Contract
THIS
INSTRUMENT IS SUBJECT TO THAT CERTAIN SUBORDINATION AND INTERCREDITOR AGREEMENT
DATED AS OF OCTOBER 25, 2010, BETWEEN XXXX XXXXXX, AS THE SUBORDINATED CREDITOR,
AND CAPITAL ONE LEVERAGE FINANCE CORPORATION, AS SENIOR AGENT FOR ALL SENIOR
LENDERS.
THIS NOTE
HAS BEEN ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (“THE ACT”). THIS NOTE IS SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.
Amended and
Restated
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$500,000.00
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As
of October 25, 2010
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P&F Industries, Inc., a Delaware
corporation, Florida Pneumatic Manufacturing Corporation, a Florida corporation,
Embassy Industries, Inc, a New York corporation, Green Manufacturing, Inc., a
Delaware corporation, Countrywide Hardware, Inc., a Delaware corporation,
Nationwide Industries, Inc., a Florida corporation, Woodmark International,
L.P., a Delaware limited partnership, Pacific Stair Products, Inc., a Delaware
corporation, WILP Holdings, Inc., a Delaware corporation, Continental Tool
Group, Inc., a Delaware corporation and Hy-Tech Machine, Inc., a Delaware
corporation (each hereinafter referred to individually as a “Maker” and
collectively as the “Makers”), jointly and severally, hereby promise to pay to
Xxxx Xxxxxx, his heirs, administrators, successors or assigns (the “Payee”), the
principal amount of Five Hundred Thousand Dollars ($500,000.00) in such coin or
currency of the United States of America as at the time of payment shall be
legal tender therein for the payment of public and private debts, together with
interest, as hereinafter provided, compounded annually (calculated on the basis
of the actual number of days elapsed over a year of 365 days), from the date
hereof on the unpaid balance of such principal amount, at the rate of eight
percent (8%) per annum All principal, outstanding accrued interest, penalties,
premiums and/or other charges, if any, under this Note (collectively
“Obligations”) shall be due and payable on October 25, 2013 (the “Maturity
Date”) unless accelerated or prepaid pursuant to the terms of this
Note.
Makers
agree to pay: (a) on the date hereof, $20,273.97 representing all outstanding
accrued interest under the Original Note, as defined below, through the date
hereof; (b) commencing December 31, 2010 and continuing quarterly thereafter on
the last day of March, June, September and December thereafter interest accrued
through the quarter ended on such payment date (each a “Scheduled Subordinated
Debt Payment”) to the extent Makers are permitted to make such payments under
the Subordination Agreement (used as hereinafter defined); and (c) when
permitted under the Subordination Agreement mandatory prepayments of principal,
in an amount equal to the amount of Excess Cash Flow (as defined in the
Subordination Agreement) that Makers are permitted to pay to the Payee under the
conditions and at the times specified in the Subordination
Agreement.
This Note
is being executed and delivered as a restatement of the outstanding indebtedness
evidenced by that certain $500,000.00 note dated April 23, 2010 (hereinafter
referred as the “Original Note”) in the current outstanding aggregate principal
amount due thereunder of $500,000.00 and Payee acknowledges receipt of accrued
interest of $20,273.97 representing all outstanding accrued interest under the
Original Note through the date hereof. This Note shall not constitute
a cancellation or novation with respect to the indebtedness evidenced by the
Original Note. Such indebtedness (as heretofore evidenced by the
Original Note and as hereafter evidenced by this Note) shall continue to be
secured by, inter alia, the personal property without interruption in the lien
or priority thereof in accordance with the Security Agreement hereinafter
referred to. Subject to the foregoing provisions this Note amends,
restates and supersedes the Original Note in its entirety and specifically
extends the original maturity date to the Maturity Date and modifies the
payments of principal and interest heretofore provided to conform same to the
Subordination Agreement. By its acceptance hereof, Payee waives and
discharges the Makers from any claims Payee may have against Makers or their
affiliates under the Original Note.
NOTWITHSTANDING
ANYTHING TO THE CONTRARY IN THIS NOTE, THE PAYMENT AND PRIORITY OF ALL CLAIMS OF
PAYEE UNDER THIS NOTE ARE SUBORDINATE IN RIGHT, TIME, AND PRIORITY TO THE CLAIMS
OF CAPITAL ONE LEVERAGE FINANCE CORPORATION AS AGENT AND THE LENDERS PARTY TO
THE LOAN AGREEMENT DATED AS OF OCTOBER 25, 2010 AS AMENDED, RESTATED,
SUPPLEMENTED OF MODIFIED FROM TIME TO TIME (THE “LOAN AGREEMENT”) FROM TIME TO
TIME (THE “LENDERS”), AND ALL SUCH AMOUNTS PAYABLE TO PAYEE SHALL NOT BE PAID OR
PAYABLE, EXCEPT AS SET FORTH IN THE SUBORDINATION AND INTERCREDITOR AGREEMENT
DATED AS OF OCTOBER 25, 2010 BETWEEN THE LENDERS, THE PAYEE AND XXXX XXXXXX (AS
AMENDED, RESTATED, SUPPLEMENTED OR MODIFIED FROM TIME TO TIME, THE
“SUBORDINATION AGREEMENT”). ANY REFERENCE TO THE SUBORDINATION AND INTERCREDITOR
AGREEMENT DATED AS OF APRIL 23, 2010 BY AND AMONG CITIBANK, N.A., AS LENDER AND
ADMINISTRATIVE AGENT AND HSBC BANK USA, NATIONAL ASSOCIATION AND PAYEE DELIVERED
IN CONNECTION WITH THE ORIGINAL NOTE IN THE (A) INDEMNIFICATION AGREEMENT DATED
APRIL 23, 2010 BY AND AMONG PAYEE, XXXXXXX X. XXXXXXXX AND P&F INDUSTRIES
INC. AND (B) THE SECURITY AGREEMENTS DATED APRIL 23, 2010 FROM MAKERS TO PAYEE
AND XXXXXXX X. XXXXXXXX SHALL MEAN THE SUBORDINATION AGREEMENT, AS DEFINED
ABOVE. THE SUBORDINATION AGREEMENT IS INCORPORATED BY REFERENCE AS IF SET FORTH
IN FULL. TO THE EXTENT THE SUBORDINATION AGREEMENT REQUIRES, THE MAKERS SHALL
PAY THE LENDERS ANY SUMS THIS DOCUMENT OTHERWISE REQUIRES THE MAKERS TO PAY
PAYEE.
This Note
is secured by the “Collateral” identified in certain Security Agreements by each
Maker in favor of Payee and the other secured party named therein of even date
herewith (the “Security Agreements”). The principal of and accrued interest on
this Note shall be payable by wire transfer of immediately available funds to
the account of the Payee of this Note at such banking institution as such Payee
designates or, if requested by such Payee, by certified or official bank check
payable to the Payee of this Note at the address of such Payee as may be
designated in writing by the Payee to the Makers.
Any of
the following events shall constitute an “Event of Default”
under this Note:
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1. failure
by the Makers or any of them to pay all or any amount due under the Note within
ten (10) days of when same is due and payable, except to the extent such payment
is not permitted under the Subordination Agreement;
2. the
material breach of any of the representations, warranties or covenants of the
Makers contained in this Note or the Security Agreements unless such breach was
caused in whole or in part by the acts or omissions of Xxxxxxx Xxxxxxxx in his
capacity as officer, director and/or other fiduciary of any Maker;
3. a
default shall occur in the payment of any amount when due (subject to any
applicable grace period), whether by acceleration or otherwise, of any principal
or stated amount of, or interest or fees on, any indebtedness of any Maker
having an outstanding principal amount, individually or in the aggregate, of one
hundred thousand dollars ($100,000.00) or more or an event of default shall
occur under any instrument evidencing or securing any such indebtedness which
gives the holder(s) of such indebtedness or any person acting on behalf of such
holder(s) thereof the right to accelerate the maturity of such indebtedness;
provided, that in any such case the Payee gives the Makers ten (10) days written
notice of such default;
4. filing
by any Maker of a petition seeking relief under any provision of any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction, or consenting in writing to the filing of
any such petition against it;
5. making
by any Maker of a general assignment for the benefit of its creditors, or
admitting in writing its inability to pay, or in fact failure to pay, its debts
generally as they become due, or consenting in writing to the appointment of a
receiver, conservator, custodian, liquidator or trustee of the Maker, or of all
or any part of the assets of such Maker; or
6. appointment
of a receiver, conservator, custodian, liquidator or trustee of the Maker or of
all or any of its assets by court order, if such order remains in effect for
more than sixty (60) days; or entering of an order for relief with respect to
such Maker under the U.S. Bankruptcy Code; or filing of a petition against such
Maker under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction, if not
dismissed within sixty (60) days.
Upon the
occurrence and continuation of an Event of Default hereunder, all of the unpaid
principal amount of this Note and any accrued interest thereon shall
automatically become due and payable, and the Makers hereby waive diligence,
presentment, demand, protest and notice of every kind whatsoever. The failure of
the Payee to exercise any of its rights hereunder in any particular instance
shall not constitute a waiver of the same or of any other right in that or any
subsequent instance with respect to the Payee or any subsequent
holder.
Upon the
occurrence and continuation of an Event of Default hereunder, then at the option
of Payee upon notice to the Makers, all accrued and unpaid interest, hereunder,
shall be added to the outstanding principal balance hereof, and the entire
outstanding principal balance, as so adjusted, shall bear interest thereafter
until paid at an annual rate equal to the lesser of (i) the rate that is two
percentage points (2.0%) in excess of the above-specified interest rate, or (ii)
the maximum rate of interest allowed to be charged under applicable
law.
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Should
the indebtedness evidenced by this Note or any part hereof be collected at law
or in equity or in bankruptcy, receivership or other court proceedings, or this
Note placed in the hands of attorneys for collection, the Makers agree to pay,
in addition to principal and interest due and payable hereon, all costs of
collection, including reasonable attorneys' fees, incurred by the Payee of this
Note in collecting or enforcing this Note. The Makers further agree to pay the
reasonable attorneys fees of the Payee's counsel in connection with the
preparation and negotiation of this Note and the Security
Agreements.
No
extension of the time for payment of the indebtedness evidenced hereby, made by
agreement with any person now or hereafter liable for payment of the
indebtedness evidenced hereby, shall operate to release, discharge, modify,
change or affect the original liability of the Maker hereunder or that of any
other person now or hereafter liable for payment of the indebtedness evidenced
hereby, either in whole or in part, unless the Payee otherwise agrees in
writing. No delay by the Payee in exercising any power or right hereunder shall
operate as a waiver of any power or right, nor shall any single or partial
exercise of any power or right preclude other or further exercise thereof, or
the exercise of any other power or right hereunder or otherwise, and no waiver
or modification of the terms hereof shall be valid unless set forth in writing
by the Payee of this Note and then only to the extent set forth
therein.
The joint
and several Obligations of each of the Makers under this Note shall be absolute
and unconditional and shall remain in full force and effect until the
Obligations shall have been paid and, until such payment has been made, shall
not be discharged, affected, modified or impaired on the happening from time to
time of any event, including, without limitation, any of the following, whether
or not with notice to or the consent of any of the Makers:
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a.
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the
waiver, compromise, settlement release, termination or amendment
(including, without limitation, any extension or postponement of the time
for payment or performance or renewal or refinancing) of any or all of the
obligations or agreements of any of the Makers under this Note or any
other loan document;
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b.
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the
failure to give notice to any or all of the Makers of the occurrence of a
default under the terms and provisions of this Note or any other loan
document;
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c.
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the
release, substitution or exchange by the holder of this Note of any
Collateral (whether with or without consideration) or the acceptance by
the Payee of this Note of any additional collateral or the availability or
claimed availability of any other collateral or source of repayment or any
non- perfection or other impairment of any collateral; provided, that
nothing herein shall be construed as preventing such release, substitution
or exchange with the consent of the holder of this Note and any such
exchange shall not be deemed an Event of Default
hereunder;
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d.
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the
release of any person primarily or secondarily liable for all or any part
of the obligations, whether by the Payee or any
other holder of this Note or in connection with any voluntary or
involuntary liquidation, dissolution, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors or similar event or
proceeding affecting any or all of the Makers or any other person or
entity who, or any of whose property, shall at the time in question be
obligated in respect of the obligations or any part thereof;
or
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e.
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to
the extent permitted by law, any other event, occurrence, action or
circumstance that would, in the absence of this clause, result in the
release or discharge of any or all of the undersigned from the performance
or observance of any obligation, covenant or agreement contained in this
Note.
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The
Makers expressly agree that the Payee shall not be required first to institute
any suit or exhaust its remedies against any of the undersigned or any other
person or party to become liable hereunder or against any collateral, in order
to enforce this Note; and expressly agree that, notwithstanding the occurrence
of any of the foregoing, the Makers shall be and remain, directly and primarily
liable for all sums due under this Note and under the loan documents. On
disposition by the Payee of any property encumbered by any collateral, the
undersigned shall be and shall remain jointly and severally liable for any
deficiency.
The
provisions hereof shall be binding upon and inure to the benefit of the Payee of
this Note and its successors, assigns, heirs/or personal representatives. This
Note may be assigned, in whole or in part, by the Payee or any subsequent Payee
hereof without the consent of the Makers.
THE
MAKERS HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR
COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF
OR IN ANY WAY RELATING TO THIS NOTE.
The
Makers, from time to time after the date hereof, at the Payee's request, will
execute, acknowledge and deliver to the Payee such other instruments and will
take such other actions and execute and deliver such other documents,
certifications and further assurances as the Payee may reasonably request in
order to carry out the intent and purposes of this Note.
All
notices, demands and other communications provided for or permitted hereunder
shall be made in writing as set forth in the Security Agreements.
This Note
is made and delivered in, and shall be governed by and construed in accordance
with, the laws of the State of New York without giving effect to the conflicts
of laws rules thereof.
(SIGNATURE
PAGES FOLLOW)
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IN
WITNESS WHEREOF, the Makers has caused this Note to be duly executed and
delivered by its duly authorized officer as of the date first above
written.
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P&F
INDUSTRIES, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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FLORIDA
PNEUMATIC MANUFACTURING CORPORATION
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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EMBASSY
INDUSTRIES, INC
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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GREEN
MANUFACTURING, INC
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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NATIONWIDE
INDUSTRIES, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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WOODMARK
INTERNATIONAL, L.P.
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By: COUNTRYWIDE HARDWARE,
INC., its
General Partner |
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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PACIFIC
STAIR PRODUCTS, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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CONTINENTAL
TOOL GROUP, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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HY-TECH
MACHINE, INC.
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By:
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/s/
Xxxxxx X. Xxxxxx, Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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WILP
HOLDINGS, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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COUNTRYWIDE
HARDWARE, INC.
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By:
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/s/ Xxxxxx X. Xxxxxx,
Xx.
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Xxxxxx
X. Xxxxxx, Xx., Vice President
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THE
AMENDED AND RESTATED SECURED SUBORDINATED PROMISSORY NOTE SET FORTH ABOVE
IS ACCEPTED AND AGREED TO.
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/s/
Xxxx Xxxxxx
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Xxxx
Xxxxxx
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