AMENDMENT AND SUPPLEMENT
TO
LOAN AGREEMENT
AGREEMENT, made this 23rd day of October, 1995, by
and among:
MXL INDUSTRIES, INC., a Delaware corporation (the
"Borrower");
The Banks that have executed the signature pages
hereto (individually a "Bank" and collectively, the "Banks"); and
NATWEST BANK N.A., a national banking association
(the successor in interest to National Westminster Bank NJ),
as Agent for the Banks (in such capacity, together with its
successors in such capacity, the "Agent");
W I T N E S S E T H:
WHEREAS:
A. The Borrower, the Banks and National
Westminster Bank N.J., as Agent (the predecessor in interest
to the Agent) have heretofore entered into a Loan Agreement
dated April 29, 1993 (the "Original Loan Agreement", and as
the Original Loan Agreement is amended and supplemented
hereby and as it may from time to time hereafter be amended
and supplemented, the "Loan Agreement");
B. The parties hereto wish to amend and
supplement the Original Loan Agreement to provide for an
increase in the principal amount of the Term Loans, as
defined therein, and for certain other matters as
hereinafter set forth; and
C. Capitalized terms used herein which are
defined in the Original Loan Agreement and not otherwise defined herein
shall have the respective meanings ascribed thereto in the Original Loan
Agreement;
NOW, THEREFORE, for good and valuable
consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
Article 1. Amended Term Loans; Release of
Certain Collateral; Waiver as to Interest Rate Contract
Section 1.1 The Borrower hereby acknowledges
and confirms that as of the date hereof, the outstanding
principal balance of each Bank's Term Loan (individually an
"Original Term Loan" and collectively, the "Original Term
Loans") is as follows:
Outstanding Principal
Bank Balance of Term Loan
NatWest Bank N.A. (the $1,117,500.00
successor in interest to
NatWest USA and hereinafter
referred to as "NatWest")
UJB $ 382,500.00
Concurrently herewith, each Bank is making an additional
loan (individually, an "Additional Term Loan" and
collectively, the "Additional Term Loans") to be added to
such Bank's Original Term Loan in the following respective
principal amounts:
Principal Amount of
Bank Additional Term Loan
NatWest $1,800,395.00
UJB $ 659,605.00
Upon the making of the Additional Term Loans on the date
hereof, the outstanding principal balance of each Bank's Original Term
Loan and Additional Term Loan (individually, an "Amended
Term Loan" and collectively, the "Amended Term Loans") is as
follows:
Outstanding Principal
Balance of Amended
Bank Term Loan
NatWest $2,917,895.00
UJB $1,042,105.00
Section 1.2 The Amended Term Loans made by each
Bank shall be evidenced by a single promissory note of the
Borrower in form and substance satisfactory to the Banks and
the Agent (each, an "Amended and Restated Term Note", and
collectively, the "Amended and Restated Term Notes"). Each
Amended and Restated Term Note shall be dated the date of
this Amendment and Supplement, and shall be payable to the
order of such Bank in a principal amount equal to such
Bank's Term Loan Commitment, as amended hereby, advanced to
the Borrower, and shall otherwise be duly completed. The
Amended and Restated Term Notes shall be payable as provided
in Section 1.3 hereof. The Amended and Restated Term Notes
shall be deemed to amend and restate the Term Notes executed
and delivered in connection with the Original Term Loans
(individually, an "Original Term Note" and collectively, the
"Original Term Notes"), and upon the execution and delivery
to each Bank of the Amended and Restated Term Note payable
to such Bank, such Bank shall mark the Original Term Note
payable to such Bank "Paid by Substitution of New Note" and
return it to the Borrower.
Section 1.3 (a) The Borrower shall pay to the
Agent for the account of each Bank the principal of the
Amended Term Loan made by such Bank in sixteen (16)
consecutive quarterly installments on the Payment Dates,
commencing on October 31, 1995 (provided that the last such
payment shall be on July 31, 1999, and shall be in an amount
sufficient to repay in full the principal amount of such
Amended Term Loans), with the aggregate amount of the
installments paid on each Payment Date to be equal to
$247,500, and such payments shall be distributed between
NatWest and UJB in the respective amounts set forth below:
Amount of Installment Amount of Installment
to be Distributed to be Distributed
Payment Dat e to NatWest to UJB
The last day of each $182,368.43 $65,131.57
October, January,
April and July from
October 31, 1995
through April 30, 1999
July 31, 1999 $182,368.55 $65,131.45
b. The Amended Term Loans shall bear interest at
the rates applicable to the Term Loans as set forth in the
Original Loan Agreement, and such interest shall be payable
in accordance with the terms of the Loan Agreement.
Section 1.4 Concurrently with the execution and
delivery of this Amendment and Supplement, the Borrower
shall pay a non-refundable facility fee to NatWest in the
amount of $14,500 and to UJB in the amount of $5,300.
Section 1.5 The proceeds of the Additional Term
Loans shall be used by the Borrower solely for the following
purposes:
(a) The amount of $1,666,666 shall be loaned
by the Borrower to FSG simultaneously with the making of the
Additional Term Loans to be used by FSG, simultaneously with
its receipt of such amount, for the payment in full by FSG
of the outstanding principal balance of the "Term Loans"
outstanding under the FSG Loan Agreement; and
(b) The reimbursement to the Borrower of its
payment to the Banks of $793,334 made on July 31, 1995 in
respect of the Loans.
Section 1.6 Concurrently with the execution and
delivery of this Amendment and Supplement, the Borrower
shall execute and deliver to the Agent Mortgage Modification
and Extension Agreements in form and substance satisfactory
to the Agent and the Banks (the "Mortgage Modification
Agreements") pursuant to which the Borrower agrees that the
Borrower Mortgages secure, without limitation, the
Borrower's obligations in respect of the Amended and
Restated Term Notes and the Amended Term Loans (the Mortgage
Modification Agreements, the Amended and Restated Term Notes
and this Amendment and Supplement, and all other documents
executed and delivered in connection herewith or therewith,
are sometimes hereinafter referred to collectively as the
"Supplemental Loan Documents").
Section 1.7 Concurrently herewith, the Banks
and the Agent hereby release their lien on and security
interest in:
(a) Bonds denominated in Swiss francs issued by
NPDC, bearing an 8% interest rate and due March 1, 1995 (the "Swiss Bonds")
in the principal amount of SFr2,001,000, heretofore owned by the Borrower and
pledged pursuant to the Borrower Debt Assignment Agreement; and
(b) Swiss Bonds in the principal amount of SFr 4,581,000,
heretofore owned by FSG and pledged pursuant to the Guarantor Debt Assignment
Agreement.
The Borrower and the Guarantors acknowledge that
all of the foregoing Swiss Bonds are to be canceled,
and that the Agent shall, concurrently herewith deliver
the certificates representing such Swiss Bonds to NPDC.
NPDC, by its countersignature hereof, agrees that, promptly
upon its receipt of such certificates, it shall deliver such
certificates to the Trustee in respect of the Swiss Bonds
for cancellation, and shall take all other action required
on its part to effect the cancellation of such Swiss Bonds.
The Borrower further acknowledges that the foregoing release
of Collateral shall not be deemed to be a waiver or consent
by the Banks or the Agent for any purpose whatsoever, and
that the Borrower's Obligations, as amended and supplemented
hereby, remain in full force and effect without regard to
such release of Collateral.
Section 1.8 The Agent and the Banks acknowledge
that the Borrower has heretofore entered into an Interest
Rate Contract in accordance with Section 2.21 of the Loan
Agreement, that such Interest Rate Contract has expired by
its terms, and that the Borrower is not currently a party to
an Interest Rate Contract as provided in such Section 2.21.
The Agent and the Banks hereby consent to the Borrower's
failure to have any such Interest Rate Contract in effect
and waive any default under such Section 2.21 arising from
such failure; provided, however, that the Borrower
acknowledges that the foregoing consent and waiver shall be
applicable only to the specific matter referred to in this
Section 1.8 and shall not be deemed to be a consent or
waiver for any other purpose whatsoever.
Section 1.9 The Original Loan Agreement, the
Loan Documents, and all agreements, instruments and
documents executed and delivered in connection with any of
the foregoing, shall each be deemed to be amended hereby to
the extent necessary to give effect to the provisions of
this Amendment and Supplement. Except as amended hereby,
the Loan Agreement and the other Loan Documents shall remain
in full force and effect in accordance with their respective
terms.
Article 2. Amendments to the Loan Agreement
Without limiting the generality of Section 1.6,
the Original Loan Agreement is hereby amended as follows:
Section 2.1 Article 1 of the Original Loan
Agreement is amended as follows:
(a) The following new definitions are added:
"'Adjusted Excess Cash Flow' - for any period, an
amount equal to (i) the Borrower's Net Income for such period, (ii)
plus, but only to the extent such items shall have been
deducted in determining such Net Income, the sum of
depreciation and amortization of assets, and other non-cash
charges, and (iii) minus, without duplication, the sum of
(1) all Capital Expenditures incurred by the Borrower during
such period, but only to the extent that the Borrower did
not incur Indebtedness in connection with the incurrence of
such Capital Expenditures, and (2) all payments made by the
Borrower of principal and interest that were due and payable
during such period in respect of the Borrower's Long Term
Debt (including, without limitation, such payments in
respect of Capitalized Lease Obligations)."
"'Amendment and Supplement' - the Amendment and
Supplement to Loan Agreement dated October 23, 1995 by and
among the Borrower, the Banks that have executed the
signature pages thereto and the Agent (as such Amendment and
Supplement to Loan Agreement may be amended, modified and
supplemented from time to time)."
"'Long Term Debt' - all Indebtedness which by its
terms matures more than twelve (12) months from the date as of
which any determination of Long Term Debt is made."
(b) The definition of "Debt Service" is
deleted and the following is substituted therefor:
"Debt Service" - as to any Person as at any
date, the sum of (a) all payments of principal and interest on
Indebtedness (other than the Term Loan) of such Person for
borrowed money and all payments in respect of Capital Leases
of such Person that were due and payable during the
immediately preceding four full fiscal quarters of such
Person, plus (b) (i) during the period from January 1, 1996
through September 29, 1996, the aggregate amount of all
payments of principal and interest on the Term Loan that
were due and payable during the immediately preceding fiscal
quarter of the Borrower, multiplied by four, and (ii) from
and after September 30, 1996, all payments of principal and
interest on the Term Loan that were due and payable during
the immediately preceding four full fiscal quarters of the
Borrower.
(c) The definition of "Term Loan Commitment"
is deleted and the following is substituted therefor:
"'Term Loan Commitment' - as to each Bank, the
amount set forth opposite such Bank's name on Schedule I to the
Amendment and Supplement."
(d) The definition of "Net Income" is
amended by adding the following new sentence at the
conclusion thereof:
"Notwithstanding the foregoing, for purposes of
computing the aggregate income (or loss) of the Borrower for any
period in determining the Borrower's Net Income for such
period, the income (or loss, as the case may be) of GPC and
ISI for such period shall not be included to the extent that
such income (or loss) otherwise would have been included in
such computation in accordance with generally accepted
accounting principles consistently applied. The Borrower
acknowledges and confirms that to the extent the aggregate
income (or loss) of the Borrower is used in computing the
Borrower's Tangible Net Worth, such aggregate income (or
loss) shall be computed in accordance with generally
accepted accounting principles consistently applied, without
regard to the immediately preceding sentence."
(e) The definition of "Operating Cash Flow"
is amended by adding in clause (iii) thereof the words "or
provided for" immediately after the word "paid".
(f) The definition of "Tangible Net Worth"
is amended by changing the period at the conclusion thereof
to a semicolon, and by adding the following after such
semicolon:
"and further provided, that the amount receivable
by the Borrower from FSG in respect of the Borrower's
advance to FSG of $1,666,666 (such advance consisting of the
payment by the Borrower on behalf of FSG of the outstanding
principal balance of the 'Term Loans' under the FSG Loan
Agreement), shall be deemed to be an intangible for the
purposes hereof."
Section 2.2 Section 6.9 of the Original Loan
Agreement is amended by deleting subsection 6.9(a) in its
entirety and by substituting therefor the following:
"(a) Have or maintain, as to the Borrower:
(i) Tangible Net Worth as at the last day of
each fiscal quarter of the Borrower which day occurs in the years
set forth below at not less than the respective amounts set
forth opposite each such year:
Minimum Tangible Net
Fiscal Quarter-End Worth on Such Fiscal
Date Occurring In: Quarter-End Date
1993 $ 4,000,000
1994 5,000,000
1995 5,200,000
1996 6,000,000
1997 6,900,000
1998 7,900,000
1999 9,500,000
(ii) The ratio of Indebtedness to Tangible
Net Worth of the Borrower as at the last day of each fiscal
quarter of the Borrower at not more than 1.50 to 1.00.
(iii) The excess of Current Assets over
Current Liabilities of the Borrower as at the last day of
each fiscal quarter of the Borrower at not less than
$1,000,000.
(iv) Debt Service Coverage of the Borrower
for the four full fiscal quarters ending on the last day of each
fiscal quarter of the Borrower at not less than 150%."
Section 2.3 Section 7.5 of the Original Loan
Agreement is amended by deleting subsection 7.5(b) in its
entirety and by substituting therefor the following:
"(b) Declare or pay any dividends or make any
distribution of any kind on the Borrower's or FSG's
outstanding stock, or set aside any sum for any such
purpose, except that the Borrower or FSG may declare or pay
any dividend payable solely in shares of its common stock;
provided, however, that:
(i) the Borrower shall be permitted to pay
dividends from time to time to NPDC during any fiscal
quarter in an amount not exceeding the aggregate amount of
interest, if any, actually paid in cash by NPDC and received
by the Borrower during the immediately preceding fiscal
quarter in respect of any bonds issued by NPDC owned by the
Borrower plus the amount of cash dividends, if any, actually
received by the Borrower in respect of stock of GPC and ISI
owned by the Borrower; provided further however, that:
(1) the amount of such dividends permitted
under this subsection 7.5(b)(i) in any fiscal quarter shall
be reduced by the aggregate amount of loans made during such
fiscal quarter by the Borrower to NPDC based upon the amount
of bond interest and dividends received by the Borrower, as
permitted under subsection 7.9(d) hereof; and
(2) no such dividend shall be permitted if
at the time of the proposed payment thereof, a Default shall
have occurred and be continuing hereunder; and
(ii) the Borrower shall be permitted to pay
dividends from time to time to NPDC during each half of its
fiscal year in an amount not in excess of 50% of the
Borrower's Adjusted Excess Cash Flow for the immediately
preceding half of its fiscal year; provided, further
however, that:
(1) in the event that the Borrower had
positive Adjusted Excess Cash Flow for the first half of a
fiscal year, and based upon such Adjusted Excess Cash Flow,
the Borrower paid dividends pursuant to this subsection
7.5(b)(ii) during the second half of such fiscal year, and
in the event that the financial statements delivered in
accordance with Section 5.1 hereof reflect that the Adjusted
Excess Cash Flow for such full fiscal year was less than $0,
then the amount of dividends permitted under this subsection
7.5(b)(ii) to be paid in the immediately succeeding fiscal
year shall be reduced by the amount of dividends paid during
such second half of the fiscal year to which such financial
statements relate;
(2) the amount of such dividends permitted
under this subsection 7.5(b)(ii) during any fiscal half-year
of the Borrower shall be reduced by the aggregate amount of
investments made by the Borrower during such fiscal half-
year pursuant to subsection 7.9(c) hereof (and if the amount
of such investments shall exceed the amount of dividends
otherwise permitted to be paid pursuant to this subsection
7.5(b)(ii) during such fiscal half-year, then the amount of
dividends permitted in the immediately ensuing fiscal half-
years shall be accordingly reduced by the amount of such
remaining excess);
(3) the amount of such dividends permitted
under this subsection 7.5(b)(ii) in any fiscal half-year
shall be reduced by the aggregate amount of loans made
during such fiscal half-year by the Borrower to NPDC as
permitted under subsection 7.9(i) hereof; and
(4) no such dividend shall be permitted if
at the time of the proposed payment thereof, a Default shall
have occurred and be continuing hereunder."
Section 2.4 Section 7.9 of the Original Loan
Agreement is amended as follows:
(a) Subsection 7.9(c)(iv) is amended by changing
the period at the conclusion thereof to a comma, and by
adding the following after such comma:
"reduced, in either event, by the aggregate amount
of dividends paid by the Borrower during such fiscal year
pursuant to subsection 7.5(b)(ii) hereof."
(b) Section 7.9 is further amended by adding the
following new subsections to read in their entirety as
follows:
"(g) (i) The advance by the Borrower to FSG in the
amount of $1,666,666, such advance consisting of the payment
by the Borrower on behalf of FSG of the outstanding
principal balance of the 'Term Loans' under the FSG Loan
Agreement, (ii) the advance heretofore made by the Borrower
to FSG in the amount of $416,666, such advance constituting
the payment by the Borrower on behalf of FSG of the July 31,
1995 principal installments of the 'Term Loans' under the
FSG Loan Agreement and (iii) the advance heretofore made by
the Borrower to FSG on December 21, 1994 in the amount of
$300,000 for the working capital purposes of FSG.
(h) Loans and advances from time to time by the
Borrower to FSG (in addition to the advances permitted under
subsection 7.9(g) hereof), provided that the outstanding
principal amount of all such loans and advances shall at no
time exceed $750,000.
(i) Loans and advances from time to time by the
Borrower to NPDC during each half of the Borrower's fiscal
year in an amount not in excess of 50% of the Borrower's
Adjusted Excess Cash Flow for the immediately preceding half
of its fiscal year; provided, however, that:
(1) in the event that the Borrower had
positive Adjusted Excess Cash Flow for the first half of a
fiscal year, and based upon such Adjusted Excess Cash Flow,
the Borrower made loans and advances pursuant to this
subsection 7.9(i) during the second half of such fiscal
year, and in the event that the financial statements
delivered in accordance with Section 5.1 hereof reflect that
the Adjusted Excess Cash Flow for such full fiscal year was
less than $0, then the amount of loans and advances
permitted under this subsection 7.9(i) to be paid in the
immediately succeeding fiscal year shall be reduced by the
amount of loans and advances made during such second half of
the fiscal year to which such financial statements relate;
(2) the amount of such loans and advances
permitted under this subsection 7.9(i) during any fiscal
half-year of the Borrower shall be reduced by the aggregate
amount of investments made by the Borrower during such
fiscal half-year pursuant to subsection 7.9(c) hereof (and
if the amount of such investments shall exceed the amount of
loans and advances otherwise permitted pursuant to this
subsection 7.9(i) during such fiscal half-year, then the
amount of loans and advances permitted in the immediately
ensuing fiscal half-years shall be accordingly reduced by
the amount of such remaining excess;
(3) the amount of such loans and advances
permitted under this subsection 7.9(i) in any fiscal half-
year shall be reduced by the aggregate amount of dividends
paid during such fiscal half-year by the Borrower to NPDC as
permitted under subsection 7.5(b)(ii) hereof; and
(4) no such loan or advance shall be
permitted if at the time of the proposed making thereof, a
Default shall have occurred and be continuing hereunder.
(j) Concurrently with the execution and delivery
of the Amendment and Supplement, the Borrower shall be
permitted to lend to NPDC the principal amount of $500,000."
Section 2.5 Section 7.13 of the Original Loan
Agreement is deleted in its entirety, and the following new
Section 7.13 is substituted therefor:
"Section 7.13 Capital Expenditures
Make or become obligated to make Capital
Expenditures in the aggregate for the Borrower during the
period from April 1, 1993 through December 31, 1993 in
excess of $250,000, and during each fiscal year of the
Borrower thereafter, in excess of the respective amounts set
forth below (provided, however, that the Capital
Expenditures set forth on Exhibit M-2 annexed hereto shall
not be included for purposes of determining compliance with
this Section 7.13):
Fiscal Year Ending Maximum Capital
December 31 Expenditures
1994 $250,000
1995 500,000
1996 400,000
1997 250,000
1998 and each 250,000"
year thereafter
Section 2.6 Section 7.14 of the Loan Agreement
is amended by deleting the period at the conclusion thereof,
and by adding the following at the conclusion thereof:
"other than the fiscal year ending December 31,
1995, and would exceed $700,000 during the fiscal year
ending December 31, 1995."
Section 2.7 Exhibit M to the Original Loan
Agreement is amended by deleting in its entirety the list of
debt and other arrangements guaranteed by NPDC attached
thereto, and by substituting for such list the list annexed
hereto as Schedule II.
Section 2.8 Exhibit M-2 to the Original Loan
Agreement is amended by adding, at the conclusion thereof,
the following:
"Any refinancing or substitute financing of the
General Electric Credit Corp. obligation referred to above
(whether or not the substitute lessor or financer is General
Electric Credit Corp.), provided that the maximum principal
amount of MXL's obligation thereunder shall not exceed
$1,054,000."
Article 3. Acknowledgments and Confirmations
Section 3.1 a. The Borrower acknowledges and
confirms that any term used in the Security Documents to
which the Borrower is a party to refer to the Borrower's
Indebtedness, liabilities and obligations to the Banks and
the Agent, includes, without limitation, the Indebtedness,
liabilities and obligations of the Borrower to the Banks,
whether now existing or hereafter arising under the Amended
and Restated Term Notes and the Original Loan Agreement as
amended hereby, and that all of the collateral security
provided for in such Security Documents secures the
Borrower's full payment and performance of such
Indebtedness, liabilities and obligations of the Borrower.
(b) The Indebtedness, liabilities and obligations
of the Borrower to the Banks and the Agent, whether now
existing or hereafter arising, under the Amended and
Restated Term Notes and the Original Loan Agreement as
amended and supplemented hereby, are hereinafter referred to
collectively as the "Supplemental Obligations".
Section 3.2 Each of FSG and NPDC, as
Guarantors, consents in all respects to the execution and
delivery by the Borrower of this Amendment and Supplement
and the Amended and Restated Term Notes and the transactions
contemplated herein, including, without limitation, the
release of Collateral provided for herein, and acknowledges
and confirms that:
(a) its Guaranty continues to be valid and in
full force and effect, and guarantees, without limitation,
the full payment and performance of the Supplemental
Obligations as well as the Obligations; and
(b) any term used in the Security Documents to
which such Guarantor is a party to refer to the Borrower's
Indebtedness, liabilities and obligations to the Banks and
the Agent, includes, without limitation, the Supplemental
Obligations, and that all of the collateral security
provided for in such Security Documents secures, without
limitation, the full payment and performance by each
Guarantor of the Indebtedness, liabilities and obligations
of such Guarantor under its Guaranty, as acknowledged and
confirmed hereby.
Section 3.3 Each of the Borrower, the Banks and
the Agent hereby acknowledges and confirms that all
references in the Loan Agreement, the other Loan Documents
and any other agreement, instrument or document executed and
delivered in connection herewith or therewith:
(a) to the "Term Loans" shall be deemed to
include the Amended Term Loans;
(b) to the "Term Notes" shall be deemed to refer
to the Amended and Restated Term Notes;
(c) to the "Loan Agreement" or "this Agreement"
(insofar as such term refers to the Loan Agreement) shall be
deemed to refer to the Original Loan Agreement as amended
and supplemented hereby;
(d) to the "Loan Documents" shall be deemed to
include, without limitation, the Supplemental Loan
Documents, and all other documents executed and delivered in
connection herewith or therewith; and
(e) to the "Obligations" (or any other term used
to describe or refer to the Borrower's Indebtedness,
liabilities and Obligations to the Banks and the Agent)
shall be deemed to include, without limitation, the
Supplemental Obligations.
Article 4. Representations and Warranties
The Borrower hereby represents and warrants to the
Agent and the Banks that:
Section 4.1 After giving effect to the
amendment and supplement of the Original Loan Agreement
pursuant hereto and the consummation of the transactions
contemplated hereby, b. each of the representations and
warranties set forth in Article 3 of the Loan Agreement is
true and correct in all respects as if made on the date
hereof, and c. there exists no Default or Event of Default
under the Loan Agreement.
Section 4.2 The Borrower and each Guarantor has
the power to execute, deliver and perform the Supplemental
Loan Documents to be executed by it. The Borrower and each
other Loan Party has taken all necessary action, corporate
or otherwise, to authorize the execution, delivery and
performance of the Supplemental Loan Documents to be
executed by it. No consent or approval of any Person
(including, without limitation, any stockholder of the
Borrower or any Guarantor), no consent or approval of any
landlord or mortgagee, no waiver of any Lien or right of
distraint or other similar right and no consent, license,
certificate of need, approval, authorization or declaration
of any governmental authority, bureau or agency, is or will
be required in connection with the execution, delivery or
performance by the Borrower or any other Loan Party, or the
validity, enforcement or priority, of the Supplemental Loan
Documents.
Section 4.3 The execution and delivery by the
Borrower and each other Loan Party of each Supplemental Loan
Document to which it is a party and performance by it
hereunder and thereunder, will not conflict with or result
in a breach of any order, writ, injunction, ordinance,
resolution, decree, or other similar document or instrument
of any court or governmental authority, bureau or agency,
domestic or foreign, or any certificate of incorporation or
by-laws of the Borrower or any other Loan Party, or create
(with or without the giving of notice or lapse of time, or
both) a default under or breach of any agreement, bond, note
or indenture to which the Borrower or any other Loan Party,
is a party, or by which it is bound or any of its properties
or assets is affected, or result in the imposition of any
Lien of any nature whatsoever upon any of the properties or
assets owned by or used in connection with the business of
the Borrower or any other Loan Party, except for the Liens
created and granted pursuant to the Security Documents and
acknowledged and confirmed hereby.
Section 4.4 This Agreement and each other
Supplemental Loan Document has been duly executed and
delivered by the Loan Party that is a party thereto, and
each constitutes the valid and legally binding obligations
of the Loan Party that is a party thereto, enforceable in
accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or other similar laws, now or
hereafter in effect, relating to or affecting the
enforcement of creditors' rights generally and except that
the remedy of specific performance and other equitable
remedies are subject to judicial discretion.
Section 4.5 The Liens that have been created
and granted pursuant to the Security Documents and confirmed
hereby constitute valid perfected first Liens on the
properties and assets covered by the Security Documents,
subject to no prior or equal Lien except as permitted by
Section 7.2 of the Loan Agreement and except for Liens on
such properties and assets in favor of the FSG Agent.
Article 5. Conditions to Amendment
The effectiveness of this Amendment and Supplement
shall be subject to the fulfillment (to the satisfaction of
the Agent and the Banks) of the following conditions
precedent:
Section 5.1 The Borrower, the Banks and the
Agent shall have executed and delivered this Amendment and
Supplement.
Section 5.2 The Borrower shall have executed
and delivered to each Bank its Amended and Restated Term
Note.
Section 5.3 The Borrower shall have executed
and delivered to the Agent the Mortgage Modification
Agreements in recordable form.
Section 5.4 The Agent shall have received
copies of (1) a certificate of an officer of the Borrower
and the Guarantors to the effect that the Borrower's and
Guarantors' respective certificates of incorporation and by-
laws have not been amended, modified or changed in any
respect since the date of delivery to the Agent of the
certificates of incorporation and by-laws of the Borrower
and the Guarantors in connection with the execution and
delivery of the Original Loan Agreement; (2) all corporate
action taken by the Borrower and the Guarantors to authorize
the execution, delivery and performance of each of this
Amendment and Supplement, the Loan Agreement as amended
hereby, the Amended and Restated Term Notes, the other
agreements, instruments and documents executed in connection
herewith and therewith and the consummation of the
transactions contemplated hereby and thereby, certified by
its secretary; and (3) an incumbency certificate (with
specimen signatures) with respect to the Borrower and the
Guarantors.
Section 5.5 Counsel to the Borrower shall have
delivered to the Agent an opinion in form and substance
satisfactory to the Agent and its counsel.
Section 5.6 d. The Borrower shall have complied
and shall then be in compliance with all of the terms,
covenants and conditions of this Amendment and Supplement
and the Loan Agreement as amended hereby;
(b) After giving effect to the transactions
contemplated hereby, there shall exist no Default or Event
of Default under the Loan Agreement; and
(c) The representations and warranties contained
in Article 3 of the Loan Agreement shall be true and correct
on the date hereof and after giving effect to this Amendment
and Supplement, the Loan Agreement as amended hereby and the
transactions contemplated hereunder and thereunder; and the
Agent shall have received a Compliance Certificate dated the
date hereof to the foregoing effect.
Section 5.7 All legal matters incident hereto
shall be satisfactory to counsel to the Agent.
Article 6. The Agent
(a) The Banks and the Agent agree and confirm
that Article 9 of the Loan Agreement applies in all respects
to this Amendment and Supplement, the Loan Agreement as
amended hereby and the transactions contemplated herein.
Without limiting the generality of the foregoing, each Bank
agrees that Section 9.6 of the Loan Agreement applies to
this Amendment and Supplement and the transactions
contemplated hereby, and that each Bank has, independently
and without reliance on the Agent or any other Bank, and
based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to
enter this Amendment and Supplement.
(b) Each Bank acknowledges that Natwest Bank N.A.
is the
successor in interest to National Westminster Bank N.J. in
its capacity as Agent, and that Natwest Bank N.A., in such
capacity, is vested with all the rights, powers, privileges
and duties with which National Westminster Bank N.J. had
been vested in its capacity as Agent, and each Bank consents
to the foregoing in all respects.
Article 7. Miscellaneous
Section 7.1 THIS AMENDMENT AND SUPPLEMENT, THE
AMENDED AND RESTATED TERM NOTES, THE LOAN AGREEMENT AS
AMENDED HEREBY AND ALL OTHER AGREEMENTS, DOCUMENTS AND
INSTRUMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH
AND THEREWITH SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
Section 7.2 The provisions of this Amendment
and Supplement are severable, and if any clause or provision
shall be held invalid or unenforceable in whole or in part
in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision,
or part thereof, in such jurisdiction and shall not in any
manner affect such clause or provision in any other
jurisdiction, or any other clause or provision in this
Amendment and Supplement in any jurisdiction.
Section 7.3 This Amendment and Supplement may
be signed in any number of counterparts with the same effect
as if the signatures thereto and hereto were upon the same
instrument.
Section 7.4 This Amendment and Supplement shall
be binding upon and inure to the benefit of the Borrower and
the Guarantors and their respective successors and to the
benefit of each of the Agent and the Banks and its
respective successors and assigns. The rights and
obligations of the Borrower and the Guarantors under this
Amendment and Supplement shall not be assigned or delegated
without the prior written consent of the Banks, and any
purported assignment or delegation without such consent
shall be void.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed as of the date first above
written.
MXL INDUSTRIES, INC.
By:
NATWEST BANK N.A.
By:
UNITED JERSEY BANK/CENTRAL,
N.A.
By:
NATWEST BANK N.A.,
as Agent
By:
Consented to and
Agreed in All Respects:
NATIONAL PATENT DEVELOPMENT
CORPORATION
By:
FIVE STAR GROUP, INC.
By:
Schedule I to
Amendment and Supplement
to Loan Agreement
Amended Term Loan Commitments
NatWest $2,917,895.00
UJB $1,042,105.00
Schedule II to
Amendment and Supplement
to Loan Agreement
Debt and Other Arrangements
Guaranteed by NPDC
[to be supplied by L. Gordon]6