Attached files
| file | filename |
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| 8-K - POINT BLANK SOLUTIONS, INC. | form8k07601_01292010.htm |
Exhibit 10.1
TWENTY-FIRST AMENDMENT TO
LOAN AND SECURITY AGREEMENT
This
TWENTY-FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as
of this 29th day of January, 2010 by and among BANK OF AMERICA, N.A., as
successor by merger to LaSalle Business Credit, LLC, as administrative agent and
collateral agent (in such agent capacities, “Agent”) for itself and all
other lenders from time to time a party hereto (“Lenders”), located at
135 South LaSalle Street, Chicago, Illinois 60603-4105, PROTECTIVE APPAREL
CORPORATION OF AMERICA, a New York corporation (“PACA”), POINT BLANK BODY ARMOR
INC., a Delaware corporation (“Point Blank”) (collectively,
the “Borrowers” and
each, individually, a “Borrower”) and POINT BLANK
SOLUTIONS, INC., a Delaware corporation (the “Parent” and a “Guarantor”). Unless
otherwise specified herein, capitalized terms used in this Amendment shall have
the meanings ascribed to them by the Loan Agreement (as hereinafter
defined).
RECITALS
WHEREAS,
Borrowers, Parent, Agent and Lenders have entered into that certain Amended and
Restated Loan and Security Agreement dated as of April 3, 2007 (as amended,
supplemented, restated or otherwise modified from time to time, the “Loan Agreement”);
WHEREAS,
Borrowers, Parent, Agent and Lenders have agreed to the amendments set forth
herein;
NOW
THEREFORE, in consideration of the foregoing recitals, mutual agreements
contained herein and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Borrowers, Parent, Agent and
Lenders hereby agree as follows:
SECTION
1. Amendments.
(a) The
definition of “Eligible Inventory” set forth in Section 1 of the Loan Agreement
is hereby amended by replacing the period at the end of clause (ix) therein with
“; and” and adding a new clause (x) at the end of such definition to
read as follows:
“(x) it is not subject
to any prepayment or progress billing arrangement as determined by
Agent.
(b) The
definition of “Sixteenth Amendment Reserve” set forth in Section 1 of the Loan
Agreement is hereby amended and restated to read as follows:
“Sixteenth Amendment
Reserve” means, for the relevant period, the dollar amount of the
“Availability Block” set forth below for such period:
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START
DATE
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END
DATE
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AVAILABILITY
BLOCK
|
|
Sixteenth
Amendment Effective Date
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November 6,
2009
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$7,500,000
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November
7, 2009
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November
13, 2009
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$9,000,000
|
|
November
14, 2009
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November
20, 2009
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$10,500,000
|
|
November
21, 2009
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December
4, 2009
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$11,500,000
|
|
December
5, 2009
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December
29, 2009
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$7,750,000
|
|
December
30, 2009
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January
6, 2010
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$5,750,000
plus 85% of
the
amount of sales
assigned
to Agent
between
December 30,
2009
and January 6, 2010
|
|
January
7, 2010
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January
17, 2010
|
$4,630,000
plus (a) 85%
of
the amount of sales
assigned
to Agent
between
January 7, 2010
and
January 17, 2010;
plus
(b) 100% of the
amount
of any tax refund
received
in this period
|
|
January
18, 2010
|
January
28, 2010
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$7,301,000
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|
January
29, 2010
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February
9, 2010
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$2,000,000
|
|
February
10, 2010
|
April
4, 2010
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$8,742,000
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(c) Section
2(a)(i) of the Loan Agreement is hereby amended by reducing the advance rate
against Borrowers’ Eligible Accounts set forth therein from “eighty-five percent
(85%)” to “seventy-five percent (75%)”.
(d) Section
2(a)(ii) of the Loan Agreement is hereby amended and restated to read as
follows:
“(ii) Up
to the lesser of: (A) twenty percent (20%) of the Borrowers’ Eligible Inventory
valued at cost (in accordance with the procedures described in Schedule
2(a)(ii)); or (B) $5,000,000 (such amount then applicable, the Inventory Advance
Limit”); minus”
(e) The
definition of “Maximum Revolving Loan Limit” set forth in Section 2(a) of the
Loan Agreement is hereby amended by deleting the language reading “(B) during
the period from December 19, 2009 through January 6, 2010, Twenty Million and
No/100 Dollars ($20,000,000), (C) during the period from January 7, 2010 through
January 17, 2010, Fifteen Million and No/100 Dollars ($15,000,000), (D) during
the period from January 18, 2010 through January 22, 2010, Twenty Million and
No/100 Dollars ($20,000,000), (E) during the period from January 23, 2010
through February 12, 2010, Fifteen Million and No/100 Dollars ($15,000,000), (F)
during the period from February 13, 2010 through February 26, 2010, Ten Million
and No/100 Dollars ($10,000,000) and (G) from and after February 27, 2010, Five
Million and No/100 Dollars ($5,000,000)” and replacing it with the language
reading:
“(B) during the period from December
19, 2009 through January 6, 2010, Twenty Million and No/100 Dollars
($20,000,000), (C) during the period from January 7, 2010 through January 17,
2010, Fifteen Million and No/100 Dollars ($15,000,000), (D) during the period
from January 18, 2010 through January 22, 2010, Twenty Million and No/100
Dollars ($20,000,000), (E) during the period from January 23, 2010 through
January 28, 2010, Fifteen Million and No/100 Dollars ($15,000,000),
(F) during the period from January 29, 2010 through February 26, 2010, Ten
Million and No/100 Dollars ($10,000,000) and (G) from and after February 27,
2010, Five Million and No/100 Dollars ($5,000,000)”
2
(f) Section
2(a) of the Loan Agreement is hereby amended by adding two new sentences to the
end thereof to read as follows:
“The Agent, Lenders and Borrowers agree
that upon the Agent’s receipt of (a) the Borrowers’ income tax refund in the
approximate amount of $6,742,000 and (b) prepaid amounts under Borrowers’
government contracts after January 15, 2010 in the approximate amount of
$4,321,000, Agent shall apply all such amounts in each case against the
outstanding balance of Revolving Loans but, in the case of clause (b), such
amounts shall not reduce the Revolving Loan Limit until such time as the
inventory relating to such prepayments is shipped and billed at which time the
applicable prepayment amount will then be applied against the account receivable
relating to such Inventory for which the prepayment was received. The
parties hereto agree that no Revolving Loans, Letters of Credit or other
financial accommodations shall be made by Agent and Lenders or requested by
Borrowers from and after such time when the aggregate combined amount of
Revolving Loans, Letters of Credit and other financial accommodations made from
and after January 28, 2010 equal (or would exceed after giving effect to such
Revolving Loans, Letters of Credit and other financial accommodations requested
by Borrowers) the amounts received by Agent under clauses (a) and (b) of the
previous sentence (which amounts, for purposes of this limitation, shall not
exceed the approximate amounts set forth in the previous
sentence).”
(g) Section
12 of the Loan Agreement is hereby amended by adding a new subsection 12(p) to
the end thereof to read as follows:
“(p) Cash Flow
Projections. Borrowers shall have provided Agent
with a 13 week cash flow projection on or prior to February 4, 2010 in a form
acceptable to Agent.”
(h) Section
15(b)(i) of the Loan Agreement is hereby amended by adding a reference to
“12(p)” immediately after reference to “12(o)” set forth therein.
(i) For
purposes of clarification (i) with respect to that certain Eleventh Amendment to
Loan And Security Agreement dated in May, 2009 among the parties hereto, the
reference in Section 1(c) thereto to “new subsection 2(e)” shall be deemed a
reference to “new subsection 2(f)” and (ii) with respect to that certain
Fourteenth Amendment to Loan And Security Agreement dated in August, 2009 among
the parties hereto, the reference in Section 1(b) thereto to “new subsection
2(f)” shall be deemed a reference to “new subsection 2(g)” and all references in
any subsequent amendments to the Loan Agreement referring to either “Section
2(f)” or to “subsection (f)” of Section 2 to the Loan Agreement
shall be deemed a reference to “Section 2(g)” or “subsection (g)” of
Section 2 to the Loan Agreement, as applicable.
3
SECTION
2. Effectiveness. The
effectiveness of this Amendment is subject to the satisfaction of each of the
following conditions precedent:
(a) This
Amendment shall have been duly executed and delivered by Borrowers and Parent
(collectively, “Amendment
Parties”), Agent and each Lender;
(b) No
Default or Event of Default shall have occurred and be continuing after giving
effect to this Amendment; and
(c) The
representations and warranties contained herein shall be true and correct in all
material respects.
SECTION
3. Representations
and Warranties. In order to induce Agent and each Lender to
enter into this Amendment, each Amendment Party hereby represents and warrants
to Agent and each Lender, which representations and warranties shall survive the
execution and delivery of this Amendment, that:
(a) all
of the representations and warranties contained in the Loan Agreement and in
each of the Other Agreements are true and correct in all material respects as of
the date hereof after giving effect to this Amendment, except to the extent that
any such representations and warranties expressly relate to an earlier
date;
(b) the
execution, delivery and performance by Amendment Parties of this Amendment has
been duly authorized by all necessary corporate action required on their part
and this Amendment, the Loan Agreement and the Other Agreements are the legal,
valid and binding obligation of Amendment Parties enforceable against Amendment
Parties in accordance with their terms, except as their enforceability may be
affected by the effect of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights or remedies of creditors generally, and by
general limitations on the availability of equitable remedies;
(c) neither
the execution, delivery and performance of this Amendment by Amendment Parties,
the performance by Amendment Parties of the Loan Agreement nor the consummation
of the transactions contemplated hereby does or shall contravene, result in a
breach of, or violate (i) any provision of any Amendment Party’s certificate or
articles of incorporation or bylaws or other similar documents, or agreements,
(iii) any law or regulation, or any order or decree of any court or government
instrumentality, or (iii) any indenture, mortgage, deed of trust, lease,
agreement or other instrument to which any Amendment Party or any of its
Subsidiaries is a party or by which any Amendment Party or any of its
Subsidiaries or any of their property is bound, except in any such case to the
extent such conflict or breach has been waived or consented to herein or by a
written waiver document, a copy of which has been delivered to Agent on or
before the date hereof; and
(d) no
Default or Event of Default has occurred and is continuing after giving effect
to this Amendment.
4
SECTION
4. Reference to and Effect Upon
the Loan Agreement.
(a) Except
as specifically set forth above, the Loan Agreement and each of the Other
Agreements shall remain in full force and effect and are hereby ratified and
confirmed; and
(b) the
amendments set forth herein are effective solely for the purposes set forth
herein and shall be limited precisely as written, and shall not be deemed to (i)
be a consent to any amendment, waiver or modification of any other term or
condition of the Loan Agreement or any of the Other Agreements except as
specifically set forth herein, (ii) operate as a waiver or otherwise prejudice
any right, power or remedy that Agent or Lenders may now have or may have in the
future under or in connection with the Loan Agreement or any of the Other
Agreements except as specifically set forth herein, (iii) constitute a waiver of
any provision of the Loan Agreement or any of the Other Agreements, except as
specifically set forth herein, or (iv) constitute a waiver of any Event of
Default existing on the date hereof or arising after the date hereof except as
specifically set forth herein and Agent and Lenders hereby reserve all rights
and remedies under the Loan Agreement and the Other Agreements as a result of
such Events of Default. Upon the effectiveness of this Amendment,
each reference in the Loan Agreement to “this Agreement”, “herein”, “hereof” and
words of like import and each reference in the Loan Agreement and the Other
Agreements to the Loan Agreement shall mean the Loan Agreement as amended
hereby. This Amendment shall be construed in connection with and as
part of the Loan Agreement. Each Amendment Party hereby acknowledges
and agrees that there is no defense, setoff or counterclaim of any kind, nature
or description to the Liabilities or the payment thereof when due.
SECTION
5. Costs And
Expenses. To the extent provided in Section 4(c)(iv) of
the Loan Agreement, Borrowers agree to reimburse Agent for all fees, costs, and
expenses, including the reasonable fees, costs, and expenses of counsel or other
advisors for advice, assistance, or other representation in connection with this
Amendment.
SECTION
6. GOVERNING
LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION
7. Headings. Section
headings in this Amendment are included herein for convenience of reference only
and shall not constitute part of this Amendment for any other
purposes.
SECTION
8. Counterparts. This
Amendment may be executed in any number of counterparts, each of which when so
executed shall be deemed an original, but all such counterparts shall constitute
one and the same instrument.
[Signature
Pages Follow]
5
IN
WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment
as of the date first written above.
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BORROWERS:
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PROTECTIVE
APPAREL
CORPORATION
OF AMERICA
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By:
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/s/
Michelle Doery
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Name:
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Michelle
Doery
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Title:
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Chief
Financial Officer
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POINT
BLANK BODY ARMOR INC.
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By:
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/s/
Michelle Doery
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Name:
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Michelle
Doery
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Title:
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Chief
Financial Officer
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PARENT:
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POINT
BLANK SOLUTIONS, INC.
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By:
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/s/
Michelle Doery
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Name:
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Michelle
Doery
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Title:
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Chief
Financial Officer
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[Signature
Page to Twenty-First Amendment to Loan and Security
Agreement]
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AGENT
AND LENDER:
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BANK
OF AMERICA, N.A., as successor by merger to
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LaSalle
Business Credit, LLC
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By:
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/s/
Patrick M. Cornell
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Name:
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Patrick
M. Cornell
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Title:
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Senior
Vice President
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[Signature
Page to Twenty-First Amendment to Loan and Security
Agreement]