AMENDMENT NO. 5 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

Exhibit 10.2

EXECUTION FINAL

AMENDMENT NO. 5

TO

AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NO. 5 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT, dated as of January 26, 2007 (this “Amendment”), is entered into by and among WACHOVIA BANK, NATIONAL ASSOCIATION, in its capacity as agent for Lenders (in such capacity, “Agent”) and as a Lender, THE CIT GROUP BUSINESS CREDIT, INC., as a Lender, FEDDERS NORTH AMERICA, INC., a Delaware corporation, and the other Borrowers party to the Loan Agreement referred to below, FEDDERS CORPORATION, a Delaware corporation, and the other Guarantors party to the Loan Agreement.

W I T N E S S E T H:

WHEREAS, Agent, Lenders, Borrowers and Guarantors are party to that certain Amended and Restated Loan and Security Agreement, dated as of January 31, 2006, as amended by Amendment No. 1 to Loan and Security Agreement, dated as of February 15, 2006, Amendment No. 2 to Loan and Security Agreement, dated as of August 11, 2006, Amendment No. 3 to Amended and Restated Loan and Security Agreement, dated as of October 19, 2006 (“Amendment No. 3”), and Amendment No. 4 to Amended and Restated Loan and Security Agreement, dated as of January 11, 2007 (the “Loan Agreement”); and

WHEREAS, pursuant to Amendment No. 3, Agent and Lenders made additional short term supplemental term loans to Borrowers as part of the Supplemental Term Loan and extended the maturity date of the Supplemental Term Loan from October 15, 2006 to January 26, 2007; and

WHEREAS, Borrowers have advised Agent that Borrowers are currently engaged in negotiations with another lender (a “Replacement Lender”) with respect to a commitment letter to be issued by such Replacement Lender to provide financing to Borrowers to replace the Credit Facility provided by Agent and Lenders (the “Replacement Facility”), the initial proceeds of which Replacement Facility shall be used by Borrowers to pay and satisfy in full all Obligations owing to Agent and Lenders; and

WHEREAS, Borrowers and Guarantors have requested that Agent and Lenders agree to further extend the maturity date of the Supplemental Term Loan beyond January 26, 2007; in order to, among other things, provide an accommodation with respect to the repayment of the Supplemental Term Loan while Borrowers undertake to consummate the closing of a Replacement Facility; and Agent and Lenders are willing to agree to the foregoing, on and subject to the terms and conditions set forth in this Amendment;

NOW, THEREFORE, in consideration of the premises and the representations, warranties and covenants set forth herein and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, it is hereby agreed as follows:

1. Definitions. All capitalized terms used and not otherwise defined herein shall have their respective meanings as set forth in the Loan Agreement.

2. Additional Definitions. Section 1 of the Loan Agreement is hereby amended to include, in addition and not in limitation, the following defined terms:

“Amendment No. 5” shall mean Amendment No. 5 to Loan and Security Agreement, dated as of January 26, 2007, executed among Agent, Lenders, Borrowers and Guarantors.

“Amendment No. 5 Effective Date” shall mean the date on which all conditions precedent to the effectiveness of Amendment No. 5 have been fully satisfied, as determined by Agent.

3. Amended Amortization of Supplemental Term Loan.

Notwithstanding anything to the contrary contained in Amendment No. 3 or otherwise in the Loan Agreement, the unpaid principal of the Supplemental Term Loan shall not be due and payable in full on January 26, 2007 and shall instead be payable to Agent, for the benefit of Lenders, from and after the Amendment No. 5 Effective Date in accordance with the following terms and conditions: Borrowers shall pay a principal installment of $1,000,000 on the date hereof and the balance of the Supplemental Term Loan shall be due and payable in full, without notice or demand, on Friday, February 2, 2007.

4. Mortgage with respect to Texas Real Property.

As required by the terms of Amendment No. 3, Xxxxxx has executed and delivered to Agent a Mortgage covering the Real Property known as 1998 XX0000, Xxxxxxxx, Xxxxx and Xxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxx and Borrowers (including Xxxxxx) hereby authorize Agent to file such Mortgage in the appropriate public real estate records.

5. Representations, Warranties and Covenants. In addition to the continuing representations, warranties and covenants heretofore or hereafter made by Borrowers and Guarantors to Agent and Lenders pursuant to the Loan Agreement and the other Financing Agreements, Borrowers and Guarantors hereby represent, warrant and covenant with and to Agent and Lenders as follows (which representations, warranties and covenants are continuing and shall survive the execution and delivery hereof and shall be incorporated into and made a part of the Financing Agreements):

(a) This Amendment has been duly executed and delivered by each Borrower and each Guarantor and is in full force and effect as of the date hereof, and the agreements and obligations of such Borrower or Guarantor contained herein constitute its legal, valid and binding obligations, enforceable against it in accordance with the terms hereof;

(b) All of the representations and warranties set forth in the Loan Agreement, as amended by this Amendment, are true and correct in all material respects on and as of the date hereof as if made on the date hereof, except as affected by transactions expressly contemplated or

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permitted by this Amendment and except to the extent that any such representation or warranty is made as of a specified date, in which case each such representation or warranty shall have been true and correct as of such date; and

(c) As of the date hereof and after giving effect to the amendments set forth in this Amendment, there exists no Default or Event of Default.

6. Condition Precedent. The effectiveness of the agreements and amendments made in this Amendment is subject to Agent’s receipt of an executed copy (or executed faxed or electronic copy) of this Amendment duly authorized, executed and delivered by the parties hereto other than Agent.

7. Acceleration of Arrangement Fee. In consideration of the agreements of Agent and Lenders and the amendments to the Loan Agreement set forth in this Amendment, Borrowers agree to pay to Agent on February 1, 2007, for the benefit of Lenders, the unpaid balance of the “Arrangement Fee” (as such quoted term is defined in the Fee Letter), in the amount of $240,000, which includes the final installment in the amount of $120,000 which would have otherwise been payable under the Fee Letter on February 1, 2008, and such Arrangement Fee may, at Agent’s sole option, be charged by Agent to any account of Borrowers maintained by Agent.

8. Further Assurances. Borrowers and Guarantors shall execute and deliver such additional documents and take such additional actions as may be reasonably requested by Agent to effectuate the provisions and purposes of this Amendment.

9. Governing Law. The rights and obligations hereunder of each of the parties hereto shall be governed by and interpreted and determined in accordance with the internal laws of the State of New York (without giving effect to principles of conflicts of laws).

10. Binding Effect. This Amendment shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns.

11. Counterparts. This Amendment may be executed in any number of counterparts, all of which counterparts shall together constitute one and the same agreement. In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart hereof signed by each of the parties hereto.

12. Inconsistencies; Effect; No Waiver. To the extent that any provision of the Loan Agreement or any Financing Agreement is inconsistent with the provisions of this Amendment, such other provision shall be deemed to be amended so that it is made consistent with the provisions of this Amendment. Except as expressly agreed herein, the Loan Agreement and all of the other Financing Agreements and all covenants, representations and warranties contained therein, are hereby ratified and confirmed in all respects and shall remain in full force and effect in accordance with their terms.

[SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day and year first above written.

AGENT:				BORROWERS:
WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent and Issuing Bank				FEDDERS NORTH AMERICA, INC.
By:				By:
Title:				Title:
LENDERS:
WACHOVIA BANK, NATIONAL ASSOCIATION				XXXXXXX QUIET KOOL CORPORATION
By:				By:
Title:				Title:
THE CIT GROUP BUSINESS CREDIT, INC.					COLUMBIA SPECIALTIES, INC.
By:					By:
Title:					Title:
					TRION, INC.
					By:
					Title:
					ENVIRCO CORPORATION
					By:
					Title:
[SIGNATURES CONTINUED ON NEXT PAGE]

[SIGNATURES CONTINUED FROM PREVIOUS PAGE]

XXXXXX COIL COMPANY, formerly known as Fedders Xxxxxx Company, Inc.

By:

Title:

FEDDERS ADDISON COMPANY, INC.

By:

Title:

FEDDERS ISLANDAIRE, INC.

By:

Title:

ISLAND METAL FABRICATING, INC.

By:

Title:

GUARANTORS:

FEDDERS CORPORATION

By:

Title:

FEDDERS INTERNATIONAL, INC.

By:

Title:

[SIGNATURES CONTINUED ON NEXT PAGE]

[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
				FEDDERS INVESTMENT CORPORATION
				By:
				Title:
				FEDDERS, INC.
				By:
				Title:
				ROTOREX COMPANY, INC.
				By:
				Title:
AGREED TO:
FEDDERS HOLDING COMPANY, INC.				HERRMIDIFIER COMPANY, INC.
By:				By:
Title:				Title: