EXHIBIT 10.6.3.2
For Bank Use Only Reviewed by____
Due DECEMBER 15, 2003
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Customer # 1105510939 Loan # 83
AMENDMENT TO LOAN AGREEMENT AND NOTE
This amendment the "Amendment", dated as of the date specified below,
is by and between the borrower (the "Borrower") and the bank (the "Bank")
identified below.
RECITALS
A. The Borrower and the Bank have executed a Loan Agreement (the
"Agreement") dated MARCH 23, 2000 and the Borrower has executed a Note (the "
Note "), dated MARCH 23, 2000, either or both which may have been amended from
time to time, and the Borrower (and if applicable, certain third parties) have
executed the collateral documents which may or may not be identified in the
Agreement and certain other related documents (collectively the "Loan
Documents"), setting forth the terms and conditions upon which the Borrower may
obtain loans from the Bank from time to time in the original amount of
$5,500,000.00, as may be amended from time to time.
B. The Borrower has requested that the Bank permit certain
modifications to the Agreement and Note as described below.
C. The Bank has agreed to such modifications, but only upon the terms
and conditions outlined in this Amendment.
TERMS OF AGREEMENT
In consideration of the mutual covenants contained herein, and for
other good and valuable consideration, the Borrower and the Bank agree as
follows:
[X] Extension of Maturity Date. If checked here, any references in the
Agreement or Note to the maturity date or date of final payment are hereby
deleted and replaced with DECEMBER 15, 2003.
[X] Change in Maximum Loan Amount. If checked here, all references in
the Agreement and in the Note (whether or not numerically) as the maximum loan
amount are hereby deleted and replaced with "$ SEE ADDENDUM", which evidences an
additional $ SEE ADDENDUM available to be advanced subject to the terms and
conditions of the Agreement and Note.
[ ] Change in Multiple Advance Termination Date. If checked here, all
references in the Agreement and in the Note to the termination date for multiple
advances are hereby deleted and replaced with " N/A ".
Change in Financial Covenant(s).
(i) ___ If checked here, all references to "$____________" in the
Agreement as the minimum Net Working Capital amount are hereby deleted
and replaced with "$______________" for the period beginning
_________and thereafter.
(ii) ___ If checked here, all references to "$___________" in the
Agreement as the minimum Tangible Net Worth amount are hereby deleted
and replaced with "$__________"for the period beginning __________ and
thereafter.
(iii) ___ If checked here, all references to "___________" in the
Agreement as the maximum Debt to Worth Ratio are hereby deleted and
replaced with "____________" for the period beginning ____________and
thereafter.
(iv) ___ If checked here, all references to "_________" in the
Agreement as the minimum Current Ratio are hereby deleted and replaced
with "____________" for the period beginning _____________and
thereafter.
(v) ___ If checked here, all references to "$_____________" in the
Agreement as the maximum Capital Expenditures amount are hereby deleted
and replaced with "$__________" for the period beginning _____________
and thereafter.
(vi) ___ If checked here, all references to "_______" in the Agreement
as the minimum Cash Flow Coverage Ratio are hereby deleted and replaced
with "______________" for the period beginning ___________ and
thereafter.
(vii) ___ If checked here, all references to "$____________" in
Agreement as the maximum Officers, Directors, Partners, and Management
Salaries and Other Compensation amount are hereby deleted and replaced
with "$__________" for the period beginning _______________ and
thereafter.
[ ] Change in Payment Schedule. If checked here, effective upon the
date of this Amendment, any payment terms are amended as follows:
[X] Change in Interest Rate. If checked here, effective upon the date
of this Amendment, interest payable under the Note is amended as follows:
The unpaid principal balance will bear interest at an annual rate equal to
0.500% plus the prime rate announced by the Bank.
The interest rate hereunder will be adjusted each time that the prime rate
changes.
[ ] Change in Late Payment Fee. If checked here, subject to applicable
law, if any payment is not made on or before its due date, the Bank may collect
a delinquency charge of____% of the unpaid amount. Collection of the late
payment fee shall not be deemed to be a waiver of the Bank's right to declare a
default hereunder.
Default Interest Rate. Notwithstanding any provision of this Note to
the contrary, upon any default or at any time during the continuation thereof
(including failure to pay upon maturity), the Bank may, at its option and
subject to applicable law, increase the interest rate on this Note to a rate of
5% per annum plus the interest rate otherwise payable hereunder. Notwithstanding
the foregoing and subject to applicable law, upon the occurrence of a default by
the Borrower or any guarantor involving bankruptcy, insolvency, receivership
proceedings or an assignment for the benefit of creditors, the interest rate on
this Note shall automatically increase to a rate of 5% per annum plus the rate
otherwise payable hereunder.
Effectiveness of Prior Documents. Except as specifically amended
hereby, the Agreement, the Note and the other Loan Documents shall remain in
full force and effect in accordance with their respective terms. All warranties
and representations contained in the Agreement and the other Loan Documents are
hereby reconfirmed as of the date hereof. All collateral previously provided to
secure the Agreement and/or Note continues as security, and all guaranties
guaranteeing obligations under the Loan Documents remain in full force and
effect. This is an amendment, not a novation.
Preconditions to Effectiveness. This Amendment shall only become
effective upon execution by the Borrower and the Bank, and approval by any other
third party required by the Bank.
No Waiver of Defaults; Warranties. This Amendment shall not be
construed as or be deemed to be a waiver by the Bank of existing defaults by the
Borrower, whether known or undiscovered. All agreements, representations and
warranties made herein shall survive the execution of this Amendment.
Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be considered an original, but when taken
together shall constitute one document.
Authorization. The Borrower represents and warrants that the execution,
delivery and performance of this Amendment and the documents referenced herein
are within the authority of the Borrower and have been duly authorized by all
necessary action.
Attachments. All documents attached hereto, including any appendices,
schedules, riders, and exhibits to this Amendment, are hereby expressly
incorporated herein by reference.
Dated as of DECEMBER 15, 2002
HI-SHEAR TECHNOLOGY, CORP.
(Individual Borrower) Borrower Name (Organization)
_______________________________(SEAL) a DELAWARE CORPORATION
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Borrower Name __________N/A______ By: /S/ XXXXXX X. XXXXXX
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Name and Title: XXXXXX XXXXXX,
PRESIDENT/CEO
_______________________________(SEAL) By: /S/ XXXXXXX X. XXXXX
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Name and Title: XXXXXXX XXXXX,
V.P. FINANCE/CFO
Borrower Name ________N/A_________
Agreed to:
U.S. BANK N.A.
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By: /S/ XXXXX X. XXXXXXXX
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Name and Title: XXXXX X. XXXXXXXX
SENIOR VICE PRESIDENT
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ADDENDUM TO AMENDMENT TO LOAN AGREEMENT AND NOTE
This Addendum is made part of the Amendment to Loan Agreement and Note (the
"Amendment") made and entered into by and between the undersigned borrower (the
"Borrower") and the undersigned bank (the "Bank") as of the date identified
below. The following provisions are hereby added to the Agreement, (or to the
extent such provisions already exist, are hereby modified) as follows
Change in Maximum Loan Amount (continued):
Effective immediately, the maximum loan amount which may be borrowed from time
to time under the Note is hereby reduced from $4,300,000.00 to $2,700,000.00.
Effective as of January 31, 2003, the maximum loan amount which may be borrowed
from time to time under the Note shall be further reduced from $2,700,000.00 to
$2,500,000.00. On any date that the outstanding principal balance of the Note
exceeds the available loan amount, the Borrower shall make a principal payment
to reduce the outstanding principal balance to the available loan amount. The
available loan amount is an amount equal to the lesser of (a) the maximum loan
amount or (b) any applicable borrowing base amount.
Deletion of Sections Titled "Line of Credit Advances" and "Restriction of
Advances". The sections of the Agreement titled "Line of Credit Advances" and
"Restriction of Advances" are hereby deleted.
Dated as of: DECEMBER 15, 2002
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Borrower: Hi-Shear Technology Corporation
A Delaware corporation
By: /S/ XXXXXX X. XXXXXX By: /S/ XXXXXXX X. XXXXX
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Xxxxxx Xxxxxx, President/CEO Xxxxxxx Xxxxx, VP Finance/CFO
Bank: U.S. Bank N.A.
By: /S/ XXXXX X. XXXXXXXX
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Xxxxx X. Xxxxxxxx, Senior Vice President
