except as specifically modified by this Amendment, it shall remain in effect.
6. Severability. In the event any parts of this Amendment are found to
be void, the remaining provisions of this Amendment shall nevertheless be
binding with the same effect as though the void parts were deleted.
7. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. The execution of this
Amendment may be by actual or facsimile signature.
8. Benefit. This Amendment shall be binding upon and inure to the
benefit of the parties hereto and their legal representatives, successors and
assigns.
9. Notices and Addresses. All notices, offers, acceptance and any other
acts under this Amendment (except payment) shall be in writing, and shall be
sufficiently given if delivered to the addressees in person, by Federal Express
or similar receipted delivery, by facsimile delivery or, if mailed, postage
prepaid, by certified mail, return receipt requested, as follows:
The Company: Top Source Technologies, Inc.
0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxxxx Xxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
with a copy to: Xxxxxxx X. Xxxxxx, Esq.
XXXXXXX XXXXXX, P.A.
0000 Xxxx Xxxxx Xxxxx Xxxx.
Xxxxx 000
Xxxx Xxxx Xxxxx, XX 00000
Facsimile (000) 000-0000
The Agent: Mellon Private Asset Management
f/n/a Ganz Capital Management, Inc.
2875 N.E. 000xx Xxxxxx, Xxxxxxxxx I
North Xxxxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
or to such other address as either of them, by notice to the other may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be conclusive evidence of successful facsimile delivery.
Time shall be counted to, or from, as the case may be, the delivery in person or
by mailing.
10. Attorney's Fees. In the event that there is any controversy or
claim arising out of or relating to this Amendment, or to the interpretation,
breach or enforcement thereof, and any action or proceeding including an
arbitration proceeding is commenced to enforce the provisions of this Amendment,
the prevailing party shall be entitled to an award by the court or arbitrator,
as appropriate, of reasonable attorney's fees, costs and expenses.
11. Oral Evidence. This Amendment constitutes the entire Amendment
between the parties and supersedes all prior oral and written agreements between
the parties hereto with respect to the subject matter hereof. Neither this
Amendment nor any provision hereof may be changed, waived, discharged or
terminated orally, except by a statement in writing signed by the party or
parties against which enforcement or the change, waiver discharge or termination
is sought.
12. Additional Documents. The parties hereto shall execute such
additional instruments as may be reasonably required by their counsel in order
to carry out the purpose and intent of this Amendment and to fulfill the
obligations of the parties hereunder.
13. Governing Law. This Amendment and any dispute, disagreement, or
issue of construction or interpretation arising hereunder whether relating to
its execution, its validity, the obligations provided herein or performance
shall be governed or interpreted according to the internal laws of the State of
Florida without regard to choice of law considerations.
14. Section or Paragraph Headings. Section headings herein have been
inserted for reference only and shall not be deemed to limit or otherwise
affect, in any matter, or be deemed to interpret in whole or in part any of the
terms or provisions of this Amendment.
IN WITNESS WHEREOF the parties hereto have set their hand and seals as
of the date first above written.
WITNESSES: TOP SOURCE TECHNOLOGIES, INC.
By:
Xxxxxxx X. Xxxxxx, Xx.
President
MELLON PRIVATE ASSET MANAGEMENT
F/K/A GANZ CAPITAL MANAGEMENT, INC.
By:
EXHIBIT A
THE MELLON PURCHASERS
Xxx. Xxxx Xxxxxxx
Mr. Xxxxxxx Xxxxxxx
Xx. Xxxxx Xxxxxxx
Xx. Xxxxxx Broad
Xx. Xxxxxxx Xxxx
Xxxxx Family Foundation
Xx. Xxxxxx Xxxxxxx
Xxxx Investments
Xx. Xxxxxxx Xxxxxx
Xx. Xxxxx Xxxxxxx
Xx. Xxxxxx Xxxxxxxx
Xxx. Xxxxxx Xxxxxxxx
Xx. Xxxxxx Xxxxxxxxx
Xx. Xxxxxxx Xxxxxx
Xxx. Xxxxxxx Xxxxxx
Xx. Xxxxxxx Xxxxxxxxxx
Xx. Xxxxxx X. Xxxxxx
December 2, 1998
Via Fax and Federal Express
Dear Noteholder:
We are writing to solicit your consent to the modification of the Note
Purchase Agreement (the "Agreement") dated as of June 9, 1995 among Top Source
Technologies, Inc. (the "Company"), Ganz Capital Management, Inc. (the "agent")
and various Noteholders who purchased an aggregate of $3,020,000 in principal
amount of the Company's 9% Senior Subordinated Convertible Note due June 9, 2000
(the "Notes"). The modification is contained in the enclosed amendment (the
"Amendment"). Under the terms of the Agreement, your consent is required because
the Amendment provides for (1) partial pre-payment of your Note, for (2) the
reduction in the conversion price of your Note from $10.00 to $2.00, and for (3)
the reduction of the interest rate on your Note from 9% to 5%. The Amendment has
been negotiated over a number of months between Top Source and representatives
of Mellon Bank, which owns the Agent. With the Federal Express version of this
letter, we are enclos- ing a copy of the Company's Proxy Statement and
Supplement to the Proxy Statement.
As is typical with any agreement, both sides made concessions. In
addition to the substantially reduced conversion price (thus providing you the
potential to convert your Note to equity on substantially improved terms) and
reduced interest rate, the Company is required to prepay the Notes as follows:
(i) On or before December 15, 1998, the Company shall pay each Noteholder who
consents to prepayment, the amount of $.33 for each $1.00 of principal
amount of Notes held (less a credit for pro-rata prepaid interest); and
(ii) Assuming that the stockholders of the Company approve the sale of the
assets of its subsidiary, Top Source Automotive, Inc. to NCT Audio
Products, Inc. at the stockholders' meeting currently scheduled for
December 15, 1998, not later than two days later the Company shall pay each
consenting Note- holder an additional $.37 for each $1.00 principal amount
of Notes owned by such Noteholder (less a credit for pro-rata prepaid
interest) bringing the total pre-payment to $.70 for each $1.00 principal
amount of Notes.
In order to receive the payments described above, each Noteholder being
offered these terms must consent to the Amendment. We have provided two
alternative boxes for you to express your position. The first box represents
approval of the prepayment transaction negotiated by the Agent.
Because time is of the essence and your consent is needed, we are
requesting that you Fax (000) 000-0000 or deliver via Priority Mail/Fedex your
response as quickly as possible but not later than December 11, 1998.
Sincerely, yours,
Xxxxxxx X. Xxxxxx, Xx.
President and CEO
ww/jmo
cc: Mellon Bank, X.X.
Xxxx Capital Management, Inc.
==============================================================================
OPTION 1
_____ I hereby agree to the terms and conditions of the Amendment
-----
substantially in the form presented by Top Source Technologies
and supported by Ganz Capital Management, Inc.
OPTION 2
_____ I hereby agree to the terms and conditions of the Amendment
-----
substantially in the form presented by Top Source Technologies
except I do not want to have my Note prepaid.
------
---------------------
Signature
---------------------
Print Name
December , 1998_
EXHIBIT A
TO
AMENDMENT TO NOTE PURCHASE AGREEMENT
LIST OF CONSENTING PURCHASERS
[To be completed upon receipt of consents.]
Exhibit B
TOP SOURCE TECHNOLOGIES, INC.
9% Senior Subordinated Convertible Notes
Maturity Date: June 20, 2000
Interest: 9% based over twelve 30-day months and a 360-day year
Interest is payable on July 1 and January 1
Summary of Note Holders: ParticiNoteng
Name House Amount Name Attention
---------------------------------------------------------------------------------------------------------
F/B/O Xxxxx X. Xxxxxxx Successor Trustee U/A FBO JComeri35,000tComerica Xxxxx Xxxxxxxx
F/B/O Xxxxxx Xxxxxx XXX Xxxx W25,000 Mellon Bank Proxy Unit
Xxxxx X. Xxxxxxxxx Indivi25,000 Xxxxx X. Xxxxxxxx x/x Xxxxxx & Xxx
Xxxxxx & Xx. Xxxxxx00,000 Batrus & Co.
Green Haft Trustee F/B/O Xxxxxxx X. Xxxx Indivi125,000Richard Haft Xxxxxxx Xxxx
Xxxxxx Xxxxxxxxx Family Foundation Indivi35,000 Northern Trust BanChristopheraRuss
Xxxxxxx X. Xxxx Indivi20,000 Xxxxxxx Xxxx Xxxxxxx Xxxx
C/F Xxxx Xxxxxxx 8%-Charitable Remainder Annuity TInvest125,000Investors Bank TruRon Gayton
C/F Xxxxxxx Xxxxxxx 5%-Charitable Remainder AnnuitInvest125,000Investors Bank TruRon Gayton
FBO Ganz Advisory Accounts-Vision Associates Xxxx V30,000 Xxxx Xxxxxxx & Co.Xxxx Xxxxxxxxxxx
X. Xxxxxx Xxxxxxxx, Successor Trustee Xxxxxxx X. MIndivi100,000Same
Xxxxxx X. Xxxxxxxx, Trustee FBO Xxxxxx X. MarshallIndivi100,000Same
FBO Ganz Advisory Accounts Mac & 125,000Mellon Bank Proxy Unit
Xxxxxx X. Xxxxxxxx, Trustee Xxxxxxx X. Xxxxxxxx StMacn& 85,000tMellonrBankInvest Proxy Unit
Xxxxxx X. Xxxxxxxx, Trustee, Xxxxxxx X. Xxxxxxxx SMace&s15,000tMellonrBankInvest Proxy Unit
Xxxxxxx Xxxxxxxxxx Mac & 35,000 Mellon Bank Proxy Unit
Xxxxxx Xxxxxxxx and Xxxxxxx Xxxxxxxx Mellon35,000 Mellon Bank Proxy Unit
Xxxxxxx Xxxxxxxxx Mellon100,000Mellon Bank Proxy Unit
Xxxx & Xxxxxxx Xxxxx Foundation Inc. Mellon20,000 Mellon Bank Proxy Unit
Xxxxx Xxxxxxx Trust U/A DTD6-28-72, Xxxxxx HarvithMellon30,000 Mellon Bank Proxy Unit
FBO Ganz Advisory Accounts-Xxxx Investments Mellon25,000 Mellon Bank Proxy Unit
Xxxxx Xxxxxxxxx Trust Mellon145,000Mellon Bank Proxy Unit
Xxx Xxxxxxxxx, Trustee, Xxx Xxxxxxxxx Revocable TrMellon25,000 Mellon Bank Proxy Unit
Xxxxx Xxxx-Xxxxxxx Mellon25,000 Mellon Bank Proxy Unit
Xxxxxx X. and Xxxxxx X. Xxxxx Family Foundation, IMellon25,000eMellongBankst Proxy Unit
May Xxxxxxxxx Trust Mellon120,000Mellon Bank Proxy Unit
Xxxxxx Xxxxxxxxx, Trustee, Xxxxxx Xxxxxxxxx RevocaMellon25,000 Mellon Bank Proxy Unit
Xxxxxx Broad-Account G Mellon20,000 Mellon Bank Proxy Unit
Xxxxxxx Xxxx Revocable Trust Mellon25,000 Mellon Bank Proxy Unit
Xxxxxxx Xxxxxx and Xxxx Xxxxxx Mellon35,000 Mellon Bank Proxy Unit
Xxxxxxx Xxxxxx, XXX R/O Mellon25,000 Mellon Bank Proxy Unit
The Ganz Family Foundation Mellon35,000 Mellon Bank Proxy Unit
The Xxxxxx and Xxxxxx Xxxxx Family Foundation Mellon25,000 Mellon Bank Proxy Unit
The Xxxxx & Xxxxxxx Xxxx Family Supporting FoundatMellon25,000 Mellon Bank Proxy Unit
Xxxxx Inc. Mercan$125,00Mercantile Safe DeJanet Xxxxxx
The Pearlstone Foundation for Jewish Living Mercan150,000Mercantile Safe DeJanet Xxxxxx
The Pearlstone Institute for Living Judiasm Mercan150,000Mercantile Safe DeJanet Xxxxxx
The Xxxxx Xxxxxxxxx Pearlstone Foundation Mercan20,000 Mercantile Safe DeJanet Xxxxxx
Xxxxxxxxx X. Xxxxx Merril100,000Paine Xxxxxx Xxxx Xxxxxxxx
X.X. Xxxxxx Nation75,000 Nations Bank of Texas
Xxxxxx X Xxxxxx XXX Xxxxx 50,000 Xxxxx Xxxxxx Xxxx Xxxxxx
Xxxx X. Xxxxxxx Indivi50,000 Xxxx X. Xxxxxxx Xxxx X. Xxxxxxx
Xxxxxx Xxxxxxx M.D., Xxxxx X. Xxxxxxx Co-Trustees Pruden40,0001Arthur & Xxxxx GilArthur & Xxxxx
Xxxxx X. Xxxxxxxx MD Indivi140,000Clive X. Xxxxxxxx,Xxxxx X. Xxxxxxx
=======
Total $3,020,000
=======
EXHIBIT C
TO
AMENDMENT TO NOTE PURCHASE AGREEMENT
List of Holders of Senior Indebtedness
NationsCredit Commercial Corporation, through its
NationsCredit Commercial Funding Division
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
EXHIBIT D
December 1, 1998
Xxxxxxx Xxxxxx, P.A., Escrow Agent
0000 Xxxx Xxxxx Xxxxx Xxxx.
Xxxxx 000
Xxxx Xxxx Xxxxx, XX 00000
Re: Top Source Technologies, Inc./Ganz
Dear Sirs:
Reference is made to the sum of $2,050,000 together with accrued
interest accruing thereon which you are currently holding in escrow pursuant to
the Asset Purchase Agreement by and among Top Source Technologies, Inc. (the
"Company"), Top Source Automotive, Inc. ("TSA"), NCT Audio Products, Inc. and
Noise Cancellation Technologies, Inc. entered into as of August 14, 1998 as
amended (the "Agreement"). Pursuant to the terms and conditions of an escrow
agreement, you are required to hold the funds in escrow until such time as the
stockholders of the Company have convened the meeting and voted upon the
proposal of sale of the assets of TSA pursuant to the terms and conditions of
the Agreement. At such time as the stockholders of the Company approve the sale
of the assets of TSA pursuant to the Agreement, you are directed to pay to the
noteholders listed on Exhibit A the amounts set forth on that exhibit (except to
the extent any of the noteholders elect in writing not to be prepaid) and
disburse the balance to TSA. The Company agrees that the noteholders listed on
Exhibit A are third party beneficiaries of this letter agreement. These payment
instructions are subject to the Company entering into a binding agreement with
Ganz Capital Management, Inc. which is substantially in the form sent to holders
of outstanding convertible notes.
Please execute a copy of this letter evidencing your agreement to abide
by these payment instructions.
Very truly yours,
Xxxxxxx X. Xxxxxx, Xx.
President and CEO
ww/jmo
cc: Ganz Capital Management, Inc.
We hereby agree to the contents of the foregoing letter agreement.
Date: December ___, 1998 XXXXXXX XXXXXX, P.A.
By: _________________
Xxxxxxx X. Xxxxxx, President
