Sixth Amendment to Credit Agreement
THIS SIXTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made and
effective as of July ___, 2003, by and among COMPUDYNE CORPORATION
(the "Borrower"), the GUARANTORS party to this Sixth Amendment and the
Credit Agreement referred to below (collectively, the "Guarantors"), the
BANKS party to this Sixth Amendment and the Credit Agreement referred to
below (collectively and together with the Agent, the "Banks") and
PNC BANK, NATIONAL ASSOCIATION, individually and in its capacity as agent
for the Banks under the Credit Agreement referred to below (hereinafter
referred to in such capacity as the "Agent").
WITNESSETH:
WHEREAS, reference is made to (i) that certain Credit Agreement
dated November 16, 2001, as amended by that First Amendment to Credit
Agreement dated as of December 19, 2001, that Second Amendment to Credit
Agreement dated as of April 22, 2002, that Third Amendment to Credit
Agreement dated and effective as of September 30, 2002, that Fourth
Amendment to Credit Agreement dated as of March 21, 2003 and that Fifth
Amendment to Credit Agreement dated as of June 27, 2003 by and among the
Borrower, the Guarantors party thereto, the Banks party thereto and the
Agent (as the same may be further amended, restated, supplemented or
modified from time to time, the "Credit Agreement") pursuant to which
the Banks made available to the Borrower a $30,000,000 original principal
amount revolving credit facility, now reduced by amendment to $25,000,000
(including a $7,000,000 letter of credit subfacility and a $2,000,000
swing line of credit) and a $5,000,000 original principal amount term
loan, now reduced through amortization to $2,496,666.65, and (ii) those
Notes of the Borrower evidencing its obligations under the Credit
Agreement and the Loan Documents, comprised of (A) a Second Amended and
Restated Term Note in the stated principal amount of $1,951,666.65 in
favor of PNC Bank, National Association dated June 27, 2003, (B) a
Third Amended and Restated Revolving Credit Note in the stated principal
amount of $19,545,000 in favor of PNC Bank, National Association dated
June 27, 2003, (C) a Term Note in the stated principal amount of
$545,000 in favor of SunBank dated June 27, 2003 and (D) a Revolving
Credit Note in the stated principal amount of $5,455,000 in favor of
SunBank dated June 27, 2003 (as the same may be amended, restated,
supplemented, restated or substituted from time to time, collectively,
the "Notes");
WHEREAS, the Borrower, the Guarantors, the Agent and the Banks
desire to amend the Credit Agreement to increase the amount of the
letter of credit subfacility on the terms and conditions set forth
herein as provided for below.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Amendments to Credit Agreement. The Credit Agreement is amended
as set forth in Exhibit A. Any and all references to the Credit
Agreement in any of the Loan Documents shall be deemed to refer to the
Credit Agreement as amended hereby. Any initially capitalized terms
used in this Sixth Amendment without definition shall have the meanings
assigned to those terms in the Credit Agreement.
2. Incorporation into Credit Agreement. This Sixth Amendment is deemed
incorporated into each of the Loan Documents. To the extent that any
term or provision of this Sixth Amendment is or may be deemed expressly
inconsistent with any term or provision in any Loan Document, the terms
and provisions hereof shall control.
3. Representations. In order to induce the Banks and the Agent to enter
into this Sixth Amendment and agree to the transactions herein
specified, Borrower and Guarantors represent and warrant as follows:
(a) Borrower and each of the Guarantors is a corporation duly
organized and in good standing under the laws of their respective
states of incorporation. Borrower and each of the Guarantors has
the power to own its property and to carry on its business as now
being conducted. Borrower and each of the Guarantors is duly
qualified to do business in every other jurisdiction in which the
character of the property owned or the nature of the business
conducted makes qualification necessary;
(b) None of Borrower or any of the Guarantors is in violation of its
articles of incorporation or bylaws, or in default in the
performance of any material obligation, agreement, permit or
license agreement to which it is a party or by which it is bound.
The execution and delivery of this Sixth Amendment, and all other
documents as specified herein, the performance and fulfillment of
the terms herein and therein set forth and the consummation of
the transactions herein or therein contemplated do not and will
not constitute a breach of, or default under, any of Borrower's
or Guarantors' articles of incorporation or bylaws, or any other
agreement, indenture or other instrument by which it is bound,
or any applicable law, administration regulation or court decree.
All corporate and other actions, consents or authorizations which
may be necessary or appropriate for the execution, delivery of
and compliance with this Sixth Amendment and all documents and
instruments herein set forth have been taken or obtained. Upon
their execution and delivery, this Sixth Amendment and such other
documents and instruments will constitute the valid and legally
binding obligations of Borrower and Guarantors, enforceable
against Borrower and Guarantors in accordance with their
respective terms.
(c) As of the date hereof, no Event of Default (as defined in the
Credit Agreement) or any event, fact or circumstance which, with
the passage of time or the giving of notice, or both, would
constitute an Event of Default, has occurred and is continuing.
(d) All representations and warranties of Borrower and Guarantors to
the Banks as set forth in the Credit Agreement and each of the
Loan Documents (as defined in the Credit Agreement) are true and
correct as of the date hereof as if fully set forth herein at
length.
(e) None of Borrower or any of the Guarantors has any defense,
set-off, claim or counterclaim to or against, or with respect
to, full and prompt payment and performance by Borrower of all
of Borrower's debts, liabilities or obligations to Agent or any
of the Banks under the Credit Agreement and under the Loan
Documents.
4. Collateral Confirmation. The Borrower and the Guarantors hereby
confirm that any collateral for the Obligations, including but not
limited to liens, security interests, mortgages, and pledges granted
by the Borrower, the Guarantors or third parties (if applicable),
shall continue unimpaired and in full force and effect.
5. Guarantor Reaffirmation. The Guarantors hereby affirm, acknowledge
and agree that their respective guaranty agreements continue in full
force and effect with respect to the Obligations, as modified and
amended by this Sixth Amendment. None of the Guarantors has any
defense, offset or counterclaim to full performance and observance
of their respective liabilities under the guaranty agreements as
reaffirmed hereby. Each Guarantor hereby acknowledges and affirms
that it has and will continue to realize tangible and significant
direct economic benefit from the transactions described in the
Credit Agreement, as amended hereby, the Notes and the other Loan
Documents and hereby irrevocably and unconditionally acknowledge
the receipt of good and valuable consideration for the execution and
delivery of their respective guaranty agreements.
6. Release of Agent and Banks. As additional consideration for the
Agent's and the Banks' entering into this Sixth Amendment, the Borrower
and each Guarantor hereby fully and unconditionally releases and forever
discharges the Agent and the Banks, their respective agents, employees,
directors, officers, attorneys, branches, affiliates, subsidiaries,
successors and assigns and all persons, firms, corporations and
organizations acting on any of their respective behalves (the
"Released Parties") of and from any and all claims, liabilities,
demands, obligations, damages, losses, actions and causes of action
whatsoever which the Borrower or any Guarantor may now have or claim to
have against the Agent or any Bank or any other Released Parties as of
the date hereof, whether presently known or unknown and of any nature
and extent whatsoever, including, without limitation, on account of or
in any way affecting, concerning or arising out of or founded upon the
Credit Agreement, this Sixth Amendment or any of the Loan Documents,
including but not limited to all such loss or damage of any kind
heretofore sustained or that may arise as a consequence of the dealings
between the parties up to and including the date hereof, including but
not limited to, the administration or enforcement of the Loans, the
Notes, the Obligations or any of the Loan Documents. The obligations
of the Borrower and the Guarantors under the Loan Documents and this
Sixth Amendment shall be absolute and unconditional and shall remain in
full force and effect without regard to, and shall not be released,
discharged or in any way affected by:
(i) any exercise or nonexercise of any right, remedy,
power or privilege under or in respect of this Sixth Amendment,
any Loan Document, any document relating to or evidencing any of
the Agent's or any Bank's liens or applicable law, including,
without limitation, any waiver, consent, extension, indulgence or
other action or inaction in respect thereof; or
(ii) any other act or thing or omission or delay to do any
other act or thing which could operate to or as a discharge of the
Borrower or any Guarantor as a matter of law, other than payment in
full of all Obligations, including but not limited to all
obligations under the Loan Documents and this Sixth Amendment.
The Borrower and each of the Guarantors further agrees to indemnify and
hold the Agent and the Banks and their respective officers, directors,
attorneys, agents and employees harmless from any loss, damage, judgment,
liability or expense (including attorneys' fees) suffered by or rendered
against the Agent or the Banks, or any of them, on account of any claims
arising out of or relating to the Obligations. The Borrower and each of
the Guarantors further states that it has carefully read the foregoing
release and indemnity, knows the contents thereof and grants the same
as its own free act and deed.
7. Counterparts. This Sixth Amendment may be signed in any number of
counterpart copies and by the parties hereto on separate counterparts,
but all such copies shall constitute one and the same instrument.
8. Binding Effect. This Sixth Amendment will be binding upon and inure
to the benefit of the Borrower, the Guarantors, the Banks and the Agent
and their respective heirs, executors, administrators, successors and
assigns.
9. Additional Conditions and Covenants. The following agreements and
covenants constitute additional and substantial consideration for the
Banks' agreement to effect the amendments to the Credit Agreement set
forth herein:
(a) The Borrower shall reimburse the Agent for its out of pocket
fees and expenses incurred in connection with this Sixth
Amendment, including, without limitation, its attorney fees
and expenses.
(b) The Borrower and the Guarantors shall execute such
reaffirmation documents and other documents, instruments and
agreements that the Agent may request from time to time in
order to evidence, ratify and affirm its obligations under the
Credit Agreement and the other Loan Documents and the security
interests, liens and pledges effected thereby.
10. Representation by Counsel. The Borrower and each Guarantor
represents and warrants that it is represented by legal counsel of its
choice and that its counsel has had the opportunity to review this Sixth
Amendment, that it is fully aware of the terms contained herein and that
it has voluntarily and without coercion or duress of any kind or nature
whatsoever entered into this Sixth Amendment. The provisions of this
Sixth Amendment shall survive the execution and delivery of this Sixth
Amendment.
11. LIMITATION ON DAMAGES. NEITHER THE AGENT, ANY BANK NOR ANY AGENT
OR ATTORNEY FOR OR OF THE AGENT OR ANY BANK SHALL BE LIABLE TO THE
BORROWER OR ANY GUARANTOR FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL OR
PUNITIVE DAMAGES ARISING FROM ANY BREACH OF CONTRACT, TORT OR OTHER
WRONG RELATING TO THE ESTABLISHMENT, ADMINISTRATION OR COLLECTION OF
THE OBLIGATIONS, AS DEFINED IN ANY LOAN DOCUMENT OR THE ACTION OR
INACTION OF THE AGENT OR ANY BANK OR THE BORROWER OR ANY GUARANTOR
UNDER THIS SIXTH AMENDMENT OR ANY LOAN DOCUMENT OR OTHERWISE.
12. Ratification of Loan Documents. Except as amended hereby, the
terms and provisions of the Loan Documents remain unchanged and in
full force and effect, and are hereby ratified and affirmed. Except
as expressly provided herein, this Sixth Amendment shall not constitute
an amendment, waiver, consent or release with respect to any provision
of any Loan Document, a waiver of any default or Event of Default
thereunder, or a waiver or release of any of the Banks' rights and
remedies (all of which are hereby reserved). The Borrower and each
of the Guarantors expressly ratifies and confirms the confession of
judgment (if applicable) and waiver of jury trial provisions contained
in the Loan Documents as if set forth herein in their entirety as of
the date hereof.
[SIGNATURE PAGE FOLLOWS IMMEDIATELY]
WITNESS the due execution hereof as of the day and year first
above written.
COMPUDYNE CORPORATION,
a Nevada corporation
By:
Title: CFO-Treasurer
CORRLOGIC, INC.,
a Nevada corporation
By:
Title: Vice President
FIBER SENSYS, INC.,
an Oregon corporation
By:
Title: Vice President
NEW TIBURON, INC.,
a Virginia corporation
By:
Title: Vice President
NORMENT SECURITY GROUP, INC.,
a Delaware corporation
By:
Title: Vice President
NORSHIELD CORPORATION,
an Alabama corporation
By:
Title: Vice President
QUANTA SYSTEMS CORPORATION,
a Connecticut corporation
By:
Title:
SYSCO SECURITY SYSTEMS, INC., now by
name change SECURETRAVEL, INC.
a Nevada corporation
By:
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Bank and as Agent
By:
Title: Vice President
SUNBANK
By:
Title: Regional President
AMENDMENTS TO CREDIT AGREEMENT
EXHIBIT A
The Credit Agreement is hereby amended as follows:
I. Background to Amendment
The Borrower, the Guarantors, the Banks and the Agent desire
to amend the Credit Agreement to increase the amount of the letter
of credit subfacility.
II. Credit Agreement Amendments
(A) Section 2.8.1 is deleted and restated in its entirety as follows:
"2.8.1 Issuance of Letters of Credit.
Borrower may request the issuance of letters of credit (each a
"Letter of Credit") on behalf of itself or another Loan Party by
delivering to the Agent a completed application and agreement for
letters of credit in such form as the Agent may specify from time to time
by no later than 10:00 a.m., Pittsburgh time, at least three (3) Business
Days, or such shorter period as may be agreed to by the Agent, in advance
of the proposed date of issuance. Except for the Second Norment Letter
of Credit (as defined in Subsection 2.8.10, below), each Letter of Credit
shall be either a Standby Letter of Credit or a Commercial Letter of
Credit. Subject to the terms and conditions hereof and in reliance on the
agreements of the other Banks set forth in this Section 2.8, the Agent
will issue a Letter of Credit provided that each Letter of Credit shall
(A) have a maximum maturity of thirty-six (36) months from the date of
issuance, and (B) in no event expire later than ten (10) Business Days
prior to the Expiration Date and further provided that in no event shall
(i) the Letter of Credit Outstanding exceed, at any one time, $8,000,000
or (ii) the Revolving Facility Usage exceed, at any one time, the
Revolving Credit Commitments. The Existing Letters of Credit will be
cancelled on the Closing Date or replaced by Letters of Credit. The
Existing Letters of Credit are not "Letters of Credit" hereunder, but
the Second Norment Letter of Credit constitutes a "Letter of Credit"
hereunder (subject to the provisions of Subsection 2.8.10)."
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of COMPUDYNE CORPORATION and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of CORRLOGIC, INC. and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of FIBER SENSYS, INC. and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of NEW TIBURON, INC. and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of NORMENT SECURITY GROUP, INC. and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of NORSHIELD CORPORATION and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of QUANTA SYSTEMS CORPORATION and that he/she, as such officer, being
authorized to do so, executed the foregoing instrument for the purposes
therein contained by signing on behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself/herself to be the ____________________________
of SECURETRAVEL, INC., formerly SYSCO SECURITY SYSTEMS, INC. and that
he/she, as such officer, being authorized to do so, executed the
foregoing instrument for the purposes therein contained by signing on
behalf of the corporation as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
COMMONWEALTH OF PENNSYLVANIA )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared Thomas J. Fowlston, who
acknowledged himself to be the Vice President of PNC BANK,
NATIONAL ASSOCIATION and that he, as such officer, being authorized to
do so, executed the foregoing instrument for the purposes therein
contained by signing on behalf of said bank as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires:
STATE OF ____________________ )
) SS:
COUNTY OF )
On this, the _____ day of July, 2003, before me, a Notary Public, the
undersigned officer, personally appeared ___________________________,
who acknowledged himself to be the Regional President of SUNBANK, and
that he, as such officer, being authorized to do so, executed the
foregoing instrument for the purposes therein contained by signing
on behalf of said bank as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Notary Public
My commission expires: