EXHIBIT 10.7
THIRD AMENDMENT
TO
AMENDED AND RESTATED CREDIT AGREEMENT
THIRD AMENDMENT, dated as of November 6, 1995 (the
'Amendment'), to the Amended and Restated Credit Agreement, dated as of April
12, 1995, among NAI Technologies, Inc., a New York corporation (the 'Borrower'),
Chemical Bank, a New York banking corporation ('Chemical'), The Bank of New
York, a New York banking corporation ('BNY'), and each of the other financial
institutions which from time to time becomes party thereto (together with
Chemical and BNY, the 'Banks'), BNY, as administrative agent (in such capacity,
the 'Administrative Agent'), and Chemical, as collateral agent (in such
capacity, the 'Collateral Agent').
W I T N E S S E T H :
WHEREAS, the Borrower, the Banks, the Administrative Agent and
the Collateral Agent are parties to that certain Amended and Restated Credit
Agreement, dated as of April 12, 1995 (as amended by that certain First
Amendment, dated as of August 14, 1995, and that certain Second Amendment, dated
as of October 13, 1995, the 'Credit Agreement');
WHEREAS, unless otherwise defined herein, terms defined in the
Credit Agreement and used herein are used herein as therein defined;
WHEREAS, in connection with the Borrower's incurrence of
Subordinated Indebtedness, the Borrower has executed a promissory note in favor
of Charles Holmes in the principal amount of $1,000,000, which note provides for
certain covenants and defaults which differ from those set forth in the Credit
Agreement;
WHEREAS, by letter dated October 13, 1995, the Borrower has
agreed to amend the Credit Agreement as hereinafter provided; and
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Amendments to Article V. Article V of the Credit
Agreement is hereby amended by (a) amending Section 5.01(f) to add the words ',
registration statements,' after the words 'proxy statements' and (b) adding the
following section to the end of such Article:
Section 5.18. Maintenance of Properties. Keep all
properties useful in the business of the Borrower in good
working order and condition except to the extent that
discontinuing the operation or maintenance of any such
properties is, in the judgment of the Borrower, desirable in
the conduct of its business.
Section 2. Amendments to Article VI. Article VI of the Credit
Agreement is hereby amended by (a) amending Section 6.07 in its entirety as
follows:
Section 6.07. Transactions with Affiliates. Directly
or indirectly enter into or permit to exist any transaction or
series of related transactions (including, but not limited to,
the purchase, sale or exchange of property, the making of any
investment, the giving of any guarantee or the rendering of
any service) with any Affiliate of the Borrower unless (i)
such transaction or series of related transactions is on terms
no less favorable to the Borrower or such Subsidiary than
those that could be obtained in a comparable arm's length
transaction with a Person that is not an Affiliate, and (ii)
such transaction or series of related transactions is approved
by a majority of the Board of Directors of the Borrower
(including a majority of the disinterested directors), which
approval is set forth in a board resolution of the Borrower
certifying that such transaction or series of transactions
complies with the immediately preceding clause (i).
and (b) amending Section 6.08 thereof to delete both clauses (a) and (b) after
the words 'except for' and to substitute the words 'Permitted Investments'.
Section 3. Amendments to Article VII. Article VII of the
Credit Agreement is hereby amended by (a) amending Section 7.01(f)(ii)(y) to
substitute '30 days' for '60 days'; (b) amending Section 7.01(j)(ii) to
substitute '30 consecutive days' for '45 consecutive days'; (c) moving the word
'or' from the end of Section 7.01(o) to the end of Section 7.01(p); and (d)
adding the following subsection to the end of Section 7.01(p):
(q) all or any substantial part of the assets
or property of the Borrower are condemned, seized
or appropriated by any Governmental Authority;
Section 4. Representations and Warranties. The representations
and warranties set forth in Section 3 of the Credit Agreement are true and
correct in all material respects on and as of the date hereof, except to the
extent that such representations and warranties expressly relate to an earlier
date. As of the Effective Date (as hereinafter defined), and after giving effect
to this Amendment, no Event of Default, or an event which with the giving of
notice or the passage of time, or both, would constitute an Event of Default,
exists.
Section 5. Conditions to Effectiveness. This Amendment
shall become effective as of the date hereof (the 'Effective Date')
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when the Banks shall have each received counterparts of this Amendment, duly
executed by the Borrower.
Section 6. Ratification. Except to the extent hereby amended,
the Credit Agreement remains in full force and effect and is hereby ratified and
affirmed. References in the Loan Documents to the Credit Agreement shall mean
such document as amended by this Amendment, as the same may be further amended,
supplemented or otherwise modified from time to time.
Section 7. Costs and Expenses. All out-of-pocket expenses
incurred by the Banks, including the reasonable fees and disbursements of
Zalkin, Rodin & Goodman LLP, counsel to the Banks, incurred in connection with
the negotiation and preparation of this Amendment shall be paid by the Borrower
as provided in Section 9.05 of the Credit Agreement. The Borrower hereby
confirms that the Borrower shall be obligated to reimburse the Banks' reasonable
expenses incurred in the retention of a financial advisor to the Banks in
connection with the administration of the Loans or the protection or enforcement
of the Banks' rights in connection therewith.
Section 8. References. This Amendment shall be limited
precisely as written and shall not be deemed (a) to be a consent granted
pursuant to, or a waiver or modification of, any other term or condition of the
Credit Agreement or any of the instruments or agreements referred to therein or
(b) to prejudice any right or rights which the Administrative Agent, Collateral
Agent or the Banks may now have or have in the future under or in connection
with the Credit Agreement or the Loan Documents or any of the instruments or
agreements referred to therein.
Section 9. Applicable Law. THIS AMENDMENT SHALL IN ALL
RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN SUCH
STATE.
Section 10. Headings. Section headings in this Amendment are
included herein for convenience of reference only and are not to affect the
construction of, or to be taken into consideration in interpreting, this
Amendment.
Section 11. Integration. This Amendment represents the entire
agreement of the parties hereto with respect to the amendment of the Credit
Agreement, and the terms of any letters and other documentation entered into
among the Borrower and any Bank or the Administrative Agent or the Collateral
Agent prior to the execution of this Amendment which relate to the amendment of
the Credit Agreement shall be replaced by the terms of this Amendment.
Section 12. Execution in Counterparts. This Amendment may be
executed in any number of counterparts, each of which shall constitute an
original, but all of which taken together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered in New York, New York by their
proper and duly authorized officers as of the day and year first above written.
NAI TECHNOLOGIES, INC.
By___________________________
Title:
THE BANK OF NEW YORK
as Administrative Agent and as a Bank
By:___________________________
Vice President
CHEMICAL BANK
as Collateral Agent and as a Bank
By:___________________________
Vice President
Consented to as of this
____ day of November, 1995
NAI TECHNOLOGIES - SYSTEMS DIVISION CORPORATION
By:_______________________
Title:
WILCOM, INC.
By:_______________________
Title:
ARATHON, V.I., INC.
By:_______________________
Title:
CODAR TECHNOLOGY, INC.
By:_______________________
Title:
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