EXHIBIT 10.20
FIRST AMENDMENT TO LOAN AGREEMENT
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FIRST AMENDMENT TO LOAN AGREEMENT dated as of May 23, 1997, by and between
NU HORIZONS ELECTRONICS CORP., a Delaware corporation having its executive
offices at 00 Xxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx (the "Company") and MELLON BANK,
N.A., a national banking association, having offices at 000 Xxxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 ("Mellon") and KEYBANK NATIONAL ASSOCIATION, a
national banking association, having offices at 000 Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxx 00000 ("Key"; Mellon and Key, collectively, the "Banks")).
RECITALS
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The Company and the Banks entered into a Loan Agreement dated as of May 23,
1997 (the "Loan Agreement"), pursuant to which certain financial accommodations
were made available by the Banks to the Company. Unless otherwise expressly
provided herein, all capitalized terms used in this First Amendment shall have
the respective meanings ascribed to such terms in the Loan Agreement.
The Company has requested that the Banks modify certain of the terms set
forth in the Loan Agreement and the Banks are willing to comply with such
request but only upon and subject to the following terms and conditions.
NOW THEREFORE, in consideration of the premises and mutual covenants and
promises exchanged herein, the parties hereto mutually agree as follows:
1. Section 7.1 of the Agreement is hereby deleted and the following is
substituted therefor:
"7.1 Indebtedness for Borrowed Money. Incur, or permit to
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exist, any indebtedness for borrowed money except (i) indebtedness incurred
pursuant to borrowings hereunder, (ii) purchase money indebtedness secured
by Liens described in Section 7.2(iv) hereof, (iii) indebtedness existing
on the date hereof and reflected in the financial statements referred to in
Section 3.1 hereof and extensions, renewals and refinancings thereof
(without increase in principal amount) other than amounts owing to Fleet
Bank, N.A. under a revolving credit facility which shall be repaid in full
and terminated prior to or on the date hereof, (iv) indebtedness incurred
in the ordinary course of business exclusive of that incurred in the
borrowing of money, (v) the Subordinated Indebtedness, (vi) indebtedness
owing to Mellon in a principal amount not to exceed $3,000,000 pursuant to
that certain loan agreement dated October 10, 1997 between Mellon and the
Company (the
"ESOP Loan Agreement") and (vii) other indebtedness which shall not exceed
in the aggregate, for the Borrower and all Subsidiaries, at any time
outstanding, the sum of $500,000."
2. Section 7.3 of the Agreement is hereby deleted and the following is
substituted therefor:
"7.3 Loans and Investments. Lend or advance money, credit or
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property to or invest in (by capital contribution, loan, purchase or
otherwise) any firm, corporation, or other Person except (i) investments in
United States Government obligations, certificates of deposit of any
banking institution with combined capital and surplus of at least
$200,000,000 and commercial paper of the highest credit rating given by
Xxxxx'x Investors Service, Inc. or Standard and Poors Corporation, (ii)
each Borrower may make loans provided that the aggregate thereof at any
time outstanding and owing by any one Person shall not exceed $100,000,
(iii) investments in stocks, securities and assets of other corporations in
connection with any transaction not otherwise qualifying as a Permitted
Acquisition, the result of which will constitute an investment by the
Borrower in a new Subsidiary or a merger in which the Borrower is the
surviving corporation; provided, however, that the aggregate of such
investments shall not exceed $1,000,000, and provided, further, that the
Borrower shall cause any new Subsidiary which is so acquired to guarantee
payment to the Banks of all of the Borrower's obligations arising
hereunder, (iv) Permitted Acquisitions and (v) the ESOP Loans as defined in
and in accordance with the ESOP Loan Agreement."
3. It is expressly understood and agreed that all collateral security
for the Loans and other extensions of credit set forth in the Loan Agreement
prior to the amendments provided for herein is and shall continue to be
collateral security for the Loans and other extensions of credit provided in the
Loan Agreement as herein amended. Without limiting the generality of the
foregoing, the Company hereby absolutely and unconditionally confirms that (i)
each document and instrument executed by the Company pursuant to the Loan
Agreement continues in full force and effect, is ratified and confirmed and is
and shall continue to be applicable to the Loan Agreement (as herein amended)
and (ii) the Notes are hereby ratified and confirmed and shall remain in full
force and effect in accordance with their respective terms.
4. In order to induce the Banks to enter into this First Amendment to Loan
Agreement, the Company represents and warrants to the Banks that each of its
representations and warranties made in the Loan Agreement is true and correct as
of the date hereof except
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as otherwise set forth in writing(s) to which the
Banks are parties.
5. No modifications or waiver or any provisions of the Loan Agreement or
any other agreement or instrument made or issued pursuant thereto or
contemplated thereby, nor consent to any departure by the Company therefore
shall, in any event, be effective unless made in writing and signed by the Banks
and the Company, and then any such modification or waiver shall be effective
only in the specific instance and for the purpose for which given unless
otherwise specified therein. No notice to, or demand on, the Company in any
case shall, of itself, entitle it to any further notice or demand in similar or
other circumstances.
6. The Company agrees to pay on demand, and the Banks may charge any
deposit or loan account(s) of the Company, for all expenses incurred by the
Banks in connection with the negotiation, preparation and administration
(including any future waiver or modification and legal counsel as to the rights
and duties of the Banks) of this First Amendment to Loan Agreement.
7. This amendment is limited precisely as written and shall not be deemed
to (a) be a consent or waiver of any other term or condition of the Loan
Agreement or of any of the documents referred to therein or (b) prejudice any
right or rights which the Banks may now have or may have in the future under or
in connection with the Loan Agreement or any of the documents referred to
therein.
8. This First Amendment to Loan Agreement is dated for convenience of as
October 1, 1997 and shall be effective on the delivery of an executed
counterpart to the Company. This First Amendment to Loan Agreement may be
executed in counterparts, each of which shall constitute an original, and each
of which taken together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to Loan
Agreement to be duly executed and delivered by their duly authorized officers,
all as of the day and year first above written.
Borrower:
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NU HORIZONS ELECTRONICS CORP.
By:__________________________
Xxxx Xxxxxxx
Vice President/Finance
Agent:
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MELLON BANK, N.A., as Agent
By:___________________________
Xxxxxx Xxxxx
Senior Vice President
Banks:
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MELLON BANK, N.A.
By:___________________________
Xxxxxx Xxxxx
Senior Vice President
KEYBANK NATIONAL ASSOCIATION
By:___________________________
Xxxxxxxx Xxxx
Vice President
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XXXXX XX XXX XXXX)
:ss.:
COUNTY OF NASSAU )
On the ____ day of October, 1997, before me personally came XXXX XXXXXXX,
to me known, who, being by me duly sworn, did depose and say that he resides at
c/o 00 Xxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx; that he is the Vice President/Finance of
NU HORIZONS ELECTRONICS CORP., the corporation described in and which executed
the foregoing instrument; and that he signed his name thereto by order of the
board of directors of said corporation.
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Notary Public
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XXXXX XX XXX XXXX )
:ss.:
COUNTY OF NASSAU )
On the ____ day of October, 1997, before me personally came Xxxxxx
Xxxxx, to me known, who, being by me duly sworn, did depose and say that he
resides at c/o 000 XXX Xxxxx, Xxxx Xxxxx, 00xx Xxxxx, Xxxxxxxxx, XX 00000-0000;
that he is a Senior Vice President of MELLON BANK, N.A., the banking institution
described in and which executed the foregoing document and that he signed his
name thereto by authority of such banking institution.
____________________________
Notary Public
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STATE OF OHIO )
:ss.:
COUNTY OF )
On the ____ day of October, 1997, before me personally came Xxxxxxxx
Xxxx, to me known, who, being by me duly sworn, did depose and say that she
resides at c/o 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxx; that she is a Vice President
of KEYBANK NATIONAL ASSOCIATION , the banking institution described in and which
executed the foregoing document and that she signed her name thereto by
authority of such banking institution.
____________________________
Notary Public
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