AMENDMENT NO. 2 TO GUARANTY AGREEMENT
THIS AMENDMENT NO. 2 to GUARANTY AGREEMENT (this "Amendment No.
2") dated as of September [sic October] , 1994, among United
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Industrial Corporation, a Delaware corporation (herein called the
"Guarantor"), to Principal Mutual Life Insurance Company and The
Travelers Insurance Company (collectively, the "Purchasers") and their
respective successors and assigns as holders of the Notes hereinafter
described (the "Noteholders").
W I T N E S S E T H
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WHEREAS, the Guarantor and the Noteholders have heretofore
entered into a Guaranty Agreement dated as of July 15, 1992 (the
"Guaranty Agreement");
WHEREAS, the Guarantor and the Noteholders have heretofore
entered into an Amendment No. 1 to the Guaranty Agreement dated as of
July 15, 1993 (the "Amendment No. 1");
WHEREAS, the Guarantor has requested that the Noteholders agree
to amend certain provisions and covenants contained in the Guaranty
Agreement, as amended; and
WHEREAS, the Noteholders are willing to amend such provisions
and covenants upon the terms and conditions herein provided.
NOW, THEREFORE, the parties hereto, in consideration of the
mutual promises made herein, the sufficiency of which is hereby
acknowledged, hereby agree as follows:
Section 1. Definitions; References. Unless otherwise
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specifically defined herein, each term used herein which is defined in
the Guaranty Agreement, as amended shall have the meaning assigned to
such term in the Guaranty Agreement, as amended. Each reference to
"hereof," "hereunder," "herein" and "hereby" and each other similar
reference to in "this Agreement," and each other similar reference
contained in the Guaranty Agreement, Amendment No. 1 or Amendment No.
2, shall from and after the date hereof refer to the Guaranty
Agreement as amended by Amendment No. 1 and this Amendment No. 2.
Section 1.1. The following definitions are hereby added to the
definitions under the Guaranty Agreement, as amended:
""Agent": as of the date of the Credit Agreement, First
Fidelity Bank, National Association in its
capacity as party to the Credit Agreement as "Agent," and, after
the date of the Credit Agreement, the person from time to time,
party to the Credit Agreement as "Agent."
"Aggregate Loans Outstanding": as to any Lender at a
particular time, the aggregate principal amount of the
Revolving Credit Loans of such Lender outstanding at such
time.
"Borrower": shall mean AAI Corporation, a Maryland
Corporation.
"Collateral Agent": shall mean as of the date of this
Amendment No. 2, First Fidelity Bank, National Association
in its capacity as party to the Intercreditor Agreement as
"Collateral Agent," and, after the date of this Amendment
No. 2, the person from time to time, party to the
Intercreditor Agreement as "Collateral Agent."
"Collateral Agent Liens": shall mean, as the same may be
amended, waived, modified, extended, renewed, supplemented
or replaced from time to time, all security interests,
liens, assignments and other encumbrances in or upon any
property (real, personal or mixed) granted in favor of
Collateral Agent pursuant to the Security Documents.
"Credit Agreement": shall mean, as the same may be amended,
waived, modified, extended, renewed, supplemented or
replaced from time to time, that certain Credit Agreement of
even date herewith among Agent, Borrower, Lenders and
Issuing Bank.
"First Fidelity": shall mean First Fidelity Bank, National
Association.
"Governmental Authority": shall mean any nation or
government, any state or other political subdivision thereof
and any entity exercising executive, legislative, judicial
regulatory or administrative functions of or pertaining to
government, and any Person owned or controlled directly or
indirectly by any of the foregoing, whether domestic or
foreign.
"Intercreditor Agreement": shall mean, as the same may be
amended, waived, modified, extended, renewed,
NYFS11...:\95\78495\0001\7120\GUA02894.E40
supplemented or replaced from time to time, that certain
Intercreditor Agreement of even date herewith by and among The
Travelers Insurance Company, a Connecticut corporation, Principal
Mutual Life Insurance Company, an Iowa corporation, First
Fidelity Bank, National Association in its capacity as Lender, in
its capacity as Agent, in its capacity as Issuing Bank, and in
its capacity (in such capacity, "Collateral Agent") as grantee
and beneficiary of the Collateral Agent Liens, and The Bank of
Baltimore in its capacity as Lender."
"Issuing Bank": shall mean, as of the date of the Credit
Agreement, First Fidelity Bank, National Association, in its
capacity as party to the Credit Agreement as "Issuing Bank,"
and, after the date of the Credit Agreement, the person from
time to time party to the Credit Agreement as "Issuing
Bank."
"L/C Agreements": shall mean, as amended, modified,
extended, renewed, supplemented or replaced from time to
time, applications and reimbursement and other agreements in
form and content and executed by Persons satisfactory to the
Issuing Bank requesting issuance of one or more Letters of
Credit and setting forth reimbursement obligations and other
terms and conditions relating thereto.
"Lenders": shall mean, as of the date of the Credit
Agreement, First Fidelity Bank, National Association, and
Bank of Baltimore, each in its capacity as party to the
Credit Agreement as a "Lender," and, after the date of the
Credit Agreement, all persons from time to time parties to
the Credit Agreement as "Lenders."
"Letter of Credit": shall mean, commercial and standby
letters of credit issued for the account of the Borrower,
for such purposes, in such amounts, for the benefit of such
Persons and subject to such terms and conditions as may be
acceptable to the Issuing Bank and the Required Lenders in
their discretion exercised in good faith (individually, as
amended, modified, extended, renewed, supplemented or
replaced from time to time, a "Letter of Credit," and
collectively, the "Letters of Credit").
"Person": an individual, partnership, corporation, limited
liability company, business trust, joint stock
company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Required Lenders": at a particular time, a Lender or
Lenders holding more than sixty percent (60%) of the
Aggregate Loans Outstanding of all Lenders under the Credit
Agreement as at such time or, if no Lender has any Revolving
Credit Loans outstanding under the Credit Agreement from
time to time, a Lender or Lenders whose commitment
percentages as identified in the Credit Agreement aggregate
more than sixty percent (60%) as at such time.
"Restricted Subsidiaries": shall mean (i) AAI Engineering
Support, Inc., a Maryland corporation, AAI Microflite
Simulation International Corporation, a Maryland
Corporation, AAI/ACL Technologies, Inc., a Maryland
corporation, Seti, Inc., a Pennsylvania corporation, AAI
Systems Management, Inc., a Maryland corporation and AAI
California Carshell, Inc., a Maryland corporation; (ii) any
other Subsidiary with respect to which the Company has
notified the Noteholders that it has been designated as such
by the Board of Directors of
the Company or by an Executive Officer of the Company who
has been authorized by such Board of Directors to make such
designation; and (iii) Symtron Systems, Inc., a New Jersey
corporation, a wholly owned subsidiary of Guarantor.
"Revolving Credit Loans": at a particular time and from
time to time the revolving credit loans made by Lender or
Lenders to the Borrower under Section 2.1 of the Credit
Agreement.
"Revolving Credit Notes": shall mean the promissory notes
of the Borrower evidencing the revolving credit loan or
loans made under the Credit Agreement, from time to time,
appropriately completed, as amended, modified, extended,
renewed, supplemented or replaced from time to time, payable
to the order of such Lender and further evidencing the
obligation of the Borrower to pay with interest the
aggregate loans outstanding under the Credit Agreement to
such Lender from time to time.
"Security Documents": shall mean, as the same may be
amended, waived, modified, extended, renewed, supplemented
or replaced from time to time, that certain Pledge and
Security Agreement of even date herewith executed and
delivered by the Borrower in favor of Collateral Agent, that
certain Security Agreement of even date herewith executed
and delivered by the Borrower in favor of the Collateral
Agent, that certain Security Agreement of even date herewith
executed and delivered by the Restricted Subsidiaries and
Guarantor, et al in favor of Collateral Agent, that certain
Pledge and Security Agreement of even date herewith executed
and delivered by the Guarantor in favor of the Collateral
Agent, that certain Deed of Trust and Security Agreement of
even date herewith executed and delivered by Borrower in
favor of certain trustees for the benefit of the Collateral
Agent, that certain Assignment of Leases and Rents of even
date herewith executed and delivered by the Borrower in
favor of the Collateral Agent, that certain Collateral
Assignment of Trademarks of even date herewith executed and
delivered by Borrower in favor of the Collateral Agent, that
certain Collateral Assignment of Patents of even date
herewith executed and delivered by Borrower in favor of the
Collateral Agent, that certain Collateral Assignment of
Trademarks of even date herewith executed and delivered by
Symtron Systems, Inc. in favor of the Collateral Agent, that
certain Collateral Assignment of
Patents of even date herewith executed and delivered by
Symtron Systems, Inc. in favor of the Collateral Agent, that
certain Collateral Assignment of Trademarks of even date
herewith executed and delivered by AAI/ACL Technologies,
Inc. in favor of the Collateral Agent, that certain
Collateral Assignment of Patents of even date herewith
executed and delivered by AAI/ACL Technologies, Inc. in
favor of the Collateral Agent, and that certain Collateral
Assignment of Copyrights of even date herewith executed and
delivered by AAI/ACL Technologies, Inc. in favor of the
Collateral Agent.
"Subsidiary": of a Person means (i) any corporation or
other entity of which securities or other ownership
interests having ordinary voting power to elect a majority
of the board of directors or other persons performing
similar functions are at the time, directly or indirectly,
owned by such Person, or (ii) the
management of which is otherwise controlled, directly or
indirectly, through one or more intermediaries, by such Person.
"Symtron": shall mean Symtron Systems, Inc., a New Jersey
corporation."
Section 2. Section 5. (e) Restriction on Liens.
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Subsections (6), (7) and (8) be and hereby are added to Section 5. (e)
of the Guaranty Agreement, as amended, as follows:
"(6) Liens in favor of the Collateral Agent
created pursuant to the Security Documents
securing the obligations under the Credit
Agreement and the Revolving Credit Notes and under
the Note Purchase Agreement and the Notes.
(7) Liens in favor of or for the benefit of the
Issuing Bank in or upon cash, cash equivalents or
other liquid assets pledged to the Issuing Bank in
connection with, or in or upon bills of lading or
other shipping or transportation documents,
warehouse receipts or similar rights arising in
connection with, the L/C Agreements or the
issuance and payment of drawings under Letters of
Credit.
(8) Liens in favor of or for the benefit of the
Agent or any Lender in or upon cash, cash
equivalents, marketable securities or other liquid
assets and other rights relating to or in
connection with overnight investments or other
investments made or managed by Agent or any Lender
for or on behalf of the Borrower, any of its
Subsidiaries or Symtron."
Section 3. Section 7. Definitions. Section 7 of the Guaranty
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Agreement is amended in its entirety as follows:
""Subsidiaries" of Guarantor means AAI Corporation, a
Maryland corporation; Detroit Stoker Company, a Michigan
corporation; Neo Products Co., an Illinois corporation;
U.I.C.-Del. Corporation, a Delaware corporation; and Symtron
Systems, Inc., a New Jersey corporation."
Section 4. No Other Amendment. Except as specifically amended
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herein, the Guaranty Agreement shall remain in full force and effect
in accordance with its terms.
Section 5. Governing Law. This Amendment No. 2 shall be
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governed by and construed in accordance with the laws of the State of
New York.
Section 6. Counterparts. This Amendment No. 2 may be
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executed in any number of counterparts and by different parties hereto
in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
No. 2 to be executed by their respective officers thereunto duly
authorized as of the date above first written.
UNITED INDUSTRIAL CORPORATION
By:
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Name: Howard Bloch
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Title: Vice President
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PRINCIPAL MUTUAL LIFE INSURANCE COMPANY
By:
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Name:
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Title:
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By:
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Name:
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Title:
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THE TRAVELERS INSURANCE COMPANY
By:
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Name:
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Title:
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