Exhibit 4.1
SECOND WAIVER AND AMENDMENT AGREEMENT
This Second Waiver and Amendment Agreement (the 'Second
Waiver Agreement') dated as of April 15, 2002 is made and entered
into by and among Wachovia Bank, National Association, formerly
known as First Union National Bank, with an office at Broad and
Walnut Streets, Philadelphia, Pennsylvania 19109 (the 'Bank'),
Selas Corporation of America, a Pennsylvania business corporation
with offices located at 0000 Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx
00000 (the 'Borrower'), Selas SAS (formerly named Selas S.A.), a
corporation organized under the laws of France ('Selas SAS'),
CFR-CECF Fofumi Ripoche, a corporation organized under the laws
of France ('CFR'); and together with Selas SAS, the 'European
Subsidiaries'), Deuer Manufacturing, Inc., an Ohio business
corporation with offices located at 0000 Xxxxxxxxxx Xxxx, Xxxxxx,
Xxxx 00000 ('Deuer'), Resistance Technology, Inc., a Minnesota
business corporation with offices located at 0000 Xxx Xxx Xxxx,
Xxxxx Xxxxx, Xxxxxxxxx 00000 ('RTI'), RTI Export, Inc., a
Barbados corporation with offices located at c/o 0000 Xxxxxxxx
Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000 ('RTIE'), and RTI Electronics,
Inc., a Delaware corporation with offices located at 0000 Xxx
Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000 ('RTI Electronics'; and
together with Deuer, RTI and RTIE, the 'U.S. Guarantors').
BACKGROUND
A. The Bank, the Borrower and the U.S. Guarantors entered
into that certain Amended and Restated Credit Agreement dated as
of July 31, 1998, as amended by: an Amendment dated as of June
30, 1999, a Second Amendment dated as of July 7, 2000, a Third
Amendment dated as of January 19, 2001 and the Waiver Agreement
(hereinafter defined) (as amended, the "Credit Agreement"),
pursuant to which the Bank made certain term loans to the
Borrower described therein (the 'Term Loans') and agreed to make
available to the Borrower a revolving credit facility in the
principal amount of Four Million Five Hundred Thousand U.S.
Dollars ($4,500,000) (the 'Revolving Credit').
B. The U.S. Guarantors jointly and severally guaranteed
and became surety for all loans, advances, debts, liabilities,
obligations, covenants and duties of the Borrower to the Bank
pursuant to the following agreements (collectively, the 'Borrower
Surety Agreements'): (i) that certain Guaranty and Suretyship
Agreement of Deuer dated as of October 20, 1993 and amended as of
July 31, 1998 (as amended, the 'Deuer Surety Agreement'), (ii)
that certain Guaranty and Suretyship Agreement of RTI dated as of
October 20, 1993 and amended as of July 31, 1998 (as amended, the
'RTI Surety Agreement'), (iii) that certain Guaranty and
Suretyship Agreement of RTIE dated as of October 20, 1993 and
amended as of July 31, 1998 (as amended, the 'RTIE Surety
Agreement'), and (iv) that certain Guaranty and Suretyship
Agreement of RTI Electronics dated as of February 20, 1997, and
amended as of July 31, 1998 (as amended, the 'RTI Electronics
Surety Agreement').
C. The Term Loans, that are outstanding as of the date
hereof, are evidenced by the following promissory notes executed
by the Borrower in favor of the Bank: (i) Term Note D dated as of
June 30, 1999 in the original principal amount of Nine Hundred
Thousand U.S. Dollars ($900,000) ('Term Note D'), (ii) Term Note
E dated as of January 19, 2001 in the original principal amount
of Two Million U.S. Dollars ($2,000,000) ('Term Note E'), and
(iii) Term Note F dated as of January 19, 2001 in the original
principal amount of Xxx Xxxxxxx Xxxxx Xxxxxxx Xxxxxxxx Xxxxxxxxx
Dollars (Singapore $1,700,000) ('Term Note F'; and together with
Term Note D and Term Note E, the 'Term Notes'). The Revolving
Credit facility is evidenced by an Amended and Restated Revolving
Credit Note dated as of January 19, 2001 in the original
principal amount of Four Million Five Hundred Thousand U.S.
Dollars ($4,500,000) executed by the Borrower in favor of the
Bank (the 'Revolving Credit Note'). The Term Notes and the
Revolving Credit Note are collectively referred to hereinafter as
the 'Notes'.
D. Wachovia Bank, National Association, London Branch,
formerly known as First Union National Bank, London Branch
('London Branch') and Selas SAS, a subsidiary of the Borrower,
entered into that certain Agreement dated as of February 2, 2001
(the 'Selas SAS Facility Agreement') pursuant to which the Bank
provided to Selas SAS a discretionary line of credit facility in
the aggregate amount of Sixteen Million Euros (E16,000,000) on an
'on demand' basis, expiring on April 30, 2001 (the 'Selas SAS
Facility') for the purposes of providing: discretionary advance
payment guarantees on behalf of Selas SAS (the 'APG Facility')
and a discretionary overdraft facility for general working
capital purposes with a sub-limit amount of Two Million Euros
(E2,000,000) that was later increased (the 'Overdraft
Facility'). The London Branch and Selas SAS also entered into
certain term loan agreements (collectively, the 'Selas SAS Term
Loan Agreements'), as follows: an agreement dated February 26,
1998 pursuant to which the Bank made a term loan to Selas SAS in
the original principal amount of Fifteen Million French Francs
(FF 15,000,000) (the 'Selas SAS 1998 Term Loan Agreement'); and
an agreement dated January 2000 pursuant to which the Bank made a
term loan to Selas SAS in the original principal amount of One
Million Seven Hundred and Fifty-Three Thousand One Hundred and
Fifty-Eight and 30/100 Euros (E1,753,158.30) (the 'Selas SAS 2000
Term Loan Agreement').
E. The Borrower and U.S. Guarantors jointly and severally
guaranteed and became surety for all loans, advances, debts,
liabilities, obligations, covenants and duties then existing or
thereafter arising of Selas SAS to the Bank, pursuant to the
following agreements (the 'Selas SAS Surety Agreements'): (i)
that certain Unconditional Guaranty executed by the Borrower in
favor of the Bank dated as of January 10, 2000 (the 'Borrower
Guaranty'), (ii) that certain Unconditional Guaranty executed by
Deuer in favor of the Bank dated as of January 10, 2000 (the
'Deuer Guaranty'), (iii) that certain Unconditional Guaranty
executed by RTI in favor of the Bank dated as of January 10, 2000
(the 'RTI Guaranty'), (iv) that certain Unconditional Guaranty
executed by RTIE in favor of the Bank dated as of January 10,
2000 (the 'RTIE Guaranty'), and (v) that certain Unconditional
Guaranty executed by RTI Electronics in favor of the Bank dated
as of January 10, 2000 (the 'RTI Electronics Guaranty').
F. As security for any and all indebtedness, liabilities
and obligations of the Borrower to the Bank, then existing or
thereafter arising, the Borrower: (i) pursuant to that certain
Security Agreement dated as of October 20, 1993, as amended July
31, 1998 between the Borrower and the Bank (as amended, the
'Borrower Security Agreement'), granted to the Bank a security
interest in and lien on: (a) all of the Borrower's assets, then
owned or thereafter acquired, including, without limitation, all
accounts, contract rights, inventory, fixtures, machinery,
equipment, general intangibles, and (b) all of Borrower's rights
under a certain contract with Production Machinery Corporation in
Talcahuano, Chile for the sale of and the proceeds of a Five
Million Twenty-Five Thousand U.S. Dollars ($5,025,000)
documentary letter of credit issued by Bank One, Columbus, Ohio;
(ii) pursuant to that certain Second Amended and Restated Pledge
Agreement dated as of July 31, 1998 (the 'Borrower Pledge
Agreement'), assigned, pledged and granted to Bank a security
interest in all of the issued and outstanding stock of Deuer,
RTI, RTIE and RTI Electronics; and (iii) pursuant to that certain
First Mortgage and Security Agreement dated as of October 20,
1993, as amended on July 21, 1995, February 20, 1997, July 31,
1998, January 10, 2000, and November 20, 2001 (as amended, the
'Borrower Mortgage and Security Agreement'), granted to the Bank a
first mortgage lien on certain real property of the Borrower and
improvements thereon located in Dresher, Upper Dublin Township,
Xxxxxxxxxx County, Pennsylvania (the 'Pennsylvania Property').
G. As security for any and all indebtedness, liabilities
and obligations of Deuer to the Bank, then existing or thereafter
arising, Deuer: (i) granted to the Bank a security interest in
and lien on all of Deuer's assets, then owned or thereafter
acquired, including, without limitation, all accounts, contract
rights, inventory, fixtures, machinery, equipment, general
intangibles pursuant to that certain Security Agreement dated as
of October 20, 1993, as amended July 31, 1998 between Deuer and
the Bank (as amended, the 'Deuer Security Agreement'); and (ii)
granted to the Bank a first mortgage lien on certain real
property of Deuer and improvements thereon located in Moraine,
Xxxxxxxxxx County, Ohio (the 'Ohio Property') pursuant to that
certain First Mortgage and Security Agreement dated as of October
20, 1993, as amended July 21, 1995, February 20, 1997, July 31,
1998, January 10, 2000, and November 20, 2001 (as amended, the
'Deuer Mortgage and Security Agreement').
H. As security for any and all indebtedness, liabilities
and obligations of RTI to the Bank, then existing or thereafter
arising, RTI: (i) granted to the Bank a security interest in and
lien on all of RTI's assets, then owned or thereafter acquired,
including, without limitation, all accounts, contract rights,
inventory, fixtures, machinery, equipment, general intangibles
pursuant to that certain Security Agreement dated as of October
20, 1993, as amended July 31, 1998 between RTI and the Bank (as
amended, the 'RTI Security Agreement'); (ii) granted to the Bank
a security interest in and lien on certain patents and trademarks
and other intellectual property pursuant to that certain Patent
and Trademark Security dated as of October 20, 1993, as amended
July 31, 1998 between RTI and the Bank (the 'RTI Patent and
Trademark Security Agreement'); and (iii) granted to the Bank a
first mortgage lien on certain real property of RTI and
improvements thereon located in Xxxxxx County, Minnesota (the
'Minnesota Property') pursuant to that certain Mortgage, Security
Agreement and Fixture Financing Statement dated as of June 30,
1999, as amended January 10, 2000 and November 20, 2001 (as
amended, the 'RTI Mortgage and Security Agreement').
I. As security for any and all indebtedness, liabilities
and obligations of RTIE to the Bank, then existing or thereafter
arising, RTIE granted to the Bank a security interest in all of
RTIE's assets, then owned or thereafter acquired, including,
without limitation, all accounts, contract rights, inventory,
fixtures, machinery, equipment, general intangibles pursuant to
that certain Security Agreement dated as of October 20, 1993, as
amended July 31, 1998 between RTIE and the Bank (as amended, the
'RTIE Security Agreement').
J. As security for any and all indebtedness, liabilities
and obligations of RTI Electronics to the Bank, then existing or
thereafter arising, RTI Electronics granted the Bank a security
interest in all of RTI Electronic's assets, then owned or
thereafter acquired, including, without limitation, all accounts,
contract rights, inventory, fixtures, machinery, equipment,
general intangibles pursuant to that certain Security Agreement
dated as of October 20, 1993, as amended February 20, 1997 and
July 31, 1998 between RTI Electronics and the Bank (as amended,
the 'RTI Electronics Security Agreement').
K. The Borrower, the U.S. Guarantors, and the European
Subsidiaries entered into that certain Waiver and Amendment
Agreement dated as of November 20, 2001, as amended by that
certain First Amendment to Waiver and Amendment Agreement dated
as of February 28, 2002 and that certain Second Amendment to
Waiver and Amendment Agreement dated as of March 20, 2002 (as
amended, the 'Waiver Agreement'), pursuant to which, among other
things, the Bank agreed to waive certain Financial Covenant
Defaults (as defined therein) and provide a new credit facility
pursuant to which the Bank's London Branch agreed to issue
certain advance payment guarantees.
L. The Credit Agreement, the Notes, the Borrower Surety
Agreements, the Selas SAS Facility Agreement, the Selas SAS Term
Loan Agreements, the Selas SAS Surety Agreements, the Borrower
Security Agreement, the Borrower Pledge Agreement, the Borrower
Mortgage and Security Agreement, the Deuer Security Agreement,
the Deuer Mortgage and Security Agreement, the RTI Security
Agreement, the RTI Patent and Trademark Security Agreement, the
RTI Mortgage and Security Agreement, the RTIE Security Agreement,
the RTI Electronics Security Agreement, the Waiver Agreement, and
the Waiver Documents (as defined in the Waiver Agreement)
together with the various agreements, instruments and other
documents executed in connection therewith and all amendments and
modifications thereto, now or hereafter in effect, shall be
referred to hereinafter as the 'Existing Loan Documents'. All
capitalized terms not otherwise defined shall have the meanings
ascribed to them in the Loan Documents (as such term is defined
in the Credit Agreement, as amended hereby).
M. The Borrower, the U.S. Guarantors and the European
Subsidiaries have requested that the Bank agree to extend the
maturity of certain existing credit facilities, provide a
Supplemental Credit Facility (as hereinafter defined) and issue
additional advance payment guarantees under the Selas SAS
Facility in accordance with and subject to the terms and
conditions contained herein.
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained and incorporating the Background by
reference herein, the Bank, the Borrower, the U.S. Guarantors and
the European Subsidiaries intending to be legally bound hereby,
agree as follows:
ARTICLE I - ACKNOWLEDGMENTS
1.1 Acknowledgment of Joint and Several Liability, Maturity
Dates and Amounts of Notes.
1.1.1The Borrower, the U.S. Guarantors and the European
Subsidiaries acknowledge and agree that as of the effective date
of this Second Waiver Agreement, after giving effect to the
amendments described herein: (i) they are jointly and severally
indebted and liable to the Bank in respect of the outstanding
principal amount of the Notes, together with accrued and unpaid
interest thereon, and all other Obligations; (ii) the Notes
mature and are due and payable in full on the respective maturity
dates set forth below next to each such Note; and (iii) the
outstanding principal amount of each Note as of April 8, 2002, is
set forth below next to each such Note:
Promissory Notes Maturity Date Outstanding
Principal Amount
Term Note D 07/01/2004 $ 652,500.00 (US
Dollars)
Term Note E 02/01/2006 $ 1,533,333.38 (US
Dollars)
Term Note F0 02/01/2006 S$
1,452,789.00 (Singapore
Dollars)
Revolving Credit Note 01/31/2003 $ 3,731,137.09 (US
Dollars)
1.1.2The Borrower, the U.S. Guarantors and the European
Subsidiaries acknowledge and agree that as of the effective date
of this Second Waiver Agreement, after giving effect to the
amendments described herein: (i) they are jointly and severally
indebted and liable to the Bank in respect of the Selas SAS Term
Loan Agreements, the Overdraft Facility and all other amounts
outstanding under the Selas SAS Facility Agreement, together with
accrued and unpaid interest thereon, and all other Guaranteed
Obligations (as such term is defined in the Selas SAS Surety
Agreements); (ii) the Selas SAS Term Loan Agreements mature and
are due and payable in full, together with all interest accrued
thereon, on the respective maturity dates set forth below; (iii)
the Overdraft Facility and all other amounts outstanding under
the Selas SAS Facility Agreement are on an 'on demand' basis and
the Bank may make demand therefor at any time and for any reason
in its sole and absolute discretion; and (iv) as of April 8,
2002, the outstanding principal amounts owing to the Bank in
respect of the Selas SAS Term Loan Agreements and the Overdraft
Facility are set forth below next to each such agreement or
facility:
(i) The Selas SAS 1998 Term Loan Agreement, in the
outstanding principal amount of 457,347.06 (Euros),
which matures on the Selas SAS 1998 Term Loan Maturity
Date (as defined in the Credit Agreement, as amended
hereby);
(ii) The Selas SAS 2000 Term Loan Agreement, in the
outstanding principal amount of E1,051,895.02 (Euros),
which matures on the Selas SAS 2000 Term Loan Maturity
Date (as defined in the Credit Agreement, as amended
hereby); and
(iii)The Overdraft Facility, in the outstanding principal
amount of E5,976,854.11 (Euros), which matures on the
Supplemental Credit Facility Maturity Date (as defined
in the Credit Agreement, as amended hereby).
1.1.3The Borrower, the U.S. Guarantors and the European
Subsidiaries acknowledge and agree that as of the effective date
of this Second Waiver Agreement, they are jointly and severally
indebted and liable to the Bank in respect of the following
outstanding advance payment guarantees that were issued under the
Waiver Agreement:
(i) Advance Payment Guaranty in the amount of E2,199,000
(Euros) to Voest Alpine Xxxxx GmbH on behalf of Selas
SAS expiring not later than February 28, 2003;
(ii) Advance Payment Guaranty in the amount of Norwegian
Kroners 1,305,000 to Sor-Norge Aluminum AS on behalf of
CFR expiring not later than August 31, 2002; and
(iii)Advance Payment Guaranty in the amount of E25,192.20
(Euros) to Vallourec Precision Etirage on behalf of CFR
expiring not later than November 30, 2002.
1.1.4 The outstanding principal amounts of the Term
Notes, the Revolving Credit Note, the Selas SAS Term Loan
Agreements, the APG Facility, the Overdraft Facility, Advance
Payment Guarantees issued under the Waiver Agreement, the
Supplemental Credit Facility (as hereinafter defined), plus
accrued and unpaid interest thereon, all fees and costs in
connection therewith, all other sums payable by the Borrowers,
the U.S. Guarantors and/or the European Subsidiaries to the Bank,
whether under the Loan Documents or otherwise, together with any
other Guaranteed Obligations (as such term is used in each of the
Selas SAS Surety Agreements and the European Subsidiaries Surety
Agreements) and any and all other Obligations (as such term is
used in the Loan Documents) are collectively referred to herein
as the 'Obligations'.
1.2 Acknowledgment of Loan Documents; Financial Covenant
Defaults; Loan Documents; Waiver of Defenses. The Borrower, the
U.S. Guarantors and the European Subsidiaries hereby acknowledge
and agree that as of the date of this Second Waiver Agreement:
(i) the Loan Documents to which each is a party are valid,
binding and enforceable against them, in every respect, and all
of the terms and conditions thereof are binding upon them; (ii)
the Financial Covenant Defaults (as such term is defined in the
Waiver Agreement) were material in nature; (iii) the Selas SAS
Facility is a discretionary facility that expired on April 30,
2001; the Bank had no duty to issue any advance payment
guarantees thereunder at any time, except in its sole discretion;
and following such expiration date, Selas SAS had no right to
request the issuance of advance payment guarantees under the
Selas SAS Facility; (iv) the Bank may demand any and all amounts
outstanding under the Selas SAS Facility at any time and for any
reason in its sole and absolute discretion; (v) as a result of
the Financial Covenant Defaults, in the absence of the waiver
provided in the Waiver Agreement, the Bank would have been
entitled immediately, and without further notice or declaration
to the Borrower, the U.S. Guarantors, or the European
Subsidiaries not to make any further loans or advances or issue
any Advance Payment Guaranty (as defined in the Waiver
Agreement), to accelerate the Obligations, and to exercise its
rights and remedies under the Loan Documents and applicable law;
(vi) to the extent that any of the Loan Documents required
notification by the Bank to the Borrower, the U.S. Guarantors, or
the European Subsidiaries of the existence of a default or
provide an opportunity to cure such default, such notice and
period for cure were waived with respect to the Financial
Covenant Defaults by the Borrower, the U.S. Guarantors, and/or
the European Subsidiaries; and (vii) to the extent that the
Borrower, any U.S. Guarantor, or any European Subsidiary has any
defenses, setoffs, claims, or counterclaims to repayment of the
Obligations or against the Bank, such defenses, setoffs, claims,
and counterclaims have been and are hereby waived.
1.3 Acknowledgment of Liens and Priority. The Borrower,
the U.S. Guarantors and the European Subsidiaries as of the date
of this Second Waiver Agreement acknowledge and agree that
pursuant to the Loan Documents, as security for all of the
Obligations, the Bank holds, and the Borrower and U.S. Guarantors
hereby grant and reaffirm their prior grant of, first priority,
perfected security interests in and liens upon all of the
Borrower's and U.S. Guarantors' assets, wherever located, now
owned or hereafter acquired, including, without limitation, such
assets as more specifically described in the Loan Documents, and
first priority mortgage liens upon and security interests in: (i)
the Pennsylvania Property, (ii) the Ohio Property, and (iii) the
Minnesota Property (all of the foregoing assets and property,
collectively "Bank's Mortgages, Liens and Security Interests").
1.4 Reaffirmation of Mortgages, Security Documents and
Security Interests. All of the Borrower's, the U.S. Guarantors'
and the European Subsidiaries' respective assets, now or
hereafter, pledged, assigned, conveyed, mortgaged, hypothecated
or transferred to the Bank pursuant to the Loan Documents
including, without limitation, accounts, accounts receivable,
inventory, equipment, general intangibles, contracts, contract
rights, instruments, letters of credit, deposits, deposit
accounts, documents of title, and all other personal property,
together with the Pennsylvania Property, the Minnesota Property
and the Ohio Property (collectively, the "Collateral") constitute
security for all of the Obligations (including, without
limitation, such Obligations arising under or in respect of the
Borrower Surety Agreements, the Selas SAS Surety Agreements, the
European Subsidiaries Surety Agreements, the Advance Payment
Guarantees, the Waiver Documents and the other Loan Documents)
(it being understood that the European Subsidiaries' accounts
receivable shall be pledged, assigned and transferred to the Bank
pursuant to this Second Waiver Agreement). The Borrower, the
U.S. Guarantors and the European Subsidiaries hereby grant to the
Bank and reaffirm their prior grant and conveyance to the Bank of
a continuing first priority security interest in, lien on and
charge against all of the Collateral. The Borrower, each U.S.
Guarantor and each European Subsidiary hereby acknowledge and
agree that the Borrower Security Agreement, the Borrower Pledge
Agreement, the Borrower Mortgage and Security Agreement, the
Deuer Security Agreement, the Deuer Mortgage and Security
Agreement, the RTI Security Agreement, the RTI Patent and
Trademark Security Agreement, the RTI Mortgage and Security
Agreement, the RTIE Security Agreement, the RTI Electronics
Security Agreement, and any other security agreements are
ratified, reaffirmed and confirmed in all respects, shall
continue in full force and effect, and are valid, binding and
enforceable against the parties thereto as if executed as of the
date hereof. The Borrower, the U.S. Guarantors and the European
Subsidiaries agree to execute and deliver to the Bank such
additional documentation deemed necessary or appropriate by the
Bank, in its sole and absolute discretion, to achieve the purpose
of this section of this Second Waiver Agreement.
1.5 Reaffirmation of Representations and Warranties. The
Borrower, the U.S. Guarantors and the European Subsidiaries
hereby reaffirm their respective representations and warranties
in the Loan Documents, which representations and warranties are
true and correct as of the date hereof, and each and all of which
shall survive the execution and delivery of this Second Waiver
Agreement.
1.6 Reaffirmation of Guaranties. In consideration of the
undertakings of the Bank pursuant to this Second Waiver Agreement
and the other Loan Documents, the Borrower, each U.S. Guarantor
and each European Subsidiary hereby reaffirm the Borrower Surety
Agreements, the Selas SAS Surety Agreements, the other Loan
Documents and all of their respective obligations thereunder.
The Borrower and each U.S. Guarantor hereby consent to the
execution and delivery by the Borrower, the U.S. Guarantors, and
the European Subsidiaries of this Second Waiver Agreement, the
other Waiver Documents and the other Loan Documents and all other
documents and instruments to be executed pursuant hereto or in
connection herewith. The Borrower, each U.S. Guarantor and each
European Subsidiary hereby waive any right it may have to contest
the validity or enforceability of the Borrower Surety Agreements,
Selas SAS Surety Agreements, the Selas SAS Guaranty, the CFR
Guaranty or any other Loan Document, for any reason whatsoever.
The U.S. Guarantors and the European Subsidiaries hereby
acknowledge and agree that the term 'Obligations,' as defined in
their respective Borrower Surety Agreements and the Selas SAS
Surety Agreements includes, without limitation, all of the
obligations, now or hereafter arising, of Borrower to the Bank,
whether under the Credit Agreement, the other Loan Documents, as
amended, or otherwise. The Borrower and each U.S. Guarantor
hereby acknowledge and agree that the term 'Guaranteed
Obligations,' as defined in their respective Selas SAS Surety
Agreements includes, without limitation, all of the obligations,
now or hereafter arising, of Selas SAS to the Bank, whether under
the Selas SAS Term Loan Agreements, the Selas SAS Facility
Agreement, any document or agreement now or hereafter executed in
connection with the Advance Payment Guarantees that may now or
hereafter be issued by the Bank on behalf of Selas SAS, the other
Loan Documents, or otherwise. The Borrower, each U.S. Guarantor
and each European Subsidiary hereby acknowledge and agree that
the Borrower Surety Agreements and the Selas SAS Surety
Agreements, and any other suretyship agreements executed by them
in favor of the Bank or its affiliates, are ratified, reaffirmed
and confirmed in all respects, shall continue in full force and
effect, and are valid, binding and enforceable against the
parties thereto as if executed as of the date hereof. The
Borrower, the U.S. Guarantors, and the European Subsidiaries
agree to execute and deliver to the Bank such additional
documentation deemed necessary or appropriate by the Bank, in its
sole and absolute discretion, to achieve the purpose of this
section of this Second Waiver Agreement.
1.7 Bank Has No Obligation to Extend Waiver. The
Borrower, the U.S. Guarantors and the European Subsidiaries
hereby acknowledge and agree that the Bank shall have no actual
or implied duty or obligation to extend the waiver granted to
Borrower in the first Waiver Agreement beyond the waiver of the
Financial Covenant Defaults as of December 31, 2001, and the
determination as to any other or further waivers shall only be
made by the Bank, in the Bank's sole and absolute discretion.
1.8 Bank Has No Obligation to Issue Further Advance Payment
Guarantees. The Borrower, the U.S. Guarantors and the European
Subsidiaries hereby acknowledge and agree that except as
expressly provided herein and in the other Loan Documents, the
Bank shall have no duty to issue any advance payment guarantees
to or for the benefit of Borrower, the U.S. Guarantors, and/or
the European Subsidiaries, or provide overdraft financing for
Borrower, U.S. Guarantors, and/or the European Subsidiaries.
ARTICLE II - AMENDMENTS TO LOAN DOCUMENTS
2.1 New Definitions. The following new defined terms are
hereby added to Section 1.1 of the Credit Agreement (and if such
terms are defined elsewhere in the Credit Agreement, such defined
terms are deemed to be amended and restated and replaced with the
definitions set forth below):
'Advance Payment Guarantees' shall mean advance payment
guarantees issued or requested to be issued by the London
Branch subject to the terms and conditions of the Loan
Documents.
'Second Waiver Agreement' shall mean that certain Second
Waiver and Amendment Agreement dated as of April 15, 2002,
by and among, the Bank, the Borrower, the U.S. Guarantors,
and the European Subsidiaries, as the same may be amended
from time to time.
'Selas SAS Facility' shall have the meaning given to such
term in the Second Waiver Agreement.
'Selas SAS Term Loan 1998 Maturity Date' shall mean the
earlier to occur of (i) February 27, 2003 or (ii) the date
on which a Selas SAS Transfer Event occurs if, on or before
the date of such Selas Transfer Event, all liabilities and
obligations of Selas SAS under the Selas SAS 1998 Term Loan
Agreement and the Selas SAS 2000 Term Loan Agreement (and
the related instruments and agreements) have not been
transferred to and fully assumed by the Borrower, subject to
documentation acceptable to the Bank in its sole discretion.
'Selas SAS 2000 Term Loan Maturity Date' shall mean the
earlier to occur of (i) January 12, 2005 or (ii) the date on
which a Selas SAS Transfer Event occurs if, on or before the
date of such Selas Transfer Event, all liabilities and
obligations of Selas SAS under the Selas SAS 1998 Term Loan
Agreement and the Selas SAS 2000 Term Loan Agreement (and
the related instruments and agreements) have not been
transferred to and fully assumed by the Borrower, subject to
documentation acceptable to the Bank in its sole discretion.
'Selas SAS Transfer Event' shall mean a sale, transfer or
assignment of all or substantially all of the assets or
equity share capital of Selas SAS.
'Supplemental Credit Facility' shall have the meaning given
to such term in Section 2.1.1 hereof.
'Supplemental Credit Facility Maturity Date' means the date
which is the earlier of: (i) January 31, 2003; or (ii) the
date of any Selas SAS Transfer Event.
'Supplemental Credit Facility Note' means the promissory
note of the Borrower in favor of the Bank dated April 15, 2002
to evidence that certain credit facility provided by the Bank
to the Borrower in the original maximum amount of Five Million
U.S. Dollars ($5,000,000).
'Supplemental Credit Facility Payment Date' shall mean the
date on which the Bank has received payment and satisfaction
in full of all principal, interest, fees and costs in
connection with the Supplemental Credit Facility (including
all Advance Payment Guarantees issued thereunder).
'U.S. Guarantors' shall mean those certain domestic
guarantors consisting of Deuer Manufacturing, Inc., an Ohio
business corporation with offices located at 0000 Xxxxxxxxxx
Xxxx, Xxxxxx, Xxxx 00000 ('Deuer'), Resistance Technology,
Inc., a Minnesota business corporation with offices located
at 0000 Xxx Xxx Xxxx, Xxxxx Xxxxx, Xxxxxxxxx 00000 ('RTI'),
RTI Export, Inc., a Barbados corporation with offices
located at c/o 0000 Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx
00000 ('RTIE'), and RTI Electronics, Inc., a Delaware
corporation with offices located at 0000 Xxx Xxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000 ('RTI Electronics').
2.2 Amendment of the Definition of Loan Documents. The
following definitions in the Credit Agreement are hereby amended
and restated in their entirety, as follows:
'European Subsidiaries' shall have the meaning given to such
term in the Second Waiver Agreement.
'Existing Loan Documents' shall have the meaning given to
such term in the Second Waiver Agreement.
'Guarantors' shall mean collectively, the U.S. Guarantors
and the European Subsidiaries; and 'Guarantor' shall mean
each such entity.
'Loan Documents' means the Existing Loan Documents, the
Waiver Agreement, the Second Waiver Agreement, the Waiver
Documents, and all documents and agreements executed in
connection therewith or pursuant thereto, as amended from
time to time.
'Notes' means the Term Notes, the Revolving Credit Note, and
the Supplemental Credit Facility Note.
'Obligations' means any and all indebtedness, obligations
and liabilities, of any kind, of the Borrower, the U.S.
Guarantors, the European Subsidiaries (or any of them) to
the Bank and/or its affiliates including, but not limited
to, all obligations under the Loan Documents (or any of
them), and any other notes, loan agreements, security
agreements, guarantees, surety agreements, letters of
credit, swap agreements (as defined in Title 11 of the
United States Code), instruments, accounts receivable,
contracts, drafts, leases, chattel paper, indemnities,
acceptances, reimbursement agreements, repurchase
agreements, overdrafts, however and whenever incurred or
evidenced, whether primary, secondary, direct, indirect,
absolute, contingent, due or to become due, now existing or
hereafter arising, and all amendments, modifications or
renewals thereof, including without limitation all
principal, interest, fees, charges, advances, and costs and
expenses incurred thereunder (including, without limitation,
attorneys fees and other costs of collection, regardless of
whether suit is commenced).
'Permitted Investments' means that certain permitted final
payment of the United States Dollar equivalent of Two
Hundred Fifty Thousand (250,000) Singapore Dollars for the
acquisition of Lectret Precision Pte. Ltd. in accordance
with the terms of Term Note F and the Credit Agreement.
'Revolving Credit Termination Date' means the earlier of (i)
January 31, 2003 (as such date may be extended from time to
time in accordance with Section 2.8 hereof) or (ii) the
date on which the Revolving Credit Commitment is terminated
pursuant to Section 9.2 hereof.
'Rolling Period' means, as of any date, the fiscal quarters
included in the current fiscal year.
'Tangible Capital Funds' means, as of the date of
determination: (i) the sum of Net Worth plus Subordinated
Debt of the applicable entity and any loss from Discontinued
Operations, (ii) less its Intangible Assets and any profits
from Discontinued Operations.
'Waiver Agreement' shall mean that certain Waiver and
Amendment Agreement dated as of November 20, 2001, by and
among, the Bank, the Borrower, the U.S. Guarantors, and the
European Subsidiaries, as the same may be amended from time
to time.
'Waiver Documents' shall mean the Waiver Agreement, the
Second Waiver Agreement, and all of the documents,
agreements and instruments executed and/or delivered to the
Bank pursuant to or in connection with the Waiver Agreement
and/or the Second Waiver Agreement (including the documents
described in Articles IV and V thereof).
2.3 Amendments to Section 2.5 of the Credit Agreement.
2.3.1 Amendment to subsection (c)(i). Subsection
(c)(i) of Section 2.5 of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:
'(c) Revolving Credit Facility.
(i) In the absence of an Event of Default or
Default hereunder, the outstanding principal balance of each
Advance shall bear interest at the following interest rates
(in each case calculated on the basis of a three hundred
sixty (360) day year and the actual number of days elapsed):
(A) Each Advance which is a Base Rate Loan
shall accrue interest at the Base Rate plus 150 basis points
(1.50%), which accrued interest shall be payable by the
Borrower monthly in arrears on the first day of each month
and on the Revolving Credit Termination Date.
(B) Each Advance which is a LIBOR Market
Index Loan shall accrue interest at the LIBOR Market Index
Rate plus 250 basis points (2.50%), payable by the Borrower
monthly in arrears on the first day of each month and on the
Revolving Credit Termination Date. Upon and following the
Supplemental Credit Facility Payment Date, interest on the
outstanding principal of each Advance shall accrue at LIBOR
Market Index Rate plus 200 basis points (2.00%).
(C) Each Advance which is a LIBOR Loan shall
bear interest at the LIBOR Adjusted Rate plus 250 basis
points (2.50%), payable by the Borrower monthly on the last
day of the applicable Interest Period and on the Revolving
Credit Termination Date. Upon and following the
Supplemental Credit Facility Payment Date, interest on the
outstanding principal of each Advance shall accrue at LIBOR
Adjusted Rate plus 200 basis points (2.00%).'
2.3.2 Amendment to subsection (d). Subsection (d) of
Section 2.5 of the Credit Agreement is hereby amended and
restated to read as follows:
'(d) Term Loan D. In the absence of an Event of Default
or Default hereunder, the outstanding principal balance of
Term Loan D shall continue to accrue interest at the LIBOR
Market Index Rate plus 250 basis points (2.50%), payable by
the Borrower monthly on the first day of each month and upon
maturity of Term Loan D. Upon and following the
Supplemental Credit Facility Payment Date, and provided that
no Event of Default or Default has occurred hereunder,
interest on the outstanding principal balance of Term Loan D
shall accrue at LIBOR Market Index Rate plus 200 basis
points (2.00%). In each case, interest will be calculated
on the basis of a 360-day year and the actual number of days
elapsed.'
2.3.3 Amendment to subsection (e). Subsection (e) of
Section 2.5 of the Credit Agreement is hereby amended and
restated to read as follows:
'(e) Term Loan E. In the absence of an Event of
Default or Default hereunder, the outstanding principal
balance of Term Loan E shall bear interest at the following
interest rate (in each case calculated on the basis of a
360-day year and the actual number of days elapsed):
(i) Each portion of Term Loan E which is a LIBOR
Market Interest Loan shall accrue interest at the LIBOR
Market Index Rate plus 250 basis points (2.50%), payable by
the Borrower monthly in arrears on the first day of each
month and upon maturity of Term Loan E. Upon and following
the Supplemental Credit Facility Payment Date, and provided
that no Event of Default or Default has occurred hereunder,
interest on the outstanding principal of Term Loan E shall
accrue at the LIBOR Market Index Rate plus 200 basis points
(2.00%).
(ii) Each portion of Term Loan E which is a LIBOR
Loan shall bear interest at the LIBOR Adjusted Rate for such
LIBOR Loan plus 250 basis points (2.50%), payable by the
Borrower monthly in arrears on the first day of each month
and upon maturity of Term Loan E. Upon and following the
Supplemental Credit Facility Payment Date, and provided that
no Event of Default or Default has occurred hereunder,
interest on the outstanding principal of Term Loan E shall
accrue at the LIBOR Adjusted Rate for such LIBOR Loan plus
200 basis points (2.00%).'
2.3.4 Amendment to subsection (f). Subsection (f) of
Section 2.5 of the Credit Agreement is amended to read as follows:
'(f) Term Loan F.
(i) In the absence of an Event of Default or
Default hereunder, each Singapore Dollar Loan comprising
Term Loan F shall bear interest at the Singapore Dollar
Offer Rate for such Singapore Dollar Loan plus 250 basis
points (2.50%), payable by the Borrower on the last day of
the applicable Interest Period and upon maturity of Term
Loan F. Upon and following the Supplemental Credit Facility
Payment Date, and provided that no Event of Default or
Default has occurred hereunder, interest on the outstanding
principal of each Singapore Dollar Loan shall accrue at the
Singapore Dollar Offer Rate for such Singapore Dollar Loan
plus 200 basis points (2.00%). In each case, interest shall
be calculated on the basis of a 360-day year and the actual
number of days elapsed.
(ii) If the Borrower shall fail to select the
duration of any Interest Period for any Singapore Dollar
Loan in accordance with the provisions of this Agreement,
the Bank will forthwith so notify the Borrower, whereupon
such Singapore Dollar Loan will automatically, on the last
day of the Interest Period therefor, convert into a
Singapore Dollar Loan having a one-month Interest Period.'
2.4 New subsection (h) to Section 9.1. Subsection (h) is
hereby added to section 9.1 of the Credit Agreement as follows:
'(h) If there shall occur an Event of Default under the
Waiver Agreement, the Second Waiver Agreement, any Waiver
Document or any other document or agreement executed in
connection therewith or pursuant thereto.'
2.5 Supplemental Credit Facility. Section 2.1 of the
Credit Agreement is hereby amended by adding, at the end thereof,
new Sections 2.1.1 through 2.1.10, as follows:
'2.1.1 Supplemental Credit Facility. Subject in all
events to the terms, conditions and covenants contained in
this Section 2.1 and Article IV of the Second Waiver
Agreement and in the other Waiver Documents, and provided
that there is no default, Default or Event of Default under
any of the Loan Documents, the Bank agrees to make available
to the Borrower a credit facility (the 'Supplemental Credit
Facility') in the maximum aggregate amount of Two Million
U.S. Dollars ($2,000,000) (the 'Supplemental Credit Facility
Sub-Limit') until such time as the conditions specified in
Section 2.1.3 hereof have been satisfied, at which time the
maximum aggregate amount of the Supplemental Credit Facility
shall be increased to Five Million U.S. Dollars ($5,000,000)
(the 'Supplemental Credit Facility Limit'); provided
however, that at no time shall the outstanding loans or
advances under the Supplemental Credit Facility exceed Two
Million U.S. Dollars ($2,000,000).
2.1.2Selas SAS Facility. Subject in all events to the
terms, conditions and covenants contained in this Section
2.1 and Article IV of the Second Waiver Agreement and in the
other Waiver Documents, and provided that there is no
default, Default or Event of Default under any of the Loan
Documents, and provided further that the outstanding
principal balance of the Overdraft Facility shall have been
permanently reduced to an amount that is less than Five
Million Nine Hundred and Seventy-Six Thousand Eight Hundred
and Fifty-Four Dollars and 11/100 Euros (E5,976,854.11)
('Overdraft Facility Limit'), the Bank agrees to cause to be
issued by the Bank's London Branch, upon request of Selas
SAS, Advance Payment Guarantees under the Selas SAS
Facility, in an aggregate amount not to exceed (i) the
Overdraft Facility Limit, less (ii) the aggregate amount of
the outstanding Advance Payment Guarantees that have been
issued under the Selas SAS Facility and the outstanding
principal balance of the Overdraft Facility, together with
accrued and unpaid interest thereon, at the time of each
request for issuance of an Advance Payment Guarantee under
the Selas SAS Facility; provided that, such requested
Advance Payment Guarantee, together with the aggregate
amount of all Advance Payment Guarantees outstanding under
the Supplemental Credit Facility and the Selas SAS Facility
shall not exceed Six Million Three Hundred Thousand U.S.
Dollars ($6,300,000). From and after April 15, 2002,
extensions of credit under the Selas SAS Facility shall only
be permitted, if at all, for the issuance of Advance Payment
Guarantees by the Bank's London Branch and shall not be
available for any cash borrowing.
2.1.3Specific Conditions Precedent to Availability of
Supplemental Credit Facility. The Bank's obligation: (i) to
make loans, advances or extensions of credit under the
Supplemental Credit Facility, or (ii) to cause the Bank's
London Branch to issue any Advance Payment Guarantee under
the Supplemental Credit Facility in the aggregate amount in
excess of the Supplemental Credit Facility Sub-Limit, or
(iii) to issue any Advance Payment Guarantee under the Selas
SAS Facility, is subject, in each case, to the prior
satisfaction of all of the following conditions precedent
which the Borrower, the U.S. Guarantors, and the European
Subsidiaries acknowledge are material (provided, however,
that the conditions specified in Subsection 2.1.3(a) shall
not apply to the issuance of Advance Payment Guarantees or
loans or advances under the Supplemental Credit Facility in
an aggregate amount not to exceed the Supplemental Credit
Facility Sub-Limit):
(a) The European Subsidiaries shall have granted,
assigned and transferred to the Bank duly perfected, valid,
first-priority security interests in and liens on all now
owned and hereafter acquired accounts receivable and all
other rights to payment of money of the European
Subsidiaries, and the proceeds thereof, pursuant to such
agreements and documents in form and substance acceptable in
all respects to the Bank and its counsel in their sole and
absolute discretion. Such documentation shall include,
without limitation, representations and warranties of the
European Subsidiaries that the billed accounts receivable
(excluding all unbilled and xxxx-and-hold accounts
receivable): have a realizable value at all times of not
less than Six Million Euros (E6,000,000), are valid
obligations of the account debtors thereof, are not subject
to any defenses, counterclaims or reduction, and are fully
collectible. The European Subsidiaries shall have provided
an opinion of their counsel as to the validity, perfection
and enforceability of such security interests and liens
acceptable to the Bank and its counsel in their sole and
absolute discretion.
(b) For each Advance Payment Guaranty, the European
Subsidiaries, the Borrower and the U.S. Guarantors shall
have executed and delivered (or caused to be executed and
delivered) to the Bank such documents and agreements, as the
Bank, in its sole and absolute discretion, may require,
including, without limitation, the following:
(i) A facility agreement for each Advance Payment
Guaranty, duly executed by the particular European
Subsidiary on whose behalf such Advance Payment Guaranty
will be issued, the Borrower, the U.S. Guarantors and the
other European Subsidiary, that will include certain terms
and conditions for the issuance of the Advance Payment
Guarantees, such as duration of such Advance Payment
Guaranty, applicable fees, interest rates, penalty interest,
and other terms and conditions, as the Bank determines in
its sole and absolute discretion;
(ii) a General Counter Indemnity, duly executed by
the particular European Subsidiary on whose behalf such
Advance Payment Guaranty will be issued, the Borrower, the
U.S. Guarantors and the other European Subsidiary that will
include such terms and conditions as the Bank determines in
its sole and absolute discretion; and
(iii)such other documents as the Bank, in its sole
discretion, may require, including, but not limited to a
legal opinion from counsel to the European Subsidiaries in
form and substance acceptable to the Bank.
(c) There shall not be a default, a Default or an
Event of Default under the Loan Documents, the Selas Term
Loan Agreements, the Selas SAS Facility, the Credit
Agreement, or any other document executed or delivered in
connection with any Advance Payment Guaranty or any other
Loan Document (other than the Financial Covenant Defaults
that were waived in the Waiver Agreement); and
(d) The requirements of Article IV of the Second
Waiver Agreement shall have been satisfied.
2.1.4Advances. The Borrower shall give the Bank written
notice (which notice may be transmitted by telecopier,
provided that the Bank receives an original request within
24 hours thereafter) not later than eleven o'clock (11:00)
a.m. on the date of each requested loan or advance under the
Supplemental Credit Facility.
2.1.5Conversion of Currency. In the case of loans, advances
or extensions of credit for the issuance of an Advance
Payment Guaranty under the Supplemental Credit Facility or
the Selas SAS Facility, any amount required to be paid in
U.S. Dollars may be converted and made available in Euros at
the applicable conversion rate for Euros on the date of such
advance as determined by the Bank.
2.1.6Assignment of Foreign Accounts Receivable.
(a) Each European Subsidiary shall provide to the Bank
on the 20th day of each month updated detailed accounts
receivable aging reports as of the last day of the prior
month which shall include without limitation: (i) the name
of the account debtor; (ii) the address of the account
debtor; (iii) the date of the invoice; (iv) the invoice
number; and (v) a description of the goods or services
furnished by the European Subsidiary.
(b) Each European Subsidiary hereby agrees to assign
all of its accounts receivable and rights to payment of
money, now existing and hereafter arising, to the Bank as
such accounts receivable or other right to payment of money
arise or are created. The European Subsidiaries hereby
authorize the Bank to immediately notify any account debtor,
or person owing money to each European Subsidiary, from time
to time, (i) of the assignment, and (ii) to the extent
necessary to create, attach or perfect the Bank's security
interests and liens, or upon an Event of Default, to remit
payment on the account or contract directly to the Bank.
The Bank shall release to the European Subsidiaries all
payments on the European Subsidiaries' accounts or
contracts, to the extent received by the Bank, if, and only
if: (i) an Event of Default has not occurred, or (ii) such
release of payments will not impair or render unenforceable
the creation, attachment or perfection of the Bank's
security interests in and liens on such accounts or
contracts.
(c) If an Event of Default (as defined in Article VI
of the Second Waiver Agreement) shall occur and be
continuing, any payment received by the Bank from an account
debtor of a European Subsidiary shall be applied in the
following order: (i) first, to pay and satisfy in full the
outstanding principal under the Overdraft Facility (together
with accrued interest and fees thereon), (ii) second, to pay
and satisfy in full the outstanding principal under the
Supplemental Credit Facility (together with accrued interest
and fees thereon), and (iii) then to such Obligations as the
Bank may determine in its sole discretion.
(d) The Borrower, the European Subsidiaries, and the
U.S. Guarantors agree that the Bank, or its accountants,
shall at all times have the right to confirm orders and to
verify any or all of the European Subsidiaries' accounts
receivable and rights to payment of money by contacting the
appropriate debtor.
(e) Upon written request from the Bank, each European
Subsidiary shall deliver to the Bank copies of purchase
orders, invoices, contracts, shipping and delivery receipts
and any other document or instrument which evidences or
gives rise to an account receivable.
2.1.7Selas SAS Transfer Event. The proceeds of any Selas
SAS Transfer Event shall, in all events, be applied in the
following order: (i) first, to pay and satisfy in full the
entire outstanding balance of the Overdraft Facility
(together with accrued interest and fees thereon); (ii)
second, to pay and satisfy in full the outstanding balance
of the Supplemental Credit Facility (together with accrued
interest and fees thereon), if any; and (iii) third, to
repay any loans or advances made by the Borrower to Selas
SAS. Upon a Selas SAS Transfer Event, the Borrower, the
European Subsidiaries and the U.S. Guarantors shall cause
all outstanding Advance Payment Guarantees that have been
issued for the benefit of Selas SAS to be cancelled,
terminated and surrendered to the London Branch without any
amounts having been drawn thereunder.
2.1.8Commitment Fee. On the earlier to occur of: (i)
January 31, 2003; or (ii) the date of any Selas SAS Transfer
Event, the Borrower shall pay to the Bank a non-refundable
commitment fee in the aggregate amount of One Hundred and
Fifty Thousand U.S. Dollars ($150,000) plus an amount equal
to two percent (2.0%) of that portion of the gross price for
the Selas SAS Transfer in excess of Seven Million Euros
(E7,000,000). The Borrower, the U.S. Guarantors and the
European Subsidiaries hereby acknowledge and agree that the
commitment fee payable hereunder is fully earned on the date
hereof, is non-refundable and constitutes a part of the
Obligations, and is in addition to any other fees payable by
the Borrower, the U.S. Guarantors and the European
Subsidiaries under the Loan Documents.
2.1.9Unused Facility Fee. The Borrower shall pay to the
Bank a non-refundable facility fee of 25 basis points
(0.25%) per annum on the unused portion of the Supplemental
Credit Facility (based upon the Supplemental Credit Facility
Sub-Limit until such time as the conditions contained in
Section 2.1.3 hereof have been satisfied, then based upon
the Supplemental Credit Facility Limit, in each case whether
or not in effect), from the date hereof through the
Supplemental Credit Facility Maturity Date, which facility
fee shall be due and payable at the offices of the Bank,
quarterly in arrears, on the first day of each January,
April, July, and October, as billed by the Bank. The
Borrower, the U.S. Guarantors and the European Subsidiaries
hereby acknowledge and agree that the facility fee payable
under this Subsection is fully earned on the date such fee
is due and payable, as provided herein, is non-refundable
and constitutes a part of the Obligations, and is in
addition to any other fees payable by the Borrower, the U.S.
Guarantors and the European Subsidiaries under the Loan
Documents.'
2.1.10 Financial Information.
(a) On or before May 10, 2002, the Borrower shall provide a
report to the Bank from its independent consultants, which
shall include: (i) an analysis and assessment of the
financial projections for (a) the Borrower's consolidated
operations and (b) the Discontinued Operations, including
the balance sheet, income statement, statement of cash flows
and the related underlying assumptions for each, (ii) an
analysis of the current status of major international
contracts of the European Subsidiaries, including, but not
limited to, an assessment of the budgeted to actual results
against targeted milestones and projected profitability, and
(iii) such other information as may be requested by the
Bank; and
(b) On a monthly basis commencing on the first full month
after the date hereof, the Borrower shall provide to the
Bank its detailed actual cash flow statements (the
'Statements'), and a comparison of such actual Statements to
the Borrower's projected Statements for its fiscal year
2002, previously delivered to the Bank ('2002 Budget'), for
the discontinued operations of Selas SAS, Selas UK and Selas
Italiana (the 'Discontinued Operations'), the Borrower's
consolidated domestic operations and the Borrower's
consolidated European operations. Such actual Statements
and comparison of actual to 2002 Budget shall be in the same
form as the 2002 Budget, and shall be delivered by the
Borrower to the Bank no later than the 20th day after the
end of each month.
2.6 Supplemental Credit Facility Note. Section 2.2 of the
Credit Agreement is hereby amended by adding new subsection 2.2.4
after subsection 2.2.3:
'2.2.4 Supplemental Credit Facility. The indebtedness of
Borrower under the Supplemental Credit Facility shall be
evidenced by the Supplemental Credit Facility Note.'
2.7 Use of Proceeds of Supplemental Credit Facility.
Section 2.3 of the Credit is hereby amended by adding the
following new subsection 2.3.2 after subsection 2.3.1:
'2.3.2 Supplemental Credit Facility. The Supplemental
Credit Facility shall be used solely for: (i) working
capital and general corporate purposes of the Borrower, the
U.S. Guarantors and the European Subsidiaries; or (ii) the
issuance of advance payment guarantees for the benefit of
the European Subsidiaries.'
2.8 Interest under Supplemental Credit Facility. Section
2.5 of the Credit is hereby amended by adding the following new
subsection (g) after subsection (f):
(g) Supplemental Credit Facility. The outstanding principal
balance of each loan or advance under the Supplemental
Credit Facility (excluding fees for the issuance of Advance
Payment Guarantees) shall accrue interest at the LIBOR
Market Index Rate plus 325 basis points (3.25%), payable by
the Borrower on the first day of each month in arrears and
on the Supplemental Credit Facility Maturity Date.
2.9 Subsection 2.5(h) Former subsection 2.5(g) is hereby
redesignated as subsection 2.5(h); and the references therein to
'subsections (a), (b), (c), (d), (e) and (f)' and 'Sections
2.5(a), (b), (c), (d), (e) and (f)' are hereby amended and
restated to read 'subsections (a), (b), (c), (d), (e), (f) and
(g)' and 'Sections 2.5(a), (b), (c), (d), (e) (f) and (g)',
respectively.
2.10 Amended Financial Covenants. Subsections 6.15 through
6.18 of the Credit Agreement are hereby amended and restated to
read as follows:
6.15 Consolidated Tangible Capital Funds. Maintain, as of
the last day of each fiscal quarter, commencing March 31,
2002, Consolidated Tangible Capital Funds for the Borrower
and its Consolidated Subsidiaries of not less than
Twenty-Two Million U.S. Dollars ($22,000,000), increasing on
a quarterly basis, commencing on the last day of each fiscal
quarter, on a cumulative basis, by: (i) an amount equal to
one hundred percent (100%) of cumulative net earnings of
continuing operations on and after April 1, 2002 (with no
reduction for losses), (ii) plus one hundred percent (100%)
of contributions to capital on or after April 1, 2002, (iii)
plus one hundred percent (100%) of any subordinated debt on
or after April 1, 2002, and (iv) excluding losses solely as
a result of currency translation (up to a maximum cumulative
loss of Seven Hundred and Fifty Thousand U.S. Dollars
($750,000)).
6.16 Consolidated Total Liabilities and Contingent
Liabilities to Consolidated Tangible Capital Funds.
Maintain, as of the last day of each fiscal quarter, a ratio
of (a) Consolidated Total Liabilities of the Borrower and
its Consolidated Subsidiaries plus the Contingent
Liabilities of Selas SAS which are guaranteed by the
Borrower, to (b) Consolidated Tangible Capital Funds of the
Borrower and its Consolidated Subsidiaries, of not more than
2.50 to 1.0.
6.17 Consolidated Current Ratio. Maintain, as of the last
day of each fiscal quarter, a Consolidated Current Ratio of
not less than 1.10 to 1.0.
6.18 Consolidated Fixed Charge Coverage Ratio. Maintain, as
of the last day of each fiscal quarter, a Fixed Charge
Coverage Ratio for the Borrower and its Consolidated
Subsidiaries, excluding Discontinued Operations, of 1.25 to
1.0 for the preceding Rolling Period.
2.11 New Financial Covenants. The Credit Agreement is
hereby amended by adding new Subsections 6.22 through 6.26 as
follows:
6.22 Accounts Receivable of European Subsidiaries.
Maintain, at all times, billed accounts receivable
(excluding all unbilled and xxxx-and-hold accounts
receivable) of the European Subsidiaries in an amount not
less than Six Million Euros (E6,000,000).
6.23 Financial Information of Discontinued Operations.
Within twenty (20) days after the end of each month and
within thirty-five (35) days after the end of each quarter,
the Borrower shall provide to the Bank its monthly financial
statements or quarterly financial statements, as applicable,
including balance sheets and income statements, pertaining
to the Discontinued Operations, together with year to date
financial statements, of its Discontinued Operations.
6.24 Monthly Net Losses on Discontinued Operations. The
Borrower's monthly net losses from Discontinued Operations
shall not exceed One Hundred Thousand U.S. Dollars
($100,.000) on a monthly basis. Within twenty (20) days
after the end of each month and within thirty-five (35) days
after the end of each quarter, the Borrower shall provide to
the Bank a written certification of its compliance with the
financial covenant in this Section 6.24.
6.25 Quarterly Net Losses on Discontinued Operations. The
Borrower's quarterly net losses from Discontinued Operations
shall not exceed: (i) Four Hundred and Seventy-Five Thousand
U.S. Dollars ($475,000) for the first quarter of fiscal year
2002, (ii) Two Hundred Thousand U.S. Dollars ($200,000) for
the second quarter of fiscal year 2002, (iii) Two Hundred
and Fifty Thousand U.S. Dollars ($250,000) for the third
quarter of fiscal year 2002, and (iv) One Hundred Thousand
U.S. Dollars ($100,000) for the fourth quarter of fiscal
year 2002. Within thirty-five (35) days after the end of
each fiscal quarter, the Borrower shall provide to the Bank
a written certification of its compliance with the financial
covenant in this Section 6.24.
2.12 Acquisitions. Section 7.8 of the Credit Agreement is
hereby amended and restated in its entirety as follows:
7.8 Acquisitions and Investments. Purchase or otherwise
acquire (including without limitation by way of share
exchange) any part or amount of the capital stock, equity
share capital or assets of, or make any investments (other
than the Permitted Investments) in, any other firm or
corporation; or enter into any new business activities or
ventures not directly related to its present business; or
merge or consolidate with or into any other firm or
corporation; or create any subsidiary corporations or joint
ventures; or permit the Borrower's Consolidated Subsidiaries
to do any of the foregoing (any of the foregoing
transactions being referred to herein as an 'Acquisition'),
without the prior written approval of the Bank.
2.13 Capital Expenditures. Section 7.9 of the Credit
Agreement is hereby amended and restated in its entirety as
follows:
7.9 Capital Expenditures. Make Capital Expenditures (not
including Acquisitions) in excess of One Million Eight
Hundred Thousand U.S. Dollars ($1,800,000) in the aggregate
for the Borrower's Consolidated Subsidiaries in any fiscal
year without the prior written approval of the Bank.
2.14 Cross Default. The Loan Documents are hereby amended
to provide that an Event of Default or a Default under any Loan
Document is an Event of Default or Default under all of the Loan
Documents, and upon such Event of Default or Default the Bank may
exercise its remedies as provided in such Loan Documents or
applicable law.
ARTICLE III - FAILURE OF CONDITIONS
3.1 Failure of Conditions. The Borrower acknowledges and
agrees that it failed to satisfy the conditions precedent for
issuance of Advance Payment Guarantees as set forth in Section
4.2.2 of the Waiver Agreement; and as a result of such failure,
the Bank has no obligation to issue any Advance Payment Guaranty
described in Section 4.1 of the Waiver Agreement (other than the
Advance Payment Guarantees described in the Supplemental Credit
Facility or the Selas SAS Facility, subject to the satisfaction
of the terms and conditions set forth in this Second Waiver
Agreement).
ARTICLE IV- CONDITIONS PRECEDENT
The effectiveness of this Second Waiver Agreement and the
Bank's obligations hereunder are conditioned upon the fulfillment
by the Borrower, the U.S. Guarantors and the European
Subsidiaries of all of the following express conditions precedent:
4.1 Documents to be Delivered to the Bank. The Borrower,
the U.S. Guarantors, and/or the European Subsidiaries shall
deliver, or cause to be delivered, to the Bank, in form and
substance reasonably satisfactory to the Bank, the documents
described in Section 2.1.2 hereof and the following documents:
(a) This Second Waiver Agreement, executed by the
Borrower, the U.S. Guarantors, and the European Subsidiaries;
(b) the Supplemental Credit Facility Note;
(c) An Unconditional Guaranty and Suretyship Agreement
duly executed by Selas SAS, as guarantor and surety for all
indebtedness, liabilities and obligations of the Borrower, the
U.S. Guarantors and CFR to the Bank (collectively, the 'Selas SAS
Guaranty');
(d) An Unconditional Guaranty and Suretyship Agreement
duly executed by CFR, as guarantor and surety for all
indebtedness, liabilities and obligations of the Borrower, the
U.S. Guarantors and Selas SAS to the Bank (collectively, the 'CFR
Guaranty');
(e) Sixth Amendment to First Mortgage and Security
Agreement, duly executed by Borrower as Mortgagor (with respect
to the Pennsylvania Property), which shall, among other things,
increase the amount of the mortgage to include the maximum amount
of the Supplemental Credit Facility;
(f) Sixth Amendment to First Mortgage and Security
Agreement, duly executed by Borrower as Mortgagor (with respect
to the Ohio Property), which shall, among other things, increase
the amount of the mortgage to include the maximum amount of the
Supplemental Credit Facility;
(g) Third Amendment to Mortgage, Security Agreement
and Fixture Financing Statement, duly executed by RTI as
Mortgagor (with respect to the Minnesota Property), which shall,
among other things, increase the amount of the mortgage to
include the maximum amount of the Supplemental Credit Facility;
(h) Amended and Restated Facility Agreement, with
respect to the Overdraft Facility;
(i) Amended and Restated Selas SAS 1998 Term Loan
Agreement;
(j) Amended and Restated Selas SAS 2000 Term Loan
Agreement;
(k) A Certification of Authority executed by the
Secretary of each of the Borrower, the U.S. Guarantors, and the
European Subsidiaries, each dated as of the date hereof,
certifying the incumbency and signature of the officers of each
such entity executing this Second Waiver Agreement and all other
documents to be delivered by them pursuant hereto, together with
evidence of the incumbency of such Secretary; and Corporate
Resolutions for each of the Borrower, the U.S. Guarantors, and
the European Subsidiaries, certified by their respective
Secretaries, authorizing and approving this Second Waiver
Agreement, and the documents and payments specified herein;
(l) Opinions of counsel for each of the Borrower and
the U.S. Guarantors, satisfactory to the Bank and counsel to the
Bank in all respects; and
(m) Such other documents as may be required by the
Bank.
4.2 Payment of Bank's Costs, Expenses and Legal Fees. The
Borrower shall have paid to the Bank the amount of the Bank's
out-of-pocket costs and expenses, including, without limitation,
all reasonable fees and out-of-pocket expenses of counsel for the
Bank in connection with: (i) the Financial Covenant Defaults,
(ii) the negotiation and preparation of this Second Waiver
Agreement, the Waiver Documents, and (iii) the other Loan
Documents.
ARTICLE V - REPRESENTATIONS AND WARRANTIES
To induce the Bank to enter into this Second Waiver
Agreement and as partial consideration for the terms and
conditions contained herein, the Borrower, the U.S. Guarantors
and the European Subsidiaries make the following representations
and warranties to the Bank, each and all of which shall survive
the execution and delivery of this Second Waiver Agreement and
all of the other documents executed in connection herewith:
5.1 Organization; Authorization; and Location.
(a) The Borrower, the U.S. Guarantors, and the
European Subsidiaries are duly incorporated, organized, validly
existing and in good standing under the laws of the jurisdictions
indicated in the first paragraph of this Second Waiver Agreement,
and each is duly authorized to do business, and is duly qualified
as a foreign corporation in all jurisdictions wherein the nature
of its business or property makes such qualification necessary,
and has the corporate power to own its property and to carry on
its business as now conducted;
(b) The Borrower, the U.S. Guarantors, and the
European Subsidiaries have the requisite corporate power and
authority to execute, deliver and perform this Second Waiver
Agreement and all of the documents executed by it in connection
herewith.
5.2 Valid and Binding Agreement. This Second Waiver
Agreement is, and each of the documents executed pursuant hereto
will be, legal, valid, and binding obligations of the party or
parties thereto, enforceable against each such party in
accordance with their respective terms.
5.3 Compliance with Laws. The Borrower, each U.S.
Guarantor, and each European Subsidiary are in compliance in all
material respects with all laws, regulations and requirements
applicable to its business, including without limitations all
applicable Environmental Laws, and each has not received, and has
no knowledge of, any order or notice of any governmental
investigation or of any violations or claims of violation of any
law, regulation or any governmental requirement, except as
expressly disclosed herein.
5.4 No Conflict; Government Approvals. The execution,
delivery and performance by the Borrower, each U.S. Guarantor,
and the European Subsidiaries of this Second Waiver Agreement and
the other documents executed in connection herewith will not:
(a) conflict with, violate or result in the breach of
any provisions of any applicable law, rule, regulation or order;
or
(b) conflict with or result in the breach of any
provision of its Articles of Incorporation, charter, and/or
by-laws. No authorization, consent or approval of, or other
action by, and no notice of or filing with, any governmental
authority or regulatory body is required to be obtained or made
by the Borrower for the due execution, delivery and performance
of this Second Waiver Agreement.
5.5 Third Party Consents. The execution, delivery and
performance by the Borrower, each U.S. Guarantor, and each
European Subsidiary of this Second Waiver Agreement and the
documents related hereto will not:
(a) require any consent or approval of any person or
entity which has not been obtained prior to, and which is not in
full force and effect as of, the date of this Second Waiver
Agreement;
(b) result in the breach of, default under, or cause
the acceleration of any obligation owed under any loan, credit
agreement, note, security agreement, lease indenture, mortgage,
loan document or other agreement by which the Borrower is bound
or affected; or
(c) result in, or require the creation or imposition
of, any lien or encumbrance on any of the Borrower's properties
other than those liens or security interests in favor of the Bank
or the liens or security interests disclosed to the Bank in the
Loan Documents.
5.6 Accounts Receivable. The Borrower, the U.S.
Guarantors, and the European Subsidiaries hereby agree that the
list of accounts receivable of the European Subsidiaries attached
to this Second Waiver Agreement as Exhibit 'A' hereto, is true,
correct and complete as of March 31, 2002.
5.7 Financial Statements; Reporting.
(a) Except as otherwise disclosed in writing to the
Bank prior to the date hereof, all balance sheets, reports,
budgets, reconciliations, accounts receivable reports, and other
financial information supplied to the Bank by the Borrower have
been prepared in conformity with GAAP, and present fairly the
financial condition and results of operations of the Borrower for
the period covered thereby.
(b) The Borrower, each U.S. Guarantor, and each
European Subsidiary do not know of any facts, other than those
already disclosed in writing to the Bank, that materially
adversely affect or in so far as can be foreseen, will materially
adversely affect their ability to perform their respective
obligations under this Second Waiver Agreement and the documents
executed in connection herewith.
5.8 Exclusive and First Priority Perfected Lien. The Bank
has, as of the date hereof, and shall continue to have, until
all of the Obligations are paid in full, first priority, valid
perfected liens upon and security interests in all of the
Collateral to secure the payment and performance of all of the
Obligations.
5.9 No Untrue or Misleading Statements. Neither this
Second Waiver Agreement nor any other document executed in
connection herewith contains any untrue statement of a material
fact or omits any material fact necessary in order to make the
statement made, in light of the circumstances under which it was
made, accurate.
5.10 No Events of Default. Other than the Financial
Covenant Defaults, no default or Event of Default has occurred as
of the date hereof under any of the Loan Documents.
ARTICLE VI - EVENTS OF DEFAULT
The occurrence of any one or more of the following shall
constitute an "Event of Default" hereunder:
6.1 Borrower's Failure to Pay. The Borrower, any U.S.
Guarantor, or any European Subsidiary shall fail to pay any
amount of principal, interest, fees or other sums as and when due
under any of the Loan Documents, or any other Obligations,
whether upon stated maturity, acceleration, or otherwise.
6.2 Breach of Covenants. The Borrower, any U.S. Guarantor,
or any European Subsidiary shall fail to perform or observe any
covenant, term or agreement in the Waiver Agreement, this Second
Waiver Agreement, the other Waiver Documents or any other Loan
Document or is in violation of or non-compliance with any
provision of the Waiver Agreement, this Second Waiver Agreement,
the other Waiver Documents or any other Loan Document after the
expiration of any applicable cure period, if any, set forth in
any such Loan Document with respect to such covenant, term or
agreement.
6.3 Defaults in Other Material Agreements. There shall
occur any default under, or as defined in, any other material
agreement applicable to the Borrower, any U.S. Guarantor, or any
European Subsidiary or by which the Borrower, any U.S. Guarantor,
or any European Subsidiary is bound which shall not be remedied
within the period of time (if any) within which such other
agreement permits such default to be remedied, unless such
default is waived by the other party thereto or excused as a
matter of law.
6.4 Agreements Invalid. The validity, binding nature of,
or enforceability of any material term or provision of any Loan
Document is disputed by, on behalf of, or in the right or name of
the Borrower, any U.S. Guarantor, or any the European Subsidiary
or any material term or provision of any such Loan Document is
found or declared to be invalid, avoidable, or non-enforceable by
any court of competent jurisdiction.
6.5 False Warranties; Breach of Representations. Except as
otherwise disclosed to the Bank in writing prior to the date
hereof, any warranty or representation made by the Borrower, each
U.S. Guarantor, and/or each European Subsidiary in this Second
Waiver Agreement or any other Loan Document or in any certificate
or other writing delivered under or pursuant to this Second
Waiver Agreement or any other Loan Document, or in connection
with any provision of this Second Waiver Agreement or related to
the transactions contemplated hereby shall prove to have been
false or incorrect or breached in any material respect.
6.6 Bankruptcy.
(a) The Borrower, any U.S. Guarantor, or any European
Subsidiary commences any bankruptcy, reorganization, debt
arrangement, receivership, or other case or proceeding under any
bankruptcy, insolvency or receivership law, or any dissolution or
liquidation proceeding.
(b) Any bankruptcy, reorganization, debt arrangement,
receivership, or other case or proceeding under any bankruptcy,
insolvency or receivership law, or any dissolution or liquidation
proceeding, is involuntarily commenced against or in respect of
the Borrower, any U.S. Guarantor, or any European Subsidiary or
an order for relief is entered in any such proceeding and such
case or proceeding is not fully and finally dismissed within
thirty (30) days.
(c) A trustee, receiver, or other custodian is
appointed for the Borrower, any U.S. Guarantor or any European
Subsidiary or a substantial part of any of its/their assets.
6.7 Failure to Pay Taxes. The Borrower, any U.S.
Guarantor, or any European Subsidiary shall fail to pay when due
any tax, assessment or other governmental charge as and when due
to the appropriate governmental entity.
6.8 Event of Default Under Other Loan Documents. An Event
of Default (as such term is defined in the Credit Agreement) or a
Default or an Event of Default (as each such term is defined in
the other Loan Documents) (other than the Financial Covenant
Defaults) shall occur under any of the Loan Documents.
ARTICLE VII - REMEDIES
If an Event of Default (as defined in Article VI of this
Second Waiver Agreement) shall occur and be continuing, at any
time, without notice to the Borrower, any U.S. Guarantor, or any
European Subsidiary:
7.1 Loan Documents; Applicable Law. The Bank may, in its
sole discretion, enforce all of its remedies as set forth
hereunder, under any of the Loan Documents and/or under
applicable law against the Borrower, the U.S. Guarantors, and/or
the European Subsidiaries.
7.2 Additional Remedies. The Bank may declare all
Obligations to be immediately due and payable and shall have, in
addition to any other remedies, all of the remedies of a secured
party under the Uniform Commercial Code (the 'Code') and/or other
applicable law. Expenses of retaking, holding, preparing for
sale, selling or the like shall include the Bank's reasonable
attorney's fees and legal expenses incurred or expended by the
Bank to enforce any payment due to it hereunder or under the Loan
Documents, as against the Borrower, the U.S. Guarantors, or the
European Subsidiaries, or in the prosecution or defense of any
action, or concerning any matter growing out of or in connection
with the Loan Documents and/or the Collateral.
7.3 Power of Attorney. The Borrower, each U.S. Guarantor,
and each European Subsidiary do hereby make, constitute and
appoint any officer or agent of the Bank as the true and lawful
attorney-in-fact of the Borrower, each U.S. Guarantor, and the
European Subsidiaries, with power to, at the Bank's option and at
the expense and liability of the Borrower, the U.S. Guarantors,
and the European Subsidiaries: (a) sign, for the Borrower, any
U.S. Guarantor, and/or the European Subsidiaries, financing,
continuation or amendment statements pursuant to the Code; (b)
endorse the name of the Borrower, any U.S. Guarantor, or any
European Subsidiary or any of the respective officers or agents
thereof upon any notes, checks, drafts, money orders, or other
instruments of payment with respect to the Collateral that may
come into the Bank's possession in full or partial payment of any
of the Obligations; and (c) after an Event of Default has
occurred, xxx for, compromise, settle and release any and all
claims and disputes with respect to the Collateral; granting to
said attorney of the Borrower, the U.S. Guarantors, and/or the
European Subsidiaries full power to do any and all things
necessary to be done in and about the premises as fully and
effectually as the Borrower, any U.S. Guarantor, and/or the
European Subsidiaries might or could do. The Borrower, the U.S.
Guarantors, and the European Subsidiaries hereby ratify all that
said attorney shall lawfully do or cause to be done by virtue
hereof. This power of attorney is coupled with an interest, and
is irrevocable.
7.4 Payment of Expenses. At its option, the Bank may
discharge taxes, liens, security interests or such other
encumbrances as may attach to the Collateral, as determined by
the Bank to be necessary. The Borrower, the U.S. Guarantors, and
the European Subsidiaries will reimburse the Bank on demand for
any payment so made or any expense incurred by the Bank pursuant
to the foregoing authorization, and the Collateral also will
secure any loans or advances or payments so made or expenses so
incurred by the Bank.
ARTICLE VIII - GENERAL RELEASE
EFFECTIVE UPON THE BORROWER, THE U.S. GUARANTORS, AND THE
EUROPEAN SUBSIDIARIES, FOR AND ON BEHALF OF THEMSELVES AND ALL
PERSONS AND/OR ENTITIES CLAIMING BY, THROUGH AND/OR UNDER ANY OF
THEM, INCLUDING, BUT NOT LIMITED TO, ALL OF THEIR RESPECTIVE PAST
AND PRESENT PARTNERS, DIRECTORS, SHAREHOLDERS, OFFICERS,
EMPLOYEES, ATTORNEYS, ACCOUNTANTS, ADMINISTRATORS, AGENTS, PARENT
CORPORATIONS, SUBSIDIARIES, AFFILIATES, REPRESENTATIVES,
PREDECESSORS, SUCCESSORS AND ASSIGNS AND WHERE APPLICABLE THEIR
RESPECTIVE HEIRS, EXECUTORS AND TRUSTEES (COLLECTIVELY REFERRED
TO HEREIN, JOINTLY AND SEVERALLY, AS THE 'RELEASORS') HEREBY
JOINTLY AND SEVERALLY UNCONDITIONALLY REMISE, RELEASE, ACQUIT AND
FOREVER DISCHARGE THE BANK AND ALL OF ITS PAST AND PRESENT
DIRECTORS, SHAREHOLDERS, OFFICERS, EMPLOYEES, ATTORNEYS,
ACCOUNTANTS, ADMINISTRATORS, AGENTS, PARENT CORPORATIONS,
SUBSIDIARIES, AFFILIATES, REPRESENTATIVES, PREDECESSORS,
SUCCESSORS, ASSIGNS AND WHERE APPLICABLE THEIR RESPECTIVE HEIRS,
EXECUTORS AND TRUSTEES (COLLECTIVELY REFERRED TO HEREIN AS THE
'RELEASEES'), OF, FROM AND WITH RESPECT TO ANY AND ALL GRIEVANCES,
DISPUTES, MANNER OF ACTIONS, CAUSES OF ACTION, SUITS,
OBLIGATIONS, LIABILITIES, LOSSES, DEBTS, DAMAGES, DUES, SUMS OF
MONEY, ACCOUNTS, RECKONINGS, CONTROVERSIES, AGREEMENTS, CLAIMS,
DEMANDS, COUNTERCLAIMS AND CROSSCLAIMS, INCLUDING, BUT NOT
LIMITED TO ALL CLAIMS AND CAUSES OF ACTION ARISING OUT OF OR
RELATED TO THE LOAN DOCUMENTS AND/OR ALL TRANSACTIONS RELATED
THERETO, WHETHER KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
DIRECT, INDIRECT OR CONTINGENT, ARISING IN LAW OR EQUITY, WHICH
THE RELEASORS (OR ANY OF THEM) EVER HAD, NOW HAS, OR MAY EVER
HAVE AGAINST ANY ONE OR MORE OF THE RELEASEES, FROM THE BEGINNING
OF TIME TO THE DATE OF THIS SECOND WAIVER AGREEMENT.
ARTICLE IX - MISCELLANEOUS
9.1 Continuing Effect. Except as amended hereby, all of
the Loan Documents shall remain in full force and effect and bind
and inure to the benefit of the parties thereto and are hereby
ratified and confirmed.
9.2 Choice of Law and Venue; Submission to Jurisdiction;
Selection of Forum; Jury Trial Waiver.
9.2.1This Second Waiver Agreement and the other Loan
Documents (unless expressly provided to the contrary in any other
Loan Document with respect to such other Loan Document), the
construction, interpretation, and enforcement hereof and thereof,
and the rights of the parties hereto and thereto with respect to
all matters arising hereunder or thereunder or related hereto and
thereto shall be determined under, governed by, and construed in
accordance with the laws of the Commonwealth of Pennsylvania.
9.2.2 The Bank, the Borrower, the U.S. Guarantors,
and the European Subsidiaries agree that all actions or
proceedings arising in connection with this Second Waiver
Agreement and the other Loan Documents shall be tried and
litigated only in the state or federal courts located in the
Commonwealth of Pennsylvania, provided, however, that any suit,
action or other proceeding seeking enforcement against any
Collateral or other property may be brought, at Bank's option, in
the courts of any jurisdiction where Bank elects to bring such
action or where such Collateral or other property may be found.
The Bank, the Borrower, the U.S. Guarantors, and the European
Subsidiaries waive, to the extent permitted under applicable law,
any right each may have to assert the doctrine of forum non
conveniens or to object to venue to the extent any suit, action
or other proceeding is brought in accordance with this section.
9.2.3The Bank, the Borrower, the U.S. Guarantors, and
the European Subsidiaries hereby waive personal service of
process and agree that a summons and complaint commencing an
action or proceeding in such court shall be proper and shall
confer personal jurisdiction if served by registered or certified
mail, return receipt requested, in accordance with the notice
provisions of this Second Waiver Agreement.
9.2.4The Bank, the Borrower, the U.S. Guarantors, and
the European Subsidiaries hereby waive their respective rights to
a jury trial of any claim or cause of action based upon or
arising out of this Second Waiver Agreement or any other Loan
Document or any of the transactions contemplated herein or
therein, including all contract claims, tort claims, breach of
duty claims, and all other common law or statutory claims,
whatsoever. The Bank, the Borrower, each U.S. Guarantor, and
each European Subsidiary warrant and represent that they have
reviewed this waiver and, following consultation with legal
counsel of its or his choice, do hereby knowingly, voluntarily,
intentionally, and expressly waive their right to jury trial and
right to claim or recover, in any such suit, action or
proceeding, any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual
damages. In the event of litigation, a copy of this waiver
agreement may be filed as a written consent to a trial by the
court.
9.2.5The Bank, the Borrower, the U.S. Guarantors, and
the European Subsidiaries hereby acknowledge and agree that this
Section is a specific and material aspect of this Second Waiver
Agreement and that neither the Bank, the Borrower, any U.S.
Guarantor, nor any European Subsidiary would enter into this
Second Waiver Agreement if the waivers set forth in this section
were not a part of thereof.
9.3 Cooperation; Other Documents. At all times following
the execution of this Second Waiver Agreement, the Borrower, each
U.S. Guarantor, and each European Subsidiary shall execute and
deliver to the Bank, or shall cause to be executed and delivered
to the Bank, and shall do or cause to be done all such other acts
and things as the Bank may reasonably deem to be necessary or
desirable to assure the Bank of the benefit of this Second Waiver
Agreement and the documents comprising or relating to this Second
Waiver Agreement.
9.4 Remedies Cumulative; No Waiver. The rights, powers and
remedies of the Bank in this Second Waiver Agreement and in the
other Loan Documents are cumulative and not exclusive of any
right, power or remedy provided in the Loan Documents, by law or
in equity and no failure or delay on the part of the Bank in the
exercise of any right, power or remedy shall operate as a waiver
thereof, nor shall any single or partial exercise of any right,
power or remedy preclude any other or further exercise thereof,
or the exercise of any other right, power or remedy.
9.5 Notices. Any notice given pursuant to this Second
Waiver Agreement or pursuant to any document comprising or
relating to this Second Waiver Agreement or any of the other Loan
Documents shall be in writing, including telecopies. Notice
given by telecopy shall be deemed to have been given and received
when sent. Notice given by overnight mail courier shall be
deemed to have been given and received one (1) day after the date
delivered to such overnight courier by the party sending such
Notice. Notice by mail shall be deemed to have been given and
received three (3) days after the date deposited, when sent by
first class certified mail, postage prepaid, and addressed as
follows:
To the Borrower, the U.S. Guarantors, and/or the
European Subsidiaries:
Xx. Xxxxx X. Xxxxxxxxxxx
Vice President and Treasurer
Selas Corporation of America
0000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
With a copy to:
Drinker Xxxxxx & Xxxxx LLP
One Xxxxx Square
00xx xxx Xxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esquire
Telecopy Number: 215-988-2757
To the Bank:
Wachovia Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx-XX0000
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxxx, VP
Telecopy Number: 000-000-0000
With a copy to:
Xxxxx Xxxxxx, LLP
Xxx Xxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxx, Esquire
Telecopy Number: 000-000-0000
A party may change his or its address by giving written notice of
the changed address to the other parties, as specified herein.
9.6 Indemnification. If, after receipt of any payment of
all or any part of the Obligations, the Bank is compelled to
surrender such payment to any person or entity for any reason
(including, without limitation, a determination that such payment
is void or voidable as a preference or fraudulent conveyance, an
impermissible setoff, or a diversion of trust funds), then this
Second Waiver Agreement and the other Loan Documents shall
continue in the full force and effect, and the Borrower, each
U.S. Guarantor, and each European Subsidiary shall be jointly and
severally liable for, and shall indemnify, defend and hold
harmless the Bank with respect to the full amount so
surrendered. The provisions of this Section shall survive the
termination of this Second Waiver Agreement and the other Loan
Documents and shall be and remain effective notwithstanding the
payment of the Obligations, the cancellation of any note, the
release of any lien, security interest or other encumbrance
securing the Obligations or any other action which the Bank may
have taken in reliance upon its receipt of such payment. Any
cancellation of any note, release of any such encumbrance or
other such action shall be deemed to have been conditioned upon
any payment of the Obligations having become final and
irrevocable.
9.7 Costs, Expenses and Attorneys' Fees. The Borrower,
the U.S. Guarantors, and the European Subsidiaries agree to pay
on demand by the Bank, all reasonable out-of-pocket fees, costs
and expenses incurred by the Bank, including, without limitation,
all reasonable costs and expenses and all reasonable fees and
expenses of counsel for the Bank in connection with: (i)
perfecting the Bank's interest in the foreign accounts and other
collateral; (ii) the negotiation, preparation and enforcement of
this Second Waiver Agreement, the Waiver Documents, the other
Loan Documents and all other documents and instruments executed
in connection herewith or otherwise relating to this Second
Waiver Agreement; and (iii) the enforcement or exercise by the
Bank of its rights and remedies with respect to the collection of
the Obligations or to preserve, protect or enforce its interests.
9.8 Bankruptcy/Relief from Automatic Stay. If any
bankruptcy, insolvency, reorganization or rehabilitation case or
proceeding is commenced by or against the Borrower, any U.S.
Guarantor, or any European Subsidiary under any state, federal or
foreign proceeding (including, without limitation, title 11 of
the United States Code (the "Bankruptcy Code")), the Borrower,
each U.S. Guarantor, and each European Subsidiary hereby agree
that the Bank and/or its nominee(s) or assignee(s) are entitled
to, and the Borrower, each U.S. Guarantor, and each European
Subsidiary hereby waive any objections to, immediate relief from
any stay imposed by Section 362 or 105 of the Bankruptcy Code or
other applicable law or against the exercise of the rights and
remedies otherwise available to the Bank and/or its nominee(s) or
assignee(s) as provided in this Second Waiver Agreement, the
Waiver Agreement, the other Waiver Documents, the other Loan
Documents and as otherwise provided by law. Upon the occurrence
of any of the events described in this Section, the Borrower,
each U.S. Guarantor, and each European Subsidiary covenant to
take any action deemed necessary or convenient by the Bank and/or
its nominee(s) and assignee(s) to enable the Bank and/or its
nominee(s) and assignee(s) to continue to exercise its rights and
remedies under this Second Waiver Agreement.
9.9 Survival of Representations and Warranties. All
representations and warranties of the Borrower, the U.S.
Guarantors, and the European Subsidiaries contained in this
Second Waiver Agreement, the Waiver Agreement, the other Waiver
Document, the other Loan Documents, and in all other documents
and instruments executed in connection herewith or therewith
shall survive the execution of this Second Waiver Agreement and
are material and have been or will be relied upon by the Bank,
notwithstanding any investigation made by any person, entity or
organization on the Bank's behalf. No implied representations or
warranties are created or arise as a result of this Second Waiver
Agreement or the documents comprising or relating to this Second
Waiver Agreement.
9.10 Headings. The headings and underscoring of articles,
sections and clauses have been included herein for convenience
only and shall not be considered in interpreting this Second
Waiver Agreement.
9.11 Integration. This Second Waiver Agreement and all
documents and instruments executed in connection herewith or
otherwise relating to this Second Waiver Agreement, including,
without limitation, the Loan Documents, constitute the sole
agreement of the parties with respect to the subject matter
hereof and thereof and supersede all oral negotiations and prior
writings with respect to the subject matter hereof and thereof.
9.12 Amendment and Waiver. No amendment of this Second
Waiver Agreement, and no waiver, discharge or termination of any
one or more of the provisions thereof, shall be effective unless
set forth in writing and signed by all of the parties hereto.
9.13 Successors and Assigns. This Second Waiver Agreement
and the other Loan Documents: (a) shall be binding upon the Bank,
the Borrower, each U.S. Guarantor, and each European Subsidiary
and upon their respective officers, directors, employees, agents,
trustees, representatives, nominees, parent corporation,
subsidiaries, heirs, executors, administrators, successors or
assigns, and (b) shall inure to the benefit of the Bank, the
Borrower, each U.S. Guarantor, and each European Subsidiary
provided, however, that neither the Borrower nor any U.S.
Guarantor or European Subsidiary may assign any rights hereunder
or any interest herein without obtaining the prior written
consent of the Bank, and any such assignment or attempted
assignment shall be void and of no effect with respect to the
Bank.
9.14 Severability of Provisions. Any provision of this
Second Waiver Agreement that is held to be inoperative,
unenforceable, void or invalid in any jurisdiction shall, as to
that jurisdiction, be ineffective, unenforceable, void or invalid
without affecting the remaining provisions in that jurisdiction
or the operation, enforceability or validity of that provision in
any other jurisdiction, and to this end the provisions of this
Second Waiver Agreement are declared to be severable. This
Second Waiver Agreement shall remain valid and enforceable
notwithstanding the invalidity, insufficiency, or
unenforceability of any other Loan Document.
9.15 Conflicting Provisions. To the extent that any of the
terms in this Second Waiver Agreement contradict any of the terms
contained in any of the Loan Documents, the terms of this Second
Waiver Agreement shall control.
9.16 Joint and Several Liability. The obligations and
liabilities of the Borrower, each U.S. Guarantor and each
European Subsidiary hereunder are joint and several.
9.17 Intent to Limit Charges to Maximum Lawful Rate. In no
event shall the interest rate or rates payable under Loan
Documents, as amended by this Second Waiver Agreement, plus any
other amounts paid in connection herewith, exceed the highest
rate permissible under any law that a court of competent
jurisdiction shall, in a final determination, deem applicable.
The parties hereto, in executing and delivering this Second
Waiver Agreement, intend legally to agree upon the rate or rates
of interest and manner of payment stated within it; provided;
however, that, anything contained herein to the contrary
notwithstanding, if said rate or rates of interest or manner of
payment exceeds the maximum allowable under applicable law, then,
ipso facto, as of the date hereof, the Borrower, the U.S.
Guarantors, and the European Subsidiaries are and shall be liable
only for the payment of such maximum as allowed by law, and
payment received from the Borrower, the U.S. Guarantors, and the
European Subsidiaries in excess of such legal maximum, whenever
received, shall be applied to reduce the principal balance of the
Obligations to the extent of such excess.
9.18 Counterparts; Effectiveness. This Second Waiver
Agreement may be executed by facsimile signatures and in any
number of counterparts and by the different parties on separate
counterparts, and each such counterpart shall be deemed to be an
original, but all such counterparts shall together constitute one
and the same Second Waiver Agreement. This Second Waiver
Agreement shall be deemed to have been executed and delivered
when the Bank has received facsimile counterparts hereof executed
by all parties listed on the signature pages hereto.
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IN WITNESS WHEREOF, the undersigned have caused this Second
Waiver Agreement to be executed by their duly authorized officers
on the date first above written.
WITNESS: WACHOVIA BANK, NATIONAL ASSOCIATION
By:/s/ Xxxxxxxx X. Xxxxxxx
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
WITNESS: SELAS CORPORATION OF
AMERICA
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President Treasurer & Secretary
WITNESS: SELAS SAS
By:/s/ Christian Bailliart
Name: Christian Bailliart
Title: President
WITNESS: CFR-CECF FOFUMI RIPOCHE
By:/s/ Christian Bailliart
Name: Christian Bailliart
Title: President
WITNESS: DEUER MANUFACTURING, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President Treasurer
WITNESS: RESISTANCE TECHNOLOGY, INC.,
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President Treasurer
WITNESS: RTI EXPORT, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President Treasurer
WITNESS: RTI ELECTRONICS, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President Treasurer
