EXHIBIT 10.2
AMENDMENT AGREEMENT
This Amendment Agreement is made this 9th day of June 1999 between
Manufacturers and Traders Trust Company, a New York banking organization having
its chief executive office at One M&T Plaza, Buffalo, New York 14240, (the
"Bank") and American Locker Group Incorporated, a Delaware business corporation
having its chief executive office at 608 Allen Street, P.O. Box 1000, Jamestown,
New York 14702-1000, (the "Borrower").
WHEREAS, the Bank and the Borrower previously entered into a
Corporate Term Loan Agreement dated August 30, 1991, which was amended by (1) an
Amendment Agreement dated as of May 1, 1994, (2) an Amendment Agreement dated
March 12, 1996 and (3) an Amendment Agreement dated as of August 22, 1997 (as so
amended, the "Loan Agreement"); and
WHEREAS, the Bank and the Borrower now desire to amend certain
provisions of the Loan Agreement;
NOW, THEREFORE, effective on the date of this Amendment Agreement,
the Bank and the Borrower agree that:
1. A new clause (jiii) to read "(jiii) Loan III," is added to
Section 1 of the Loan Agreement after clause (jii) of such Section 1.
.
2. There is added to the Loan Agreement after Section 2B thereof a
new Section 2C to read as follows:
2C. LOAN III.
a. MAKING AND OBTAINING LOAN III. Upon and subject to each
term and condition of this Agreement, the Bank shall
make Loan III to the Borrower, and the Borrower shall
obtain Loan III from the Bank. The principal amount of
Loan III shall be $3,000,000. The Borrower may obtain
Loan III in a series of advances.
b. TERMINATION OF OBLIGATION. Any obligation of the Bank to
make Loan III or any advance of any portion thereof
shall terminate no later than June 30, 2000.
c. REPAYMENT. The Borrower shall repay the outstanding
principal amount of Loan III on July 1, 2000 to the Bank
in 60 monthly installments, with the first of such
installments to become due on August 1, 2000 and one of
such installments to become due on the same day of each
succeeding calendar month through July 1, 2005, when the
Borrower shall repay the outstanding principal amount of
Loan III to the Bank and pay to the Bank all interest
owing pursuant to this Agreement in connection with Loan
III and remaining unpaid and all other amounts owing by
the Borrower to the Bank pursuant to this Agreement in
connection with Loan III and remaining unpaid. Such
installments shall consist of 60 installments equal in
amount or 59 installments equal in amount followed by a
final installment as nearly equal in amount to the other
59 installments as possible.
d. OPTIONAL REPAYMENT IN ADVANCE. The Borrower shall have
the option of repaying the principal amount of Loan III
to the Bank in advance in full or in part at any time
and from time to time; provided, however, that (i) the
amount of any such repayment in part shall be an
integral multiple of $50,000 and (ii) upon making any
such repayment in full the Borrower shall pay to the
Bank all interest owing pursuant to this Agreement in
connection with Loan III and remaining unpaid and all
other amounts owing by the Borrower to the Bank pursuant
to this Agreement in connection with Loan III and
remaining unpaid. Each such repayment in part shall be
applied to the installments of the principal amoun t of
Loan III in the inverse order of such installments
becoming due.
e. INTEREST. From and including the date Loan III is made
to but not including the date the outstanding principal
amount of Loan III is repaid in full, the Borrower shall
pay to the Bank interest, calculated on the basis of a
360-day year for the actual number of days of each year
(365 or 366, as applicable), on such outstanding
principal amount at a rate per year that shall (i) on
each day beginning before the maturity, whether by
acceleration or otherwise, of such outstanding principal
amount be the rate in effect such day as the Bank's
Prime Rate and (ii) on each day subsequent to the last
day described in clause (i) of this sentence be 3% above
the rate in effect such subsequent day as the Bank's
Prime Rate; provided, however, that (A) in no event
shall such interest be payable at a rate in excess of
the maximum rate permitted by applicable law and (B)
solely to the extent necessary to result in such
interest not being payable at a rate in excess of such
maximum rate, any amount that would be treated as part
of such interest under a final judicial interpretation
of applicable law shall be deemed to have been a mistake
and automatically canceled, and, if received by the
Bank, shall be refunded to the Borrower, it being the
intention of the Bank and of the Borrower that such
interest not be payable at a rate in excess of such
maximum rate. Except as otherwise provided in Section
2Cc or 2Cd of this Agreement, payments of such interest
shall become due on the last day of each calendar month,
beginning on the first day of the first calendar month
after the calendar month in which Loan III or the first
advance of any portion thereof is made.
f. GENERAL PROVISIONS AS TO REPAYMENT AND PAYMENT.
Repayment of the principal amount of Loan III, payment
of all interest owing pursuant to this Agreement in
connection with Loan III and payment of all other
amounts owing by the Borrower to the Bank pursuant to
this Agreement in connection with Loan III shall be made
in lawful money of the United States and in immediately
available funds at the banking office of the Bank
located at One Fountain Plaza, Buffalo, New York, or at
such other office of the Bank as may at any time and
from time to time be specified in any notice delivered,
given or sent to the Borrower by the Bank. No such
repayment or payment shall be deemed to have been
received by the Bank until received by the Bank at the
office of the Bank determined in accordance with the
preceding sentence, and any such repayment or payment
received by the Bank at such office after 2:00 P.M. on
any day shall be deemed to have been received by the
Bank at the time such office opens for business on the
next business day of the Bank. If the time by which any
of the principal amount of Loan III is to be repaid is
extended by operation of law or otherwise,
the Borrower shall pay interest on the outstanding
portion thereof during such period of extension as
provided in Section 2Ce of this Agreement.
g. NON-USAGE FEE. For each period (i) beginning on the date
of this Agreement and ending on the last day of the
calendar quarter containing such date or (ii) consisting
of a calendar quarter beginning after the calendar
quarter containing the date of this Agreement and ending
on or before June 30, 2000, the Borrower shall pay to
the Bank on demand made by the Bank a non-usage fee
equal to the product obtained by multiplying (A) the
difference between $3,000,000 and the daily average
during such period of the outstanding principal amount
of Loan III first by (B) 1/4% and then by (C) the
fraction obtained by dividing the number of days in such
period by 360; provided, however, that (I) in no event
shall there be payable any such non-usage fee that would
result in interest being payable on the outstanding
principal amount of Loan III at a rate in excess of the
maximum rate permitted by applicable law and (II) solely
to the extent necessary to result in such interest not
being payable at a rate in excess of such maximum rate,
any amount that would be treated as part of such
interest under a final judicial interpretation of
applicable law shall be deemed to have been a mistake
and automatically canceled and, if received by the Bank,
shall be refunded to the Borrower, it being the
intention of the Bank and of the Borrower that such
interest not be payable at a rate in excess of such
maximum rate.
3. Section 3 of the Loan Agreement is amended in its entirety to
read as follows:
3. PREREQUISITES TO ANY LOAN. The obligation of the Bank to
make any Loan or any advance of any portion of Loan III
shall be conditioned upon the following:
a. NO DEFAULT. (i) There not having occurred or existed at
any time during the period beginning on the date of this
Agreement and ending at the time such Loan or advance is
to be made, and there not existing at the time such Loan
or advance is to be made, any Event of Default or
Potential Event of Default and (ii) the Bank not
believing in good faith that any Event of Default or
Potential Event of Default has so occurred or existed or
so exists;
b. REPRESENTATIONS AND WARRANTIES. (i) Each representation
and warranty made in this Agreement being true and
correct as of all times during
the period beginning on the date of this Agreement and
ending at the time such Loan or advance is to be made
and as of the time such Loan or advance is to be made,
except to the extent updated in (A) a certificate
executed by the Chief Executive Officer or the President
or a Vice President of the Borrower and by the chief
financial officer of the Borrower and received by the
Bank before the time such Loan or advance is to be made
or (B) Exhibit A attached to and made a part of this
Agreement, (ii) each other representation and warranty
made to the Bank by or on behalf of the Borrower or by
or on behalf of any Subsidiary or Other Obligor before
the time such Loan or advance is to be made being true
and correct as of the date thereof, except to the extent
updated in (A) a certificate executed by the Chief
Executive Officer or the President or a Vice President
of the Borrower and by the chief financial officer of
the Borrower and received by the Bank before the time
such Loan or advance is to be made or (B) Exhibit A
attached to and made a part of this Agreement, (iii)
each financial statement provided to the Bank by or on
behalf of the Borrower or by or on behalf of any
Subsidiary or Other Obligor before the time such Loan or
advance is to be made being true and correct as of the
date thereof and (iv) the Bank not believing in good
faith that (A) any such representation or warranty,
except as so updated, was or is other than true and
correct as of any such time, or as of such date, of
determination of the truth and correctness thereof or
(B) any such financial statement was other than true and
correct as of the date thereof;
c. PROCEEDINGS. The Bank being satisfied as to each
corporate or other proceeding in connection with any
transaction contemplated by this Agreement; and
d. RECEIPT BY BANK. The receipt by the Bank at or before
the time such Loan or advance is to be made of the
following, in form and substance satisfactory to the
Bank: i. If such Loan is Loan I, a Promissory Note I,
appropriately completed and duly executed by the
Borrower;
ii. If such Loan is Loan II, a Promissory Note II,
appropriately completed and duly executed by the
Borrower;
ii(I). If such Loan is Loan III, a Promissory Note III,
appropriately completed and duly executed by the
Borrower;
iii. A Ratification of General Guaranty Agreement,
appropriately completed and duly executed by
American Locker Security Systems, Inc.;
iv. A Ratification of General Guaranty Agreement,
appropriately completed and duly executed by
American Locker Company, Inc.;
v. A certificate executed by the Chief Executive
Officer or the President or a Vice President of
the Borrower and by the chief financial officer
of the Borrower and stating that (A) there did
not occur or exist at any time during the period
beginning on the date of this Agreement and
ending at the time such Loan or advance is to be
made, and there does not exist at the time such
Loan or advance is to be made, any Event of
Default or Potential Event of Default and (B)
each representation and warranty made in this
Agreement was true and correct as of all times
during the period beginning on the date of this
Agreement and ending at the time such Loan or
advance is to be made and is true and correct as
of the time such Loan or advance is to be made,
except to the extent updated in a certificate
executed by the Chief Executive Officer or the
President or a Vice President of the Borrower
and by the chief financial officer of the
Borrower and received by the Bank before the
time such Loan or advance is to be made;
vi. Evidence that each of the Borrower and all
Subsidiaries is at the time such Loan or advance
is to be made in good standing under the law of
the jurisdiction in which it is incorporated;
vii. A copy of the certificate or articles of
incorporation or other charter document of each
of the Borrower and all Subsidiaries certified
by its Secretary to be complete and accurate at
the time such Loan or advance is to be made;
viii. A copy of the by-laws or other
organizational document of each of the Borrower
and all Subsidiaries certified by its Secretary
to be complete and accurate at the time such
Loan or advance is to be made;
ix. Evidence of the taking, and of the continuation
in full force and effect at the time such Loan
or advance is to be made, of each corporate or
other action of the Borrower or of any other
Person necessary to authorize the obtaining of
such Loan or advance by the Borrower, the
execution, delivery to the Bank and performance
of each Loan Document and the imposition or
creation of any security interest, mortgage and
other lien and encumbrance imposed or created
pursuant to any Loan Document;
x. Evidence that each requirement contained in any
Loan Document with respect to insurance is being
met at the time such Loan or advance is to be
made;
xi. Each additional writing required by any Loan
Document or deemed necessary or desirable by the
Bank at the sole option of the Bank; and
xii. Payment of all costs and expenses payable
pursuant to the first sentence of Section 8 of
this Agreement at or before the time such Loan
or advance is to be made.
4. Section 4a of the Loan Agreement is amended in its entirety to
read as follows:
a. USE OF PROCEEDS. The proceeds of Loan I and Loan II will
be used only (i) to refinance existing indebtedness of
the Borrower to the Bank in the approximate outstanding
principal amount of $950,000 and (ii) to repurchase
187,385 shares of stock of the Borrower from Thomas P.
Johnson and his family. The proceeds of the first
advance of any portion of Loan III will be used only to
refinance existing indebtedness of the Borrower to the
Bank in the approximate amount of $1,900,000 incurred to
finance the repurchase of shares of stock of the
Borrower. The proceeds of subsequent advances of any
portion of Loan III will be used only to repurchase
shares of stock of the Borrower.
5. Section 10j of the Loan Agreement is amended in its entirety to
read as follows:
j. LOAN. "Loan" means Loan I, Loan II or Loan III.
6. There is added to the Loan Agreement after Section 10j(ii)
thereof a new Section 10j(iii) to read as follows:
j(iii). LOAN III. "Loan III" means a loan by the Bank to
the Borrower in the principal amount shown in Section
2Ca of this Agreement.
7. The references in the third sentence of Section 4f of the Loan
Agreement, the second sentence of Section 8 of the Loan Agreement, clause (i) of
Section 10h of the Loan Agreement and the first sentence of Section 11 of the
Loan Agreement to "either Loan" are changed to "any Loan."
8. The references in clause (ix) of Section 10h of the Loan
Agreement to "either Loan" are changed to "any Loan or any advance of any
portion of Loan III."
9. The Loan Agreement is changed by this Amendment Agreement only to
the extent that it is specifically amended by this Amendment Agreement, and, as
so amended, the Loan Agreement shall remain in full force and effect. Effective
on the date of this Amendment Agreement, references in the Loan Agreement to
"this Agreement" shall be deemed to be references to the Loan Agreement as
amended by this Amendment Agreement.
IN WITNESS WHEREOF, the Bank and the Borrower have caused this
Amendment Agreement to be duly executed on the date shown at the beginning of
this Amendment Agreement.
MANUFACTURERS AND TRADERS
TRUST COMPANY
By /s/ RICHARD S. BAGOSY
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AMERICAN LOCKER GROUP INCORPORATED
By /s/ EDWARD F. RUTTENBERG
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Edward F. Ruttenberg, Chairman and
Chief Executive Officer