1
August 21, 1996
Lexington Components, Inc.
767 Third Avenue
New York, New York 10017
Re: AMENDMENT TO FINANCING AGREEMENTS
Gentlemen:
Reference is made to certain financing agreements dated
January 11, 1990 between Lexington Components, Inc. ("LCI") and Congress
Financial Corporation ("Congress"), including, but not limited to, an Accounts
Financing Agreement [Security Agreement], as amended (the "Accounts
Agreement"), and all supplements thereto and all other related financing and
security agreements (collectively, all of the foregoing, as the same have
heretofore or contemporaneously been or may be hereafter, amended, replaced,
extended, modified or supplemented, the "Financing Agreements").
In connection with the financing arrangements pursuant to the Accounts
Agreement and the other Financing Agreements, the parties hereto hereby agree to
amend the Financing Agreements, as set forth below (capitalized terms used
herein, unless otherwise defined herein, shall have the meanings ascribed
thereto in the Accounts Agreement and the other Financing Agreements):
1. ADDITIONAL TERM LOAN. Contemporaneously herewith, in order to
evidence the balance of the outstanding Obligations owed by LCI pursuant to the
Second Amended and Restated Promissory Note, dated January 31, 1995, made
payable by LCI in favor of Congress, in the original principal amount of
$6,957,000, and in order to evidence an additional one-time advance to LCI,
which is deemed to be made upon the effective date hereof, in the principal
amount of $1,000,000, LCI is executing and delivering to Congress a Third
Amended and Restated Promissory Note in the original principal amount of
$6,087,000 (as the same now exists or may hereafter be amended, supplemented,
renewed, extended, restated or replaced, the "LCI Third Restated Note"). The
Obligations evidenced by the LCI Third Restated Note shall be payable, including
interest and other amounts, as provided therein and, to the extent not
inconsistent with the terms of the LCI Third Restated Note, as provided in the
other Financing Agreements, and shall be secured by all Collateral.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS. In addition to the
continuing representations, warranties and covenants heretofore or hereafter
made by LCI to Congress pursuant to the Financing Agreements, LCI hereby
represents, warrants and covenants with and to Congress as follows (which
representations, warranties and covenants are continuing and shall survive the
2
execution and delivery hereof and shall be incorporated into and made a part of
the Financing Agreements):
(a) No Event of Default exists or has occurred and is
continuing on the date of this Amendment.
(b) This Amendment has been duly executed and delivered by LCI
and is in full force and effect as of the date hereof, and the agreements and
obligations of LCI contained herein constitute the legal, valid and binding
obligations of LCI enforceable against LCI in accordance with their terms.
3. CONDITIONS TO EFFECTIVENESS OF AMENDMENT. Anything contained in this
Amendment to the contrary notwithstanding, the terms and provisions of this
Amendment shall only become effective upon the satisfaction of the following
conditions precedent:
(a) Congress shall have received an executed original or
executed original counterparts (as the case may be) of this Amendment, together
with the following, each of which shall be in form and substance satisfactory to
Congress:
(i) the LCI Third Restated Note; and
(ii) the Amendment between LPC and Congress with
respect to the LPC Financing Agreements and the documents and instruments
required thereunder and the satisfaction of all conditions precedent to the
effectiveness thereof.
(b) All representations and warranties contained herein, in
the Accounts Agreement and in the other Financing Agreements shall be true and
correct in all material respects.
(c) No Event of Default shall exist or have occurred and be
continuing, and no event shall have occurred or condition be existing which,
with notice or passage of time or both, would constitute an Event of Default.
4. EFFECT OF THIS AMENDMENT. Except as modified pursuant hereto, the
Accounts Agreement and all supplements to the Accounts Agreement and all other
Financing Agreements are hereby specifically ratified, restated and confirmed by
the parties hereto as of the date hereof and no existing defaults or Events of
Default have been waived in connection herewith. To the extent of conflict
between the terms of this Amendment and the Accounts Agreement or any of the
other Financing Agreements, the terms of this Amendment control.
5. FURTHER ASSURANCES. LCI shall execute and deliver such
- 2 -
3
additional documents and take such additional actions as may reasonably be
requested by Congress to effectuate the provisions and purposes of this
Amendment.
6. GOVERNING LAW. This Amendment shall be governed by and construed
in accordance with the laws of the State of New York without reference to its
principles of conflicts of law.
By the signatures hereto of the duly authorized officers, the parties
hereto mutually covenant, warrant and agree as set forth herein.
Very truly yours,
CONGRESS FINANCIAL CORPORATION
By: Frank S. Chiovari
--------------------------
Title: Vice President
--------------------------
AGREED AND ACCEPTED:
LEXINGTON COMPONENTS, INC.
By: Warren Delano
----------------------------
Title: President
----------------------------
- 3 -
4
CONSENT
The undersigned guarantor hereby consents to the foregoing Amendment,
agrees to be bound by its terms applicable to it, and ratifies and confirms the
terms of its Guarantee and Waiver dated January 11, 1990 as applicable to all
present and future indebtedness, liabilities and obligations of LEXINGTON
COMPONENTS, INC. to CONGRESS FINANCIAL CORPORATION, including, without
limitation, all indebtedness, liabilities and obligations under the Financing
Agreements as amended hereby.
LEXINGTON PRECISION CORPORATION
By: Warren Delano
----------------------------
Title: President
----------------------------
- 4 -