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Exhibit 10.1
As of March 31, 1999
Lexington Precision Corporation
767 Third Avenue
New York, New York 10017
Re: Amendment to Financing Agreements
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Gentlemen:
Reference is made to certain financing agreements dated January 11,
1990 between Lexington Precision Corporation ("LPC") 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:
1. DEFINITIONS:
(a) The definition of "Term Loans" contained in the letter agreement
re: Amendment to Financing Agreements, dated January 31, 1995, between LPC and
Congress (the "January 1995 Amendment"), as amended by the letter agreement re:
Amendment to Financing Agreements, dated January 16, 1996, between LPC and
Congress, the letter agreement re: Amendment to Financing Agreements, dated
March 11, 1997, between LPC and Congress, and the letter agreement re: Amendment
to Financing Agreements, dated January 28, 1999, between LPC and Congress, is
hereby further amended to mean and include all term loans now outstanding or
hereafter made by Congress to LPC, including, without limitation, the term loan
made by Congress to LPC evidenced by the March 1999 Additional LPC Term Note (as
defined below) and any and all New Equipment Term Notes heretofore or hereafter
executed by LPC, as any such notes may hereafter be amended, renewed, extended,
restated or replaced.
(b) Capitalized terms used herein, unless otherwise defined herein,
shall have the meanings ascribed thereto in the Accounts Agreement and the other
Financing Agreements.
2. ADDITIONAL TERM LOAN. In order to evidence an additional one-time
advance to LPC (the "March 1999 Additional LPC Term Loan"), which shall be made
upon the effective date
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hereof, LPC is executing and delivering to Congress a Term Promissory Note in
the principal amount of $1,100,000 (the "March 1999 Additional LPC Term Note").
The Obligations evidenced by the March 1999 Additional LPC Term Note shall be
payable, including interest and other amounts, as provided therein and, to the
extent not inconsistent with the terms of the March 1999 Additional LPC Term
Note, as provided in the other Financing Agreements, and shall be secured by all
Collateral.
3. MAXIMUM AMOUNT OF TERM LOANS. The aggregate principal amount of all
Term Loans and all "Term Loans" made to LCI (as defined in the "LCI Financing
Agreements", as hereinafter defined), at any one time outstanding, shall not
exceed the amount of $31,000,000.
4. LCI NAME CHANGE:
(a) Congress hereby waives any requirement of prior notice with
respect to the proposed corporate name change from Lexington Components, Inc. to
Lexington Rubber Group, Inc. (the "LCI Name Change"); PROVIDED, THAT, LPC or LCI
notifies Congress within three (3) days of the date of the effectiveness of the
LCI Name Change (the "LCI Name Change Date").
(b) LPC hereby acknowledges that as of the LCI Name Change Date, LCI
shall have changed its name from Lexington Components, Inc. to Lexington Rubber
Group, Inc. ("LRG"). Accordingly, the parties agree that, as of the LCI Name
Change Date, any and all references to Lexington Components, Inc. or LCI
contained anywhere in the Financing Agreements (including the use of the letters
"LCI" as part of other defined terms) shall be deemed amended to mean and refer
to LRG.
5. FEE. LPC shall pay to Congress a facility amendment fee in the
amount of $24,000, payable simultaneously with the execution hereof, which fee
is fully earned as of the date hereof.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS. In addition to the
continuing representations, warranties and covenants heretofore or hereafter
made by LPC to Congress pursuant to the Financing Agreements, LPC hereby
represents, warrants and covenants with and to Congress as follows (which
representations, warranties and covenants are continuing and shall survive the
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) Within seven (7) days following the LCI Name Change Date, LPC
shall cause LCI to deliver to Congress a true
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copy of the amendment to the certificate of incorporation of LCI as certified
and issued by the Secretary of State of the State of Delaware, evidencing the
name change of Lexington Components, Inc. to Lexington Rubber Group, Inc.
(c) As soon as practicable following the LCI Name Change Date, LPC
shall cause LCI to deliver copies of related certifications of name change
and/or applications for change of name filed with the Department of State of
each state where LCI is qualified to do business as a foreign corporation.
(d) As soon as practicable following the LCI Name Change Date and
the delivery of UCC-3 amendments to LCI by Congress, LPC shall cause LCI to
execute and deliver to Congress, such UCC-3 amendments evidencing the LCI Name
Change, to be filed with respect to each financing statement currently filed
against LCI, as debtor in favor of Congress, as secured party.
(e) This Amendment and each instrument required to be executed and
delivered by LPC hereunder, has been duly executed and delivered by LPC and is
in full force and effect as of the date hereof, and the agreements and
obligations of LPC contained herein and therein constitute the legal, valid and
binding obligations of LPC enforceable against LPC in accordance with their
terms.
7. USE OF PROCEEDS. The proceeds of the March 1999 Additional LPC Term
Loan to be made by Congress hereof shall be credited to LPC's Revolving Loan
account maintained by Congress under the Financing Agreements.
8. 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
additional 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 March 1999 Additional LPC Term Note;
(ii) certified resolutions of the Board of
Directors of LPC duly authorizing the
execution and delivery of this
Amendment and the instruments and
transactions hereunder; and
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(iii) an Amendment between LCI and Congress
with respect to the LCI 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; and
(c) No Event of Default shall have occurred 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.
9. 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.
10. FURTHER ASSURANCES. LPC shall execute and deliver such additional
documents and take such additional actions as may reasonably be requested by
Congress to effectuate the provisions and purposes of this Amendment, including,
but not in limitation, the following:
(a) At Congress' request, LPC shall execute and deliver to Congress
such mortgage modification agreements or similar agreements with respect to any
and all properties of LPC which are encumbered by a mortgage or deed of trust,
as the case may be, in favor of Congress, to expressly secure, without
limitation, the notes evidencing the then current Term Loans and other
Financing Agreements evidencing the Obligations (it being agreed that the
absence of such agreement shall not deprive Congress of the benefit of the
liens held by Congress on the real property covered by such mortgages or deeds
of trust, which shall continue to secure all Obligations); and
(b) In connection with such agreements under Section 10(a) of the
Amendment, LPC shall arrange for the delivery to Congress, at LPC's expense,
of an updated title insurance policy and necessary endorsements thereto in favor
of Congress, in form and substance satisfactory to Congress, for each property
that is subject to such agreements.
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11. 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: Herbert C. Korn
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Title: Assistant Vice President
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AGREED AND ACCEPTED:
LEXINGTON PRECISION CORPORATION
By: Warren Delano
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Title: President
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CONSENT
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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
PRECISION CORPORATION to CONGRESS FINANCIAL CORPORATION, including, without
limitation, all indebtedness, liabilities and obligations under the Financing
Agreements as amended hereby.
LEXINGTON COMPONENTS, INC.
By: Warren Delano
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Title: President
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