1
FOURTH MODIFICATION OF CONSTRUCTION TO
PERMANENT LOAN PROMISSORY NOTE AND
OPEN-END CONSTRUCTION TO PERMANENT MORTGAGE DEED
THIS FOURTH MODIFICATION OF CONSTRUCTION TO PERMANENT LOAN PROMISSORY NOTE
AND OPEN-END CONSTRUCTION TO PERMANENT MORTGAGE DEED (the "AGREEMENT"), entered
into as of the 30th day of June, 1998, by and between EDAC TECHNOLOGIES
CORPORATION, a Wisconsin corporation having a place of business at 0000 Xxx
Xxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000 (the "BORROWER"), and FLEET
NATIONAL BANK f/k/a FLEET NATIONAL BANK OF CONNECTICUT f/k/a SHAWMUT BANK
CONNECTICUT, N.A. a national banking association, having an office at 000 Xxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the "LENDER").
W I T N E S S E T H:
1. On October 3, 1985, the Lender and the Borrower entered into a certain
Revolving Loan and Security Agreement which has been (a) amended and restated
in its entirety by a certain Fifth Amended and Restated Revolving Loan, Term
Loan, Equipment Loan and Security Agreement dated February 28, 1995, (b)
amended by a certain Sixth Amendment to Revolving Loan, Term Loan, Equipment
Loan and Security Agreement dated July 31, 1995, (c) amended by a certain
Seventh Amendment to Revolving Loan, Term Loan, Equipment Loan and Security
Agreement and Reaffirmation of Guaranties dated as of January 26, 1996, (d)
amended by a certain Eighth Amendment to Revolving Loan, Term Loan, Equipment
Loan and Security Agreement dated as of April 10, 1996, (e) amended by a
certain Ninth Amendment to Revolving Loan, Term Loan, Equipment Loan, Security
Agreement, Modification of Notes and Reaffirmation of Guaranties dated May 27,
1997 between Borrower and Lender, (f) as further amended by a certain Tenth
Amendment to Revolving Loan, Term Loan, Equipment Loan and Security Agreement
and Reaffirmation of Guaranties dated May 22, 1998, and (g) as further amended
by a certain Eleventh Amendment to Loan and Security Agreement and Modification
of Notes and Reaffirmation of Guaranties (as amended and in effect from time to
time, collectively, the "LOAN AGREEMENT"). Capitalized terms used herein and
not defined herein shall have the meanings given to them in the Loan Agreement.
2. Pursuant to the Loan Agreement, the Borrower executed a certain
Construction to Permanent Loan Promissory Note dated July 31, 1995 in the
original principal amount of up to $1,000,000 in favor of the Lender, which was
amended pursuant to (i) a certain Modification of Construction to Permanent
Loan Promissory Note and Open-End Construction to Permanent Mortgage Deed
recorded in Volume 513 at Page 462 of the Farmington Land Records (the
"MODIFICATION"), (ii) a certain Second Modification of Construction to
Permanent Loan, Promissory Note and Open End Construction to Permanent Mortgage
dated as of April 10, 1996 and recorded in Volume 514 at Page 716 of the
Farmington Land Records (the "SECOND MODIFICATION") and (iii) a certain Third
Modification of Construction to Permanent Loan Promissory Note and Open-End
Construction to Permanent Mortgage Deed dated as of March 27, 1997 and recorded
in Volume 535 at Page 344 of the Farmington Land Records (the "THIRD
MODIFICATION") (collectively, as modified,
2
the "NOTE"). The Note is secured by, among other things, an Open-End
Construction to Permanent Mortgage Deed from the Borrower in favor of Lender
dated August 3, 1995 and recorded in Volume 502 at Page 1024 of the Farmington
Land Records, which was modified pursuant to the Modification, the Second
Modification and Third Modification (as modified, the "MORTGAGE"), encumbering
certain real property located in the Town of Farmington as more particularly
described in Schedule A to the Mortgage. The Loan Agreement, Note, Mortgage and
related documents are collectively referred to as the "LOAN DOCUMENTS".
3. The Borrower has requested that the Lender extend certain other loans
from the Lender to the Borrower and to modify the interest rates set forth in
the Note.
4. As a condition to the extension, the Lender requires the Borrower to
enter into this Agreement.
5. In consideration of the foregoing, and for One ($1.00) Dollar and other
valuable consideration received to its satisfaction, the Borrower agrees to
modify the terms and conditions of the Note and Mortgage as more specifically
set forth in this Agreement.
TERMS OF AGREEMENT
A. Acknowledgments, Affirmations and Representations and Warranties.
1. The Borrower acknowledges and affirms that:
a. All of the statements contained herein are true and correct and
that they understand that the Lender is relying on the truth and completeness of
such statements to enter into this Agreement.
b. As of the date hereof and without regard to the financial
accommodations contemplated herein, the Borrower is legally and validly indebted
to the Lender in the principal amount of $833,333.20 with respect to the Note,
plus interest and fees accrued and accruing thereon and costs and expenses of
collection, including without limitation, attorneys' fees, and there is no
defense, offset or counterclaim with respect to any of the foregoing or
independent claim or action against the Lender.
2. The Borrower represents and warrants to the Lender that:
a. The resolutions previously adopted by the Board of Directors of
the Borrower and provided to the Lender have not in any way been rescinded or
modified and have been in full force and effect since their adoption to and
including the date hereof and are now in full force and effect, except to the
extent that they have been modified or supplemented to authorize this Agreement
and the documents and transactions described herein.
2
3
b. The Borrower has the corporate power and authority to enter
into, and have taken all necessary corporate action to authorize, this Agreement
and the transactions contemplated hereby.
c. All representations, warranties and covenants contained in, and
schedules and exhibits attached to, the Loan Documents are true and correct on
and as of the date hereof, are incorporated herein by reference and are hereby
remade.
d. Other than the defaults previously waived in writing by the
Lender, the Borrower is not currently in default under any of the Loan
Documents, and no condition exists which would constitute an event of default
under any of the Loan Documents but for the giving of notice or passage of time,
or both.
e. The consummation of the transactions contemplated hereby is not
prevented or limited by, nor does it conflict with or result in a breach of
terms, conditions or provisions of the Borrower's Certificate of Incorporation
or Bylaws or any evidence of indebtedness, agreement or instrument of whatever
nature to which the Borrower is a party or by which it is bound, does not
constitute a default under any of the foregoing and does not violate any
federal, state or local law, regulation or order or any order of any court or
agency which is binding upon the Borrower.
B. Modification of Note.
The Borrower and the Lender agree that the terms of the Note are hereby
modified in accordance with the following:
1. Paragraph (15) entitled "Permanent Interest Rate" on page four of
the Note is hereby deleted in its entirety and the following is substituted in
lieu thereof:
(15) "PERMANENT INTEREST RATE" shall mean a variable rate, at
Borrower's election pursuant to Section I, below, equal to
(a) the Prime Rate, (b) the LIBOR Rate plus one hundred fifty
(150) basis points or (c) Cost of Funds Rate plus one hundred
fifty (150) basis points, provided, however, that if Borrower
achieves an Operating Leverage Ratio (as defined in the Loan
Agreement) of less than or equal to 2.0 to 1.0 for the
quarterly period tested, the Lender in its sole and absolute
discretion may lower the interest rate on the Construction
Loan if it bears interest with reference to the LIBOR Rate by
one-quarter of one percent (.25%).
3
4
C. Modification of Mortgage.
The Borrower and Lender hereby agree that the terms of the Mortgage are
hereby modified in accordance with the following:
1. Any and all references in the Mortgage to the term "Note" or words
of similar import shall be deemed to mean and refer to the Note as modified by
this Agreement.
2. The form of the Note attached as Schedule D to the Mortgage is
hereby modified in accordance with Section B. above.
D. Miscellaneous
1. Except as specifically modified hereby, all of the terms and
conditions of the Note and Mortgage shall remain in full force and effect, and
Borrower hereby ratifies and affirms each of its respect obligations, terms,
conditions, covenants, representations and warranties contained therein, except
to the extent expressly modified hereby. Borrower agrees to be bound by the
terms and conditions of said instruments, as modified by this Agreement.
2. The rights and duties of the parties under this Agreement shall be
governed by the laws of the State of Connecticut.
3. This Agreement shall be binding upon the Borrower, the Lender and
each of their respective successors and assigns.
4. Nothing contained in this Agreement shall constitute a repayment of
the Note, or affect the priority of the lien of the Mortgage.
[Remainder of the page intentionally left blank]
4
5
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as a sealed instrument by their duly authorized representatives as of the date
first above written.
Witnesses: EDAC TECHNOLOGIES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------
Xxxxxx X. Xxxxxxxxx
Its Vice President-Finance
FLEET NATIONAL BANK f/k/a
FLEET NATIONAL BANK OF
CONNECTICUT f/k/a SHAWMUT
BANK CONNECTICUT, N.A.
By: /s/ Xxxxx Xxxxxxx
------------------------------
Xxxxx Xxxxxxx
Its Vice President
STATE OF CONNECTICUT)
) ss.: ____________
COUNTY OF HARTFORD )
On this 30th day of June, 1998, before me, personally appeared XXXXXX X.
XXXXXXXXX, known to me to be the Vice President-Finance of EDAC TECHNOLOGIES
CORPORATION, a Wisconsin corporation, signer and sealer of the foregoing
instrument and acknowledged the same to be his free act and deed and the free
act and deed of said corporation.
_________________________________
Commissioner of the Superior Court
Notary Public
My Commission Expires:____________
5
6
STATE OF CONNECTICUT)
) ss.: ____________
COUNTY OF HARTFORD )
On this 30th day of June, 1998, before me, personally appeared Xxxxx
Xxxxxxx, known to me to be the Vice President of FLEET NATIONAL BANK f/k/a
FLEET NATIONAL BANK OF CONNECTICUT f/k/a SHAWMUT BANK CONNECTICUT, N.A., a
national banking association, signer and sealer of the foregoing instrument and
acknowledged the same to be his free act and deed and the free act and deed of
said banking association.
____________________________________
Commissioner of the Superior Court
Notary Public
My Commission Expires:
6
