AMENDMENT NO. 6 TO LOAN AND SECURITY AGREEMENT
▇.▇. ▇▇▇▇▇▇▇▇▇▇ & CO., INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
As of March 17, 2000
Congress Financial Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Congress Financial Corporation ("Lender"), ▇.▇. ▇▇▇▇▇▇▇▇▇▇ & Co., Inc.
("Borrower"), EFP Corporation ("EFP"), ▇▇▇▇ Group, Inc. ("▇▇▇▇"), Magnetic
Instruments Corp. ("MIC"), ▇▇▇▇▇▇ Trailer Mfg. Co. ("▇▇▇▇▇▇"), Truck Accessories
Group, Inc. ("TAG"), Raider Industries Inc. ("Raider"), KWS Manufacturing
Company, Inc. ("KWS"; and together with EFP, ▇▇▇▇, MIC, ▇▇▇▇▇▇, TAG and Raider,
each individually, a "Guarantor" and, collectively, "Guarantors") have entered
into certain financing arrangements as set forth in the Loan and Security
Agreement, dated as of June 28, 1996, by and among Lender, Borrower and
Guarantors, as amended by Amendment No. 1 to Loan and Security Agreement, dated
May 13, 1998, Amendment No. 2 to Loan and Security Agreement, dated as of June
30, 1998, Amendment No. 3 to Loan and Security Agreement, dated as of June 24,
1999, Amendment No. 4 to Loan and Security Agreement, dated as of February 25,
2000 and Amendment No. 5 to Loan and Security Agreement ("Amendment No.5"),
dated as of March 8, 2000 (and as amended hereby and as heretofore amended or
may hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced, the "Loan Agreement"), together with all other agreements, documents,
supplements and instruments now or at any time hereafter executed and/or
delivered by Borrower, Guarantors or any other person, with, to or in favor of
Lender in connection therewith (all of the foregoing, together with this
Amendment and the other agreements and instruments delivered hereunder, as the
same now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced, collectively, the "Financing Agreements"). For
purposes of this Amendment, unless otherwise defined herein, all capitalized
terms used herein, shall have the respective meanings ascribed to them in the
Loan Agreement.
MIC has entered or is about to enter into certain arrangements to
purchase all of the issued and outstanding shares of capital stock of Universal
▇▇▇▇▇▇▇, Inc. ("▇▇▇▇▇▇▇"), a Wisconsin corporation as set forth in the ▇▇▇▇▇▇▇
Stock Purchase Agreement (as hereinafter defined). Upon the acquisition of all
the issued and outstanding shares of capital stock, ▇▇▇▇▇▇▇ will be a
wholly-owned direct subsidiary of MIC and indirect subsidiary of Borrower.
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(a) In connection with the acquisition, Borrower and Guarantors have requested
that Lender consent to MIC's purchase of ▇▇▇▇▇▇▇ on the terms and conditions set
forth in the ▇▇▇▇▇▇▇ Purchase Agreements (as such term is defined below), add
▇▇▇▇▇▇▇ as a Guarantor party to the Loan Agreement, and upon the effectiveness
of this Amendment, make certain supplemental loans to Borrower. Lender is
willing to make such loans and agree to such amendments to the extent set forth
herein.
(b)
(c) In consideration of the foregoing, the mutual agreements and covenants
contained in this Amendment No. 6 to Loan and Security Agreement (this
"Amendment"), and other good and valuable consideration, the adequacy and
sufficiency of which are hereby acknowledged, Borrower, Guarantors and Lender
agree as follows:
(d)
2. Definitions.
3.
(a) Additional Definitions. As used herein, the following terms shall have the
respective meanings given to them below and the Loan Agreement shall be deemed
and is hereby amended to include, in addition and not in limitation of, each of
the following definitions:
(b)
(i) "▇▇▇▇▇▇▇" shall mean Universal ▇▇▇▇▇▇▇, Inc., a Wisconsin corporation, and
its successors and assigns.
(ii)
(A) "▇▇▇▇▇▇▇ Amendment Agreements" shall mean, individually and collectively,
this Amendment No. 6 to Loan and Security Agreement by and among Lender,
Borrower and Guarantors, the Guarantee by ▇▇▇▇▇▇▇ in favor of Lender, the
Information Certificate of ▇▇▇▇▇▇▇, the Collateral Assignment of Notes by
Borrower in favor of Lender, the Acknowledgment of Assignment and Waiver of
Defense by ▇▇▇▇▇▇▇ in favor of Lender, the Collateral Assignment of Acquisition
Agreements made by MIC in favor of Lender, UCC-1 Financing Statements between
▇▇▇▇▇▇▇, as debtor and Lender, as secured party, each of the foregoing
agreements dated as of the date hereof, and all other agreements, documents and
instruments by Borrower, Guarantors, ▇▇▇▇▇▇▇ and such other Persons with, to or
in favor of Lender executed in connection with any of the foregoing, as the same
now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
(B)
(iii) "▇▇▇▇▇▇▇ Existing Lenders" shall mean the existing lenders to ▇▇▇▇▇▇▇
listed on Schedule A annexed hereto and made a part hereof.
(iv)
(v) "▇▇▇▇▇▇▇ Maximum Supplemental Revolving Loan Limit" shall mean, on the date
of the ▇▇▇▇▇▇▇ Amendment Agreements, the sum of $2,000,000, as reduced on the
first day of each calendar month, commencing, April 1, 2000 to the amount set
forth next to such date below:
(vi)
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(i)
Reduction Date ▇▇▇▇▇▇▇ Maximum Supplemental Revolving Limit
(A) April 1, 2000 $1,944,444.00
(B) May 1, 2000 $1,888,888.00
(C) June 1, 2000 $1,832,332.00
(D) July 1, 2000 $1,776,776.00
(E) August 1, 2000 $1,721,220.00
(F) September 1, 2000 $1,665,664.00
(G) October 1, 2000 $1,610,108.00
(H) November 1, 2000 $1, 554,552.00
(I) December1, 2000 $1,498,996.00
(J) January 1, 2001 $1,443,440.00
(K) February 1, 2001 $1,387,884.00
(L) March 1, 2001 $1,332,328.00
(M) April 1, 2001 $1,276,772.00
(N) May 1, 2001 $1,221,216.00
(O) June 1, 2001 $1,165,660.00
(P) July 1, 2001 $1,110,104.00
(Q) August 1, 2001 $1,054,548.00
(R) September 1, 2001 $ 998,992.00
(S) October 1, 2001 $ 943,436.00
(T) November 1, 2001 $ 887,880.00
(U) December 1, 2001 $ 832,324.00
(V) January 1, 2002 $ 776,768.00
(W) February 1, 2002 $ 721,212.00
(X) March 1, 2002 $ - 0-
(Y) and at all times thereafter
(i) "▇▇▇▇▇▇▇ Purchase Agreements" shall mean, individually and collectively, the
▇▇▇▇▇▇▇ Stock Purchase Agreement and all related agreements, documents and
instruments, including without limitation the ▇▇▇▇▇▇▇ Seller Note and ▇▇▇▇▇▇▇
Seller Security Agreements, as the same now exist or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced.
(ii)
(iii) "▇▇▇▇▇▇▇ Purchased Stock" shall mean all of the issued and outstanding
shares of the common stock of ▇▇▇▇▇▇▇.
(iv)
(v) "▇▇▇▇▇▇▇ Seller" shall mean ▇▇▇▇▇▇▇ ▇. ▇▇▇▇.
(vi)
(vii) "▇▇▇▇▇▇▇ Seller Note" shall mean the promissory note in the principal
amount of $2,875,000, dated the date hereof, made by MIC in favor of ▇▇▇▇▇▇▇
Seller pursuant to the terms of the ▇▇▇▇▇▇▇ Stock Purchase Agreement.
(viii)
(A) "▇▇▇▇▇▇▇ Seller Security Agreements" shall mean individually and
collectively the Pledge Agreement, dated the date hereof, made by MIC in favor
of ▇▇▇▇▇▇▇ Seller in respect of the shares of capital stock of ▇▇▇▇▇▇▇ and the
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Stock Escrow Agreement referred to therein and the Security Agreement dated the
date hereof, made by ▇▇▇▇▇▇▇ in favor of ▇▇▇▇▇▇▇ Seller in respect of the
equipment of ▇▇▇▇▇▇▇.
(B)
(ix) "▇▇▇▇▇▇▇ Stock Purchase Agreement" shall mean the Stock Purchase Agreement,
dated as of the date hereof, by and between MIC and ▇▇▇▇▇▇▇ Seller, as the same
now exists or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
(x)
(xi) "▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit" shall mean, at any time, the
lesser of (A) the amount equal to (1) one hundred (100%) percent of the sum of
the value of the Net Amount of Eligible Accounts of Borrower and Guarantors and
the value of Eligible Inventory of Borrower and Guarantors (for purposes of this
Section the term "value" means: with respect to Eligible Accounts, their book
value and with respect to Eligible Inventory, the lower of its cost and its book
value (on a first-in-first out basis), in each case, determined in accordance
with GAAP) minus (2) the sum of (aa) the aggregate amount of Loans outstanding
as of such time based on the applicable lending formula set forth in Section
2.1(a) hereof and (bb) the aggregate amount of KWS Supplemental Revolving Loans
outstanding at such time or (B) the ▇▇▇▇▇▇▇ Maximum Supplemental Revolving Loan
Limit then in effect.
(xii)
(xiii) "▇▇▇▇▇▇▇ Supplemental Revolving Loans" shall mean the loans hereafter
made by Lender to or for the benefit of Borrower on a revolving basis (involving
advances, repayments and readvances) as set forth in Section 5 hereof.
(xiv)
(xv) "▇▇▇▇▇▇▇ Supplemental Revolving Loan Termination Date" shall mean the
earlier to occur of (A) Lender's determination that, as of the end of any fiscal
quarter of ▇▇▇▇▇▇▇, the Fixed Charge Coverage Ratio of ▇▇▇▇▇▇▇ for such fiscal
quarter is less than 1 to1 or (B) March 1, 2002.
(xvi)
(xvii) "▇▇▇▇▇▇▇ Term Loan" shall mean the term loan made by Lender to ▇▇▇▇▇▇▇ ,
on the date hereof, in the original principal amount not to exceed $3,200,000,
on the terms and conditions set forth in the ▇▇▇▇▇▇▇ Term Loan Documents.
(xviii)
(xix) "▇▇▇▇▇▇▇ Term Loan Collateral" shall mean "Collateral" as such term is
defined in the ▇▇▇▇▇▇▇ Term Loan Documents.
(xx)
(A) "▇▇▇▇▇▇▇ Term Loan Documents" shall mean the Term Promissory Note in the
principal amount of $3,200,000, dated the date hereof, made by ▇▇▇▇▇▇▇ in favor
of Lender, the Term Loan and Security Agreement, dated the date hereof, by and
between Lender and ▇▇▇▇▇▇▇, the Guarantee, dated the date hereof, made by
Borrower of the obligations of ▇▇▇▇▇▇▇, each of the foregoing agreements and
instruments, and all other agreements, documents and instruments by ▇▇▇▇▇▇▇ and
other Persons, with, to or in favor of Lender executed in connection with any of
the foregoing, as the same now exist or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced.
(B)
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(xxi) "Revolving Loan Limit" shall mean $55,000,000.
(xxii)
2. Amendments to Definitions.
3.
(a) All references to the term "Guarantor" and "Guarantors" in the Loan
Agreement and the other Financing Agreements shall be deemed and each such
reference is hereby amended to include, in addition and not in limitation,
▇▇▇▇▇▇▇.
(b)
(c) All references to the term "Financing Agreements" in the Loan Agreement
shall be deemed and each such reference is hereby amended to include, in
addition and not in limitation, this Amendment No. 6, and all other agreements,
documents and instruments at any time executed and/or delivered by Borrower or
any other person in connection with any of the foregoing, as the same now exist
or may hereafter be amended, modified, supplemented, extended, renewed,
restated, or replaced.
(d)
(e) All references to the term "Loans" in any of the Financing Agreements shall
be deemed and each such reference is hereby amended to include, in addition and
not in limitation, the ▇▇▇▇▇▇▇ Supplemental Revolving Loans and the KWS
Supplemental Revolving Loans, except, that, the term "Loans" as used in Sections
1.4, 1.31, 1.50, 1.55, 1.69, 2.1(a),(c) and (e), 2.2 (a), (c) and (e) and
3.1(a), 3.4 and 3.5 shall only mean those the loans now or hereafter made by
Lender to or for the benefit of Borrower on a revolving basis (involving
advances, repayments and readvances) as set forth in Section 2.1(a) of the Loan
Agreement.
(f)
(g) All references to the term "Obligations" in any of the Financing Agreements
shall be deemed and each such reference is hereby amended to include, in
addition and not in limitation, the obligations of Borrower to Lender arising
pursuant to or in connection with the ▇▇▇▇▇▇▇ Supplemental Revolving Loans,
including principal, interest, fees, costs, expenses and other charges in
respect thereof.
(h)
(i) Section 1.24 (b) of the Loan Agreement is hereby deleted in its entirety and
the following substituted therefor:
(j)
"(b) such Accounts are not unpaid after the later of: (i) the
date which is sixty (60) days after the original due date for
them or (ii) the date which is ninety (90) days after the date
of the original invoice for them (or one hundred twenty (120)
days after the date of the original invoice for them, in the
case of Accounts of ▇▇▇▇▇▇▇ in respect of which the account
debtor is either Kohler Company or Aero-quip ▇▇▇▇▇▇▇);"
(a) Section 1.24 (n) of the Loan Agreement is hereby deleted in its entirety and
the following substituted therefor:
(b)
"(n) such Accounts are not owed by an account debtor who has
Accounts unpaid after the later of the date which is sixty
(60) days after the original due date for them or the date
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which is ninety (90) days after the original invoice date for
them (or one hundred twenty (120) days after the date of the
original invoice for them, in the case of Accounts of ▇▇▇▇▇▇▇
in respect of which the account debtor is either Kohler
Company or Aero-quip ▇▇▇▇▇▇▇), which constitute more than
fifty (50%) percent of the total Accounts of such account
debtor;
(a) The references in Sections 1.33(a)(ii) and Section 2.2(c) to the "Maximum
Credit" is hereby deleted in its entirety and the term "Revolving Loan Limit"
substituted therefor.
(b)
(c) Section 1.41 of the Loan Agreement is hereby deleted in its entirety and the
following substituted therefor:
(d)
" 1.41 "Guarantor Availability" shall mean, as to any
Guarantor, at any time, the amount equal to: (a) the
applicable percentage for such Guarantor set forth in Section
2.1(a) multiplied by the Net Amount of Eligible Accounts of
such Guarantor, plus (b) the applicable percentage for such
Guarantor set forth in Section 2.1(a) multiplied by the Value
of the Eligible Inventory of such Guarantor, minus (c) the
Availability Reserves allocated by Lender to such Guarantor,
except, that, (i) in the case of KWS, "Guarantor Availability"
shall include, in addition to and not in limitation of clauses
(a) through (c) above, the amount of the KWS Supplemental
Revolving Loan Limit then in effect and (ii) in the case of
▇▇▇▇▇▇▇, "Guarantor Availability" shall include, in addition
to and not in limitation of clauses (a) through (c) above, the
amount of the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit then
in effect."
(a) Section 1.47 of the Loan Agreement is hereby amended to include the
following additional clause (h) thereto:
(b)
"and (h) the promissory note dated March 17, 2000 issued by
▇▇▇▇▇▇▇ and payable to Borrower."
(a) Section 1.57 of the Loan Agreement is hereby deleted in its entirety and the
following substituted therefor:
(b)
"1.57 "Maximum Credit" shall mean the amount of $58,450,000."
(a) The definition of the term "KWS Supplemental Revolving Loan Limit" set forth
at Section 1.(a)(viii) of Amendment No.5 is hereby deleted in its entirety and
the following substituted therefor:
(b)
"(viii) KWS Supplemental Revolving Loan Limit" shall mean, at
any time, the lesser of (A) the amount equal to (1) one
hundred (100%) percent of the sum of the value of the Net
Amount of Eligible Accounts of Borrower and Guarantors and the
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value of Eligible Inventory of Borrower and Guarantors (for
purposes of this Section the term "value" means: with respect
to Eligible Accounts, their book value and with respect to
Eligible Inventory, the lower of its cost and its book value
(on a first-in-first out basis), in each case, determined in
accordance with GAAP) minus (2) the sum of (aa) the aggregate
amount of Loans outstanding as of such time based on the
applicable lending formula set forth in Section 2.1(a) hereof
and (bb) the aggregate amount of ▇▇▇▇▇▇▇ Supplemental
Revolving Loans outstanding at such time or (B) the KWS
Maximum Supplemental Revolving Loan Limit then in effect."
1. Consent to Stock Acquisition. Subject to the terms and conditions contained
herein, Lender hereby confirms and agrees that it consents to the acquisition by
MIC of all of the issued and outstanding shares of capital stock of ▇▇▇▇▇▇▇
pursuant to the terms of the ▇▇▇▇▇▇▇ Stock Purchase Agreement (as in effect on
the date hereof).
2.
(a) Loans. Sections 2.1(a)(x) and (xi) of the Loan Agreement are hereby deleted
and replaced in their entirety as follows:
(b)
"(x) sixty (60%) percent of the Value of the Eligible
Inventory of KWS, plus
(xi) eighty-five (85%) percent of the Net Amount of Eligible
Accounts of ▇▇▇▇▇▇▇, minus"
(a) Section 2.1 (a) of the Loan Agreement is hereby amended to include the
following additional section (xii) as follows:
(b)
"(xii) any Availability Reserves."
(a) The phrase "in each case pursuant to and in accordance with the Intercompany
Loan Documents as in effect on the date hereof" set forth in Section 2.4 and
elsewhere in the Loan Agreement and the other Financing Agreements of the Loan
Agreement is hereby deemed to include the Intercompany Loan Documents by and
between Borrower, as lender and ▇▇▇▇▇▇▇, as borrower, each dated March 17, 2000.
(b)
2. ▇▇▇▇▇▇▇ Supplemental Revolving Loans.
3.
(a) In addition to the loans, advances and Letter of Credit Accommodations which
may be made by Lender to Borrower pursuant to the Loan Agreement and the other
Financing Agreements, subject to and upon the terms and conditions contained
herein, and in the other Financing Agreements, Lender agrees to make the ▇▇▇▇▇▇▇
Supplemental Revolving Loans to Borrower from time to time in amounts requested
by Borrower, up to the amount at any time outstanding equal to the ▇▇▇▇▇▇▇
Supplemental Revolving Loan Limit as then in effect.
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(a) Except in Lender's discretion, Borrower shall not have any right to request,
and Lender shall not make, any ▇▇▇▇▇▇▇ Supplemental Revolving Loans in excess of
the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit or after the ▇▇▇▇▇▇▇ Supplemental
Revolving Loan Termination Date and the amount of outstanding ▇▇▇▇▇▇▇
Supplemental Revolving Loans shall not, at any time, exceed the ▇▇▇▇▇▇▇
Supplemental Revolving Loan Limit then in effect. The ▇▇▇▇▇▇▇ Supplemental
Revolving Loans shall be secured by all the Collateral.
(b)
(c) Notwithstanding anything to the contrary contained herein or in the other
Financing Agreements, (i) on each date when any reduction to the ▇▇▇▇▇▇▇
Supplemental Revolving Loan Limit becomes effective, Borrower agrees absolutely
and unconditionally to automatically and without notice or demand make a payment
in respect of the ▇▇▇▇▇▇▇ Supplemental Revolving Loans in an amount equal to the
excess, if any, of the aggregate unpaid principal amount of the ▇▇▇▇▇▇▇
Supplemental Revolving Loans over the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit
as so reduced in immediately available funds and (ii) unless sooner demanded by
Lender in accordance with terms of the Financing Agreements, Borrower further
agrees that all outstanding and unpaid Obligations arising pursuant to the
▇▇▇▇▇▇▇ Supplemental Revolving Loans (including, but not limited to, principal,
interest, fees, costs, expenses and other charges in respect thereof payable by
Borrower to Lender) shall automatically, without notice or demand, be absolutely
and unconditionally due and payable, and Borrower shall pay to Lender in cash or
other immediately available funds all such Obligations, on the ▇▇▇▇▇▇▇
Supplemental Revolving Loan Termination Date. Interest shall accrue at the
Interest Rate set forth in Section 5(d) below and be due, until and including
the next Business Day, if the amount so paid by Borrower to the bank account
designated by Lender for such purpose is received in such bank account after
12:00 p.m. New York City time.
(d)
(i) The term "Interest Rate" shall mean with respect to ▇▇▇▇▇▇▇ Supplemental
Revolving Loans, a rate of one (1%) percent per annum in excess of the Prime
Rate. Notwithstanding the foregoing, "Interest Rate" shall mean the rate equal
to two (2%) percent per annum in excess of the interest rate otherwise then
payable by Borrower on ▇▇▇▇▇▇▇ Supplemental Revolving Loans, at Lender's option,
without notice, for the period on and after the date of termination or
non-renewal of the Loan Agreement, or the date of the occurrence of any Event of
Default and for so long as such Event of Default is continuing as determined by
Lender and at any time and to the extent the outstanding principal amount of the
▇▇▇▇▇▇▇ Supplemental Revolving Loans in excess of the ▇▇▇▇▇▇▇ Supplemental
Revolving Loan Limit then in effect.
(ii)
(e) It is understood and agreed that the references to the lending formulas set
forth in Section 2.1 of the Loan Agreement, the Revolving Loan Limit and the
Availability Reserves do not apply to the KWS Supplemental Revolving Loans or
the ▇▇▇▇▇▇▇ Supplemental Revolving Loans.
(f)
(i) Acknowledgment. ▇▇▇▇▇▇▇ hereby expressly agrees to perform, comply with and
be bound by all terms, conditions and covenants of the Loan Agreement and the
other Financing Agreements applicable to all Guarantors and as applied to
▇▇▇▇▇▇▇, as a Guarantor, with the same force and effect as if ▇▇▇▇▇▇▇ had
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originally executed and been an original Guarantor signatory to the Loan
Agreement and the other Financing Agreements, and agrees that Lender shall have
all rights, remedies and interests, including, without limitation, security
interests in and to the Collateral granted pursuant to Section 7 below, the Loan
Agreement and the other Financing Agreements, with respect to ▇▇▇▇▇▇▇ and its
properties and assets with the same force and effect as Lender has with respect
to the other Guarantors and their assets and properties as if ▇▇▇▇▇▇▇ had
originally executed and had been an original Guarantor signatory to the Loan
Agreement and the other Financing Agreements.
(ii)
2. Collateral.
3.
(a) Without limiting the provisions of Section 6 hereof, Section 5 of the Loan
Agreement and the other Financing Agreements, as collateral security for the
payment and performance of all Obligations, ▇▇▇▇▇▇▇ hereby grants to Lender a
continuing security interest and lien upon, and a right of set-off against, and
hereby assigns to Lender, as security, all of the following property and
interests in property, whether now owned or hereafter acquired:
(i) Receivables;
(ii)
(iii) all present and future contract rights and other general intangibles,
including, but not limited to, tax and duty refunds, registered and unregistered
patents, trademarks, service marks, copyrights, trade names, applications for
the foregoing, trade secrets, goodwill, processes, drawings, blueprints,
customer lists, licenses, whether as licensor or licensee, and also including,
but not limited to, choses in action and other claims in connection with or
related to the Receivables or any of the other Collateral;
(iv)
(1) all present and future chattel paper, documents and instruments which
evidence or relate to Receivables or Inventory and including all documents of
title or which evidence or relate to indebtedness arising pursuant to
Receivables or any of the other Collateral (including, without limitation, the
Intercompany Notes or any promissory notes or instruments which at any time
evidence indebtedness of any Affiliate of ▇▇▇▇▇▇▇ arising from loans, advances
or other financial accommodations made or provided by ▇▇▇▇▇▇▇ to or for the
benefit of such Affiliate with proceeds of the Loans or in connection with the
Letter of Credit Accommodations and promissory notes or other instruments which
evidence indebtedness of any account debtor or other obligor in respect of any
Receivables);
(2)
(B) all present and future monies, securities, credit balances, deposits,
deposit accounts, documents, instruments and other property of ▇▇▇▇▇▇▇ now or
hereafter held or received by or in transit to Lender or its affiliates, whether
for safekeeping, pledge, custody, transmission, collection or otherwise, all
present and future monies, securities, credit balances and deposits at any bank
or other financial institution constituting proceeds of Receivables or any of
the other Collateral or constituting proceeds of loans, advances or other
financial accommodations made or provided by Lender or its Affiliates to or for
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the benefit of ▇▇▇▇▇▇▇ or its Affiliates or constituting proceeds of loans,
advances or other financial accommodations made or provided by ▇▇▇▇▇▇▇ to or for
the benefit of any Affiliate with proceeds of the Loans or in connection with
the Letter of Credit Accommodations or held or deposited in or delivered to any
deposit account or other account used in connection with the collection of
Receivables or any of the other Collateral, or containing proceeds of the
Receivables or any of the other Collateral, or containing proceeds of Loans or
Letter of Credit Accommodations made or provided by Lender or its Affiliates to
or for the benefit of ▇▇▇▇▇▇▇ or its Affiliates, or proceeds of loans, advances
or other financial accommodations made or provided by ▇▇▇▇▇▇▇ to or for the
benefit of any Affiliate with proceeds of the Loans or in connection with the
Letter of Credit Accommodations, and all right, title and interest of ▇▇▇▇▇▇▇ in
or to any deposit account or other account maintained at any bank or other
financial institution used in connection with the collection of the Receivables
or any of the other Collateral, or containing proceeds of the Receivables or any
of the other Collateral, or containing proceeds of Loans or Letter of Credit
Accommodations made or provided by Lender or its Affiliates to or for the
benefit of ▇▇▇▇▇▇▇ or its Affiliates, or proceeds of loans, advances or other
financial accommodations made or provided by ▇▇▇▇▇▇▇ to or for the benefit of
any Affiliate with proceeds of the Loans or in connection with the Letter of
Credit Accommodations;
(C)
(D) all present and future liens, security interests, rights, remedies, title
and interest in, to and in respect of Receivables or any of the other
Collateral, including, without limitation, rights and remedies under or relating
to guaranties, contracts of suretyship, letters of credit and credit and other
insurance related to the Receivables or any of the other Collateral, rights of
stoppage in transit, replevin, repossession, reclamation and other rights and
remedies of an unpaid vendor, lienor or secured party, goods described in
invoices, documents, contracts or instruments, credit card sales drafts, credit
card sales slips or charge slips or receipts and other forms of daily store
receipts with respect to, or otherwise representing or evidencing Receivables or
other Collateral, including, without limitation, returned, repossessed and
reclaimed goods, deposits by and property of account debtors or other persons
securing the obligations of account debtors, and security interests granted by
Affiliates of ▇▇▇▇▇▇▇ to ▇▇▇▇▇▇▇ to secure Indebtedness arising from loans,
advances or other financial accommodations made or provided by ▇▇▇▇▇▇▇ to or for
the benefit of such Affiliate or otherwise;
(E)
(v) Inventory;
(vi)
(vii) all leases and rental agreements for personal property between ▇▇▇▇▇▇▇,
as lessor (whether by origination or derivation) and any and all persons or
parties as lessee(s), and all rentals, purchase option amounts, and other sums
due thereunder; and all inventory, goods and property subject to such leases and
rental agreements and all accessions, parts and tools attached thereto or used
therewith and all of the residual or reversionary rights of ▇▇▇▇▇▇▇ therein;
(viii)
(ix) Records; and
(x)
10
(xi) all products and proceeds of the foregoing, in any form, including,
without limitation, insurance proceeds and all claims against third parties for
loss or damage to or destruction of any or all of the foregoing.
(xii)
(b) Notwithstanding anything to the contrary contained in Section 7(a) above,
the types or items of Collateral shall not include any rights or interests in
any contract, lease, permit, license, charter or license agreement covering
personal property, as such, if under the terms of such contract, lease, permit,
license, charter or license agreement, or applicable law with respect thereto,
the valid grant of a security interest or lien therein to Lender is prohibited
and such prohibition has not been or is not waived or the consent of the other
party to such contract, lease, permit, license, charter or license agreement has
not been or is not otherwise obtained or under applicable law such prohibition
cannot be waived; provided, that, the foregoing exclusion shall in no way be
construed (i) to apply if such prohibition is unenforceable under Section 9-318
of the UCC or other applicable law or (ii) so as to limit, impair or otherwise
affect Lender's unconditional continuing security interests in and liens upon
any rights or interests of ▇▇▇▇▇▇▇ in or to monies due or to become due under
any such contract, lease, permit, license, charter or license agreement
(including, without limitation, any Accounts or other Receivables).
(c)
(d) Without limiting the foregoing, or the other Collateral pursuant to the Loan
Agreement or any of the other Financing Agreements, in order to induce Lender to
make loans and advances and provide other financial accommodations to Borrower
under the Loan Agreement, and as additional collateral for the payment and
performance when due of all Obligations of Borrower and MIC, as the case may be,
MIC hereby pledges and assigns to Lender and grants to Lender a security
interest in, all of its now existing and hereafter arising (i) rights, remedies,
claims for monies, indemnification claims and claims for damages or other relief
pursuant to or in respect of the ▇▇▇▇▇▇▇ Purchase Agreements, (ii) rights,
remedies, claims for monies, indemnification claims and claims for damages or
other relief under or in respect of the documents and instruments referred to in
the ▇▇▇▇▇▇▇ Purchase Agreements, and (iii) all proceeds, collections, recoveries
and rights with respect to the foregoing. Nothing set forth herein, and no act
taken by Lender pursuant to the pledges, assignments and grants of security
interests set forth herein shall constitute an assumption by Lender of any
obligation or liability of MIC pursuant to or in connection with the ▇▇▇▇▇▇▇
Purchase Agreements or otherwise.
(e)
2. Payments. Notwithstanding anything to the contrary set forth in Section 6.4
of the Loan Agreement, Lender shall apply payments received or collected from
Borrower or Guarantors or for the account of Borrower or Guarantors (including,
without limitation, the monetary proceeds of collections or of realization upon
any Collateral or any other property which is security for the Obligations),
first, to all Obligations (other than the outstanding principal amount of the
KWS Supplemental Revolving Loans and the ▇▇▇▇▇▇▇ Supplemental Revolving Loans)
which are then due and payable, second, to all Obligations (other than the KWS
Supplemental Revolving Loans and the outstanding principal amount of the ▇▇▇▇▇▇▇
Supplemental Revolving Loans) which are not then due and payable, and third, to
the outstanding principal amount of the KWS Supplemental Revolving Loans and the
▇▇▇▇▇▇▇ Supplemental Revolving Loans, except, that, (i) on the first day of each
calendar month, (ii) upon the occurrence of an Event of Default or act,
11
condition or event which with notice, lapse of time or both would constitute an
Event of Default, shall exist or have occurred and be continuing, (iii) during
the period on and after the date of termination or non-renewal of the Loan
Agreement, and (iv) to the extent that aggregate principal amount of the KWS
Supplemental Revolving Loans at any time outstanding is in excess of the KWS
Supplemental Revolving Loan Limit then in effect, or the aggregate principal
amount of the ▇▇▇▇▇▇▇ Supplemental Revolving Loans at any time outstanding is in
excess of the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit then in effect, as the
case may be, Lender may apply payments received or collected from Borrower or
Guarantors or for the account of Borrower or Guarantors (including, without
limitation, the monetary proceeds of collections or of realization upon any
Collateral or any other property which is security for the Obligations), first,
to such Obligations that are then due and payable and then in such order or
manner as Lender determines.
3.
4. References in Section 9 of the Loan Agreement. The phrase ", Revolving Loan
Limit" is hereby inserted after the term "sublimits" each time the term
sublimits appears in Sections 9.7(b)(ii), 9.9(g)(vii), 9.9(h)(vi), and
9.9(m)(vii) of the Loan Agreement.
5.
6. Priority of Liens. The first sentence of Section 8.4 of the Loan Agreement
is hereby deleted and the following substituted therefor:
7.
"The security interests and liens granted to Lender
under this Agreement and the other Financing Agreements
constitute valid and perfected first priority liens and
security interests in and upon the Collateral except with
respect to (a) any assets and properties of KWS which are
included within the KWS Term Loan Collateral and (b) any
assets and properties of ▇▇▇▇▇▇▇ which are included within
the ▇▇▇▇▇▇▇ Term Loan Collateral."
1. Sales of Assets.
2.
(a) Section 9.7(b)(ii) is hereby amended to include the following at the end of
the Section:
"; and provided, that, in the case of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ may
only dispose of Equipment constituting ▇▇▇▇▇▇▇ Term Loan
Collateral in accordance with the terms of the ▇▇▇▇▇▇▇ Term
Loan Documents, except, that, as at any time the outstanding
Loans exceed the amount of the Loans available to Borrower
based on the lending formulas set forth in Section 2.1 hereof,
subject to any then applicable Availability Reserves,
sublimits and the Maximum Credit, or the intercompany loans by
Borrower to ▇▇▇▇▇▇▇ pursuant to the Intercompany Loan
Documents exceeds the Guarantor Availability of ▇▇▇▇▇▇▇ (less
the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit then in effect),
the Net Available Proceeds from such disposition equal to such
Loans which exceed the amounts available to Borrower or
12
▇▇▇▇▇▇▇ shall be paid directly to Lender for application to
the Obligations in such order and manner as Lender shall
determine;"
(a) The first parenthetical in Section 9.7(b)(vii) is hereby amended to include
the phrase "and ▇▇▇▇▇▇▇, so long as the ▇▇▇▇▇▇▇ Term Loan has not been
indefeasibly paid in full, except with respect sales of ▇▇▇▇▇▇▇ Term Loan
Collateral in accordance with the ▇▇▇▇▇▇▇ Term Loan Documents" after the term
"KWS Term Loan Documents" appears.
(b)
(c) Section 9.7(b)(viii) is hereby amended to include the following at the end
of such Section:
(d)
" and provided, further, that, in the case of ▇▇▇▇▇▇▇, so long
as the ▇▇▇▇▇▇▇ Term Loan has not been indefeasibly paid in
full, ▇▇▇▇▇▇▇ may only sell less than all or substantially all
of its assets (other than Capital Stock) constituting ▇▇▇▇▇▇▇
Term Loan Collateral in accordance with the ▇▇▇▇▇▇▇ Term Loan
Documents;"
(a) Encumbrances. Section 9.8(e) is hereby amended to include the following at
the end of such Section:
(b)
" and except, that, so long as the ▇▇▇▇▇▇▇ Term Loan has not
been indefeasibly paid in full, ▇▇▇▇▇▇▇ may not grant any such
purchase money security interests or purchase money mortgages
unless such liens are permitted pursuant to the ▇▇▇▇▇▇▇ Term
Loan Documents;"
(a) Section 9.8 is hereby amended to include the following additional
Section 9.8(s):
(b)
"(s) a Lien granted by MIC in favor of ▇▇▇▇▇▇▇ Seller on the
stock of ▇▇▇▇▇▇▇ pursuant to the terms of the ▇▇▇▇▇▇▇ Purchase
Agreements in effect on the date of the ▇▇▇▇▇▇▇ Amendment
Agreements and the Liens granted by ▇▇▇▇▇▇▇ in favor of
▇▇▇▇▇▇▇ Seller pursuant to the terms of the ▇▇▇▇▇▇▇ Seller
Security Agreements in effect on the date of the ▇▇▇▇▇▇▇
Amendment Agreements."
1. Indebtedness.
2.
(a) Section 9.9(a) is hereby amended to include the following at the end of such
Section:
(b)
"and the Indebtedness owing by ▇▇▇▇▇▇▇ to Lender in respect
of the ▇▇▇▇▇▇▇ Term Loan and ▇▇▇▇▇▇▇ Term Loan Documents;"
13
(a) The definition of "Refunding Indebtedness" in Section 9.9(q) is hereby
amended to include the indebtedness and "Obligations" (as such term is defined
in the ▇▇▇▇▇▇▇ Term Loan Documents) of ▇▇▇▇▇▇▇ to Lender under and pursuant to
the ▇▇▇▇▇▇▇ Term Loan Documents.
(b)
(c) Section 9.9 is hereby amended to include the following additional Section
9.9 (r):
(d)
(r) the Indebtedness of MIC to ▇▇▇▇▇▇▇ Seller arising pursuant
to the ▇▇▇▇▇▇▇ Seller Note (plus costs and expenses as
provided therein) and the other ▇▇▇▇▇▇▇ Purchase Agreements,
provided, that:
(i) the principal amount of such Indebtedness shall
not exceed in the aggregate $2,875,000, plus interest thereon
at the rate provided for in the ▇▇▇▇▇▇▇ Seller Note as in
effect on the date of the ▇▇▇▇▇▇▇ Amendment Agreements,
(ii) Lender shall have received true, correct and
complete copies of the ▇▇▇▇▇▇▇ Seller Note and all other
agreements, documents and instruments executed by any Borrower
or any Obligor with, to or in favor of ▇▇▇▇▇▇▇ Seller Note in
connection therewith,
(iii) MIC may make regularly scheduled payments of
principal and interest in respect of the Indebtedness as set
forth in the ▇▇▇▇▇▇▇ Seller Note, provided, that, on the date
of any such payment and after giving effect thereto, no Event
of Default, or act, condition or event which with notice or
passage of time or both would constitute an Event of Default
shall exist or have occurred and be continuing,
(iv) MIC shall not, directly or indirectly, make,
any prepayments of principal in respect of such Indebtedness,
(v) neither MIC or ▇▇▇▇▇▇▇ shall, directly or
indirectly, (a) amend, modify, alter or change any terms of
the ▇▇▇▇▇▇▇ Purchase Agreements, except that MIC and/or
▇▇▇▇▇▇▇ may, after prior written notice to Lender, amend,
modify, alter or change the terms thereof so as to (1) extend
the maturity thereof or defer the timing of any payments in
respect thereof, or (2) to forgive or cancel any portion of
such Indebtedness other than pursuant to payments thereof, or
(3) to reduce the interest rate or any fees in connection
therewith, or to release any liens or security interests in
any assets and properties of MIC or ▇▇▇▇▇▇▇, as the case may
be, or (4) to make any provision of the ▇▇▇▇▇▇▇ Seller Note or
the other ▇▇▇▇▇▇▇ Purchase Agreements less burdensome or
14
restrictive as to MIC or ▇▇▇▇▇▇▇ or any other Guarantor than
that in effect with respect to the Indebtedness on the date
hereof, or (b) redeem, retire, defease, purchase or otherwise
acquire such Indebtedness, or set aside or otherwise deposit
or invest any sums for such purpose except with respect to
payments otherwise permitted to be made hereunder, and
(vi) MIC shall furnish to Lender all material
notices, demands or other materials concerning such
Indebtedness either received by MIC or on its behalf, promptly
after receipt thereof, or sent by MIC, or on its behalf,
concurrently with the sending thereof, as the case may be."
1. Events of Default.Section 10.1(i) is hereby amended to include the following
at the end of the Section:
2.
"or Event of Default under the ▇▇▇▇▇▇▇ Term Loan Documents or
a default or Event of Default under the ▇▇▇▇▇▇▇ Seller Note or
any of the ▇▇▇▇▇▇▇ Seller Security Agreements;"
1. Early Termination Fee.Section 12.1(c) of the Loan Agreement is hereby amended
to add the following at the end of such Section:
2.
"Notwithstanding anything to the contrary set forth herein,
for purposes of calculating the foregoing early termination
fee, the term "Maximum Credit" shall be deemed to be, on such
date of determination, the sum of (i) $55,000,000, (ii) the
KWS Maximum Supplemental Revolving Loan Limit then in effect,
and (iii) the ▇▇▇▇▇▇▇ Maximum Supplemental Loan Limit then in
effect."
1. Amendments to Schedules and Exhibits. Schedules 1.20, 1.35, 1.48, 6.3, 8.1,
8.4, 8.8, 8.9, 9.9 and 9.10 to the Loan Agreement are hereby supplemented to
include the information with respect to ▇▇▇▇▇▇▇ as set forth as indicated on
Schedule B annexed hereto and the Information Certificate delivered by ▇▇▇▇▇▇▇
in accordance with Section 21(b) hereof shall constitute its Information
Certificate for purposes of Section 1.45 of the Loan Agreement.
2.
3. ▇▇▇▇▇▇▇ Term Loan. Notwithstanding anything to the contrary set forth in the
Loan Agreement, Lender hereby consents to the making of the ▇▇▇▇▇▇▇ Term Loan on
the terms and conditions set forth in the ▇▇▇▇▇▇▇ Term Loan Documents.
4.
5. Representations, Warranties and Covenants. In addition to the continuing
representations, warranties and covenants heretofore or hereafter made by
Borrower or Guarantors to Lender pursuant to the other Financing Agreements,
Borrower and Guarantors hereby represent, warrant and covenant with and to
15
Lender as follows (which representations, warranties and covenants are
continuing and shall survive the execution and delivery hereof and shall be
incorporated into and made a part of the Financing Agreements):
6.
(i) The ▇▇▇▇▇▇▇ Purchase Agreements have been duly executed and delivered by MIC
and MIC has acquired good and valid title to the ▇▇▇▇▇▇▇ Purchased Stock, free
and clear of all claims, pledges and encumbrances of any kind except the lien
granted to ▇▇▇▇▇▇▇ Seller pursuant to the ▇▇▇▇▇▇▇ Seller Security Agreements.
(ii)
(iii) All actions and proceedings required by the ▇▇▇▇▇▇▇ Purchase Agreements,
applicable law and regulation (including, but not limited to, compliance with
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Anti-Trust Improvement Act of 1976 as amended) have been taken
and the transactions required thereunder have been duly and validly taken and
consummated.
(iv)
(v) No court of competent jurisdiction has issued any injunction, restraining
order or other order which prohibits consummation of the transactions described
in the ▇▇▇▇▇▇▇ Purchase Agreements and no government action or proceeding has
been threatened or commenced seeking any injunction, restraining order or other
order which seeks to void or otherwise modify the transactions described in the
▇▇▇▇▇▇▇ Purchase Agreements.
(vi)
(vii) Borrower and ▇▇▇▇▇▇▇ have delivered, or caused to be delivered, to Lender,
true, correct and complete copies of the ▇▇▇▇▇▇▇ Purchase Agreements.
(viii)
(b) This Amendment has been duly authorized, executed and delivered by Borrower
and Guarantors, and the agreements and obligations of Borrower and Guarantors
contained herein constitute legal, valid and binding obligations of Borrower and
Guarantors enforceable against Borrower and Guarantors in accordance with their
respective terms.
(c)
(d) Neither the execution and delivery of this Amendment, nor the modifications
to the Financing Agreements contemplated by this Amendment shall violate any
applicable law or regulation, or any order or decree of any court or any
governmental instrumentality in any respect or does or shall conflict with or
result in the breach of, or constitute a default in any respect under, any
indenture, including, without limitation, the Senior Note Indenture or any
material mortgage, deed of trust, security agreement, agreement or instrument to
which Borrower or any Guarantor is a party or may be bound, or violate any
provision of the organizational documents of Borrower or Guarantors.
(e)
(f) All of the representations and warranties set forth in the Loan Agreement as
amended hereby, and the other Financing Agreements, are true and correct in all
material respects, except to the extent any such representation or warranty is
made as of a specified date, in which case such representation or warranty shall
have been true and correct as of such date.
(g)
(h) No Event of Default exists on the date of this Amendment (after giving
effect to the amendments to the Loan Agreement provided in this Amendment).
(i)
16
(j) ▇▇▇▇▇▇▇ has become a Restricted Subsidiary and Subsidiary Guarantor under
and in accordance with the terms of the Senior Note Indenture.
(k)
(l) ▇▇▇▇▇▇▇ is solvent, and will continue to be solvent after the assumption of
the Obligations, the creation of the security interests of Lender and the
consummation of the other transactions contemplated hereunder, is able to pay
its debts as they mature and has (and has reason to believe it will continue to
have) sufficient capital (and not unreasonably small capital) to carry on its
business and all businesses in which it is about to engage. The assets and
properties of ▇▇▇▇▇▇▇ at a fair valuation and at their present fair salable
value are, and will be, greater than the Indebtedness of ▇▇▇▇▇▇▇, and including
subordinated and contingent liabilities computed at the amount which, to the
best of ▇▇▇▇▇▇▇', Borrower's and each Guarantor's knowledge, represents an
amount which can reasonably be expected to become an actual or matured
liability.
(m)
(n) Borrower and ▇▇▇▇▇▇▇ shall deliver, or cause to be delivered, to Lender,
within ninety (90) days from the date hereof, an opening balance sheet of
▇▇▇▇▇▇▇ after giving effect to the transactions contemplated by this Agreement
and the ▇▇▇▇▇▇▇ Purchase Agreements, together with a certificate, dated on such
date, signed by the Chief Financial Officer of ▇▇▇▇▇▇▇ certifying that such
opening balance sheet has been prepared in accordance with GAAP and presents
fairly the financial condition of ▇▇▇▇▇▇▇ as of that date.
(o)
(i) Loans. Subject to the terms and conditions contained herein and the Loan
Agreement, Lender hereby consents to the intercompany loan by Borrower to
▇▇▇▇▇▇▇ as of the date hereof with the proceeds of the ▇▇▇▇▇▇▇ Supplemental
Revolving Loans as described in Section 5 hereof and the intercompany loans by
Borrower to ▇▇▇▇▇▇▇ on and after the date hereof from time to time with the
proceeds of the Loans as described in Section 2.4 of the Loan Agreement;
provided, that, the intercompany loans by Borrower to ▇▇▇▇▇▇▇ as of the date
hereof are and shall be evidenced by the promissory note dated the date hereof,
issued by ▇▇▇▇▇▇▇ in favor of Borrower, the original of which shall be endorsed,
assigned and delivered to Lender to hold as part of the Collateral, each of the
intercompany loans by Borrower to ▇▇▇▇▇▇▇ after the date hereof shall be
evidenced by the Intercompany Note, and in no event, except in Lender's
discretion, shall the total amount of the Indebtedness of ▇▇▇▇▇▇▇ to Borrower
evidenced by or arising under the Intercompany Note at any time outstanding
exceed the Guarantor Availability with respect to ▇▇▇▇▇▇▇ .
(ii)
7. Amendment Fee. In consideration of this Amendment, Borrower shall pay to
Lender or Lender, at its option, may charge the account of Borrower maintained
by Lender an amendment fee in the aggregate amount of $50,000, which fee is
fully earned as of the date hereof and may, at Lender's option, be charged
directly to Borrower's loan account maintained by Lender.
8.
9. Conditions Precedent. The making of the ▇▇▇▇▇▇▇ Supplemental Revolving Loans
and the effectiveness of the consents and amendments set forth herein, shall be
subject to the receipt by Lender of each of the following, in form and substance
satisfactory to Lender:
10.
17
(a) an original of this Amendment, duly authorized, executed and delivered by
Borrower and Guarantors;
(b)
(c) Lender shall have received, in form and substance satisfactory to Lender,
the other ▇▇▇▇▇▇▇ Amendment Agreements, each duly authorized, executed and
delivered by the parties thereto;
(d)
(e) Lender shall have received, in form and substance satisfactory to Lender,
evidence that the ▇▇▇▇▇▇▇ Purchase Agreements have been duly executed and
delivered by and to the appropriate parties thereto and the transactions
contemplated under the terms of the ▇▇▇▇▇▇▇ Purchase Agreements have been
consummated prior to or contemporaneously with the execution of this Amendment;
(f)
(g) Lender shall have received, in form and substance satisfactory to Lender,
all releases, terminations and such other documents as Lender may request to
evidence and effectuate the termination by the ▇▇▇▇▇▇▇ Existing Lenders of their
respective financing arrangements with ▇▇▇▇▇▇▇ and the termination and release
by each of them of any interest in and to any assets and properties of ▇▇▇▇▇▇▇ ,
duly authorized, executed and delivered by each of them, including, but not
limited to, UCC termination statements for all UCC financing statements
previously filed by each of them, as secured party and ▇▇▇▇▇▇▇, as debtor;
(h)
(i) Lender shall have received, in form and substance satisfactory to Lender,
evidence that all required consents or approvals of any persons other than
Lender to the acquisition of the capital stock of ▇▇▇▇▇▇▇, and the loans and
investments by Borrower and MIC in ▇▇▇▇▇▇▇ and the other arrangements of
Borrower and the Guarantors with ▇▇▇▇▇▇▇ contemplated herein have been obtained;
(j)
(k) Lender shall have received the originals of the Intercompany Note made by
▇▇▇▇▇▇▇ , as duly authorized, executed and delivered by ▇▇▇▇▇▇▇ and as duly
endorsed and assigned by Borrower to Lender;
(l)
(m) Lender shall have received, in form and substance satisfactory to Lender,
a fully executed copy of the Fourth Supplemental Indenture, dated on or about
the date hereof, to the Senior Note Indenture pursuant to which ▇▇▇▇▇▇▇ has
become a Subsidiary Guarantor and Restricted Subsidiary (as each such term is
defined in the Senior Note Indenture);
(n)
(o) Lender has received evidence, in form and substance satisfactory to Lender,
that, on or before the date hereof, (i) MIC has made a capital contribution of
not less than $1,000,000, in immediately available funds to ▇▇▇▇▇▇▇, which
contribution is not the proceeds of Loans or Letter of Credit Accommodations and
(ii) JBPCO has made a loan of at least $4,900,000 to MIC to purchase the capital
stock of ▇▇▇▇▇▇▇ from ▇▇▇▇▇▇▇ Seller which loan is not the proceeds of Senior
Notes, Loans or Letter of Credit Accommodations.
(p)
18
(q) Lender shall have received, in form and substance satisfactory to Lender,
the ▇▇▇▇▇▇▇ Term Loan Documents, duly authorized, executed and delivered by
▇▇▇▇▇▇▇ and the other Persons or parties thereto;
(r)
(s) all representations and warranties contained herein and in the Loan
Agreement shall be true and correct in all material respects;
(t)
(u) Lender shall have received evidence, in form and substance satisfactory to
Lender, that Lender has valid perfected and first priority security interests in
and liens upon the Collateral of ▇▇▇▇▇▇▇ and any other property which is
intended to be security for the Obligations, subject only to the Permitted
Liens;
(v)
(w) Lender shall have completed a field review of the Records and such other
information with respect to the Collateral of ▇▇▇▇▇▇▇ as Lender may require to
determine the amount of Loans available to Borrower, the results of which shall
be satisfactory to Lender, not more than three (3) Business Days prior to the
date hereof;
(x)
(y) Lender shall have received, in form and substance satisfactory to Lender,
the collateral assignment by Borrower to Lender of all right, title and interest
of Borrower under or pursuant to the Intercompany Loan Documents relating to
▇▇▇▇▇▇▇ and granting Lender such other rights with respect thereto as Lender may
require, duly authorized, executed and delivered by Borrower and acknowledged
and agreed to by ▇▇▇▇▇▇▇ (including any waiver of defenses by ▇▇▇▇▇▇▇ as against
Lender as assignee of Borrower);
(z)
(aa) Transaction Excess Availability, as determined by Lender, as of the date
hereof, shall not be less than $500,000 after giving effect to the transactions
and Loans made or to be made in connection with the transactions contemplated by
this Amendment. For purposes of this Section "Transaction Excess Availability"
shall mean the amount equal to: (i) the sum of (A) eighty-five (85%) of the Net
Amount of Eligible Accounts of ▇▇▇▇▇▇▇ minus the Availability Reserves allocated
by Lender to such Guarantor, (B) the ▇▇▇▇▇▇▇ Supplemental Revolving Loan Limit
then in effect, (C) the outstanding unpaid principal amount of the ▇▇▇▇▇▇▇ Term
Loan, (D) the amount of the ▇▇▇▇▇▇▇ Seller Note and (E) the aggregate amount of
the capital contributions and loans to be made pursuant to Section 21(h) hereof
minus (ii) the sum of (A) the amount of consideration to be paid to ▇▇▇▇▇▇▇
Seller on the date hereof pursuant to the terms of the ▇▇▇▇▇▇▇ Stock Purchase
Agreement, (B) the aggregate amount to be paid to all ▇▇▇▇▇▇▇ Existing Lenders
on the date hereof, (C) the aggregate amount of all outstanding and unpaid trade
payables owed by ▇▇▇▇▇▇▇ which are more than sixty (60) days past due as of such
time and (D) the aggregate amount of costs associated with the transactions
contemplated herein and in the ▇▇▇▇▇▇▇ Purchase Agreements;
(bb)
(cc) Lender shall have received evidence of insurance and loss payee and loss
payable endorsements with respect to the Collateral of ▇▇▇▇▇▇▇ required under
the Financing Agreements, in form and substance reasonably satisfactory to
Lender, and certificates of insurance policies and/or endorsements naming Lender
as loss payee with respect to such Collateral;
19
(dd)
(ee) Lender shall have received, in form and substance satisfactory to Lender,
the opinion letter of counsel to Borrower, MIC and ▇▇▇▇▇▇▇ with respect to the
▇▇▇▇▇▇▇ Purchase Agreements, the ▇▇▇▇▇▇▇ Amendment Agreements, Senior Note
Indenture, and the security interest and liens of Lender with respect to the
Collateral and such other matters as Lender may request;
(ff)
(gg) Lender shall have received the fee referred to in Section 20 hereof; and
(hh)
(ii) after giving effect to the amendments to the Loan Agreement provided
in this Amendment, no Event of Default shall exist or have occurred and no
event, act or condition shall have occurred or exist which with notice or
passage of time or both would constitute an Event of Default.
(jj)
11. Additional Events of Default. The parties hereto acknowledge, confirm and
agree that the failure of Borrower or any Guarantor to comply with the
covenants, conditions and agreements contained herein shall constitute an Event
of Default under the Financing Agreements (subject to the applicable cure
period, if any, with respect thereto provided for in the Loan Agreement as in
effect on the date hereof).
12.
13. Notices. For purposes of Section 12.2 of the Loan Agreement, notices shall
be sent to ▇▇▇▇▇▇▇ shall be sent to ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇.
14.
15. Effect of this Amendment. Except for the specific amendment expressly set
forth herein, no other changes or modifications to the Financing Agreements, and
no waivers of any provisions thereof are intended or implied, and in all other
respects the Financing Agreements are hereby specifically ratified, restated and
confirmed by all parties hereto as of the date hereof. To the extent of conflict
between the terms of this Amendment and the other Financing Agreements, the
terms of this Amendment shall control. The Loan Agreement and this Amendment
shall be read and construed as one agreement.
16.
17. Governing Law. The rights and obligations hereunder of each of the parties
hereto shall be governed by and interpreted and determined in accordance with
the internal laws of the State of New York (without giving effect to principles
of conflicts of laws).
18.
19. Binding Effect. This Amendment shall be binding upon and inure to the
benefit of each of the parties hereto and their respective successors and
assigns.
20.
21. Counterparts. This Amendment may be executed in any number of counterparts,
but all of such counterparts shall together constitute but one and the same
agreement. In making proof of this Amendment, it shall not be necessary to
produce or account for more than one counterpart thereof signed by each of the
parties hereto.
20
22.
23.
24.
25.
26.
27.
[REMAINDER OF PAGE LEFT
INTENTIONALLY BLANK]
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Please sign in the space provided below and return a counterpart of
this Amendment, whereupon this Amendment, as so agreed to and accepted by
Lender, shall become a binding agreement among Borrower, Guarantors and Lender.
Very truly yours,
▇.▇. ▇▇▇▇▇▇▇▇▇▇ & CO., INC.
By:
Title:
AGREED AND ACCEPTED:
CONGRESS FINANCIAL CORPORATION
By:
Title:
ACKNOWLEDGED AND CONSENTED TO:
EFP CORPORATION
By:
Title:
[SIGNATURES CONTINUED ON NEXT PAGE]
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[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
▇▇▇▇ GROUP, INC.
By:
Title:
MAGNETIC INSTRUMENTS CORP.
By:
Title:
▇▇▇▇▇▇ TRAILER MFG. CO.
By:
Title:
TRUCK ACCESSORIES GROUP, INC.
By:
Title:
RAIDER INDUSTRIES INC.
By:
Title:
[SIGNATURES CONTINUED ON NEXT PAGE]
23
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
KWS MANUFACTURING COMPANY, INC.
By:
Title:
UNIVERSAL ▇▇▇▇▇▇▇, INC.
By:
Title: