EXHIBIT 10(b)
JOINDER AND ASSUMPTION AGREEMENT
This is a JOINDER AND ASSUMPTION AGREEMENT entered into as of this 11th
day of May 2004 among RAYTECH POWERTRAIN, INC., a Delaware corporation whose
address is 0 Xxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxxx 00000 ("Raytech Powertain"),
ALLOMATIC PRODUCTS COMPANY, a Delaware corporation whose address is 000 X.
Xxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx 00000 ("Allomatic"), RAYTECH SYSTEMS, INC., a
Delaware corporation, whose address is 000 X. Xx. Xxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxx 00000 ("Raytech Systems"; and together with Raytech Powertrain and
Allomatic, the "Original Borrowers"), RAYTECH CORPORATION, a Delaware
corporation whose address is Four Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxxxxxx 00000 (the "Guarantor") and RAYBESTOS POWERTRAIN, LLC, an Indiana
limited liability company whose address is 000 Xxxx Xxxxxx Xxxxxx,
Xxxxxxxxxxxxxx XX 00000 (the "Additional Borrower") and WACHOVIA BANK, NATIONAL
ASSOCIATION, a national banking company having a place of business at 000 Xxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the "Bank").
WITNESSETH:
WHEREAS, the Original Borrowers and the Bank are parties to a Loan
Agreement, a copy of which is attached hereto as EXHIBIT A (the "Loan
Agreement") and a Security Agreement, a copy of which is attached hereto as
EXHIBIT B (the "Security Agreement") each dated as of October 23, 2003 and a
Substitute Promissory Note dated January 5, 2004 in the original principal
amount of $7,000,000, a copy of which is attached hereto as EXHIBIT C (the
"Substitute Note"; and, together with the Loan Agreement and the Security
Agreement, the "Loan Documents"); and
WHEREAS, the Guarantor has executed an Unconditional Guaranty in favor of
the Bank dated as of October 23, 2003, a copy of which is attached hereto as
EXHIBIT D (the "Guaranty") pursuant to which it has guaranteed the obligations
of the Original Borrowers under the Loan Documents, as more fully set forth in
the Guaranty (the "Guaranteed Obligations"); and
WHEREAS, the Additional Borrower is a corporate affiliate of the Original
Borrowers and received an economic benefit from the proceeds of the loan
evidenced by the Loan Agreement and the Substitute Note; and
WHEREAS, the Additional Borrower wishes to join the Loan Agreement and the
Substitute Note as a borrower thereunder and to join the Security Agreement as a
debtor thereunder and to assume and agree to pay, jointly and severally with the
Original Borrowers, the obligations of the borrowers under the Substitute Note
and the Loan Agreement and the obligations of the debtors under the Security
Agreement; and
WHEREAS, the Guarantor is willing to guaranty the obligations of the
Additional Borrower;
NOW, THEREFORE, in consideration of One Dollar and other valuable
considerations and the mutual promises herein contained, the Additional
Borrower, the Original Borrowers, the Guarantor and the Bank hereby agree as
follows:
1. The Additional Borrower hereby joins the Loan Agreement and the
Substitute Note as a Borrower (as defined therein), and joins the Security
Agreement as a Debtor (as defined therein). The Additional Borrower hereby
assumes and agrees to pay, on a joint and several basis with the Original
Borrowers, all of the obligations and liabilities, both financial and
non-financial, of a Borrower under the Loan Agreement and the Substitute Note
and all of the obligations and liabilities, both financial and nonfinancial, of
a Debtor under the Security Agreement.
2
2. In order to secure the Obligations, as that term is defined in the
Security Agreement,
the Additional Borrower hereby grants to the Bank a continuing security interest
in and lien upon the following described property whether now owned by the
Additional Borrower or hereafter acquired by it, and any additions,
replacements, accessions, or substitutes thereof and all cash and non-cash
proceeds and products thereof (collectively, "Collateral"):
All of the personal property and fixtures of the Additional Borrower of
every kind and nature including, without limitation, all accounts,
equipment, accessions, fixtures, inventory, chattel paper, instruments,
investment property, documents, letter-of-credit rights, deposit accounts
and general intangibles, wherever located. The foregoing Fixture
Collateral is located at or affixed to real property known as 000 Xxxx
Xxxxxx Xxxxxx, Xxxxxxxxxxxxxx, Xxxxxxx, wherein the record owner is
Raybestos Powertrain, LLC.
3. The Additional Borrower hereby agrees that all of the
representations, warranties, affirmative and negative covenants and other
agreements contained in each of the Loan Documents shall be deemed to have been
made and entered into by, and shall be binding upon, the Additional Borrower as
of the date hereof and all such representations and warranties contained in any
of the Loan Documents shall be deemed to have been made by the Additional
Borrower and are true, accurate and complete as they pertain to the Additional
Borrower as though they were made on and as of the date hereof except as
provided in the following sentence. The representation at the end of the second
paragraph of the Security Agreement dated October 23, 2003 is hereby amended to
reflect that Raybestos Powertrain, LLC is not a wholly owned subsidiary of
Raytech Systems, Inc. and is owned 25% each by the Guarantor, Raytech Systems,
Inc., Raytech Powertrain, Inc., and Raytech Composites, Inc., a wholly owned
subsidiary of the Guarantor.
4. Each of the Original Borrowers hereby represents and warrants to the
Bank that all of the representations and warranties made by it in the Loan
Documents are true and correct as of the
3
date hereof as though they were made as of the date hereof except as provided
in Section 3 of this Agreement. Each of the Original Borrowers further
represents and warrants to the Bank that there does not exist any Event of
Default under the Loan Documents or any event or condition which with the
passage of time, the giving of notice or both would constitute an Event of
Default hereunder.
5. The Guarantor acknowledges and agrees that the term "Guaranteed
Obligations" as defined in the Guaranty shall include all of the obligations of
the Additional Borrower, as well as the Original Borrowers, to the Bank under
the Loan Documents, including, without limitation, the Substitute Note, as fully
as though the Additional Borrower was identified as a "Borrower" as of the date
of execution of the Guaranty and as fully as though the Substitute Note were
executed as of the date of execution of the Guaranty.
6. Compliance by the Borrowers, including, without limitation, the
Additional Borrower, with the Financial Covenants contained in the Loan
Agreement shall be measured by the information contained in the consolidated and
consolidating financial statements of Raytech Systems, Allomatic and the
Additional Borrower.
7. The Original Borrowers, the Additional Borrower and the Guarantor
each acknowledge and agree that the remaining outstanding principal balance of
the Substitute Note as of the date hereof is $6,500,000.02 and that said sum is
absolutely and unconditionally owing from them to the Bank. The Original
Borrowers, the Additional Borrower and the Guarantor further acknowledge and
agree that neither they, nor any of them, have any defense or claim of set off
against payment of the indebtedness evidenced by the Substitute Note.
8. In all other respects, except as expressly herein provided, each of
the Loan Documents shall be and remain in full force and effect.
4
9. For the convenience of the parties, this Agreement may be executed
in multiple counterparts and on multiple signature pages. This Agreement, when
executed by all of the parties shall be binding on each of them, whether or not
the signatures are on the same or different signature pages.
10. CONNECTICUT PREJUDGMENT REMEDY WAIVER
EACH OF THE ORIGINAL BORROWERS, THE ADDITIONAL BORROWER AND THE GUARANTOR
ACKNOWLEDGES THAT THE TRANSACTIONS REPRESENTED BY THIS AGREEMENT ARE COMMERCIAL
TRANSACTIONS AND HEREBY VOLUNTARILY AND KNOWINGLY WAIVES ANY RIGHTS TO NOTICE OF
AND HEARING ON PREJUDGMENT REMEDIES UNDER CHAPTER 903A OF THE CONNECTICUT
GENERAL STATUTES OR OTHER STATUTES AFFECTING PREJUDGMENT REMEDIES, AND
AUTHORIZES THE BANK'S ATTORNEY TO ISSUE A WRIT FOR A PREJUDGMENT REMEDY WITHOUT
COURT ORDER, PROVIDED THE COMPLAINT SHALL SET FORTH A COPY OF THIS WAIVER.
5
IN WITNESS WHEREOF, each of the Original Borrowers, the Additional
Borrower and the Guarantor and the Bank have caused this Agreement to be
executed under seal as of the day and year first above written.
RAYTECH POWERTRAIN, INC.
By /s/ Xxxx X. Xxxxxx
----------------------------------
Xxxx X. Xxxxxx, Treasurer
ALLOMATIC PRODUCTS COMPANY
By /s/ Xxxx X. Xxxxxx
----------------------------------
Xxxx X. Xxxxxx, Vice President
RAYTECH SYSTEMS, INC.
By /s/ Xxxx X. Xxxxxx
----------------------------------
Xxxx X. Xxxxxx, Treasurer
RAYBESTOS POWERTRAIN, LLC
By /s/ Xxxx X. Xxxxxx
----------------------------------
Xxxx X. Xxxxxx, Financial Manager
RAYTECH CORPORATION
By /s/ Xxxx X. Xxxxxx
----------------------------------
Xxxx X. Xxxxxx, Vice President,
Treasurer, and Chief Financial
Officer
WACHOVIA BANK,
NATIONAL ASSOCIATION
By
-----------------------------------
Xxxxxxxx X. Xxxxxxxx,
Xx. Vice President
[Exhibts Omitted]
6
