LOAN AGREEMENT
THIS LOAN AGREEMENT (this "AGREEMENT"), is entered into as of June
2, 1998, between THE BETHLEHEM CORPORATION, a Pennsylvania corporation (the
"BORROWER") and PNC BANK, NATIONAL ASSOCIATION, a national banking association
(the "BANK").
The Borrower and the Bank with the intent to be legally bound, agree
as follows:
1. LOAN. The following loan and credit facilities (collectively
referred to as the "LOAN"), shall be subject to and governed by this
Agreement:
$3,200,000 Committed Line of Credit (the "COMMITTED LINE OF CREDIT")
$ 800,000 Term Loan (the "TERM LOAN")
The proceeds of each of the Committed Line of Credit and the Term Loan shall be
used to refinance the outstanding balance of term and revolving debt that the
Borrower presently owes to CIT Group/Credit Finance and to finance the ongoing
general corporate and general working capital needs of the Borrower, except as
otherwise set forth herein.
2. TERMS AND CONDITIONS. Subject to the terms and conditions hereof and
relying upon the representations and warranties herein set forth,
the Bank agrees to make the Loan to the Borrower at any time or from
time to time on or after the date hereof in accordance with the
terms of this Agreement.
2.1 COMMITTED LINE OF CREDIT. The Committed Line of Credit shall
have the following terms:
(a) MATURITY DATE: June 1, 1999, or such later date as may be
designated by the Bank by written notice to the Borrower.
(b) INTEREST RATE: Prime Rate (as defined hereinafter) plus one and
one-half percent (1.50%) per annum, but in no event greater than the
maximum rate permitted by law. (As used herein, the "PRIME RATE"
shall be the rate of interest per annum announced by the Bank from
time to time as its Prime Rate.)
(c) FACILITY FEE: The Borrower shall pay to the Bank the remaining
unpaid half of a facility fee in the amount of $48,000, payable at
closing on the entire amount of the facility.
(d) BORROWING BASE/AVAILABILITY: The Committed Line of Credit shall
be available in amounts determined in accordance with the Borrowing
Base Rider in the form attached hereto as EXHIBIT A. Of such
amounts, not more than $500,000 will be made available to the
Borrower in the form of issued and outstanding letters of credit
drawn to or for the account of the Borrower, with maturity dates
that do not exceed the then-current Maturity Date.
(e) REQUESTS. Except as otherwise provided herein, the Borrower may
from time to time prior to the Maturity Date request the Bank to
make a Loan under the Committed Line of Credit by delivering to the
Bank, not later than 2:00 p.m. Eastern Standard or Daylight Savings
Time, as may be in effect at the time the request for an advance is
made, a request by telephone immediately confirmed in writing by
letter, facsimile or telex in such form (a "LOAN REQUEST"), it being
understood that the Bank may rely on the authority of any individual
making such a telephonic request without the necessity of receipt of
such written confirmation. Each Loan Request shall be irrevocable
and shall specify (i) the proposed borrowing date; and (ii) the
aggregate amount of the proposed Loan. Upon the receipt by the Bank
of a timely and complete Loan Request, the Bank shall make every
reasonable effort to fund the proposed Loan on the date that it
receives such Loan Request, and shall not charge interest thereon
until such time as the proceeds thereof are in fact made available
to the Borrower.
(f) COMMITTED LINE OF CREDIT NOTE. The Obligation of the Borrower to
repay the aggregate unpaid principal amount of the Committed Line of
Credit, together with interest thereon, shall be evidenced by a
promissory note of the Borrower ("COMMITTED LINE OF CREDIT NOTE")
payable to the order of the Bank in a face amount equal to the
maximum amount of the Committed Line of Credit.
(g) LOCKBOX. The Bank, in its discretion, may establish a lockbox at
the Bank to which account debtors of the Borrower will submit all
payments in respect of the Borrower's accounts receivable.
(h) LETTER OF CREDIT FEES; RENEWAL FEES. Should the Bank
subsequently elect to extend the term of the Committed Line of
Credit (which decision shall be made at the request of the Borrower
and in the sole and absolute discretion of the Bank), the fee due
and payable to the Bank in connection therewith shall not exceed
one-half percent (0.50%). In addition, the Bank shall charge fees of
one and one-half percent per annum on stand-by letters of credit and
one-eighth of one percent (0.125%) per annum on trade letters of
credit.
2.2 TERM LOAN. The Term Loan shall have the following terms:
(a) MATURITY DATE: June 1, 2003.
(b) INTEREST RATE: The rate of interest specified in Section 1 of
the Term Note (as such term is defined below).
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(c) FACILITY FEE: The Borrower shall pay to the Bank a facility fee
in the amount of $12,000, payable at closing on the entire amount of
the facility.
(d) TERM NOTE. The Obligation of the Borrower to repay the aggregate
unpaid principal amount of the Term Loan, together with interest
thereon, shall be evidenced by a promissory note of the Borrower
(the "TERM NOTE" and together with the Committed Line of Credit
Note, the "NOTES") payable to the order of the Bank in a face amount
equal to the maximum amount of the Term Loan.
3. SECURITY. The security for repayment of the Loan shall include but
not be limited to the collateral, guaranties and other documents
heretofore, contemporaneously or hereafter executed and delivered to
the Bank (the "SECURITY DOCUMENTS"), which shall secure repayment of
the Loan, the Notes and all other loans, advances, debts,
liabilities, obligations, covenants and duties owing by the Borrower
to the Bank of any kind or nature, present or future, whether or not
evidenced by any note, guaranty or other instrument, whether arising
under any agreement, instrument or document, whether or not for the
payment of money, whether arising by reason of an extension of
credit, opening of a letter of credit, loan or guarantee or in any
other manner, whether arising out of overdrafts on deposit or other
accounts or electronic funds transfers (whether through automatic
clearing houses or otherwise) or out of the non-receipt of or
inability to collect funds or otherwise not being made whole in
connection with depository transfer check or other similar
arrangements, whether direct or indirect (including those acquired
by assignment or participation), absolute or contingent, joint or
several, due or to become due, now existing or hereafter arising,
and any amendments, extensions, renewals or increases and all costs
and expenses of the Bank incurred in the documentation, negotiation,
modification, enforcement, collection or otherwise in connection
with any of the foregoing, including but not limited to reasonable
attorneys' fees and expenses, but excluding all such expenses and
costs relating to the salaried employees of the Bank, and related
administrative and overhead expenses (hereinafter referred to
collectively as the "OBLIGATIONS"). This Agreement (including the
Addendum and any Riders thereto), the Notes and the Security
Documents are collectively referred to as the "LOAN DOCUMENTS".
4. REPRESENTATIONS AND WARRANTIES. The Borrower hereby makes the
following representations and warranties to the Bank which shall be
true and correct as of the date of this Agreement and the date of
the making of a Loan, and which shall be true and correct except as
otherwise set forth on the Addendum attached hereto and incorporated
herein by reference (the "ADDENDUM").
4.1. EXISTENCE, POWER AND AUTHORITY. The Borrower is duly
organized, validly existing and in good standing under the
laws of the Commonwealth of Pennsylvania and has the power and
authority to own and operate its assets and to conduct its
business as now or proposed to be
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carried on, and is duly qualified, licensed and in good
standing to do business in all jurisdictions where its
ownership of property or the nature of its business requires
such qualification or licensing, except where the failure to
be so qualified or licensed would not have a material adverse
effect on the business, operations or financial condition of
the Borrower. The Borrower is duly authorized to execute and
deliver the Loan Documents, all necessary action to authorize
the execution and delivery of the Loan Documents has been
properly taken, and the Borrower is and will continue to be
duly authorized to borrow under this Agreement and to perform
all of the other terms and provisions of the Loan Documents.
4.2. FINANCIAL STATEMENTS. The Borrower has delivered or caused to
be delivered to the Bank its balance sheet and income
statement for the eleven month period which ended on APRIL 30,
1998 (the "Historical Financial Statements"). The Historical
Financial Statements are true, complete and accurate in all
material respects and fairly present the financial condition,
assets and liabilities, whether accrued, absolute, contingent
or otherwise and the result of the Borrower's operations for
the period specified therein. The Historical Financial
Statements have been prepared in accordance with generally
accepted accounting principles ("GAAP") consistently applied
from period to period subject in the case of interim
statements to normal year-end adjustments and to any comments
and notes acceptable to the Bank.
4.3 NO MATERIAL ADVERSE CHANGE. Since the date of the Historical
Financial Statements, the Borrower has not suffered any
damage, destruction or loss to its assets, and no event or
condition has occurred or exists, which has resulted or could
reasonably be expected to result in a material adverse change
in its business, assets, operations, financial condition or
result of operation.
4.4. BINDING OBLIGATIONS. The Borrower has full power and authority
to enter into the transactions provided for in this Agreement
and has been duly authorized to do so by appropriate action of
its Board of Directors; and the Loan Documents, when executed
and delivered by the Borrower, will constitute the legal,
valid and binding obligations of the Borrower enforceable in
accordance with their terms.
4.5. NO DEFAULTS OR VIOLATIONS. There does not exist any Event of
Default under this Agreement or any material default or
violation by the Borrower of or under any of the terms,
conditions or obligations of: (i) its articles or certificate
of incorporation, regulations or bylaws; (ii) any material
indenture, mortgage, deed of trust, franchise, permit,
contract, agreement, or other instrument to which it is a
party or by which it is bound other than trade payables and
any legitimately disputed matter in litigation with any vendor
or customer, in each case where the amount in controversy does
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not exceed $15,000 and where the amount in controversy does
not exceed $100,000 on a collective basis and those litigation
matters listed in the Addendum; or (iii) any law, regulation,
ruling, order, injunction, decree, condition or other
requirement applicable to or imposed upon it by any law, the
action by any court or any governmental authority or agency;
and the consummation of this Agreement and the transactions
set forth herein will not result in any such default or
violation.
4.6. TITLE TO ASSETS. The Borrower has valid title to the assets
reflected on the Historical Financial Statements, free and
clear of all liens and encumbrances, except for (i) current
taxes and assessments not yet due and payable, (ii) liens and
encumbrances, if any, reflected or noted in the Historical
Financial Statements, (iii) assets disposed of by the Borrower
in the ordinary course of business since the date of the
Historical Financial Statements, and (iv) those liens or
encumbrances specified on the Addendum.
4.7. LITIGATION. There are no actions, suits, proceedings or
governmental investigations pending or, to the Borrower's
knowledge, threatened against the Borrower, which could
reasonably be expected to result in a material adverse change
in its business, assets, operations, financial condition or
results of operations and there is no basis known to the
Borrower for any action, suit, proceedings or investigation
which could reasonably be expected to result in such a
material adverse change. All pending or threatened litigation
against the Borrower of which Borrower has knowledge is listed
on the Addendum.
4.8. TAX RETURNS. The Borrower has filed all returns and reports
that are required to be filed by it in connection with any
federal, state or local tax, duty or charge levied, assessed
or imposed upon it or its property or withheld by it,
including unemployment, social security and similar taxes and
all of such taxes, have been either paid or adequate reserve
or other provision has been made.
4.9. EMPLOYEE BENEFIT PLANS. Each employee benefit plan as to which
the Borrower may have any liability complies in all material
respects with all applicable provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"), including
minimum funding requirements, and (i) no Prohibited
Transaction (as defined under ERISA) has occurred with respect
to any such plan, (ii) no Reportable Event (as defined under
Section 4043 of ERISA) has occurred with respect to any such
plan which would cause the Pension Benefit Guaranty
Corporation to institute proceedings under Section 4042 of
ERISA, (iii) the Borrower has not withdrawn from any such plan
or initiated steps to do so, and (iv) no steps have been taken
to terminate any such plan.
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4.10. ENVIRONMENTAL MATTERS. The Borrower is in compliance, in all
material respects, with all Environmental Laws, including,
without limitation, all Environmental Laws in jurisdictions in
which the Borrower owns or operates, or has owned or operated,
a facility or site, stores Collateral, arranges or has
arranged for disposal or treatment of hazardous substances,
solid waste or other waste, accepts or has accepted for
transport any hazardous substances, solid waste or other
wastes or holds or has held any interest in real property or
otherwise. Except as otherwise disclosed on the Addendum, no
litigation or proceeding arising under, relating to or in
connection with any Environmental Law is pending or, to the
best of the Borrower's knowledge, threatened against the
Borrower, any real property which the Borrower holds or has
held an interest or any past or present operation of the
Borrower. No release, threatened release or disposal of
hazardous waste, solid waste or other wastes is occurring, or
to the best of the Borrower's knowledge has occurred, on,
under or to any real property in which the Borrower holds any
interest or performs any of its operations, in material
violation of any Environmental Law. As used in this Section,
"LITIGATION OR PROCEEDING" means any demand, claim notice,
suit, suit in equity, action, administrative action,
investigation or inquiry whether brought by a governmental
authority or other person, and "ENVIRONMENTAL LAWS" means all
provisions of laws, statutes, ordinances, rules, regulations,
permits, licenses, judgments, writs, injunctions, decrees,
orders, awards and standards promulgated by any governmental
authority concerning health, safety and protection of, or
regulation of the discharge of substances into, the
environment.
4.11. INTELLECTUAL PROPERTY. The Borrower owns or has the right to
use all patents, patent rights, trademarks, trade names,
service marks, copyrights, intellectual property, technology,
know-how and processes necessary for the conduct of its
business as currently conducted that are material to the
condition (financial or otherwise), business or operations of
the Borrower.
4.12. REGULATORY MATTERS. No part of the proceeds of the Loan will
be used for "PURCHASING" or "CARRYING" any "MARGIN STOCK"
within the respective meanings of each of the quoted terms
under Regulation U of the Board of Governors of the Federal
Reserve System as now and from time to time in effect or for
any purpose which violates the provisions of the Regulations
of such Board of Governors.
4.13. SOLVENCY. As of the date hereof and after giving effect to the
transactions contemplated by the Loan Documents, the Borrower
will have sufficient cash flow to enable it to pay its debts
as they mature.
4.14. DISCLOSURE. None of the Loan Documents contains or will
contain any untrue statement of material fact or omits or will
omit to state a material fact necessary in order to make the
statements contained in this Agreement
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or the Loan Documents not misleading. There is no fact known
to the Borrower which materially adversely affects or, so far
as the Borrower can now reasonably foresee, might materially
adversely affect the business, assets, operations, financial
condition or results of operation of the Borrower and which
has not otherwise been fully set forth in this Agreement or in
the Loan Documents.
5. AFFIRMATIVE COVENANTS. The Borrower agrees that from the date of
execution of this Agreement until all Obligations have been fully
paid and any commitments the Bank to the Borrower have been
terminated, the Borrower will:
5.1. BOOKS AND RECORDS. Maintain books and records in accordance
with GAAP and give representatives of the Bank access thereto
at all reasonable times following notice from the Bank,
including permission to examine, copy and make abstracts from
any of such books and records and such other information as
the Bank may from time to time reasonably request, and the
Borrower will make available to the Bank for examination
copies of any reports, statements or returns which the
Borrower may make to or file with any governmental department,
bureau or agency, federal or state.
5.2. INTERIM FINANCIAL STATEMENTS AND REPORTS; CERTIFICATE OF NO
DEFAULT; ACCOUNTS RECEIVABLE. Furnish the Bank within ten (10)
days after the end of each month a detailed report on its
accounts receivable and inventory status in such reasonable
detail consistent with the form currently used by the
Borrower's management. A copy of the most recently prepared
such form is attached hereto as EXHIBIT B. In addition, the
Borrower shall also furnish the Bank with current work in
process reports within fifteen (15) days after the end of each
month. The Borrower shall also provide within forty-five (45)
days from the end of each of its fiscal quarters its Financial
Statements (as defined hereinafter) for such period, in
reasonable detail, certified by the President, Chief Executive
Officer or Chief Financial Officer of the Borrower and
prepared in accordance with GAAP applied from period to
period. The Borrower shall also deliver, within forty-five
(45) days from the end of its fiscal quarters, a certificate
signed by such officer which verifies compliance with
applicable financial covenants for the period then ended and
whether any Event of Default exists, and, if so, the nature
thereof and the corrective measures the Borrower proposes to
take. "FINANCIAL STATEMENTS" means the Borrower's consolidated
and, if required by the Bank in its reasonable discretion,
consolidating balance sheets, income statements and statements
of cash flows for the year, month or (excepting statements of
cash flows) quarter together with year-to-date figures and
comparative figures for the corresponding periods of the prior
year.
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5.3. ANNUAL FINANCIAL STATEMENTS AND FISCAL BUDGET. Furnish the
Borrower's Financial Statements and its then-current fiscal
budget for the immediately succeeding fiscal year of the
Borrower to the Bank within ninety (90) days after the end of
each fiscal year. Those Financial Statements will be prepared
in accordance with GAAP and audited by an independent
certified public accountant selected by the Borrower and
satisfactory to the Bank. Audited Financial Statements shall
contain the unqualified opinion of an independent certified
public accountant and its examination shall have been made in
accordance with GAAP consistently applied from period to
period. Annual fiscal budgets shall be in such form, format
and detail as shall be reasonably acceptable to the Bank. The
Borrower will also provide filings made with any regulatory
authority and such other information reasonably requested by
the Bank, from time to time.
5.4. PAYMENT OF TAXES AND OTHER CHARGES. Pay and discharge when due
all indebtedness and all taxes, assessments, charges, levies
and other liabilities imposed upon the Borrower, its income,
profits, property or business, except those which currently
are being contested in good faith by appropriate proceedings
and for which the Borrower shall have set aside adequate
reserves in accordance with GAAP or made other adequate
provision with respect thereto acceptable to the Bank.
5.5. MAINTENANCE OF EXISTENCE, OPERATION AND ASSETS. Do all things
necessary to maintain, renew and keep in full force and effect
its organizational existence and all rights, permits and
franchises necessary to enable it to continue its business;
continue in operation in substantially the same manner as at
present; keep its properties in good operating condition and
repair; and make all necessary and proper repairs, renewals,
replacements, additions and improvements thereto.
5.6. INSURANCE. Maintain with financially sound and reputable
insurers, insurance with respect to its property and business
against such casualties and contingencies, of such types and
in such amounts as is customary for established companies
engaged in the same or similar business and similarly
situated. (As of the date of this Agreement, the existing
insurance coverage of the Borrower has been reviewed and
approved by the Bank.) In the event of a conflict between the
provisions of this Section and the terms of any Security
Documents relating to insurance, the provisions in the
Security Documents will control.
5.7. COMPLIANCE WITH LAWS. Comply in all material respects with all
laws applicable to the Borrower and to the operation of its
business (including any statute, rule or regulation relating
to employment practices and pension benefits or to
environmental, occupational and health standards and
controls).
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5.8. BANK ACCOUNTS. Establish and maintain at the Bank all of the
Borrower's primary depository accounts.
5.9. FINANCIAL COVENANTS. Comply with all of the financial and
other covenants, if any, set forth on the Addendum, subject to
all applicable cure periods set forth herein.
5.10. ADDITIONAL REPORTS. Provide prompt written notice to the Bank
of the occurrence of any of the following of which the
Borrower obtains knowledge (together with a description of the
action which the Borrower proposes to take with respect
thereto): (i) any Event of Default or potential Event of
Default, (ii) any litigation filed by or against the Borrower,
(iii) any Reportable Event or Prohibited Transaction with
respect to any Employee Benefit Plan(s) (as defined in ERISA)
or (iv) any event which might reasonably be expected to result
in a material adverse change in the business, assets,
operations, financial condition or results of operation of the
Borrower other than disputes with trade debtors and any
legitimately disputed matter in litigation with any vendor or
customer, in each case where the amount in controversy does
not exceed $15,000 and where the amount in controversy does
not exceed $100,000 on a collective basis.
6. NEGATIVE COVENANTS. The Borrower covenants and agrees that from the
date of execution of this Agreement until all Obligations have been
fully paid and any commitments of the Bank to the Borrower have been
terminated, the Borrower will not, except as set forth in the
Addendum, without the prior written consent of the Bank:
6.1. INDEBTEDNESS. Incur any indebtedness for borrowed money other
than: (i) the Loan and any subsequent indebtedness the Bank;
(ii) existing indebtedness disclosed on the Borrower's
Historical Financial Statements referred to in Section 4.2;
(iii) fully-subordinated loans (under terms and conditions
which have been approved in advance by the Bank) from
Universal Process Equipment, Inc. ("UPE"); (iv) capital and
operating leases where the aggregate obligations due
thereunder from the Borrower in any fiscal year of the
Borrower does not exceed $50,000 for capital leases and
$50,000 for operating leases; or (v) such payables incurred in
the ordinary course of business. (It is expressly acknowledged
and agreed that the Bank is familiar with and has approved the
terms of the loans from UPE to the Borrower that existed on
the date of this Agreement.)
6.2. LIENS AND ENCUMBRANCES. Except as provided in Section 4.6,
create, assume or permit to exist any mortgage, pledge,
encumbrance or other security interest or lien upon any assets
now owned or hereafter acquired or enter into any lease or any
arrangement for the acquisition of property
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subject to any conditional sales agreement, other than
purchase money security interests.
6.3. GUARANTEES. Guarantee, endorse or voluntarily become
contingently liable for the obligations of any person, firm or
corporation, except in connection with the endorsement and
deposit of checks in the ordinary course of business for
collection.
6.4. LOANS OR ADVANCES. Purchase or hold beneficially any stock,
other securities or evidences of indebtedness of any loans or
advances to, or make any investment or acquire any interest
whatsoever in, any other person, firm or corporation, except
investments disclosed on the Borrower's Historical Financial
Statements of investments in the ordinary course of the
Borrower's business.
6.5. MERGER OR TRANSFER OF ASSETS. Merge or consolidate with or
into any person, firm or corporation, but only if the
aggregate cash expenditure of the Borrower in connection with
any such merger or consolidation exceeds $100,000, or lease,
sell, transfer or otherwise dispose of property or assets,
whether now owned or hereafter acquired, except for asset
sales, leases and transfers in the ordinary course of the
Borrower's business.
6.6. CHANGE IN BUSINESS, MANAGEMENT OR OWNERSHIP. Make or permit
any material change in the nature of its business as carried
on as of the date hereof, in the composition of its current
executive management (including changes due to death or
disability), or in its equity ownership other than transfers
to heirs and beneficiaries of a stockholder upon the death of
a stockholder, changes due to the exercise of stock options
now or hereafter owned by employees or officers of the
Borrower and transfers of the publicly-traded common stock of
the Borrower. (For purposes of this Agreement, such current
executive management shall be limited to Xxxx X. Xxxxxxxxxxx
and Xxxxxxxxxx Xxxxxx, unless the Bank provides the Borrower
with written notice of additions or deletions from such list.)
6.7. DIVIDENDS. Declare or pay any dividends on or make any
distribution with respect to any class of its equity or
ownership interest, or purchase, redeem, retire or otherwise
acquire any of its equity.
6.8. CAPITAL EXPENDITURES. Make capital expenditures in any fiscal
year of the Borrower which exceed an amount equal to $300,000
on an aggregate basis.
6.9. USE OF LOAN PROCEEDS. Directly or indirectly permit the
proceeds of the Loan or any part thereof to be used by
Bethlehem Advanced Materials Corporation.
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7. EVENTS OF DEFAULT. The occurrence of any of the following will be
deemed to be an "EVENT OF DEFAULT":
7.1. PAYMENT DEFAULT. The Borrower shall fail to pay any payment of
principal or interest within ten (10) calendar days following
the date when due, in respect of the Obligations.
7.2. MATERIAL ADVERSE CHANGE. There shall be a material adverse
change in the business, operations, assets, financial
condition or results of operations of the Borrower, which
default shall not have been cured within twenty (20) days from
the receipt by the Borrower of written notice thereof from the
Bank.
7.3. COVENANT DEFAULT. The Borrower shall default in the
performance of, or violate any of, the covenants or agreements
contained in this Agreement, which default shall not have been
cured within twenty (20) days from the receipt by the Borrower
of written notice thereof from the Bank.
7.4. BREACH OF WARRANTY. Any Financial Statement, representation,
warranty or certificate made or furnished by the Borrower to
the Bank in connection with this Agreement shall be materially
false, incorrect or incomplete when made.
7.5. BANKRUPTCY OR INSOLVENCY. A proceeding shall have been
instituted in a court having jurisdiction over the Borrower
seeking a decree or order for relief in respect of the
Borrower in an involuntary case under any applicable
bankruptcy, insolvency reorganization or other similar law and
such involuntary case shall remain undismissed or unstayed and
in effect for a period of ninety (90) consecutive days
(provided that the Bank shall have no obligation to advance
additional funds to the Borrower during such ninety (90) day
period), or the Borrower shall commence a voluntary case under
any such law or consent to the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator,
conservator (or other similar official).
7.6. OTHER DEFAULT. The occurrence of an Event of Default as
defined in the Notes or any of the Security Documents, or a
violation of any of the requirements set forth in the
Borrowing Base Rider.
Upon the occurrence of an Event of Default, and at any time
thereafter, the Bank may declare all Obligations hereunder immediately due and
payable will have all rights and remedies (which are cumulative and not
exclusive) specified in the Notes and the Security Documents and available under
applicable law or in equity.
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8. CONDITIONS. The Bank's obligation to make any advance or fund any
tranche under the Loan is subject to the following conditions being
satisfied as of the date of the advance:
8.1. NO EVENT OF DEFAULT. No Event of Default or event which with
the passage of time, provision of notice or both would
constitute an Event of Default shall have occurred and be
continuing.
8.2. AUTHORIZATION DOCUMENTS. The Borrower shall have furnished to
the Bank a Secretary's Certificate attesting to the Board of
Directors authorization of the execution of this Agreement,
the Notes or any of the Security Documents; or other proof of
authorization satisfactory to the Bank.
8.3. DELIVERY OF LOAN DOCUMENTS. The Borrower shall have delivered
to the Bank the Loan Documents and such other instruments and
documents which the Bank may reasonably request in connection
with the transactions provided for in this Agreement.
8.4. OPINION OF COUNSEL. Counsel for the Borrower shall have
delivered a written opinion, dated the Closing Date and in
form and substance satisfactory to the Bank and its counsel,
as to matters incident to the transactions contemplated herein
as the Bank may reasonably request.
8.5. REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Borrower to the Bank shall be true and
correct in all respects.
8.6. SUBORDINATION AGREEMENT. The Bank shall have received from UPE
a Subordination Agreement containing terms and conditions
acceptable to the Bank whereby UPE shall subordinate its
claims against the Borrower for borrowed money (the
"SUBORDINATED DEBT") to the indebtedness of the Borrower to
the Bank, but only to the extent necessary to permit the
Borrower to comply with the effective net worth covenant
contained in this Agreement. All promissory notes evidencing
the Subordinated Debt shall have been marked with the legend
set forth in the Subordination Agreement.
8.7. EQUITY CONTRIBUTION FROM UPE. Receipt of evidence that UPE has
in fact unconditionally contributed additional equity to the
Borrower in the form of used equipment inventory that is
similar to the Borrower's Bethlehem-Type Equipment with a
fair-market value that is sufficient to cause the Borrower to
meet the minimum effective net worth and maximum leverage
covenants contained in this Agreement.
8.8. EQUIPMENT REPURCHASE AGREEMENT FROM UPE. Receipt of a signed
agreement from both UPE and the Borrower wherein UPE will be
required to either liquidate or otherwise purchase for its own
account the
-12-
Borrower's Eligible Inventory on behalf of the Borrower and
for the benefit of the Bank upon the occurrence of a payment
default under the Loan Documents within fifteen (15) months
from the date that the Bank provides UPE with written notice
of an Event of Default arising from the failure of the
Borrower to make timely payments of either principal or
interest due in connection with the Loan to the Bank, subject
in all respects to the terms, restrictions and provisions set
forth therein.
8.9. COLLATERAL ASSIGNMENT OF LIFE INSURANCE POLICY. Receipt of an
assignment of a $2,500,000 "key man" insurance policy to the
Bank on the life of Xxxx X. Xxxxxxxxxxx within thirty (30)
days from the date of this Agreement.
8.10. MORTGAGEE WAIVER. Receipt of an executed copy of the Bank's
standard Mortgagee Waiver from Ocwen Federal Savings Bank in
its capacity as the holder of a mortgage on the Borrower's
Easton property.
9. INCREASED COSTS. Within twenty (20) days following written demand,
together with the written evidence of the justification therefor,
the Borrower agrees to pay the Bank all direct costs incurred and
any losses suffered or payments made by the Bank as a consequence of
making the Loan by reason of any change in law or regulation or its
interpretation imposing any reserve, deposit, allocation of capital
or similar requirement (including without limitation, Regulation D
of the board of Governors of the Federal Reserve System) on the
Bank, its holding company or any of their respective assets, but
only if similar payment demands are made by the Bank against all of
its then-currently similarly situated customers and borrowers.
10 MISCELLANEOUS.
10.1. NOTICES. All notices, demands, requests, consents, approvals
and other communications required or permitted hereunder must
be in writing and will be effective upon receipt if delivered
personally to such party, or if sent by facsimile transmission
with confirmation of delivery, or by nationally recognized
overnight courier service, to the address set forth below or
to such other address as any party may give to the other in
writing for such purpose:
To the Bank: To the Borrower:
PNC Bank, N.A. The Bethlehem Corporation
0000 Xxxxxxxx Xxxxx 00xx & Xxxxxx Xxxxxxx
Xxxx Xxxxxxxxxx, XX 00000 Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx Attention: Xxxx X. Xxxxxxxxxxx
Facsimile No.: (000) 000-0000 Facsimile No.: (000) 000-0000
-13-
With copies to: With copies to:
Xxxxxxx X. Xxxxxx, Esquire Xxxxx X. Xxxxxxx, Esquire
Blank Rome Xxxxxxx & XxXxxxxx LLP The Law Office of Xxxxx X. Xxxxxxx
0000 Xxxxxx Xxxxxx, 0xx Xxxxx 0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000 Facsimile No.: (000) 000-0000
10.2. PRESERVATION OF RIGHTS. No delay or omission on the part of
the Bank to exercise any right or power arising hereunder will
impair any such right or power or be considered a waiver of
any such right or power or any acquiescence therein, nor will
the action or inaction of the Bank impair any right or power
arising hereunder. The rights and remedies hereunder of the
Bank are cumulative and not exclusive of any other rights or
remedies which the Bank may have under other agreements, at
law or in equity.
10.3. ILLEGALITY. In case any one or more of the provisions
contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein
shall not in any way be affected or impaired thereby.
10.4. CHANGES IN WRITING. No modification, amendment or waiver of
any provision of this Agreement nor consent to any departure
by the Borrower therefrom, will in any event be effective
unless the same is in writing and signed by the Bank and then
such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice to or
demand on the Borrower in any case will entitle the Borrower
to any other or further notice or demand in the same, similar
or other circumstance.
10.5. ENTIRE AGREEMENT. This Agreement (including the documents and
instruments referred to herein) constitutes the entire
agreement and supersedes all other prior agreements and
understandings, both written and oral, between the parties
with respect to the subject matter hereof.
10.6. COUNTERPARTS. This Agreement may be signed in any number of
counterpart copies and by the parties hereto on separate
counterparts, but all such copies shall constitute one and the
same instrument.
10.7. SUCCESSORS AND ASSIGNS. This Agreement will be binding upon
and inure to the benefit of the Borrower and the Bank and
their respective, successors and assigns; PROVIDED, HOWEVER,
that the Borrower may not assign this Agreement in whole or in
part without the prior written consent of the Bank and the
Bank at any time may assign this Agreement in whole or in
part, upon prior written notice to Borrower.
-14-
10.8. INTERPRETATION. In this Agreement, unless the Bank and the
Borrower otherwise agree in writing, the singular includes the
plural and the plural the singular; words importing any gender
include the other genders; references to statutes are to be
construed as including all statutory provisions consolidating,
amending or replacing the statute referred to; the word "or"
shall be deemed to include "and/or", the words "including",
"includes" and "include" shall be deemed to be followed by the
words "without limitation"; references to articles, sections
(or subdivisions of sections) or exhibits are to those of this
Agreement unless otherwise indicated; and references to
agreements and other contractual instruments shall be deemed
to include all subsequent amendments and other modifications
to such instruments, but only to the extent such amendments
and other modifications are not prohibited by the terms of
this Agreement. Section headings in this Agreement are
included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
Unless otherwise specified in this Agreement, all accounting
terms shall be interpreted and all accounting determinations
shall be made in accordance with GAAP. If this Agreement is
executed by more than one party as Borrower, the obligations
of such persons or entities will be joint and several.
10.9. ASSIGNMENTS AND PARTICIPATION. Notwithstanding any other
provisions of this Agreement, the Bank may, at any time in its
sole discretion, without any notice to the Borrower, sell,
assign, transfer, negotiate, grant participation in, or
otherwise dispose of all or any part of the Bank's interest in
the Loan. The Borrower hereby authorizes the Bank to provide,
without any notice to the Borrower, any information concerning
the Borrower, including information pertaining to the
Borrower's financial condition, business operations or general
creditworthiness, to any person or entity which may succeed to
or participate in all or any part of the Bank's interest in
the Loan, provided that such person or entity agrees to
maintain the confidentiality of such information. The Bank
agrees that it will otherwise maintain the confidentiality of
any proprietary information in its possession concerning the
Borrower which is not otherwise available to the public.
10.10. GOVERNING LAW AND JURISDICTION. This Agreement has been
delivered to and accepted by the Bank and will be deemed to be
made in the Commonwealth of Pennsylvania. THIS AGREEMENT WILL
BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES
HERETO DETERMINED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF PENNSYLVANIA, EXCLUDING ITS CONFLICT OF LAWS
RULES. The Borrower hereby irrevocably consents to the
exclusive jurisdiction of any state or federal court seated in
Philadelphia County, Pennsylvania, and consents that all
service of process be sent by nationally recognized overnight
-15-
courier service directed to the Borrower at the Borrower's
address set forth herein and service so made will be deemed to
be completed on the business day after deposit with such
courier; provided that nothing contained in this Agreement
will prevent the Bank from bringing any action, enforcing any
award or judgment or exercising any rights against the
Borrower individually, against any security or against any
property of the Borrower within any other county, state or
other foreign or domestic jurisdiction. the Bank and the
Borrower agree that the venue provided above is the most
convenient forum for both the Bank and the Borrower. The
Borrower waives any objection to venue and any objection based
on a more convenient forum in any action instituted under this
Agreement.
10.11. WAIVER OF JURY TRIAL. EACH OF THE BORROWER AND THE BANK
IRREVOCABLY WAIVES ANY AND ALL RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING
TO THIS AGREEMENT, ANY DOCUMENTS EXECUTED IN CONNECTION WITH
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED IN ANY OF SUCH
DOCUMENTS. THE BORROWER AND THE BANK ACKNOWLEDGE THAT THE
FOREGOING WAIVER IS KNOWING AND VOLUNTARY.
The Borrower acknowledges that it has read and understood all the provisions of
this Agreement, including the waiver of jury trial, and has been advised by
counsel as necessary or appropriate.
WITNESS the due execution of this Loan Agreement as a document under
seal, as of the date first written above.
[CORPORATE SEAL] THE BETHLEHEM CORPORATION,
a Pennsylvania corporation
Attest:________________________ By:__________________________(SEAL)
Xxxx X. Xxxxxxxxxxx
President & Chief Executive Officer
PNC BANK, NATIONAL ASSOCIATION,
a national banking association
Witness:______________________ By:__________________________(SEAL)
Xxxxxx X. Xxxxxx
Vice President
-16-
ADDENDUM to that certain Loan Agreement dated June 2, 1998 between
THE BETHLEHEM CORPORATION as the Borrower and PNC BANK, NATIONAL ASSOCIATION as
the Bank.
I. FINANCIAL COVENANTS
A) MINIMUM FIXED CHARGE COVERAGE RATIO - On a continuous basis, to be
tested by the Bank at least quarterly as of the end of each fiscal
quarter of the Borrower, the Borrower's Fixed Charge Coverage Ratio
shall equal or exceed 1.20 to 1.00. (Herein, the term "Fixed Charge
Coverage Ratio" shall be determined in accordance with GAAP and
shall equal the sum of the Borrower's net income and depreciation
and amortization expenses for the immediately preceding twelve (12)
month period divided by the sum of the Borrower's unfunded capital
expenditures, interest expenses and current maturities of long-term
debt over that same twelve (12) month period.
MINIMUM EFFECTIVE NET WORTH - On a continuous basis, to be tested by the
Bank at least quarterly as of the end of each fiscal quarter of the
Borrower, the Borrower's Effective Net Worth shall equal or exceed
$1,000,000 at all times from and after the closing date through May
31, 1998, and thereafter an amount equal to the sum of $1,000,000
plus an amount equal to one hundred percent (100%) of the Borrower's
annual net income during each fiscal year of the Borrower from and
after the fiscal year ending on May 31, 1998. (Herein, the term
"Effective Net Worth" shall be determined in accordance with GAAP
and shall equal the sum of the shareholder equity of the Borrower
plus all fully-subordinated debt of the Borrower minus all of the
Borrower's intangible assets.)
C) MAXIMUM LEVERAGE RATIO - On a continuous basis, to be tested by the
Bank at least quarterly as of the end of each fiscal quarter of the
Borrower, the Borrower's Leverage Ratio shall not exceed (i) 14.00
to 1.00 from the closing date through May 30, 1998, (ii) 7.50 to
1.00 from May 31, 1998 through May 30, 1999 and (iii) 4.00 to 1.00
from and after May 31, 1999. (Herein, the term "Leverage Ratio"
shall be determined in accordance with GAAP and shall equal the sum
of the Borrower's total liabilities minus all fully-subordinated
debt divided by the sum of the Borrower's Effective Net Worth.)
-18-
II. PERMITTED ENCUMBRANCES
None
III. PENDING LITIGATION
XXXXXX RULE V. THE BETHLEHEM CORPORATION, ET AL., Civil Action No.
97003066 22-2 (C.C.P. Bucks) - This is a products liability action involving (at
this juncture) approximately eight Defendants and Additional Defendants at this
juncture; the primary Defendants are manufacturers of fire-protective garments
worn by the Plaintiff, when he was operating a piece of equipment -- allegedly
designed, manufactured and sold by the Bethlehem Corporation --, and a fire
resulted and he was burned; the case is in the discovery phase; it is believed
that the claims against Bethlehem are questionable, and that the Plaintiff's
primary focus is against the manufacturers of the protective clothing and
various component parts, which allegedly failed and resulted in burn injuries.
WESTINGHOUSE ELECTRIC CORP. V. BETHLEHEM CORP., Civil Action No.
1996-C- 8149 (C.C.P. Northampton) - Westinghouse has sued to recover $39,056.22
for services allegedly rendered; Bethlehem has counterclaimed for damages caused
by the poor quality of services rendered, and is also defending on the basis
that the services rendered by Westinghouse were of little or no value; the case
is in the middle of discovery.
SI HANDLING SYSTEMS, INC. V. THE BETHLEHEM CORPORATION - The
Complaint in this case was just filed on May 18, 1998; it is a suit for
$27,880.59 for goods and services allegedly rendered; Bethlehem intends to
assert by defense and counterclaim the poor quality of the services rendered,
and to recover damages resulting from failure to properly perform under the
agreement between the parties.
IV. ENVIRONMENTAL MATTERS
None
-19-
EXHIBIT A
BORROWING BASE RIDER
THIS BORROWING BASE RIDER ("RIDER") is executed this 28th day of May
1998, by and between THE BETHLEHEM CORPORATION, a Pennsylvania corporation (the
"BORROWER"), and PNC BANK, NATIONAL ASSOCIATION, a national banking association
(the "BANK"). This Rider is incorporated into and made part of that certain Loan
Agreement dated June 2, 1998, and also into such other financing documents and
security agreements as may be executed and delivered pursuant to said Loan
Agreement (all such documents including this Rider are collectively referred to
as the "LOAN DOCUMENTS"). All initially capitalized terms not otherwise defined
in this Rider shall have the same meanings ascribed to such terms in the other
Loan Documents.
Pursuant to the Loan Documents, the Bank has extended a "LOAN" to
the Borrower which includes a "COMMITTED LINE OF CREDIT," under which the
Borrower may borrow, repay and reborrow funds at any time prior to the Maturity
Date (such portion of the Loan being referred to together herein as the
"FACILITY"). As a condition to the Bank's willingness to extend the Facility to
the Borrower, the Bank and the Borrower are entering into this Rider in order to
set forth their agreement regarding the maximum amount which may be outstanding
under the Facility at any time, and for the other purposes set forth below:
NOW, THEREFORE, in consideration of the foregoing and intending to
be legally bound, the parties hereto covenant and agree as follows:
1. LIMITATIONS ON BORROWINGS UNDER FACILITY. Notwithstanding any
provisions to the contrary in any of the other Loan Documents, at no time shall
the aggregate principal amounts of indebtedness outstanding at any one time
under the Facility exceed the Borrowing Base at such time. If at any time the
aggregate principal amount of indebtedness outstanding under the Facility
exceeds the limitation set forth in this Section 1 for any reason, then the
Borrower shall immediately repay the amount of such excess to the Bank in
immediately available funds.
2. BORROWING BASE CERTIFICATES. In addition to any and all
provisions of the other Loan Documents which establish conditions to the
Borrower's ability to request and obtain any advance under the Facility, the
Borrower may not request an advance under the Facility unless a Borrowing Base
Certificate shall have been delivered to the Bank via telecopy by 2:00 p.m.
Eastern Standard or Daylight Savings Time, as may be in effect at the time the
request for an advance is made, on the date of such proposed advance. The
Borrower shall also deliver an updated Borrowing Base Certificate upon the
Bank's request and in no event later than on or before the 10th day of each
month or the first business day thereafter if such day falls on a weekend or
holiday, if no new advances have been requested by the Borrower under the
Facility since the date of the preceding Borrowing Base Certificate. Each such
Borrowing Base Certificate shall be in form and substance identical to the
attached SCHEDULE A hereto and shall separately track advances under the
Facility which are supported by each of the four (4) existing categories of
Eligible Inventory that are described below.
3. CERTAIN DEFINED TERMS. In addition to the words and terms defined
elsewhere in this Rider or in the other Loan Documents, as used in this Rider,
the following words and terms shall have the following meanings:
"ACCOUNT" shall mean an "ACCOUNT" or a "GENERAL INTANGIBLE" as
defined in the Uniform Commercial Code as in effect in the jurisdiction whose
Law governs the perfection of the Bank's security interest therein, whether now
owned or hereafter acquired or arising.
"ACCOUNT DEBTOR" shall mean, with respect to any Account, each
Person who is obligated to make payments to the Borrower on such Account.
"AFFILIATE" of the Borrower or any Account Debtor shall mean (a) any
Person who (either alone or with a group of Persons, and either directly or
indirectly through one or more intermediaries) is in control of, is controlled
by or is under common control with the Borrower or such Account Debtor, (b) any
director, officer, partner, employee or agent of the Borrower or such Account
Debtor, and (c) any member of the immediate family of any natural person
described in the preceding clauses (a) and (b). A Person or group of Persons
shall be deemed to be in control of the Borrower or an Account Debtor when such
Person or group of Persons possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the Borrower or
such Account Debtor, whether through the ownership of voting securities, by
contract or otherwise.
"BETHLEHEM-TYPE EQUIPMENT" shall mean the used resale equipment
inventory of the Borrower that is similar to the new resale equipment inventory
that is currently being manufactured by the Borrower except for the fact that it
was originally manufactured by an entity other than the Borrower
"BORROWING BASE" shall mean at any time the lesser of (a) $3,200,000
(the maximum principal amount of the Facility) and (b) the sum of (i) 60% of
Qualified Accounts at such time and (ii) the lesser of $2,250,000 or 50% of
Eligible Inventory at such time. The value at any time of the collateral
described in this definition shall be determined by reference to the most recent
Borrowing Base Certificate delivered by the Borrower to the Bank.
"BORROWING BASE CERTIFICATE" shall mean each Borrowing Base
Certificate to be delivered by the Borrower to the Bank pursuant to Section 2 of
this Rider, in substantially the form attached as EXHIBIT A to this Rider, with
blanks appropriately completed, as amended, supplemented or otherwise modified
from time to time. References in the Borrowing Base Certificate to the "Loan
Agreement" shall be deemed to be references to this Rider and the other Loan
Documents.
"ELIGIBLE INVENTORY" shall mean, collectively, all of the Borrower's
then-current Bethlehem-Type Equipment, New Bethlehem Equipment and Used
Bethlehem Equipment.
-21-
"LAW" shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or
award of any Official Body.
"LIEN" shall mean any mortgage, pledge, security interest, bailment,
encumbrance, claim, lien or charge of any kind, including any agreement to give
any of the foregoing, any conditional sale or other title retention agreement
and any lease in the nature thereof, and the filing of or agreement to give any
financing statement under the Uniform Commercial Code.
"NEW BETHLEHEM EQUIPMENT" shall mean the new resale equipment
inventory of the Borrower that was manufactured by the Borrower but has not yet
been sold by the Borrower.
"OFFICIAL BODY" shall mean any government or political subdivision
or any agency, authority, bureau, central bank, commission, department or
instrumentality of any government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
"PERSON" shall mean an individual, sole proprietorship, corporation,
partnership (general or limited), trust, business trust, limited liability
company, unincorporated organization or association, joint venture, joint-stock
company, Official Body, or any other entity of whatever nature.
"QUALIFIED ACCOUNTS" shall mean Accounts which are and at all times
continue to be acceptable to the Bank in its sole discretion. Standards of
acceptability include but are not limited to the following conditions:
a. The Account duly complies with all applicable Laws, whether
Federal, state or local, including but not limited to usury
Laws, the Federal Truth in Lending Act, the Federal Consumer
Credit Protection Act, the Fair Credit Billing Act, and
Regulation Z of the Board of Governors of the Federal Reserve
Systems;
b. The Account was not originated in or subject to the Laws of a
jurisdiction whose Laws would make the account or the grant of
the security interest in the Account to the Bank unlawful,
invalid or unenforceable;
c. The Account was originated by the Borrower in connection with
the sale of goods or the rendering of services by the Borrower
in the ordinary course of business under an enforceable
contract, and such sale has been consummated and such goods
have been delivered or such services have been rendered so
that the performance of such contracts has been completed by
the Borrower
-22-
and by all parties other than the Account Debtor, or the cost
thereof has been billed to the Account Debtor prior to
delivery pursuant to an existing milestone or
installment-based billing arrangement;
d. The Account is evidenced by a written invoice or other
documentation and arises from a contract, all of which are in
form and substance satisfactory to the Bank;
e. The Account does not arise out of a contract with, or order
from, an Account Debtor that, by its terms, forbids or makes
void or unenforceable the grant of the security interest by
the Borrower to the Bank in and to the Account arising with
respect thereto;
f. The title of the Borrower to the Account and, except as to the
Account Debtor, to any related goods is absolute and is not
subject to any Lien except Liens in favor of the Bank;
g. The Account provides for payment in United States Dollars by
the Account Debtor;
h. The Account shall have amounts owing that are not less than
the amounts represented by the Borrower;
i. The portion of the Account for which income has not yet been
earned or which constitutes unearned discount, services
charges or deferred interest shall be ineligible;
j. The Account shall be eligible only to the extent that it is
not subject to any defense, claim of reduction, counterclaim,
set-off, recoupment, or any dispute or claim for credits,
allowances or adjustments by the Account Debtor because of
returned, inferior, damaged goods or unsatisfactory service,
or for any other reason;
k. The goods the sale of which gave rise to the Account were
shipped or delivered or provided to the Account Debtor on an
absolute sale basis or on a xxxx and hold sale basis, but not
on a consignment sale basis, a guaranteed sale basis, a sale
or return basis, or on the basis of any other similar terms
making the Account Debtor's payment obligations conditional,
or the cost thereof has been billed to the Account Debtor
prior to delivery pursuant to an existing milestone or
installment-based billing arrangement;
l. The Account Debtor has not returned, rejected or refused to
retain, or otherwise notified the Borrower of any dispute
concerning, or claimed nonconformity of, any of the goods from
the sale of which the Account arose;
-23-
m. No default exists under the Account by any party thereto, and
all rights and remedies of the Borrower under the Account are
freely assignable by the Borrower;
n. The Account has not been outstanding for more than ninety (90)
days past the invoice date and is not subject to "dating"
terms;
o. The Account shall be ineligible to the extent that the
aggregate amount of all the Accounts of the Account Debtor and
its Affiliates exceed 70% of all of the Borrower's Accounts;
p. The Borrower has not received any note, trade acceptance,
draft, chattel paper or other instrument with respect to, or
in payment of, the Account, unless, if any such instrument has
been received, the Borrower immediately notifies the Bank and,
at the Bank's request, endorses or assigns and delivers such
instrument to the Bank;
q. The Borrower has not received any notice of (i) the filing by
or against the Account Debtor of any proceeding in bankruptcy,
receivership, insolvency, reorganization, liquidation,
conservatorship or any similar proceeding, or (ii) any
assignment by the Account Debtor for the benefit of creditors.
Upon receipt by the Borrower of any such notice, it will give
the Bank prompt written notice thereof;
r. The Account Debtor is not an Affiliate of the Borrower;
s. The Account shall be ineligible if the Account Debtor is an
Official Body, unless the Borrower shall have taken all
actions deemed necessary by the Bank in order to perfect the
Bank's security interest therein, including but not limited to
any notices or filings required under the Assignment of Claims
Act of 1940, as amended, or other applicable Laws; and
t. The Bank has not deemed such Account ineligible because of
uncertainty about the creditworthiness of the Account Debtor
(including, without limitation, unsatisfactory past
experiences of the Borrower or the Bank with the Account
Debtor) or because the Bank otherwise makes a reasonable
determination that the collateral value of the Account to the
Bank is impaired or that the Bank's ability to realize such
value is insecure.
Standards of acceptability shall be fixed and may be revised from
time to time by mutual agreement of Bank and Borrower. In the case of any
dispute about whether an Account is or has ceased to be a Qualified Account, the
decision of the Bank shall be final.
-24-
"USED BETHLEHEM EQUIPMENT" shall mean the used resale equipment
inventory of the Borrower that was originally manufactured and sold by the
Borrower, but was subsequently re-acquired by the Borrower.
4. GOVERNING LAW. THIS RIDER WILL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF PENNSYLVANIA, EXCLUDING ITS CONFLICTS OF LAW RULES.
5. COUNTERPARTS. This Rider may be signed in any number of
counterpart copies and by the parties hereto on separate counterparts, but all
such copies shall constitute one and the same instrument.
WITNESS the due execution of this Borrowing Base Rider as a document
under seal, as of the date first written above.
[CORPORATE SEAL] THE BETHLEHEM CORPORATION,
a Pennsylvania corporation
Attest:________________________ By:__________________________(SEAL)
Xxxx X. Xxxxxxxxxxx
President & Chief Executive Officer
[CORPORATE SEAL] PNC BANK, NATIONAL ASSOCIATION,
a national banking association
Witness:______________________ By:__________________________(SEAL)
Xxxxxx X. Xxxxxx, Vice President
SCHEDULE A
FORM OF BORROWING
BASE CERTIFICATE
1) Total Accounts Receivable $__________________
2) Less: Unqualified Receivables
C) Over 90 Days Due $________________
D) Retention $________________
E) Foreign Not Supported By
Letter of Credit $________________
F) Over-Concentration Limit $________________
G) Others $________________
TOTAL $__________________
3) Total Qualified Accounts
(Line 1 minus Line 2) $__________________
4) Borrowing Base Availability - Accounts Receivable
(60% of Line 3) $__________________
5) Total Qualified Inventory (By Sub-Category)
A) Bethlehem-Type Equipment $______________
B) New Bethlehem Equipment $______________
C) Used Bethlehem Equipment $______________
TOTAL (NOT TO EXCEED $4,500,000) $__________________
6) Borrowing Base Availability - Inventory
(Lesser of 50% of Line 3 or $2,250,000.) $__________________
7) Total Borrowing Base Availability
(Lesser of Line 4 plus Line 6 or $3,200,000) $__________________
-26-
8) Revolving Loan Outstanding
(Not to exceed Line 7) $___________________
9) Borrowing Base Availability
($3,200,000 minus Line 7) $___________________
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
To induce PNC Bank, National Association ("PNC Bank") to grant
advances or other financial accommodations to us pursuant to the terms of our
Loan Agreement dated as of June 2, 1998 with PNC Bank, as the same may be
extended, amended, and/or restated from time to time (the "Credit Agreement"),
we hereby certify, represent and warrant the following to the PNC Bank, all as
of the date hereof: (1) the foregoing statements of our accounts receivable and
inventory described above are true and complete; (2) the total eligible
collateral described above at Lines three (3) and five (5) represent only
Eligible Inventory and Qualified Accounts, as those terms are defined in the
Credit Agreement; (3) we are in compliance with all of the terms and provisions
of the Credit Agreement, and; (4) there exists no Default or Event of Default
under the Credit Agreement.
DATE: ________________ THE BETHLEHEM CORPORATION,
a Pennsylvania corporation
By:_________________________________
Xxxxxxxxxx Xxxxxx
Chief Financial Officer
-27-
EXHIBIT B
FORM OF ACCOUNTS RECEIVABLE AND INVENTORY REPORT
-28-
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this "AGREEMENT") is entered into as of
the 2nd day of June, 1998, by and among PNC BANK, NATIONAL ASSOCIATION (the
"BANK"), THE BETHLEHEM CORPORATION (the "BORROWER") and UNIVERSAL PROCESS
EQUIPMENT, INC. (the "CREDITOR").
RECITALS
The Bank has established or is establishing a $3,200,000 Revolving
Credit facility and an $800,000 Term Loan facility for the benefit of the
Borrower, as evidenced by certain documents, instruments and agreements all
between the Bank and the Borrower (collectively, the "LOAN DOCUMENTS").
The Creditor has extended or is extending to the Borrower certain
loans, advances and extensions of credit, as evidenced by the Promissory Note
(as such term is defined herein, and also referred to herein as the "CREDITOR
DOCUMENTS").
The Bank and the Creditor hereby desire to set forth the respective
rights and obligations each has as against the other with respect to the
Borrower.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. DEFINITIONS.
"OBLIGATIONS" means all loans, advances, debts, liabilities,
obligations, covenants and duties owing by the Borrower to the Bank of any kind
or nature, present or future, whether or not evidenced by any note, guaranty or
other instrument, whether arising under any agreement, instrument or document,
whether or not for the payment of money, whether arising by reason of an
extension of credit, opening of a letter of credit, loan or guarantee or in any
other manner, whether arising out of overdrafts on deposit or other accounts or
electronic funds transfers (whether through automatic clearing houses or
otherwise) or out of the Bank's non-receipt of or inability to collect funds or
otherwise not being made whole in connection with depository transfer check or
other similar arrangements, whether direct or indirect (including those acquired
by assignment or participation), absolute or contingent, joint or several, due
or to become due, now existing or hereafter arising, and any amendments,
extensions, renewals or increases and all costs and expenses of the Bank
incurred in the documentation, negotiation, modification, enforcement,
collection or otherwise in connection with any of the foregoing, including but
not limited to reasonable attorneys' fees and expenses, exclusive of all such
costs and expenses relating to the salaried employees of the Bank, and all
related administrative and overhead expenses of the Bank.
"COLLATERAL" means any collateral now or in the future securing the
Obligations, including but not limited to claims against any guarantors of the
Obligations and any collateral securing such guarantees.
"SUBORDINATED DEBT" means the indebtedness due and owing by the
Borrower to the Creditor, as evidenced by that certain Promissory Note to the
Creditor from the Borrower in the amount of $800,000 dated of even date herewith
(herein, the "Promissory Note").
2. SUBORDINATION. Subject to Section 3 hereof, the Creditor hereby
irrevocably subordinates and postpones the payment and the time of payment of
all the Subordinated Debt and all claims and demands arising therefrom to the
Obligations and directs that the Obligations be paid in full before the
Subordinated Debt.
3. PAYMENTS TO CREDITOR. Notwithstanding any other provision of this
Agreement, the Borrower shall be entitled to pay and the Creditor shall be
entitled to receive, prior to the date that the Creditor receives written notice
from the Bank either that an Event of Default has occurred under the Loan
Documents or would result from such payment, only all scheduled payments of
interest (at the current rate set forth in the Creditor Documents) under the
Subordinated Debt, and only when due. No payments of principal on the
Subordinated Debt or default interest thereon or costs and expenses shall be
permitted or made without the Bank's prior written consent. After the occurrence
of an Event of Default under the Loan Documents and receipt by the Creditor of
written notice thereof from the Bank to the Creditor, the Borrower shall not
make, and the Creditor shall not receive, any direct or indirect payments of
principal, interest, fees or expenses under the Subordinated Debt.
4. SECURITY. The Borrower shall not grant and the Creditor shall not take
any lien on or security interest in any of the Borrower's property, now owned or
hereafter acquired or created, without the prior written consent of the Bank,
except that the Borrower shall be permitted to grant a subordinate security
interest in the Borrower's intangible intellectual property assets and inventory
to collateralize both the Subordinated Debt and the non-subordinate debt due
from the Borrower to the Creditor, subject in all respects to the terms,
conditions and restrictions contained in this Agreement.
5. STANDBY LIMITATION. Notwithstanding any breach or default by the
Borrower under the Creditor Documents, the Creditor shall not at any time or in
any manner foreclose upon, take possession of, or attempt to realize on any
Collateral, or proceed in any way to enforce any claims it has or may have
against the Borrower unless and until the Obligations have been fully and
indefeasibly paid and satisfied in full.
6. BANKRUPTCY/PROBATE OF BORROWER. In the event a petition or action for
relief shall be filed by or against the Borrower under any federal bankruptcy
statute in effect from time to time, or under any other law relating to
bankruptcy, insolvency, reorganization, receivership, general assignment for the
benefit of creditors, general moratorium, general creditor composition,
arrangement or other similar relief for debtors, the Bank's claim (secured or
unsecured) against the assets or estate of the Borrower shall be indefeasibly
paid in full before any payment is made to the Creditor on the Subordinated
Debt, whether such payment is in cash, securities or any other form of property
or rights. The Obligations shall include interest accruing after the date of
commencement of any case or proceeding under any such bankruptcy statute or
related law, regardless of whether the Bank's claim for such interest is allowed
in such case or proceeding.
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The Bank may, in its discretion, file a proof of claim for or collect the
Creditor's claim on the Subordinated Debt first for the benefit of the Bank to
the extent of the unpaid Obligations and then for the benefit of the Creditor
(but without creating any duty or liability to the Creditor other than to remit
to the Creditor distributions, if any, actually received in such proceedings or
on either or both of the proofs of claim filed in connection with the claims of
either the Creditor and/or the Bank after the Obligations have been paid and
satisfied in full) directly from the receiver, trustee, custodian, liquidator or
representative of the Borrower's estate in such proceeding. The Borrower and the
Creditor shall furnish all assignments, powers or other documents requested by
the Bank to facilitate such direct collection by the Bank.
7. RECEIPT OF PAYMENTS BY CREDITOR. Should the Creditor directly or
indirectly receive any payment or distribution not permitted by the provisions
of this Agreement or any Collateral or proceeds thereof, prior to the full and
indefeasible payment and satisfaction of the Obligations and the termination of
all financing arrangements between the Bank and the Borrower, the Creditor will
deliver the same to the Bank in the form received (except for the endorsement or
assignment of the Creditor where necessary), for application to the Obligations
in such order and manner as the Bank may elect. Until so delivered, the Creditor
shall hold the same, IN TRUST, for the Bank as property of the Bank, and shall
not commingle such property of the Bank with any other property held by the
Creditor. In the event the Creditor fails to make any such endorsement or
assignment, the Bank, or any of its officers or employees on behalf of the Bank,
is hereby irrevocably authorized in its own name or in the name of the Creditor
to make such endorsement or assignment and is hereby irrevocably appointed as
the Creditor's attorney-in-fact for those purposes.
8. BANK'S RIGHTS.
(a) The Creditor hereby consents that at any time and from time to time,
without further consent of or notice to the Creditor and without in any manner
affecting, impairing, lessening or releasing any of the provisions of this
Agreement, the Bank may, in its sole discretion: (i) renew, compromise, extend,
expand, postpone, waive, accelerate, terminate, change the payment terms of, or
otherwise modify the Obligations or amend, renew, replace or terminate the Loan
Documents or any and all other agreements now or hereafter related to the
Obligations; (ii) extend credit to the Borrower in whatever amount on a secured
or unsecured basis or take other support for the Obligations and exchange,
enforce, waive, sell, transfer, collect, adjust or release any such security or
other support or any part thereof; (iii) apply any and all payments or proceeds
of such security or other support and in any order or manner as the Bank, in its
discretion, may determine; and (iv) release or substitute any party liable on
the Obligations, any guarantor of the Obligations, or any other party providing
support for the Obligations.
(a) This Agreement will not be affected, impaired or released by any delay
or failure of the Bank to exercise any of its rights and remedies against the
Borrower or any guarantor or under any of the Obligations or against any
Collateral, by any failure of the Bank to take steps to perfect or maintain its
lien on, or to preserve any rights to, any Collateral by any irregularity,
unenforceability or invalidity of any of the Obligations or any part thereof or
any
3
security or guarantee therefor, or by any other event or circumstance which
otherwise might constitute a defense available to, or a discharge of, the
Borrower or a subordinated creditor. Except to the extent expressly stated in
Section 3 of this Agreement, the Creditor hereby waives demand, presentment for
performance, protest, notice of dishonor and of protest with respect to the
Subordinated Debt and the Collateral, notice of acceptance of this Agreement,
notice of the making of any of the Obligations and notice of default under any
of the Obligations.
(a) Nothing in this Agreement will obligate the Bank to grant credit to, or
continue financing arrangements with, the Borrower.
9. CONTINUING AGREEMENT. This is a continuing agreement and will remain in
full force and effect until all of the Obligations and all of the Creditor's
obligations to the Bank have been fully performed and indefeasibly satisfied and
until all the Loan Documents have been terminated. This Agreement will continue
to be effective or will be reinstated, as the case may be, if at any time
payment of all or any part of the Obligations is rescinded or must otherwise be
returned by the Bank upon insolvency, bankruptcy, or reorganization of the
Borrower or otherwise, all as though such payment had not been made.
10. NO CHALLENGE TO LIENS. The Creditor agrees that it will not make any
assertion, claim or argument in any action, suit or proceeding of any nature
whatsoever in any way challenging the priority, validity or effectiveness of the
liens and security interests granted to the Bank.
11. DISPOSITION OR RELEASE OF COLLATERAL.
(a) If at any time or from time to time the Collateral, or any portion
thereof, is in any manner sold or otherwise transferred, the Creditor's consent
to such disposition shall be automatically and irrevocably given if the Bank, in
its sole discretion and for any reason, consents to such disposition, and in any
event the Creditor shall not be entitled to receive any proceeds (cash or
non-cash) of such disposition unless and until the Obligations have been
indefeasibly paid in full.
(a) If, at any time and for any reason, the Bank releases its lien on the
Collateral, or any portion thereof, the Creditor shall likewise release its lien
on the property so released from the Bank's lien, if the Creditor has obtained
such a lien.
12. ORDER OF PROCEEDINGS. Nothing in this Agreement is intended to compel
the Bank or the Creditor at any time to declare the Borrower in default or
compel the Bank to proceed against or refrain from proceeding against any
Collateral in any order or manner. All rights and remedies of the Bank with
respect to the Collateral, the Borrower, and any other obligors concerning the
Obligations are cumulative and not alternative.
4
13. REPLACEMENT FINANCING; LEGEND ON CREDITOR DOCUMENTS.
(a) The provisions hereof shall inure to the benefit of any financial
institution obtained by the Borrower or the Bank to provide replacement working
capital or other financing for the Borrower in place of the Bank, regardless of
whether any such replacement lender provides its own financing or succeeds to
the Bank's financing by assignment. If requested by such replacement lender, the
Creditor shall execute with such replacement lender a subordination agreement
substantially similar to this Agreement.
(a) The Creditor also agrees that as a prior condition of any assignment of
any of its interests under any of the Creditor Documents, the Creditor shall
require the assignee to acknowledge this Agreement and agree, in writing, to be
bound by the terms and conditions hereof.
(a) Each and every note now or hereafter issued as part of the Creditor
Documents shall bear the following legend:
This [Note or other instrument] is subject to the terms of a
Subordination Agreement dated as of June 2, 1998, in favor of PNC
Bank, National Association. Notwithstanding any contrary statement
contained in the within instrument, no payment on account of any
obligation arising from or in connection with the within
instrument or any related agreement (whether of principal,
interest or otherwise) shall be made, paid, received or accepted
except in accordance with the terms of said Subordination
Agreement.
14. FINANCING OF FIDUCIARY. In the event of a bankruptcy, reorganization,
other insolvency or court proceeding for the Borrower commences, the Bank shall
have the option (in its sole and absolute discretion) to continue to provide
financing (on terms acceptable to the Bank) of the trustee, other fiduciary, or
of the Borrower as a debtor-in-possession, if the Bank deems such financing to
be in its best interests. The subordination and lien priority provisions of this
Agreement shall continue to apply to all advances made during the pendency of
such court proceedings, so that the Bank shall have a prior lien on all
Collateral, created before or during such court proceeding, to secure all
Obligations, whether created before or during such court proceeding. The
Creditor hereby waives any right it may have to object to financing by the Bank
during the pendency of such court proceeding and the Creditor's consent to such
financing shall not be required regardless of whether the court supervising such
proceeding approves, grants or allows adequate protection to the Creditor.
15. INVESTIGATION OF PARTIES. The Creditor has entered into the Creditor
Documents with the Borrower and the Bank has entered into the Loan Documents
with the Borrower and the Creditor and the Bank have entered into this Agreement
each upon its own independent investigation, and each makes no warranty or
representation as to each other with respect to the financial condition of the
Borrower, or its ability to repay its loans to the Creditor or the Bank in the
future. Nothing in this Agreement shall be deemed to constitute this Agreement
as a security or create a joint venture or partnership between the Creditor and
the Bank for any purpose.
5
16. IMPROPER ACTION BY CREDITOR. If the Creditor, the Borrower or both,
contrary to this Agreement, make, attempt to or threaten to allow the Creditor
to exercise its remedies against the Borrower under the Creditor Documents, or
make any payment or take any action contrary to this Agreement, the Bank may
restrain or enjoin the Creditor and the Borrower from so doing, it being
expressly understood and agreed by the Creditor and the Borrower that: (i) the
Bank's damages from their actions may at that time be difficult to ascertain and
may be irreparable, and (ii) the Creditor and the Borrower waive any defense or
claim that the Bank or the Borrower cannot demonstrate damages or can be made
whole by the awarding of damages.
17. NOTICES. All notices, demands, requests, consents, approvals and other
communications required or permitted hereunder must be in writing and will be
effective upon receipt if delivered personally to such party, or if sent by
facsimile transmission with confirmation of delivery, or by nationally
recognized overnight courier service, to the address set forth below or to such
other address as any party may give to the other in writing for such purpose:
TO THE BANK: PNC BANK, NATIONAL ASSOCIATION
0000 XXXXXXXX XXXXX
XXXX XXXXXXXXXX, XXXXXXXXXXXX 00000
ATTENTION: XXXXXX X. XXXXXX
FACSIMILE NO.: (000) 000-0000
WITH COPIES TO: BLANK ROME XXXXXXX & XXXXXXXX LLP
0000 XXXXXX XXXXXX, 0XX XXXXX
XXXXXXXXXX, XX 00000
ATTENTION: XXXXXXX X. XXXXXX, ESQUIRE
FACSIMILE NO.: (000) 000-0000
TO THE CREDITOR: UNIVERSAL PROCESS EQUIPMENT, INC.
X.X. XXX 000
XXXXXXXXX, XX 00000-0000
ATTENTION: XXXXXX X. XXXX, PRESIDENT
FACSIMILE NO.: (000) 000-0000
WITH COPIES TO: UNIVERSAL PROCESS EQUIPMENT, INC.
0000 XXXXX 000 XXXXX
XXXXXXXXXXXX, XX 00000
ATTENTION: XXXXXX XXXXXX, ESQUIRE
FACSIMILE NO.: (000) 000-0000
6
TO THE BORROWER: THE BETHLEHEM CORPORATION
00XX & XXXXXX XXXXXX
XXXXXX, XXXXXXXXXXXX 00000
ATTENTION: XXXX X. XXXXXXXXXXX
FACSIMILE NO.: (000) 000-0000
WITH COPIES TO: THE LAW OFFICES OF XXXXX X. XXXXXXX
0000 XXXX XXXX
XXXXXXXXX, XX 00000
ATTENTION: XXXXX X. XXXXXXX, ESQUIRE
FACSIMILE NO.: (000) 000-0000
18. PRESERVATION OF RIGHTS. No delay or omission on the part of the Bank to
exercise any right or power arising hereunder will impair any such right or
power or be considered a waiver of any such right or power or any acquiescence
therein, nor will the action or inaction of the Bank impair any right or power
arising hereunder. The Bank's rights and remedies hereunder are cumulative and
not exclusive of any other rights or remedies which the Bank may have under
other agreements, at law or in equity. Nothing in this Agreement is intended to
modify, alter, reduce or impair any rights which the Bank or the Creditor may
have against the Borrower under the Loan Documents or the Creditor Documents,
respectively, or under any other agreement between them, or either of them, and
the Borrower.
19. ILLEGALITY. In case any one or more of the provisions contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
20. CHANGES IN WRITING. No modification, amendment or waiver of any
provision of this Agreement nor consent to any departure by the Borrower or the
Creditor therefrom, will in any event be effective unless the same is in writing
and signed by the Bank, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given.
21. ENTIRE AGREEMENT. This Agreement (including the documents and
instruments referred to herein) constitutes the entire agreement and supersedes
all other prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof.
22. COUNTERPARTS. This Agreement may be signed in any number of counterpart
copies and by the parties hereto on separate counterparts, but all such copies
shall constitute one and the same instrument.
23. SUCCESSORS AND ASSIGNS. This Agreement will be binding upon and inure
to the benefit of the Borrower, the Creditor and the Bank and their respective
heirs, executors, administrators, successors and assigns; PROVIDED, HOWEVER,
that neither the Borrower nor the Creditor may assign this Agreement in whole or
in part without the prior written consent of the Bank and the Bank at any time
may assign this Agreement in whole or in part. No claims or rights are intended
to be created hereunder for the benefit of the Borrower or any alleged third
party beneficiary hereof.
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24. INTERPRETATION. In this Agreement, unless the parties otherwise agree
in writing, the singular includes the plural and the plural the singular; words
importing any gender include the other genders; the word "or" shall be deemed to
include "and/or", the words "including", "includes" and "include" shall be
deemed to be followed by the words "without limitation"; references to articles,
sections (or subdivisions of sections) or exhibits are to those of this
Agreement unless otherwise indicated; and references to agreements and other
contractual instruments shall be deemed to include all subsequent amendments and
other modifications to such instruments, but only to the extent such amendments
and other modifications are not prohibited by the terms of this Agreement.
Section headings in this Agreement are included for convenience of reference
only and shall not constitute a part of this Agreement for any other purpose. If
this Agreement is executed by more than one party as Borrower or by more than
one party as Creditor, the obligations of such persons or entities will be joint
and several.
25. GOVERNING LAW AND JURISDICTION. This Agreement has been delivered to
and accepted by the Bank and will be deemed to be made in the State where the
Bank's office indicated above is currently located. THIS AGREEMENT WILL BE
INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE STATE WHERE THE BANK'S OFFICE INDICATED ABOVE IS
CURRENTLY LOCATED, EXCLUDING ITS CONFLICT OF LAWS RULES. Each of the Borrower
and the Creditor hereby irrevocably consents to the exclusive jurisdiction of
any state or federal court for the county or judicial district where the Bank's
office indicated above is located, and consents that all service of process be
sent by nationally recognized overnight courier service directed to it at its
address set forth herein and service so made will be deemed to be completed on
the business day after deposit with such courier; provided that nothing
contained in this Agreement will prevent the Bank from bringing any action,
enforcing any award or judgment or exercising any rights against the Borrower or
the Creditor individually, against any security or against any property of the
Borrower within any other county, state or other foreign or domestic
jurisdiction. The parties hereto agree that the venue provided above is the most
convenient forum for each of the parties. Each of the Borrower and the Creditor
waives any objection to venue and any objection based on a more convenient forum
in any action instituted under this Agreement.
26. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE CREDITOR AND THE BANK
IRREVOCABLY WAIVES ANY AND ALL RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING TO THIS AGREEMENT, ANY
DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED IN ANY OF SUCH DOCUMENTS. THE BORROWER, THE CREDITOR AND THE BANK
ACKNOWLEDGE THAT THE FOREGOING WAIVER IS KNOWING AND VOLUNTARY.
8
WITNESS the due execution hereof as a document under seal, as of the
date first written above.
[CORPORATE SEAL] THE BETHLEHEM CORPORATION,
a Pennsylvania corporation
Attest:______________________________ By:__________________________________
Xxxx X. Xxxxxxxxxxx
President & Chief Executive Officer
[CORPORATE SEAL] UNIVERSAL PROCESS EQUIPMENT, INC.,
a New Jersey corporation
Attest:______________________________ By:__________________________________
Xxxxxx X. Xxxx, President
PNC BANK, NATIONAL ASSOCIATION,
a national banking association
Witness:___________________________ By:__________________________________
Xxxxxx X. Xxxxxx, Vice President
