FIRST AMENDMENT TO LOAN AGREEMENT
Exhibit
10.5
FIRST
AMENDMENT
TO
This
First Amendment to Loan Agreement (this “Amendment”) dated as
of February 19, 2010, under the Loan Agreement, dated as of May 14, 2009 (the
“Loan
Agreement”) by and between Aerosonic Corporation, a Delaware corporation
(the “Company”) and Xxxxxx X. Xxxxxxxx (“Xxxxxxxx”).
RECITALS
WHEREAS,
the Company and Xxxxxxxx are parties to the Loan Agreement; and
WHEREAS,
the Company has requested that Xxxxxxxx agree to amend and waive certain
provisions of the Loan Agreement and Xxxxxxxx is agreeable to such request but
only upon the terms and subject to the conditions set forth herein.
NOW,
THEREFORE, in consideration of the premises and the mutual agreements contained
herein, and for other valuable consideration the receipt of which is hereby
acknowledged, the Company and Xxxxxxxx agree as follows:
1. Definitions. Unless
otherwise defined herein, capitalized terms are used herein as defined in the
Loan Agreement.
2. Amendments.
2.1 Amendments to Loan
Agreement.
(a) Section 1.1
of the Loan Agreement is hereby amended by deleting therefrom the following
definitions in their entireties and inserting the following new definitions in
the appropriate alphabetical order:
“’Note’
means the 14% Subordinated Note due April 10, 2011, as extended pursuant to the
terms and conditions of the Note, in the aggregate principal amount of $500,000,
to be issued to Xxxxxxxx at the Closing by the Company and the Subsidiaries in
the form of Exhibit
1.
“Warrant”
means for any Warrant issued to Xxxxxxxx prior to February 19, 2010, a Common
Stock Purchase Warrant of the Company to purchase at any time after the one-year
anniversary date of their original issue date until April 10, 2020, one share of
the Common Stock for a purchase price of $.64 per share, subject to
anti-dilution protection and adjustment of the warrant price and number of
shares as provided in the Warrant Certificate. For any Warrant issue
to Xxxxxxxx on or after February 19, 2010, a Common Stock Purchase Warrant of
the Company to purchase at any time after the one-year anniversary date of their
original issue date until the sixth anniversary of the date such Warrant is
issued to Xxxxxxxx, one share of the Common Stock for a purchase price per share
equal to 50% of the volume weighted average of the selling price of the Common
Stock of the Company on February 12, 2010 and for the 19 trading days prior to
February 12, 2010, or $1.98 per share, subject to anti-dilution protection and
adjustment of the warrant price and number of shares as provided in the Warrant
Certificate.”
(b) For
Advances made on or after February 19, 2010, the definitions “Advance Shares”
and “Drawdown Shares” shall each be deleted in their entirety.
(c) Section
6.2(c) of the Loan Agreement with respect to certain negative covenants shall be
deleted in its entirety.
2.2 Amendment to Exhibit 1- Form
of 14% Subordinated Note.
(a) Section
2 of the Note is hereby amended and modified by deleting therefrom the
definition of “Maturity
Date” in its entirety and inserting the following new
definition:
“’Maturity
Date’ means the earlier of: (i) April 10, 2011, or (ii) the maturity
of the Existing Loans.”
(b) Section
3 of the Note is hereby amended and modified by deleting therefrom the words
“April 10, 2010” and replacing with the words “April 10, 2011”.
2.3 Amendment to Exhibit 2- Form
of Warrant Certificate.
(a) With
respect to any Warrant Certificate issued prior to February 19, 2010, each time
the words “April 10, 2015” appear, such words shall be deleted in their entirety
and replaced with the words “April 10, 2020”.
(b) For
any Warrant Certificate issued on or after February 19, 2010, each time the
words “April 10, 2015” appear, such words shall be deleted in their entirety and
be replaced with the words “the sixth anniversary date of the issuance of the
Warrant Certificate.”
(c) For
any Warrant Certificate issued to Xxxxxxxx on or after February 19, 2010, the
words “$.64” in the first full paragraph of the Warrant Certificate shall be
deleted and replaced with the following: “50% of the volume weighted
average selling price of the Common Stock of the Company on February 12, 2010
and for the 19 trading days prior to February 12, 2010, or $1.98 per
share.”
(d) For
any Warrant Certificate issue to Xxxxxxxx on or after February 19, 2010, the
first sentence of Section 1 of the Warrant Certificate shall be deleted in its
entirety and replaced with the following:
“The
Warrants were issued in connection with the issuance by the Company and its
subsidiaries (as co-obligors) of a 14% Subordinated Note due April 10, 2011,
(the “Subordinated
Note” and
pursuant to that certain loan agreement executed as of May 14, 2009, as amended
by the First Amendment to Loan Agreement dated February 19, 2010 (the “Loan
Agreement”) with Common Stock Purchase Warrants issued to the Registered Owner
(0.20 shares of Common Stock of the Company for each $1.00 of principal amount
of Subordinated Note on the date of each Borrowing).”
2.4 Amendment to Schedule 1 to
Loan Agreement. With respect to Advances made on or after
February 19, 2010, Schedule 1 shall be deleted in its entirety and replaced with
the following:
SCHEDULE
1
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Maximum
Availability
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Warrants
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||
| $ | 500,000 |
to
purchase 0.20 shares of Common Stock for each $1.00 of principal amount of
each
Borrowing.
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3. Continuing
Effect. Except as expressly amended or waived hereby, the Loan
Agreement and the other Financing Documents shall continue to be and shall
remain in full force and effect in accordance with their respective terms. This
Amendment shall not constitute an amendment or waiver of any provision of the
Loan Agreement or the other Financing Documents not expressly referred to herein
and shall not be construed as an amendment, waiver or consent to any action on
the part of the Company that would require an amendment, waiver or consent of
Xxxxxxxx.
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4. Representations and
Warranties of the Company; Covenants of the
Company. The Company represents and warrants that the
representations and warranties contained in the Loan Agreement are true and
correct as of the date of this Amendment. The Company represents and
warrants that the Company has complied in all material respects with the
covenants contained in the Loan Agreement as of the date of this
Amendment.
5. Counterparts. The
parties to this Amendment may execute this Amendment in counterparts by manual
or facsimile signature. Each executed counterpart of this Amendment
will constitute an original document, and all executed counterparts,
collectively, will constitute the same agreement.
6. Governing
Law. The validity, construction, enforcement, and
interpretation of this Agreement are governed by the laws of the State of
Florida and the federal laws of the United States of America, excluding the laws
of those jurisdictions pertaining to the resolution of conflicts with laws of
other jurisdictions.
7. Headings. Section
headings used in this Amendment are for convenience of reference only, are not
part of this Amendment and are not to affect the constructions of, or to be
taken into consideration in interpreting, this Amendment.
[Signature
pages follow]
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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered as of the date first above written.
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AEROSONIC
CORPORATION
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By:
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/s/
Xxxxxxx X. Xxxxxxx
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Xxxxxxx
X. Xxxxxxx
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President
and Chief Executive Officer
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By:
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/s/
Xxxxxx X. Xxxxxxxx
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XXXXXX
X. XXXXXXXX
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