Exhibit 10-17
EXECUTION COPY
SIXTH AMENDMENT (this "AMENDMENT"), dated as of March 15, 2004, to LOAN
AND SECURITY AGREEMENT, dated as of September 24, 2001 (as amended, modified or
supplemented from time to time, the "LOAN AGREEMENT"), by and among LASALLE
BUSINESS CREDIT, LLC, a Delaware limited liability company, successor by merger
to LASALLE BUSINESS CREDIT, INC., a Delaware corporation ("LASALLE"), and
PROTECTIVE APPAREL CORPORATION OF AMERICA, a New York corporation ("PACA"),
POINT BLANK BODY ARMOR, INC., a Delaware corporation ("POINT BLANK"), and NDL
PRODUCTS, INC., a Florida corporation ("NDL", and with PACA and Point Blank,
collectively, the "BORROWERS" and each, a "BORROWER"), and DHB INDUSTRIES, INC.,
a Delaware corporation (f/k/a DHB Capital Group, Inc., the "PARENT"). Terms
which are capitalized in this Amendment and not otherwise defined shall have the
meanings ascribed to such terms in the Loan Agreement.
WHEREAS, the Borrowers and Parent have requested that LaSalle agree to
an extension of the term of the Loan Agreement and to the modification of
certain other terms and provisions contained in the Loan Agreement; and
WHEREAS, LaSalle has consented to such request, on the terms and
subject to the satisfaction of the conditions contained in this Amendment.
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
SECTION ONE. AMENDMENTS. Effective upon the satisfaction of the
conditions set forth in Section Three hereof, the Loan Agreement shall be and is
hereby amended as follows:
(a) SECTION 2. LOANS.
(i) Clauses (ii) and (iii) of Section 2(a) of the Loan
Agreement are deleted in their entirety; clause (iv) of Section 2(a) is
renumbered as "(ii)"; and the word "plus" at the end of clause (i) of Section
2(a) is deleted and the word "minus" substituted in lieu thereof.
(ii) The proviso appearing immediately after clause (iv) of
Section 2(a) of the Loan Agreement is deleted in its entirety and the following
substituted in lieu thereof:
"provided, that the aggregate undrawn amount of all Letters of
Credit issued or guaranteed by Lender, with respect to all
Borrowers, shall at no time EXCEED Two Million and No/100
Dollars ($2,000,000) and (y) the Revolving Loan Limit with
respect to Revolving Loans made to all Borrowers, at any one
time outstanding, shall in no event exceed Thirty-Two Million
Five Hundred Thousand and No/100 Dollars ($32,500,000) (the
"MAXIMUM REVOLVING LOAN LIMIT")."
(iii) Section 2(b) of the Loan Agreement is deleted in its
entirety and the following substituted in lieu thereof:
"(B) TERM LOAN.
Subject to the terms and conditions of this Agreement
and the Other Agreements, Lender shall make a term loan to
Point Blank in the principal amount of Twelve Million Five
Hundred Thousand and No/100 Dollars ($12,500,000) (the
"ORIGINAL TERM LOAN"). Lender shall make an additional term
loan (each, an "ADDITIONAL TERM LOAN"; the Original Term Loan
and all Additional Term Loans are herein collectively referred
to as the "TERM LOAN") to Point Blank in a principal amount
equal to the difference between $12,500,000 and the principal
balance of the Term Loan outstanding on the effective date of
such Additional Term Loan for amortization purposes, upon the
occurrence of each of the following events: (x) the net income
of the Parent and its consolidated Subsidiaries, after taxes,
for the fiscal year ending on or about December 31, 2004,
shall be not less than the lesser of (i) 80% of the projected
net income of the Parent and its consolidated Subsidiaries,
after taxes, for such fiscal year, as reflected in acceptable
annual projections for such fiscal year delivered to Lender
pursuant to Section 9(d) hereof and (ii) $14,000,000; or (y)
the net income of the Parent and its consolidated
Subsidiaries, after taxes, for the fiscal year ending on or
about December 31, 2005 and/or the fiscal year ending on or
about December 31, 2006, shall be not less than $8,000,000.
The effective date of each Additional Term Loan for
amortization purposes shall be January 1st of the year in
which such Additional Term Loan is made. Notwithstanding the
foregoing, no Additional Term Loan shall be made if, on the
date such Loan is required to be made hereunder, any one of
the following conditions exist: (x) the aggregate value
(measured at the lower of cost or market value) of the
Borrowers' Eligible Inventory, shall be less than $35,000,000,
as reflected in the most recent monthly Inventory report of
the Borrowers delivered to Lender pursuant to Section 9(b) of
this Agreement; or (y) all of the conditions set forth in
Section 17(b) of this Agreement have not been satisfied. If,
for any of the fiscal years referred to in this clause (b),
Parent and its consolidated Subsidiaries shall have achieved
the amount of net income required hereunder for an Additional
Term Loan to be made, then Lender shall make such Additional
Term Loan by the 5th day after Lender's receipt of the audited
annual financial statements of Parent and its consolidated
Subsidiaries for such fiscal year reflecting such amount of
net income. For all purposes under this Agreement, the Term
Loan shall constitute a Loan. The Term Loan shall be evidenced
by the Term Note, in the principal amount of $12,500,000,
dated on or about March 15, 2004."
-2-
(iv) Section 2(d)(ii) of the Loan Agreement is deleted in its
entirety and the following substituted in lieu thereof:
"Repayment of Term Loan. The Term Loan shall be repaid in
consecutive quarterly installments, each in the amount of One
Million and No/100 Dollars ($1,000,000) and each payable on
the first day of each quarter, commencing July 1, 2004;
provided, that the entire outstanding principal balance of the
Term Loan shall be repaid on the earliest to occur of: (i) the
last day of the Original Term; (ii) and the date of
termination of this Agreement pursuant to Section 10 hereof;
(iii) the date on which the due date of the Liabilities is
accelerated pursuant to Section 16 hereof; or (iv) the date
any mandatory prepayment thereof shall be required pursuant to
Section 2(d)(iv) hereof. If any such payment due date is not a
Business Day, then such payment shall be made on the next
succeeding Business Day, and such extension of time shall be
included in the computation of the amount of interest and fees
due hereunder."
(v) Section 2(d)(iv) of the Loan Agreement is deleted in its
entirety and the following substituted in lieu thereof:
"If, at any time, the aggregate value (measured at the lower
of cost or market value) of the Borrowers' Eligible Inventory
shall be less than $35,000,000, as reflected in the most
recent monthly Inventory report of the Borrowers delivered to
Lender pursuant to Section 9(b) hereof, then the Borrowers
shall immediately prepay the entire outstanding principal
balance of the Term Loan and Lender shall thereafter have no
obligation to make any Additional Term Loan."
(b) SECTION 4. INTEREST, FEES AND CHARGES.
(i) Clauses (a) and (b) of Section 4(a)(ii) are deleted in
their entirety and the following substituted in lieu thereof:
"(a) Revolving Loans borrowed as LIBOR Rate Loans
shall bear interest at one and three-quarters percent (1.75%)
in excess of the LIBOR Rate for the applicable Interest
Period, (b) portions of the Term Loan borrowed as LIBOR Rate
Loans shall bear interest at two and one-quarter percent
(2.25%) in excess of the LIBOR Rate for the applicable
Interest Period."
(ii) Section 4(c)(ii) of the Loan Agreement is deleted in its
entirety and the following substituted in lieu thereof:
"(ii) Unused Line Fee. The Borrowers jointly and
severally agree to pay to Lender an unused line fee of
three-eighths of one percent per annum (0.375%) of the
-3-
difference each month between (i) the Maximum Revolving Loan
Limit and (ii) the average daily balance of the Revolving
Loans, plus the outstanding Letter of Credit Obligations, in
each case for such month. Said fee shall be fully earned by
Lender and payable monthly in arrears on the first Business
Day of each month for the previous month, and shall be
calculated on the basis of a 360 day year."
(iii) Section 4(a)(iv) of the Loan Agreement is deleted in its
entirety and the following substituted in lieu thereof:
"(iv) Intentionally Omitted."
(c) SECTION 10. TERMINATION; AUTOMATIC RENEWAL.
(a) The first sentence of Section 10 of the Loan Agreement is deleted
in its entirety and the following substituted in lieu thereof:
"THIS AGREEMENT SHALL BE IN EFFECT FOR A PERIOD (SUCH
PERIOD, THE "ORIGINAL TERM") FROM THE DATE HEREOF UNTIL
OCTOBER 1, 2007, AND SHALL BE EXTENDED THEREAFTER (EACH SUCH
EXTENSION BEING REFERRED TO HEREIN AS A "RENEWAL TERM") SOLELY
AT THE OPTION OF THE LENDER, UNLESS (A) THE DUE DATE OF THE
LIABILITIES IS ACCELERATED PURSUANT TO SECTION 16 HEREOF OR
(B) THE BORROWERS ELECT TO TERMINATE THIS AGREEMENT AT THE END
OF THE ORIGINAL TERM OR AT THE END OF ANY RENEWAL TERM BY
GIVING LENDER WRITTEN NOTICE OF SUCH ELECTION AT LEAST
FORTY-FIVE (45) DAYS PRIOR TO THE END OF THE ORIGINAL TERM OR
THE THEN CURRENT RENEWAL TERM AND BY PAYING ALL OF THE
LIABILITIES IN FULL ON THE LAST DAY OF SUCH TERM."
(b) The last two sentences of Section 10 of the Loan Agreement are
deleted in their entirety and the following substituted in lieu thereof:
"In the event that the Borrowers elect to and in fact
terminate this Agreement and prepay all of the Liabilities on
or before October 1, 2005, then, in such event, on the date of
such prepayment the Borrowers agree jointly and severally to
pay to Lender as a prepayment fee, in addition to the payment
of all other Liabilities, an amount equal to one percent (1%)
of the Maximum Revolving Loan Limit in effect on such date.
There shall be no prepayment fee imposed on the Borrowers upon
-4-
any prepayment of the Term Loan."
(d) SECTION 14. FINANCIAL COVENANTS. Clauses (a), (b) and (c) of
Section 14 of the Loan Agreement are deleted in their entirety and the following
substituted in lieu thereof:
"(A) TANGIBLE NET WORTH.
(i) The Tangible Net Worth of Parent and its Subsidiaries, on
a consolidated basis, shall not at any time be less than
Forty-Five Million and No/100 Dollars ($45,000,000).
(ii) Each Borrower shall at all times maintain a minimum
Tangible Net Worth of at least One Dollar.
(B) FIXED CHARGE COVERAGE.
Parent and the Borrowers shall not permit the ratio of EBITDA
to Fixed Charges for any fiscal quarter (determined as of the
end of such fiscal quarter), commencing with the fiscal
quarter ending on or about March 31, 2004, in each case
together with the immediately preceding three fiscal quarters,
to be less than 2.00 : 1.00.
(C) CONSOLIDATED EBITDA.
Parent and the Borrowers shall not permit EBITDA for any
fiscal quarter (determined as of the end of such fiscal
quarter), commencing with the fiscal quarter ending on or
about March 31, 2004, to be less than Four Million Five
Hundred Thousand and No/100 Dollars ($4,500,000)."
(e) SECTION 15. DEFAULT. Clause (m) of Section 15 of the Loan
Agreement is deleted in its entirety and the following substituted in lieu
thereof:
"(M) INTENTIONALLY OMITTED."
SECTION TWO . AMENDMENT FEE. In consideration for the amendments
contained herein, the Borrowers agree jointly and severally to pay to Lender an
amendment fee of $83,000 (the "AMENDMENT FEE"), which fee shall be
non-refundable and deemed fully earned when paid. The Borrowers authorize
LaSalle to charge any loan account of the Borrowers for the Amendment Fee.
SECTION THREE. CONDITIONS PRECEDENT. This Amendment shall become
effective on the date when all of the following conditions, the satisfaction of
each of which is a condition precedent to the effectiveness of this Amendment,
shall have occurred or shall have been waived in writing by LaSalle.
-5-
(a) LaSalle shall have received and reviewed each of the following,
which shall be in form and substance reasonably satisfactory to it:
(i) this Amendment, duly executed by each Borrower and Parent,
and by David H. Brooks;
(ii) an original Amended and Restated Revolving Note, in the
form of Exhibit A hereto, in the principal amount of $32,500,000, duly executed
by each Borrower; and
(iii) an Original Term Note, in the form of Exhibit B hereto,
in the principal amount of $12,500,000, duly executed by each Borrower.
(b) LaSalle shall have received payment, in cash, of the Amendment Fee.
(c) All representations and warranties set forth in the Loan Agreement
(except for such inducing representations and warranties that were only required
to be true and correct as of a prior date) shall be true and correct in all
material respects on and as of the effective date hereof, and no Default or
Event of Default shall have occurred and be continuing.
(d) No event or development shall have occurred since December 31, 2002
which event or development has had or is reasonably likely to have a Material
Adverse Effect.
(e) LaSalle shall have received a certificate from each Borrower and
Parent, executed by the chairman of each such party, as to the truth and
accuracy of paragraphs (c) and (d) of this Section Three.
(f) There shall be no action, suit or proceeding pending or to any
Borrower's or Parent's knowledge overtly threatened against any Borrower or
Parent before any court (including any bankruptcy court), arbitrator or
governmental or administrative body or agency which challenges or relates to the
consummation of this Amendment or the other transactions contemplated herein.
(g) LaSalle shall have received such further agreements, consents,
instruments and documents as may be necessary or proper in the reasonable
opinion of LaSalle and its counsel to carry out the provisions and purposes of
this Amendment.
SECTION FOUR . CONDITIONS SUBSEQUENT. The Borrowers shall cause each of
the following documents to be delivered to LaSalle on or before the 30th day
after the date hereof:
(a) an opinion of counsel to the Borrowers and Parent, in form and
substance satisfactory to LaSalle and its counsel, regarding each Borrower's and
Parent's due incorporation, valid existence, good standing and power and
authority to execute this Amendment, the due authorization, execution and
delivery of this Amendment by each Borrower and Parent, the enforceability of
this Amendment against each Borrower and Parent, the perfection of Lender's
security interest in the Collateral and such other matters as LaSalle and its
counsel may reasonably require;
-6-
(b) a Certificate of the Secretary or Assistant Secretary of each
Borrower and of Parent, in each case in form and substance satisfactory to
LaSalle and its counsel, (A) relating to the adoption of resolutions by each
such Borrower's and Parent's respective Board of Directors approving this
Amendment and the other documents executed or delivered in connection herewith
by such party, (B) certifying that no amendments have been made to each such
Borrower's or Parent's Certificate of Incorporation, as amended, other than
Parent's Certificate of Designations and Preferences executed on December 14,
2001 and Point Blank's Certificate of Amendment dated December 31, 2003, and
each such Borrower's or Parent's by-laws, as amended, since September 24, 2001,
and (C) further certifying the names and incumbency of officers of each such
Borrower and of Parent authorized to sign this Amendment and all other documents
executed or delivered in connection herewith, and the names and validity of
signatures of such officers; and
(c) evidence, in each case satisfactory to LaSalle and its counsel,
that PACA has filed its past-due Biennial Statement with the New York Department
of State and that Parent has paid all past-due franchise taxes owing to the
State of Delaware.
The failure of the Borrowers to cause each of the aforementioned
documents to be delivered to Lender on or before such date shall constitute an
Event of Default.
SECTION FIVE . REPRESENTATIONS, WARRANTIES AND COVENANTS. Each Borrower
and Parent hereby represents, warrants and covenants (which representations and
warranties shall survive the execution and delivery hereof) to LaSalle that:
(a) Each Borrower and Parent has the corporate or other power,
authority and legal right to execute, deliver and perform this Amendment and the
other instruments, agreements, documents and transactions contemplated hereby to
which it is a party, and has taken all actions necessary to authorize the
execution, delivery and performance of this Amendment and the other instruments,
agreements, documents to which it is a party and the transactions contemplated
hereby and thereby;
(b) No consent of any Person (including, without limitation,
stockholders or creditors of any Borrower or Parent, as the case may be) other
than LaSalle, and no consent, permit, approval or authorization of, exemption
by, notice or report to, or registration, filing or declaration with, any
governmental authority is required in connection with the execution, delivery
and performance by each Borrower and Parent, or the validity or enforceability
against such parties, of this Amendment and the other instruments, agreements,
documents and transactions contemplated hereby to which they are a party;
(c) This Amendment has been duly executed and delivered on behalf of
each Borrower and Parent by their respective duly authorized officers, and
constitutes the legal, valid and binding obligation of such Borrower and Parent,
enforceable in accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting the rights of creditors
generally or equitable remedies (whether arising in a proceeding at law or in
equity);
-7-
(d) No Borrower or Parent is in material default under any indenture,
mortgage, deed of trust, agreement or other instrument to which it is a party or
by which it may be bound. Neither the execution and delivery of each of this
Amendment, nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof will (i) violate any law or regulation, or
(ii) result in or cause a violation by any Borrower or Parent of any order or
decree of any court or government instrumentality, or (iii) conflict with, or
result in the breach of, or constitute a default under, any indenture, mortgage,
deed of trust, material agreement or other material instrument to which each
such Borrower or Parent is a party or by which any of them may be bound, or (iv)
result in the creation or imposition of any lien, charge, or encumbrance upon
any of the property of each such Borrower or Parent, except in favor of LaSalle,
to secure the Liabilities, or (v) violate any provision of the Certificate of
Incorporation, By-Laws or any capital stock or similar equity instrument of each
such Borrower or Parent;
(e) After giving effect to this Amendment, no Default or Event of
Default shall have occurred and is continuing;
(f) Since the date of Parent's consolidated and consolidating financial
statements for the Fiscal Year ended December 31, 2002, no change or event has
occurred which has had or is reasonably likely to have a Material Adverse
Effect;
(g) Upon execution of this Amendment and the satisfaction of the
conditions set forth in Section Three hereof, Parent and each of the Borrowers
agrees that the term "Liabilities" shall include any and all Liabilities arising
under the Loan Agreement, as amended by this Amendment, including but not
limited to the Original Term Loan and any and all Additional Term Loans;
(h) Parent and its Subsidiaries, taken as a whole, are, and after
giving effect to the transactions contemplated by this Amendment, will be,
solvent, able to pay its debts as they become due, has capital sufficient to
carry on its business, now owns property having a value both at fair valuation
and at present fair saleable value greater than the amount required to pay its
debts, and will not be rendered insolvent by the execution and delivery of this
Amendment or any of the other agreements instruments being executed in
connection herewith or by completion of the transactions contemplated hereunder
or thereunder.
SECTION SIX. GENERAL PROVISIONS.
(a) Except as herein expressly amended, the Loan Agreement and all
other agreements, documents, instruments and certificates executed in connection
therewith, are ratified and confirmed in all respects and shall remain in full
force and effect in accordance with their respective terms.
(b) All references in the Other Agreements to the Loan Agreement shall
mean the Loan Agreement as amended hereby and as hereafter amended, supplemented
or modified from time to time. From and after the date hereof, all references in
the Loan Agreement to "this Agreement," "hereof," "herein," or similar terms,
shall mean and refer to the Loan Agreement as amended by this Amendment.
-8-
(c) This Amendment may be executed by the parties hereto individually
or in combination, in one or more counterparts, each of which shall be an
original and all which shall constitute one and the same agreement.
(d) This Amendment shall be governed and controlled by the internal
laws of the State of New York.
(e) Nothing contained in this Amendment shall be deemed to constitute a
waiver of any Default or Event of Default, whether or not LaSalle has knowledge
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-9-
IN WITNESS WHEREOF, LaSalle, each Borrower and Parent have caused this
Amendment to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
LASALLE BUSINESS CREDIT, INC.
By:_____________________________________
Name: Michael F. Aliberto, III
Title: First Vice President
PROTECTIVE APPAREL CORPORATION OF AMERICA
By:_____________________________________
Name:
Title:
POINT BLANK BODY ARMOR, INC.
By:_____________________________________
Name:
Title:
NDL PRODUCTS, INC.
By:_____________________________________
Name:
Title:
DHB INDUSTRIES, INC.
By:_____________________________________
Name:
Title:
ACKNOWLEDGED AND CONSENTED TO:
DAVID H. BROOKS
_____________________________
-10-
EXECUTION COPY
DHB ARMOR GROUP, INC.
By:_____________________________________
Name:
Title:
DHB SPORTS GROUP, INC.
By:_____________________________________
Name:
Title:
LANXIDE ARMOR PRODUCTS, INC.
By:_____________________________________
Name:
Title:
ORTHOPEDIC PRODUCTS, INC.
By:_____________________________________
Name:
Title:
Exhibit A to Sixth Amendment
FORM OF AMENDED AND RESTATED
REVOLVING NOTE
ORIGINAL DATE OF EXECUTION: SEPTEMBER 24, 2001
DATE OF AMENDMENT AND RESTATEMENT: MARCH 15, 2004
$32,500,000.00 NEW YORK, NEW YORK
FOR VALUE RECEIVED, PROTECTIVE APPAREL CORPORATION OF AMERICA, a
Delaware corporation, POINT BLANK BODY ARMOR, INC., a Delaware corporation, and
NDL PRODUCTS, INC., a Florida corporation (each a "Borrower" and collectively,
the "Borrowers") jointly and severally promise to pay to the order of LASALLE
BUSINESS CREDIT, LLC (the "Lender"), at its offices located at 135 South LaSalle
Street, Chicago, Illinois 60603, the principal sum of Thirty-Two Million Five
Hundred Thousand and No/100 Dollars ($32,500,000.00) on the Maturity Date, which
shall mean the last day of the Original Term, or the applicable Renewal Term, in
the event that the Loan Agreement (as defined below) is renewed, as the case may
be, or so much of such principal sum as shall be outstanding and unpaid on the
Maturity Date, all as more fully set forth in the Loan and Security Agreement,
dated as of September 24, 2001 (as the same may be amended, modified,
supplemented or restated from time to time, the "Loan Agreement"), by and among
each of the Borrowers, DHB Industries, Inc., as Guarantor, the DHB Subsidiaries
and the Lender. Terms which are capitalized in this Revolving Note but are not
otherwise defined shall have the meanings ascribed to them in the Loan
Agreement. The Borrowers further promise jointly and severally to pay (a) the
principal of the Revolving Loans, as set forth in Section 2(d)(i) of the Loan
Agreement and (b) interest on the outstanding principal amount hereof on the
dates and at the rates provided in the Loan Agreement, from the date hereof
until payment in full hereof. This Revolving Note is referred to in and
delivered pursuant to the Loan Agreement, and is subject to and entitled to all
provisions and benefits thereof.
The Borrowers hereby authorize the Lender to charge any account of the
Borrowers maintained with the Lender for all sums payable hereunder as and when
such sums become due. If payment hereunder becomes due and payable on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day, and interest shall be payable thereon at the rate
specified during such extension. Credit shall be given for payments made, in the
manner and at the times provided in the Loan Agreement. It is the intent of the
parties that the rate of interest and other charges to the Borrowers under this
Revolving Note shall be lawful; therefore, if for any reason the interest or
other charges payable hereunder are found by a court of competent jurisdiction,
in a final determination, to exceed the limit which the Lender may lawfully
charge the Borrowers, then the obligation to pay interest or other charges shall
automatically be reduced to such limit and, if any amount in excess of such
limit shall have been paid, then such amount shall be refunded to the Borrowers.
The principal and all accrued interest hereunder may be prepaid by the
Borrowers, in part or in full, at any time; provided, however, that if the
Borrowers terminate the Loan Agreement prior to the Maturity Date, the Borrowers
may be required to pay a prepayment fee as provided in Section 10 of the Loan
Agreement.
Exhibit A-1
The Borrowers waive the benefit of any law that would otherwise
restrict or limit the Lender in the exercise of its right, which is hereby
acknowledged, to set off against the Liabilities, without notice and at any time
hereafter, any amounts owing from the Lender to the Borrowers. The Borrowers
agree that the Lender shall not be liable for any error in judgment or mistakes
of fact or law, other than for gross negligence. To the extent the Borrowers
have any counterclaims, they agree to assert any and all such counterclaims
(other than compulsory counterclaims) by separate action.
The Borrowers, any other party liable with respect to the Liabilities
evidenced hereby and any and all endorsers and accommodation parties, and each
one of them, if more than one, waive any and all presentment, demand, notice of
dishonor, protest, and all other notices and demands in connection with the
enforcement of the Lender's rights hereunder.
The Revolving Loans evidenced hereby have been made, and this Revolving
Note has been delivered, at New York, New York. THIS REVOLVING NOTE SHALL BE
GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS TO
INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER
RESPECTS, INCLUDING WITHOUT LIMITATION, THE LEGALITY OF THE INTEREST RATE AND
OTHER CHARGES, and shall be binding upon the Borrowers and each of their
successors and assigns. If this Revolving Note contains any blanks when executed
by the Borrowers, the Lender is hereby authorized, without notice to the
Borrowers, to complete any such blanks according to the terms upon which the
Revolving Loan or Revolving Loans were granted. Wherever possible, each
provision of this Revolving Note shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Revolving
Note shall be prohibited by or be invalid under such law, such provision shall
be severable, and be ineffective to the extent of such prohibition or
invalidity, without invalidating the remaining provisions of this Revolving
Note.
To induce the Lender to make the Revolving Loans evidenced by this
Revolving Note, the Borrowers (i) irrevocably agree that all actions arising
directly or indirectly as a result or in consequence of this Revolving Note
shall be instituted and litigated only in courts having situs in the City of New
York, New York; provided, that Lender may elect to commence an action or
proceeding with respect to the Collateral in another jurisdiction, (ii) hereby
consent to the exclusive jurisdiction and venue of any State or Federal Court
located and having its situs in said city, and (iii) waive any objection based
on forum non-conveniens. IN ADDITION, THE BORROWERS HEREBY WAIVE TRIAL BY JURY
IN ANY ACTION OR PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS
REVOLVING NOTE, THE LIABILITIES, THE COLLATERAL, ANY ALLEGED TORTIOUS CONDUCT BY
ANY BORROWER OR THE LENDER OR WHICH IN ANY WAY, DIRECTLY OR INDIRECTLY, ARISES
OUT OF OR RELATES TO THE RELATIONSHIP BETWEEN THE BORROWERS AND THE LENDER,
waive personal service of any and all process, and consent that all such service
of process may be made by certified mail, return receipt requested, directed to
the Borrowers at the address indicated in the Lender's records; and service so
made shall be complete five (5) days after the same has been deposited in the
U.S. mails as aforesaid.
Exhibit A-2
This Note amends, supersedes and replaces in its entirety that certain
Revolving Note (the "Original Note") in the original principal amount of Fifteen
Million Five Hundred Thousand and No/100 Dollars ($15,500,000) dated September
24, 2001, executed by the Borrowers and payable to the order of the Lender;
provided, however, that all of the indebtedness evidenced by the Original Note
continues to be outstanding as of the date hereof, no cancellation, adjustment
or novation of such indebtedness shall be deemed to have occurred on account of
the amendment and restatement of the Original Note pursuant to this Note, and
the Borrowers' execution and delivery of this Note shall constitute an express
acknowledgment and confirmation of, and agreement with, the foregoing.
IN WITNESS WHEREOF, each of the Borrowers has executed this Revolving
Note on the date first above set forth.
PROTECTIVE APPAREL CORPORATION
OF AMERICA
By:_____________________________________
Name:
Title:
POINT BLANK BODY ARMOR, INC.
By:_____________________________________
Name:
Title:
NDL PRODUCTS, INC.
By:_____________________________________
Name:
Title:
Exhibit A-3
Exhibit B to Sixth Amendment
FORM OF
TERM NOTE
EXECUTED AS OF THE 15TH DAY OF MARCH, 2004 $12,500,000
FOR VALUE RECEIVED, PROTECTIVE APPAREL CORPORATION OF AMERICA, a
Delaware corporation, POINT BLANK BODY ARMOR, INC., a Delaware corporation, and
NDL PRODUCTS, INC., a Florida corporation (each, a "Borrower" and collectively,
the "Borrowers") jointly and severally promise to pay to the order of LASALLE
BUSINESS CREDIT, LLC ("Lender"), at its offices located at 135 South LaSalle
Street, Chicago, Illinois 60603, the principal sum of Twelve Million Five
Hundred Thousand and No/100 Dollars ($12,500,000.00) on the Maturity Date, which
shall mean the last day of the Original Term, or the last day of the applicable
Renewal Term, in the event that the Loan Agreement (as defined below) is
renewed, as the case may be, or so much of such principal sum as shall be
outstanding and unpaid on the Maturity Date, all as more fully set forth in the
Loan and Security Agreement, dated as of September 24, 2001 (as the same has
been, and may hereafter be, amended, modified, supplemented or restated from
time to time, the "Loan Agreement") by and among the Borrowers, DHB Industries,
Inc., as Guarantor, the DHB Subsidiaries and the Lender. Terms which are
capitalized in this Term Note but are not otherwise defined shall have the
meanings ascribed to them in the Loan Agreement. The Borrowers further promise
to (a) pay the principal amount of this Term Note in installments as set forth
in Section 2(d)(ii) of Loan Agreement, (b) make mandatory prepayments of
principal of this Term Note as set forth in Section 2(d)(iv) of the Loan
Agreement and (c) pay interest on the outstanding principal amount hereof on the
dates and at the rates provided in the Loan Agreement from the date hereof until
payment in full hereof. This Term Note is referred to and delivered pursuant to
the Sixth Amendment to the Loan Agreement, and is subject to and entitled to all
provisions and benefits of the Loan Agreement.
The Borrowers hereby authorize the Lender to charge any account of the
Borrowers maintained with the Lender for all sums payable hereunder as and when
such sums become due. If payment hereunder becomes due and payable on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day, and interest shall be payable thereon at the rate
specified during such extension. Credit shall be given for payments made in the
manner and at the times provided in the Loan Agreement. It is the intent of the
parties that the rate of interest and other charges to the Borrowers under this
Term Note shall be lawful; therefore, if for any reason the interest or other
charges payable hereunder are found by a court of competent jurisdiction, in a
final determination, to exceed the limit which the Lender may lawfully charge
the Borrowers, then the obligation to pay interest or other charges shall
automatically be reduced to such limit and, if any amount in excess of such
limit shall have been paid, then such amount shall be refunded to the Borrowers.
The principal and all accrued interest hereunder may be prepaid by the
Borrowers, in part or in full, at any time.
Exhibit B-1
The Borrowers waive the benefit of any law that would otherwise
restrict or limit the Lender in the exercise of its right, which is hereby
acknowledged, to set off against the Liabilities, without notice and at any time
hereafter, any amounts owing from the Lender to the Borrowers. The Borrowers
agree that the Lender shall not be liable for any error in judgment or mistakes
of fact or law, other than for gross negligence. To the extent the Borrowers
have any counterclaims, they agree to assert any and all such counterclaims
(other than compulsory counterclaims) by separate action.
The Borrowers, any other party liable with respect to the Liabilities
and any and all endorsers and accommodation parties, and each one of them, if
more than one, waives any and all presentment, demand, notice of dishonor,
protest, and all other notices and demands in connection with the enforcement of
the Lender's rights hereunder.
The Term Loan evidenced hereby has been made, and this Term Note has
been delivered, at New York, New York. THIS TERM NOTE SHALL BE GOVERNED AND
CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS TO INTERPRETATION,
ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER RESPECTS,
INCLUDING WITHOUT LIMITATION THE LEGALITY OF THE INTEREST RATE AND OTHER
CHARGES, and shall be binding upon the Borrowers and each of their successors
and assigns. If this Term Note contains any blanks when executed by Borrowers,
the Lender is hereby authorized, without notice to the Borrowers, to complete
any such blanks according to the terms upon which the Term Loan was granted.
Wherever possible, each provision of this Term Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Term Note shall be prohibited by or be invalid under such law, such
provision shall be severable, and be ineffective to the extent of such
prohibition or invalidity, without invalidating the remaining provisions of this
Term Note.
To induce the Lender to make the Term Loan evidenced by this Term Note,
the Borrowers (i) irrevocably agree that all actions arising directly or
indirectly as a result of or in consequence of this Term Note or any other
agreement with the Lender, or the Collateral, shall be instituted and litigated
only in courts having situs in the City of New York, New York; provided that
Lender may elect to commence an action or proceeding with respect to the
Collateral in another jurisdiction, (ii) hereby consent to the exclusive
jurisdiction and venue of any State or Federal Court located and having its
situs in said city, and (iii) waive any objection based on forum non-conveniens.
IN ADDITION, THE BORROWERS HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR
PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS TERM NOTE, THE
LIABILITIES, THE COLLATERAL, ANY ALLEGED TORTIOUS CONDUCT BY ANY BORROWER OR THE
LENDER OR WHICH IN ANY WAY, DIRECTLY OR INDIRECTLY, ARISES OUT OF OR RELATES TO
THE RELATIONSHIP BETWEEN THE BORROWERS AND THE LENDER, waive personal service of
any and all process, and consent that all such service of process may be made by
certified mail, return receipt requested, directed to the Borrowers at the
address indicated in the Lender's records; and service so made shall be complete
five (5) days after the same has been deposited in the U.S. mails as aforesaid.
Exhibit B-2
IN WITNESS WHEREOF, each of the Borrowers has executed this Term Note
on the date first above set forth.
PROTECTIVE APPAREL CORPORATION
OF AMERICA
By:_____________________________________
Name:
Title:
POINT BLANK BODY ARMOR, INC.
By:_____________________________________
Name:
Title:
NDL PRODUCTS, INC.
By:_____________________________________
Name:
Title:
Exhibit B-3