EXHIBIT 10.1
September 26, 2002
Allied HealthCare Products, Inc.
0000 Xxxxxxxx Xxxxxx
ST. LOUIS, MISSOURI 63110
RE: FIRST AMENDMENT
Gentlemen:
Allied HealthCare Products, Inc. a Delaware corporation ("BORROWER") and LASALLE
BANK NATIONAL ASSOCIATION, a national banking association ("BANK") have entered
into that certain Loan and Security Agreement dated April 24, 2002 (the
"SECURITY AGREEMENT"). From time to time thereafter, Xxxxxxxx and Bank may have
executed various amendments (each an "AMENDMENT" and collectively the
"AMENDMENTS") to the Security Agreement (the Security Agreement and the
Amendments hereinafter are referred to, collectively, as the "AGREEMENT").
Borrower and Bank now desire to further amend the Agreement as provided herein,
subject to the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual covenants
and agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. The Agreement hereby is amended as follows:
(A) Subparagraph (2)(b) of the Agreement is deleted in its entirety and
the following is substituted in its place:
(2) CAPITAL EXPENDITURE LOANS.
(B) Subject to the terms and conditions of this
Agreement and the Other Agreements, from time to
time after the initial Loans are advanced
hereunder, Xxxxxx shall make advances to Borrower
up to eighty percent (80%) of the purchase price
(exclusive of sales taxes, delivery charges and
other "soft" costs related to such purchase) of
Equipment to be purchased with the proceeds of
such advances, (including, without limitation,
Equipment purchased since June 30, 2001) which
Equipment is acceptable
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to Lender in its sole discretion, and upon which
Lender shall have a first priority perfected
security interest; provided, that (i) the
aggregate amount advanced for such purchases shall
not exceed Four Million and No/100 Dollars
($4,000,000.00), (ii) at least (5) Business Days
prior to any such advance hereunder, Borrower
shall have furnished to Lender an invoice and
acceptance letter for the Equipment being
purchased and shall have executed such documents
and taken such other actions as Lender shall
reasonably require to assure that Xxxxxx has a
priority perfected security interest in such
Equipment, and (iii) all such advances hereunder
shall occur on or before the date that is eight
(8) months after the date hereof.
(B) Subparagraph (2)(c)(ii) of the Agreement is deleted in its entirety
and the following is substituted in its place:
(C) REPAYMENTS:
(II) REPAYMENT OF CAPITAL EXPENDITURE LOANS. The
Capital Expenditure Loans shall be repaid in sixty
(60) equal monthly installments of principal in an
amount sufficient to pay such Capital Expenditure
Loan in full by the final payment, payable
commencing on the date that is eight (8) months
from the date hereof, and on the corresponding day
of each month thereafter (or if there is no
corresponding day, on the last day of each month);
provided that any remaining outstanding principal
balance of the Capital Expenditure Loans shall be
repaid at the end of the Original Term or any
Renewal Term if this Agreement is renewed pursuant
to Section 10 hereof. If any such payment due date
is not a Business Day, then such payment may be
made on the next succeeding Business Day and such
extension of time shall be included in the
computation of the amount of interest and fees due
hereunder.
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(C) Subparagraph (3)(a) of the Agreement is deleted in its entirety and
the following is substituted in its place:
(3) LETTERS OF CREDIT.
(A) GENERAL TERMS. Subject to the terms and conditions
of the Agreement and the Other Agreements, during
the Original Term or any Renewal Term, Lender
shall, absent the existence of an event of
Default, from time to time issue, upon Xxxxxxxx's
request, commercial and/or standby Letters of
Credit; provided, that the aggregate undrawn face
amount of all such Letters Of Credit shall at no
time exceed Five Million and No/100 Dollars
($5,000,000.00). Payments made by Lender to any
Person on account of any Letter of Credit shall
constitute Loans hereunder and Xxxxxxxx agrees
that each payment made by Xxxxxx in respect of a
Letter of Credit shall constitute a Loan
hereunder. Borrower shall remit to Lender a Letter
of Credit fee equal to two and one-half percent
(2-1/2%) per annum on the aggregate undrawn face
amount of all Letters of Credit outstanding, which
fee shall be payable monthly in arrears on the
last Business Day of each month. Borrower shall
also pay on demand the normal and customary
administrative charges of the Lender for issuance,
amendment, negotiation, renewal or extension of
any Letter of Credit.
(D) Subparagraph (4)(a) of the Agreement is deleted in its entirety and
the following is substituted in its place:
(4) INTEREST, FEES, AND CHARGES.
(A) Each Loan shall bear interest at the rate of
three-fourths of one percent (.75 of 1%) per annum
in excess of Bank's publicly announced prime rate
(which is not intended to be Bank's lowest or most
favorable rate in effect at any time) (the "PRIME
RATE") in effect from time to time, payable on the
last business day of each month in arrears. Said
rate of interest shall increase or decrease by an
amount equal to each increase or decrease in the
Prime Rate
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effective on the effective date of each such
change in the Prime Rate. Upon the occurrence of
an Event of Default, each Loan shall bear interest
at the rate of two percent (2%) per annum in
excess of the interest rate otherwise payable
thereon, which interest shall be payable on
demand. All interest shall be calculated on the
basis of a 360-day year.
(E) Subparagraph (4)(b) of the Agreement entitled "Other Libor
Provisions" is deleted in its entirety and the phrase "Intentionally Omitted" is
substituted in its place.
(F) Subparagraph (4)(c)(ii) of the Agreement is deleted in its entirety
and the following is substituted in its place:
(ii) AMENDMENT FEE: Borrower shall pay to Bank an amendment
fee of Twenty Thousand and No/100 Dollars ($20,000.00), which fee shall
be fully earned by Bank and payable upon execution of this Amendment.
(G) Subparagraph (14)(b) of the Agreement is deleted in its entirety
and the following is substituted in its place:
(B) FIXED CHARGE COVERAGE RATIO. Borrower hereby covenants and
agrees not to permit the Ratio of EBITDA to Fixed Charges for each period set
forth below to be less than the amount set forth below for such period:
Period Amount
------ ------
From July 1, 2002 through December 31, 2002 .10 TO 1.0
From July 1, 2002 through March 31, 2003 .50 TO 1.0
From July 1, 2002 through June 30, 2003 .75 TO 1.0
Thereafter on July 1, 2003, and for each twelve (12) month
period ending on the last day of each month. 1.0 TO 1.0
(H) Subparagraph (14)(c) of the Agreement is deleted in its entirety
and the following is substituted in its place:
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(C) Borrower shall not permit EBITDA to be less than
(i) negative (-$45,000.00) for the three (3) month
period ending September 30, 2002; (ii) $250,000.00
for the six (6) month period ending December 31,
2002; (iii) $1,500,000.00 for the nine (9) month
period ending March 31, 2003; (iv) $2,600,000.00
for the twelve (12) month period ending on June
30, 2003. Thereafter, as of the last day of each
fiscal quarter for the twelve (12) month period
ending on each such date, commencing September 30,
2003 Borrower shall not permit EBITDA to be less
than $2,600,000.00.
This Amendment shall not become effective until fully executed
by all parties hereto.
3. Except as expressly amended hereby and by any other
supplemental documents or instruments executed by either party hereto in order
to effectuate the transactions contemplated hereby, the Agreement and Exhibit A
thereto hereby are ratified and confirmed by the parties hereto and remain in
full force and effect in accordance with the terms thereof.
LASALLE BANK NATIONAL ASSOCIATION
By__________________________________________
Title_______________________________________
ACKNOWLEDGED AND AGREED TO
this ____ day of September, 2002:
ALLIED HEALTHCARE PRODUCTS, INC.
By_______________________________
Title____________________________
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