March 30, 2002
BEI TECHNOLOGIES, INC.
BEI SENSORS & SYSTEMS COMPANY, INC.
c/o BEI Technologies, Inc.
Xxx Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx/Xxxx Xxxxxxx
Re: Amendment to Note Purchase Agreement.
Gentlemen:
Reference is made to the Note Purchase Agreement dated as of November
16, 1998 (as amended from time to time, the "Note Purchase Agreement") between
BEI Technologies, Inc., a Delaware corporation (the "Company") and BEI Sensors &
Systems Company, Inc., a Delaware corporation ("Systems"; together with the
Company, the "Co-Obligors"), on the one hand, and each purchaser named on
Schedule A attached to the Note Purchase Agreement, on the other hand.
Capitalized terms used herein without definition have the meanings
ascribed to such terms in Schedule B of the Note Purchase Agreement.
The Co-Obligors have requested that the Note holders amend the Note
Purchase Agreement, subject to the conditions and in reliance of the
representations and warranties set forth herein.
In consideration of the foregoing recitals, the parties hereto agree as
follows:
1. Amendment to the Note Purchase Agreement. Pursuant to Section 17.1
thereof, the Note Purchase Agreement is amended as follows:
(a) Section 10.3(b) of the Note Purchase Agreement is amended
by adding the following proviso at the end thereof:
"provided, however, that notwithstanding anything to the
contrary in the foregoing, one time charges of up to $15,600,000 for excess
capacity and uncollectables with respect to OpticNet, Inc., a related party, and
a product line move shall be excluded from the calculation of Consolidated Net
Income for the purpose of calculating the ratio of Total Debt to
Consolidated EBITDA for each of the fiscal quarters ending March 30, 2002, June
29, 2002, September 28, 2002 and December 28, 2002."
(b) Section 10.5 of the Note Purchase Agreement is amended by
adding the following proviso at the end thereof:
"provided, however, that notwithstanding anything to the
contrary in the foregoing, one time charges of up to $15,600,000 for excess
capacity and uncollectables with respect to OpticNet, Inc., a related party, and
a product line move shall be excluded from the calculation of Consolidated Net
Income for the purpose of calculating the ratio of Earnings Available for Fixed
Charges to Fixed Charges for each of the fiscal quarters ending March 30, 2002,
June 29, 2002, September 28, 2002 and December 28, 2002."
(c) Section 10.7 of the Note Purchase Agreement is deleted in
its entirety and the following is inserted in lieu thereof:
"10.7 Restricted Payments.
The Company will not, and will not permit any of its
Restricted Subsidiaries, at any time, to declare or make, or incur any liability
to declare or make, any Restricted Payment, unless after giving effect to such
action, on a cumulative basis, (i) the aggregate amount of Restricted Payments
of the Company and its Restricted Subsidiaries declared or made at any time
after March 30, 2002 is less than the sum of (A) an aggregate amount equal to
50% of the Consolidated Net Income for the period beginning March 31, 2002 and
ending at the end of the most recently completed fiscal quarter of the Company,
plus (B) $5,000,000 plus (C) the aggregate amount of Net Proceeds of Capital
Stock for such period; and (ii) no Default or Event of Default would exist."
2. Representations and Warranties. Each Co-Obligor hereby certifies
that as of the date hereof the representations and warranties of such Co-Obligor
contained in Section 5 of the Note Purchase Agreement are true and correct as
though made on and as of such date (except to the extent such specifically
relate to another date).
3. Condition to Effectiveness. The effectiveness of this letter
agreement is subject to the receipt of a fully executed counterpart of this
letter agreement by the Co-Obligors and Required Holders.
4. No Waiver. Each amendment set forth in this letter agreement shall
be limited precisely as written and shall not be deemed to be (a) an amendment,
consent or waiver of any other terms or conditions of the Note Purchase
Agreement or any other document related to the Note Purchase Agreement, (b) a
waiver of any right or remedy of the holders of the Notes issued under the Note
Purchase Agreement or (c) a consent to any future amendment, consent or waiver
of the Note Purchase Agreement or any future transaction, event or condition
which would
constitute a Default or Event of Default under the Note Purchase Agreement.
Except as expressly set forth in this letter agreement, the Note Purchase
Agreement and all related documents shall continue in full force and effect.
If you are in agreement with the foregoing, please sign the form of
acceptance on the enclosed counterparts of this letter agreement, whereupon,
subject to satisfaction of the condition set forth in paragraph 3 above, this
letter agreement will become a binding agreement among the Co-Obligors and the
Note holders as of the date first written above.
Very truly yours,
CONNECTICUT GENERAL LIFE
INSURANCE COMPANY,
By CIGNA Investments, Inc.
By:
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Name:
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Title:
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CONNECTICUT GENERAL LIFE
INSURANCE COMPANY,
on behalf of one or more separate accounts
By CIGNA Investments, Inc.
By:
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Name:
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Title:
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ALL STATE LIFE INSURANCE COMPANY
By:
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Name:
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Title:
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By:
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Name:
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Title:
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The foregoing letter agreement is hereby accepted as of the date first above
written.
BEI TECHNOLOGIES, INC.
By:
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Name: Xxxx XxXxxxxx
Title: Senior Vice President and
Chief Financial Officer
By:
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Name: Xxxxxx X. Xxxx
Title: Vice President, Secretary, Treasurer and
Controller
BEI SENSORS & SYSTEMS COMPANY, INC.
By:
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Name: Xxxx XxXxxxxx
Title: Chief Financial Officer
By:
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Name: Xxxxxx X. Xxxx
Title: Secretary, Treasurer and
Controller
