Exhibit 10.17
2. FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (hereinafter referred to as the
"Amendment") is made as of the 31st day of October, 2003, by and between
MIKRON INFRARED, INC., a corporation duly organized, validly existing and
in good standing under the laws of the State of New Jersey, having its principal
office located at ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter
referred to as the "Borrower"),
AND
FLEET NATIONAL BANK, a national banking association duly organized and
validly existing under the laws of the United States of America, having an
office for business located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Bank").
W I T N E S S E T H:
WHEREAS, the parties have agreed to amend that certain Credit Agreement,
dated as of November 21, 2002 (the "Credit Agreement" and terms defined therein
and not otherwise defined herein being used herein as therein defined), as
hereinafter set forth.
NOW, THEREFORE, the Borrower and the Bank, hereby agree as follows:
SECTION 1. Amendment to Credit Agreement. The Credit Agreement is,
effective as of the Effective Date (as defined in Section 2 hereof), hereby
amended as follows:
1.1 Page 3, Section 1.1 of the Credit Agreement is hereby revised to
reflect the deletion and replacement in its entirety of the
definition of "Advance Limit" with the following definition:
""Advance Limit" shall mean, at any date of determination thereof,
an amount equal to the lesser of (i) Four Million and 00/100
($4,000,000.00) Dollars or (ii) the sum of (1) eighty (80%) percent
of the face amount of the Borrower's Eligible Accounts Receivable,
plus (2) fifty (50%) percent of the Borrower's Eligible Inventory,
plus (3) twenty-five (25%) percent of the value of the Borrower's
Eligible PP&E, plus (4) one hundred (100%) percent of the value of
the MMA Account."
1.2 Page 3, Section 1.1 of the Credit Agreement is hereby revised to
reflect the addition of the following definition:
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""Assignment" shall mean that certain Assignment and Pledge
Agreement, dated as of October 31, 2003, executed by the Borrower in
favor of the Bank; whereby the Borrower has assigned, pledged,
hypothecated and granted in favor of the Bank a first security lien
interest in and to the MMA Account as collateral security for the
Facility."
1.3 Page 4, Section 1.1 of the Credit Agreement is hereby revised to
reflect the deletion and replacement in its entirety of the last
sentence of the definition of "Collateral" with the following
definition:
"In addition, the term "Collateral" shall also be deemed to include
the Guaranty Agreement and the Assignment."
1.4 Page 16, Section 1.1 of the Credit Agreement is hereby revised to
reflect the addition of the following definition::
""MMA Account" shall mean that certain Money Market Account, No.
9421082594."
1.5 Page 36, Section 4.1(iii) of the Credit is hereby deleted in its
entirety.
1.6 Page 41, Section 4.25 of the Credit Agreement is hereby deleted in
its entirety and replaced with the following:
"Section 4.25 Capitalization; Ownership of the Borrower. On and as
of the Closing Date, the authorized Capital Stock of the Borrower
will consist of Fifteen Million (15,000,000) authorized shares of
common stock, one-third cent par value. Five Million Two Hundred
Fifty Nine Thousand Six Hundred Twenty Eight (5,259,628) shares of
common stock are duly issued, are outstanding and are fully paid and
non-assessable."
1.7 Page 53, Section 6.18 of the Credit Agreement is hereby deleted in
its entirety and amended to reflect the following:
"Section 6.18 Maximum
Leverage Ratio. The
Borrower shall not
permit, cause nor suffer
to permit, at any time
during the term of the
Facility, its Maximum
Leverage Ratio, to be
greater than 2.0 to 1.0.
The ratio shall be
determined as of the last
day of each Fiscal
Quarter for the four
quarter period ending on
such day."
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SECTION 2. Effectiveness of this Amendment. This Amendment shall become
effective as of the date first above written (the "Effective Date").
SECTION 3. Representations and Warranties. The Borrower hereby represents
and warrants as follows:
(a) The execution, delivery and performance by the Borrower of this
Amendment is within its corporate powers and has been duly authorized by all
necessary action and does not and will not (i) require any consent or approval
of the shareholders of the Borrower, (ii) conflict with any Borrower's
incorporation documents, (iii) result in a breach of or constitute a default
under any obligation to which the Borrower is a party of by which it or its
properties may be bound or affected, or (iv) result in, or require, the creation
or imposition of any lien of any nature upon or with respect to any of the
properties now owned or hereafter acquired by the Borrower.
(b) All Permits, consents or waivers from or by, notices to or filings
with or other actions by any court or Governmental Authority, required in
connection with the execution, delivery or performance by the Borrower of this
Amendment, if any, have been obtained, given, filed or taken and are in full
force and effect.
(c) This Amendment has been duly executed and delivered by the Borrower
and constitutes the legal, valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with its terms except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or limiting creditors' rights generally or by
general equity principles.
(d) The representations and warranties contained in Article IV of the
Credit Agreement are true and correct in all respects on and as of the date
hereof, as though made on and as of the date hereof.
(e) No event has occurred, or would result from the execution, delivery or
performance of this Amendment, the Credit Agreement or the Loan Documents, as
amended hereby, which constitutes a Default or an Event of Default.
SECTION 4. Reference to and Effect of the Loan Documents.
4.1 Upon the effectiveness of this Amendment, on and after the date
hereon, each reference in the Credit Agreement to this Agreement", "hereunder",
"hereof", or words of like import, and each reference in the other Loan
Documents to the Credit Agreement, shall mean and be a reference to the Credit
Agreement, as amended hereby.
4.2 Except as specifically amended above, all of the terms of the Credit
Agreement and all other Loan Documents shall remain unchanged and in full force
and effect.
4.3 The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of the Bank under
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the Credit Agreement, the Note or any of the Loan Documents, nor constitute a
waiver of any provision of the Credit Agreement or any of the Loan Documents.
SECTION 5. Execution in Counterparts. This Amendment may be executed and
delivered in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original and all of which taken together shall constitute one and the
same original agreement.
SECTION 6. GOVERNING LAW, SEVERABILITY. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW JERSEY WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREUNDER. WHEREVER POSSIBLE, EACH
PROVISION OF THIS AMENDMENT SHALL BE INTERPRETED IN SUCH MANNER AS TO BE
EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS AMENDMENT
SHALL BE PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH PROVISION SHALL BE
INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY, WITHOUT
INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE REMAINING PROVISIONS OF THIS
AMENDMENT.
SECTION 7. JURY TRIAL. THE BORROWER AND THE BANK (BY ACCEPTANCE OF THIS
AMENDMENT) MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF,
UNDER OR IN CONNECTION WITHH THIS AMENDMENT OR ANY OTHER LOAN DOCUMENTS
CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF THE BANK RELATING TO THE ADMINISTRATION OF THE FACILITY
OR ENFORCEMENT OF THE LOAN DOCUMENTS AND AGREE THAT NEITHER PARTY WILL SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT
BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, THE BORROWER HEREBY
WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL,
EXEMPLARY, PUNITIVE OIR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. THE BORROWER CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF THE BANK HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE
BANK WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE BANK TO ACCEPT
THIS AMENDMENT.
[SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered, all as of the day and year first above written.
MIKRON INFRARED, INC.
By: ____________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
FLEET NATIONAL BANK
By: ____________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
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