EXHIBIT 10.2
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THIRD AMENDMENT TO LINE OF CREDIT PROMISSORY NOTE
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THIS THIRD AMENDMENT (this "Amendment") is made as of this 31st day of
August, 1999 by and among ENVIRONMENTAL ELEMENTS CORPORATION, a Delaware
corporation ("Borrower") and MERCANTILE-SAFE DEPOSIT AND TRUST COMPANY, a
Maryland banking corporation ("Bank").
RECITALS
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A. The Bank previously agreed to extend credit to the Borrower pursuant
to a certain Revolving Credit and Letter of Credit Agreement dated November 24,
1993, as amended by a letter agreement dated May 26, 1994 from Xxxxxxxx X.
Xxxxxxxxxx to Xxxxxx X. XxXxxx, a Second Amendment to Revolving Credit and
Letter of Credit Agreement dated October 25, 1995, a Third Amendment to
Revolving Credit and Letter of Credit Agreement dated June 12, 1998, and a
Fourth Amendment to Revolving Credit and Letter of Credit Agreement of even date
herewith (collectively, the "Agreement"), in the form of a line of credit
facility in an original principal amount not to exceed Ten Million Dollars
($10,000,000.00), which was reduced to Seven Million Dollars ($7,000,000.00),
and then increased to Twelve Million Dollars ($12,000,000.00).
B. The indebtedness under the Agreement is evidenced by a Line of
Credit Promissory Note dated November 24, 1993 from Borrower to Bank, as amended
by a certain First Amendment to Line of Credit Promissory Note dated October 25,
1995, certain letter agreements between the Bank and the Borrower, and a certain
Second Amendment to Line of Credit Promissory Note dated June 12, 1998
(collectively, the "Note").
C. The Borrower has requested that the Bank extend the term, lower the
interest rate and increase the amount of such line of credit facility, and the
Bank has agreed, subject to the terms and conditions hereinafter described.
WITNESSETH
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NOW, THEREFORE, in consideration of the premises and the mutual
covenants set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree that the Note is hereby modified and amended as follows (the Note, as
amended, is hereinafter referred to as the "Note"):
1. Recitals. The parties acknowledge and agree that the foregoing
Recitals are true and correct, and are incorporated herein by reference.
2. Amendments to Note.
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A. The aggregate principal amount of the credit facility
evidenced by the Note is hereby increased from Twelve Million Dollars
($12,000,000.00) to Fifteen Million Dollars ($15,000,000.00), and all references
to $12,000,000.00 in the Note (as previously amended) are hereby increased to
$15,000,000.00.
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B. The maturity date for the term of the Note, as set forth on
Page 1 of the Note, is hereby extended until July 1, 2001. The Bank agrees to
provide to Borrower at least fifty-four (54) weeks' prior written notice if Bank
elects not to renew the term of the Note on July 1, 2001 (or the expiration of
any renewal term thereafter). The foregoing notice shall not be required if the
Bank elects to terminate the credit facility following a default hereunder or
under the Agreement.
C. The interest rate under the Note shall hereinafter be equal
to the Bank's Prime Rate, as announced from time to time.
D. All references in the Note to the "Agreement" shall mean
the Revolving Credit and Letter of Credit Agreement, as previously amended and
as amended on even date by the Fourth Amendment to Revolving Credit and Letter
of Credit Agreement, as well as any future amendments or modifications thereof.
3. Effect of Amendment. Except as heretofore and hereby modified and
amended, the Note shall be and remain in full force and effect. In the event of
any conflict between the terms and provisions of the Note and this Amendment,
the terms and provisions of this Amendment shall prevail.
4. No Defenses; No Novation. Borrower acknowledges and confirms that it
has no right of set-off or defense of any kind or description regarding the
payment of any principal or interest under the Agreement or the Note, that it
has no claims or causes of action against the Bank, and that upon execution of
the Fourth Amendment to Revolving Credit and Letter of Credit Agreement there
shall exist no default (or any event which, with the passing of time or giving
of notice would constitute a default) under the Agreement or the Note. This
Amendment shall not extinguish or discharge the indebtedness evidenced by the
Note, nor constitute a novation thereof.
IN WITNESS WHEREOF, the parties hereto have caused these presents to be
executed and sealed, intending this to be a sealed instrument, as of the date
first above written.
WITNESS/ATTEST: ENVIRONMENTAL ELEMENTS CORPORATION
____________________________ By:________________________________(SEAL)
Name: Xxxxx X. Xxxxxxxx
Title: Vice-President and
Chief Financial Officer
MERCANTILE-SAFE DEPOSIT AND TRUST COMPANY
____________________________ By:________________________________(SEAL)
Xxxxxx X. Xxxxxxx,
Senior Vice-President
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