EXHIBIT 10.30
FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
This Fourth Amendment to Loan and Security Agreement is dated as of
July 28, 1997 (this "Amendment") by and among:
Summit Bank, f/k/a United Jersey Bank, f/k/a United Jersey Bank/Central, N.A.
(the "Bank"), a New Jersey banking corporation having an address at 301 Carnegie
Center, CN 5316, Xxxxxxxxx, Xxx Xxxxxx 00000-0000; and,
Osteotech, Inc. (the "Borrower"), a Delaware corporation having its principal
place of business at 00 Xxxxx Xxx, Xxxxxxxxx, Xxx Xxxxxx 00000.
RECITALS:
WHEREAS, pursuant to the terms of a Loan and Security Agreement dated
May 27, 1993 (the "Loan Agreement"), the Bank provided a $4,000,000 credit
facility (the "Credit Facility") to the Borrower, including a $2,000,000
Revolving Loan and a $2,000,000 Equipment Loan; and,
WHEREAS, pursuant to a First Amendment to the Loan and Security
Agreement dated July 14, 1994 (the "First Amendment"), the Bank, among other
things, extended the term of the Credit Facility to May 31, 1995 and increased
the amount to the Credit Facility to $6,000,000.00; and,
WHEREAS, pursuant to a Second Amendment to the Loan and Security
Agreement dated June 30, 1995 (the "Second Amendment"), the Bank, among other
things, extended the term of the Credit Facility to May 31, 1996; and,
WHEREAS, pursuant to a Third Amendment to the Loan and Security
Agreement dated May 31, 1996 (the "Third Amendment"), the Bank, among other
things, extended the term of the Credit Facility to May 31, 1997 and increased
the amount the Credit Facility to $7,000,000.00; and
WHEREAS, the term of the Credit Facility expired on May 31, 1997 and
the Borrower has requested to extend the term of the Credit Facility, among
other things, and the Bank has agreed to do so subject to the terms and
conditions set forth herein.
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NOW THEREFORE, in consideration of the recitals and the mutual
covenants contained herein and in the other agreements executed in connection
with the Credit Facility, the parties hereto agree as follows:1. Notwithstanding
anything to the contrary contained in the Loan Agreement, the Notes or any other
Fundamental Document as amended by the First Amendment, Second Amendment or
Third Amendment (the "Amended Fundamental Documents"), the terms of this
Amendment shall control. All capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them pursuant to the Amended
Fundamental Documents.
2. The Loan Agreement is hereby amended as follows:
(a) The following definitions are hereby amended and restated in its
entirety to read as follows:
"Loan Termination Date" means May 31, 1998.
"Notes" means, collectively, the promissory note made by the
Borrower in favor of the Bank, in a principal amount not to
exceed Four Million Dollars ($4,000,000.00) evidencing the
Borrower's Obligations to the Bank in connection with
Equipment Advances and the promissory note made by the
Borrower in favor of the Bank, in a principal amount not to
exceed Three Million Dollars ($3,000,000.00) evidencing the
Borrower's Obligations to the Bank in connection with
Revolving Loan Advances.
(b) The following definitions are added:
"Base Rate Advance" means an Advance which the Borrower
requests to be made as an Advance which will accrue interest
at the Base Rate in accordance with the provisions of Section
2.06 hereof.
"Equipment Advance Application" has the meaning set forth in
Section 2.03(a).
"Eurodollar Advance" means an Advance which the Borrower
requests to be made as an Advance which will accrue interest
at the Eurodollar Rate or which is reborrowed as an Advance
with a Eurodollar Rate, in accordance with the provisions of
Section 2.06 hereof.
"Eurodollar Advance Period" means, for each Eurodollar
Advance, each one, two, or three month period, as selected by
the Borrower pursuant to Section 2.06 hereof, during which the
applicable Eurodollar Rate shall remain unchanged.
Notwithstanding the foregoing, however:
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(i) any applicable Eurodollar Advance Period which would
otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day, unless such
Business Day falls in another calendar month, in which case
such Eurodollar Advance Period shall end on the preceding
Business Day; (ii) any applicable Eurodollar Advance Period
which begins on a day for which there is no numerically
corresponding day in the calendar month during which such
Eurodollar Advance Period is to end shall (subject to clause
(i) above) end on the last day of such calendar month; and
(iii) no Eurodollar Advance Period shall extend beyond the
Loan Termination Date or such earlier date as would interfere
with the repayment obligations of the Borrower under Section 2
hereof. "Eurodollar Basis" means, a simple per annum interest
rate equal to the quotient of (i) the Eurodollar Rate divided
by (ii) one minus the Eurodollar Reserve Percentage, if any,
stated as a decimal. The Eurodollar Basis shall be rounded
upward to the nearest one sixteenth of one percent (1/16%)
and, once determined, shall remain unchanged during the
applicable Eurodollar Advance Period, except for changes to
reflect adjustments in the Eurodollar Reserve Percentage.
"Eurodollar Margin" has the meaning set forth in Section 2.06(b).
"Eurodollar Rate" means for any Eurodollar Advance Period, the
average (rounded upward to the nearest one sixteenth of one
percent (1/16%)) of the interest rates per annum at which
deposits in United States dollars for such Eurodollar Advance
Period are offered to prime banks in the London interbank
market as reported on Telerate Screen page 3750 at
approximately 11:00 a.m. (Eastern Time) two (2) Business Days
before the first day of such Eurodollar Advance Period, in an
amount approximately equal to the principal amount of, and for
a length of time approximately equal to the Eurodollar Advance
Period for, the Eurodollar Advance sought by the Borrower. If
such rate is not so reported, then such rate as reported by
any other internationally recognized reporting service shall
be selected by the Bank or, if no such other service is
available, such rate shall be determined by the Bank based on
rate information furnished to it by two or more banks selected
by it which participate in the market for such deposits.
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"Eurodollar Reserve Percentage" means the percentage which is
in effect from time to time under Regulation D of the Board of
Governors of the Federal Reserve System, as such regulation
may be amended from time to time, as the maximum reserve
requirement applicable with respect to Eurocurrency
Liabilities (as that term is defined in Regulation D), whether
or not the Bank has any Eurocurrency Liabilities subject to
such reserve requirement at that time. The Eurodollar Basis
for any Eurodollar Advance shall be adjusted as of the
effective date by the same effective basis point change of any
change in the Eurodollar Reserve Percentage. "Payment Date"
means the last day of each Eurodollar Advance Period for a
Eurodollar Advance.
(c) Section 2.02(b) is hereby amended and restated in its entirety as
follows:
(b) Each Revolving Loan Advance shall be made on telephonic
notice given by the Borrower to the Bank and confirmed by
telefax from the Borrower and received by the Bank before 3:00
p.m. EST at telefax number 741-0341. Each such notice of a
Revolving Loan Advance (a "Notice of Advance") shall be a
signed writing by the Borrower specifying therein (i) the
requested Advance Date, (ii) the amount of such advance, and
(iii) whether the Advance is a Base Rate Advance or a
Eurodollar Advance, as defined in Section 2.06. Such Notice of
Advance must be received by the Bank not later than 11:00
a.m., EST, on the second Business Day prior to the proposed
Advance Date.
(d) Sections 2.06 is hereby amended and restated in their entirety as
follows:
Section 2.06. Interest Rates.
(a) Choice of Interest Rate. Any Advance shall, at the option of
the Borrower and pursuant to the terms and conditions of
this Agreement, be made either as a Base Rate Advance or a
Eurodollar Advance.
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(b) Interest Rate on Revolving Loan Advances. All amounts due to
the Bank in connection with the Revolving Loan Advance shall
bear interest during each calendar month pursuant to the
Borrower's Notice of Advance either at a fluctuating
interest rate per annum equal at all times to the Base Rate
in effect from time to time, or two hundred (200) base
points greater than the Eurodollar Rate in effect from time
to time ("Eurodollar Margin").
(c) Interest Rate on Equipment Advances. All amounts due to the
Bank in connection with Equipment Advances shall bear
interest during each calendar month pursuant to the
Borrower's Equipment Advance Application at a fluctuating
interest rate per annum equal at all times to the Base Rate
in effect from time to time or the Eurodollar Margin.
(d) Changes in Interest Rates. Each change in such fluctuating
interest rates referred to above shall take effect
simultaneously with the corresponding change in such Base
Rate or Eurodollar Rate without notice to the Borrower.
Interest shall be calculated on a daily basis upon the
unpaid balance with each day representing 1/360th of a year.
(e) Eurodollar Advances.
(i) Initial and Subsequent Eurodollar
Advances. The Bank, whose determination shall be conclusive,
shall determine the Eurodollar Basis as of the Business Day
prior to the date of the requested Advance and shall promptly
notify the Borrower of the same and the Borrower shall
promptly confirm in writing receipt of such notification. The
Eurodollar Advance Period for each Eurodollar Advance shall in
all events be either thirty, sixty or ninety days, as selected
by the Borrower pursuant to the Notice of Advance or Equipment
Advance Application ("Eurodollar Advance Period").
(ii) Procedures After Repayment of
Eurodollar Advance. At least three (3) Business Days prior to
each Payment Date for a Eurodollar Advance, the Borrower shall
give the Bank written notice specifying whether all or a
portion of any Eurodollar Advance outstanding on the Payment
Date (a) is to be repaid and then reborrowed in whole or in
part as a new Eurodollar Advance, in which case such notice
shall also specify the Eurodollar Advance Period which the
Borrower shall have selected for such
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new Eurodollar Advance, (b) is to be repaid and then
reborrowed in whole or in part as a Base Rate Advance, or (c)
is to be repaid and not reborrowed. Upon such Payment Date
such Eurodollar Advance will, subject to the provisions
hereof, be so repaid and, as applicable, reborrowed.
(iii) Limitations as to Eurodollar Advances.
Requests for Eurodollar Advances may be made daily (but only
once a day) provided the Borrower satisfies all notice
requirements as provided for herein.
(iv) Reimbursement. Whenever the Bank shall
actually incur any losses or actual expenses in connection
with (i) failure by the Borrower to borrow any Eurodollar
Advance after having given notice of its intention to borrow
(whether by reason of the election of the Borrower not to
proceed or the non-fulfilment of any conditions precedent), or
(ii) prepayment of any Eurodollar Advance in whole or in part,
for any reason, the Borrower agrees to pay to the Bank, upon
the Bank's demand, an amount sufficient to compensate the Bank
for all such losses and actual expenses excluding lost
profits. Bank's good faith determination of the amount of such
losses and actual expenses, absent manifest error, shall be
binding and conclusive. The Bank shall provide a copy of the
determination of such amount to the Borrower showing in
reasonable detail the calculation of the amount thereof.
(f) General Provisions as to Eurodollar Advances.
(i) Unavailability. Notwithstanding anything contained herein
which may be construed to the contrary, if with respect to any proposed
Eurodollar Advance for any Eurodollar Advance Period, the Bank determines that
deposits in dollars (in the applicable amount) are not being offered to the Bank
in the relevant market for such Eurodollar Advance Period, the Bank shall
forthwith give notice thereof to the Borrower, whereupon until the Bank notifies
the Borrower that the circumstances giving rise to such situation no longer
exist, the obligations of the Bank to make Eurodollar Advances shall be
suspended.
(ii) Illegality. If any applicable law, rule, or regulation, or
any change therein, or any interpretation or change in interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
compliance by Bank with any request or directive (whether or not having the
force of law) of any such authority, central bank, or comparable agency, shall
make it unlawful
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or impossible for Bank to make, maintain, or fund its Eurodollar Advances, Bank
shall forthwith give notice to the Borrower. Before giving any notice to the
Borrower pursuant to this Section 2.06(f), the Bank shall designate a different
lending office if such designation will avoid the need for giving such notice
and will not, in the reasonable judgment of Bank, be otherwise materially
disadvantageous to Bank. Upon receipt of such notice, notwithstanding anything
contained in Section 2, the Borrower shall repay Bank in full the then
outstanding principal amount of each affected Eurodollar Advance, together with
accrued interest thereon, either (a) on the last day of the then current
Eurodollar Advance Period applicable to such Eurodollar Advance to such day, or
(b) immediately if Bank may not lawfully continue to fund and maintain such
Eurodollar Advance to such day; provided, however, that notwithstanding any
provision contained in this Agreement to the contrary, the Borrower shall not be
required to compensate Bank for any losses, including any loss or expenses
incurred by reason of the liquidation, reemployment of deposits or other funds
acquired to obtain the Eurodollar Advance, incurred as a consequence of any
required conversion of a Eurodollar Advance to a Base Rate Advance as
hereinafter provided, as a result of the events described in this Section 2.6.
Concurrently with repaying each affected Eurodollar Advance of Bank,
notwithstanding anything contained in Section 2, the Borrower shall borrow a
Base Rate Advance from Bank, and Bank shall make such loan in an amount such
that the outstanding principal amount of the Note held by Bank shall equal the
outstanding principal amount of such Note immediately prior to such repayment.
(iii) Increased Costs.
(1) If, after the date hereof, any applicable law, rule or regulation,
or any change therein, or any interpretation or change in interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof
or compliance by Bank with any request or directive (whether or not having
any such authority), shall:
(A) subject Bank to any tax, duty, or other charge with respect to its
obligations to make Eurodollar Advances, or shall change the basis of taxation
of payments to Bank of the principal of or interest on its Eurodollar Advances
or in respect of any other amounts due under this Agreement in respect of its
Eurodollar Advances or its obligation to make Eurodollar Advances (except for
taxes imposed upon or measured by net income or alternative minimum taxable
income or taxable assets in lieu of income imposed by the United States and the
jurisdiction in which Bank's principal executive office is located); or
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(B) impose, modify, or deem applicable with respect to the making, funding
or maintaining any Advance hereunder, any reserve (including, without
limitation, any imposed by the Board of Governors of the Federal Reserve System,
but excluding any included in an applicable Eurodollar Reserve Percentage),
special deposit, capital adequacy, assessment, or other requirement or condition
against assets of, deposits with or for the account of, or commitments or credit
extended by Bank, or shall impose on Bank or the Eurodollar interbank borrowing
market or any other condition affecting its obligation to make such Eurodollar
Advances; and the result of any of the foregoing is to increase the cost to Bank
of making or maintaining any such Eurodollar Advances, or to reduce the amount
of any sum received or receivable by Bank under this Agreement or under its
Notes with respect thereto, and such increase is not given effect in the
determination of the Eurodollar Rate then, on the earlier of thirty (30) days
after written demand by Bank or the Loan Termination Date, the Borrower agrees
to pay to Bank such additional amount or amounts as Bank determines is
attributable to making, funding and maintaining its Eurodollar Advances provided
that Bank provides notice to the Borrower of such amount within 90 days of the
date of the actual knowledge of Bank of the occurrence of the event giving rise
to such cost. Bank will promptly notify the Borrower of any event of which it
has knowledge, occurring after the date hereof, which will entitle Bank to
compensation pursuant to this Section 2.6 and will designate a different lending
office if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the reasonable judgment of Bank, be otherwise
materially disadvantageous to Bank.
(2) A certificate of Bank claiming compensation under this Section
2.6(f) and setting forth the additional amount or amounts to be paid to it
hereunder and calculations therefor shall be conclusive in the absence of
manifest error. In determining such amount, Bank may use any reasonable
averaging and attribution methods and shall calculate such sums in a fair
and reasonable manner. If Bank demands compensation under this Section
2.6(f), the Borrower may at any time, upon at least five (5) Business Days'
prior notice to Bank, prepay in full the then outstanding affected
Eurodollar Advances of Bank, together with accrued interest thereon to the
date of prepayment. Concurrently with prepaying such Eurodollar Advances
the Borrower shall borrow a Base Rate Advance, or a Eurodollar Advance not
so affected, from Bank, and Bank shall make such Advance in an amount such
that the outstanding principal amount of the Notes held by Bank shall equal
the outstanding principal amount of such Notes immediately prior to such
prepayment.
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(iv) Effect On Other Advances. If notice has been given pursuant
to Section 2.6(f)(iii), suspending the obligation of Bank to make a
Eurodollar Advance, or requiring Eurodollar Advances of Bank to be
repaid or prepaid, then, unless and until Bank notifies the Borrower
that the circumstances giving rise to such repayment no longer apply,
all Loans which would otherwise be made by Bank to the type of
Eurodollar Advances affected shall, at the option of the Borrower, be
made instead as Base Rate Advances.
(g) Base Rate Advances.
(i) Procedure to Convert Base Rate Advance to Eurodollar Advance. Borrower
may at any time or from time to time, so long as no Event of Default exists,
convert a Base Rate Advance to a Eurodollar Advance upon at least three (3)
Business Days written notice to the Bank. Such written notice shall specify (A)
the specific amount of the Base Rate Advance which will be converted to a
Eurodollar Advance, (B) the applicable Eurodollar Advance Period, and (C) the
date of conversion of the Base Rate Advance to a Eurodollar Advance (such date
of conversion shall be at least three (3) days following the written notice by
Borrower pursuant to this subsection).
3. Except as expressly otherwise provided herein, the terms of the Amended
Fundamental Documents shall remain in full force and effect and are incorporated
herein by reference. In the event of a conflict between the terms of this
Amendment and any other Amended Fundamental Document, the terms of this
Amendment shall control.
4. The Borrower acknowledges that the Bank has no obligation to make any further
amendments to the Amended Fundamental Documents or any other agreement executed
in connection therewith. The Borrower further acknowledges that it has no
defenses to any of its obligations to the Bank and represents that no Event of
Default has occurred.
5. The Borrower shall be liable for all reasonable costs and expenses
(comprising legal fees and disbursements) incurred by the Bank in connection
with this Amendment, and shall promptly pay or reimburse the Bank for all such
costs.
6. This Amendment shall be construed in accordance with, and shall be governed
by, the laws of the State of New Jersey, without reference to the choice of law
doctrine of such state. Except as otherwise expressly set forth herein, nothing
in this Amendment shall be construed as a waiver or release by the Bank of any
rights or remedies of the Bank. This Amendment shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns.
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IN WITNESS WHEREOF, the undersigned have set their hands and seals or caused
this Fourth Amendment to Loan and Security Agreement to be executed by their
proper corporate officers and sealed with their seal effective as of May 31,
1997.
ATTEST: OSTEOTECH, INC.
/s/ XXXXXX XXXXXXXX BY: /s/ XXXXXXX X. XXXXXXXX
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NAME: Xxxxxx Xxxxxxxx Xxxxxxx X. Xxxxxxxx, Exec. V.P.
Vice President Finance COO & CFO
ATTEST: SUMMIT BANK
/s/ XXXX X. XXXXXXX By: /s/ XXXXX X. XXXXXX
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Name: Xxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxx
Vice President Title: Vice President
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