Exhibit 10.1
ELEVENTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT
This ELEVENTH
AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “
Amendment ”) is entered into as of this 18
th
day of May 2009 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 ”) and LIFE WEAR TECHNOLOGIES, INC., a
Florida corporation (“ Life Wear ”, and together
with PACA and 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 and waivers 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 and
Limited Waivers .
(a) The definition of “Maximum
Revolving Loan Limit” set forth in Section 2(a) of the
Loan Agreement is hereby amended by deleting reference to the
amount of “Thirty-Five Million and No/100 Dollars
($35,000,000)” and replacing it with the amount of
“Thirty Million and No/100 Dollars
($30,000,000)”.
(b) Clause (v) of
Section 2(a) of the Loan Agreement shall be designated as
clause (vi) and a new clause (v) shall be inserted to
read as follows:
“(v) $3,000,000 plus
75% of all tax refunds received by Parent and Borrowers pursuant to
Section 2(e) of this Agreement; minus
”
(c) Section 2 of the Loan
Agreement is hereby amended by adding a new subsection 2(e) at the
end thereof to read as follows:
“(e) Mandatory Prepayments
from Tax Refunds . Upon receipt of any and all state and
federal tax refunds, Parent and Borrowers shall cause all such tax
refunds to be applied to the outstanding Revolving Loans within one
Business Day of receipt of such tax refunds.”
(d) Section 4(c)(ii) of the
Loan Agreement is hereby amended and restated to read as
follows:
“(ii) Unused Line Fee .
The Borrowers jointly and severally agree to pay to Agent, for the
benefit of Lenders according to their respective Pro Rata Shares,
an unused line fee of one and one-half percent per annum
(1.50%) of the 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 Lenders and payable in immediately available
funds 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.”
(e) Section 12 of the Loan
Agreement is hereby amended by adding a new subsection 12(m) to the
end thereof to read as follows:
“(m) Restructuring Plan
. On or prior to June 30, 2009, Borrowers shall have delivered
to Agent a comprehensive restructuring plan as to the
Borrowers’ businesses in form and substance satisfactory to
Agent.”
(f) Section 12(j) of the Loan
Agreement is hereby deleted and replaced with the language
“(j) [Intentionally Deleted]”.
(g) Section 14(b) of the Loan
Agreement is hereby amended by adding a new sentence to the end
thereof to read as follows:
“Notwithstanding the
foregoing, the parties agree that the minimum EBITDA covenant
requirement for the periods ending April 30, 2009 and
May 31, 2009 only shall not be tested.”
(h) Section 14(d) of the Loan
Agreement is hereby amended by adding a new sentence to the end
thereof to read as follows:
“Notwithstanding the
foregoing, the parties agree that the minimum Net Worth covenant
requirement for the periods ending April 30, 2009 and
May 31, 2009 only shall not be tested.”
(i) Section 15(b)(i) of the
Loan Agreement is hereby amended by adding the reference “
12(m) ,” immediately after the reference to “
12(k) ,” set forth therein.
(j) Borrowers hereby acknowledge and
agree that an Event of Default exists under Section 15(b)(i)
of the Loan Agreement by virtue of Borrowers’ failure to
comply with Section 14(b) of the Loan Agreement for the month
ending March 31, 2009 (the “Existing
Default”).
2
Subject to the satisfaction of the conditions
precedent set forth in Section 2 hereof, Agent and Lenders
hereby waive the Existing Default; provided , that nothing
contained herein shall in any way waive, release, modify or limit
Borrowers’ obligations to comply with the financial covenant
requirements set forth in Section 14 of the Loan Agreement for
any other period.
(k) The Agent and the Lender hereby
waive (i) any Event of Default that arises under
Section 15(b) and Section 15(d) of the Loan
Agreement with respect to any representation and warranty made by
the Borrowers under Section 11(u ) of the Loan
Agreement and the covenant contained in Section 12(c)
of the Loan Agreement, in each case which relate solely to the
failure by PACA to file IRS/DOL 5500 reports at any time prior to
July 15, 2009 with respect to its 401(k) Qualified Plan,
(ii) compliance by the Borrowers with the provisions contained
in Sections 11(u) and 12(c) of the Loan Agreement solely as
they relate to such IRS/DOL filings for a period commencing on the
date that this Amendment becomes effective in accordance with
Section 2 herein and ending on July 15,
2009.
(l) The Agent and the Lender hereby
waive any Event of Default that arises under
Section 13(c) of the Loan Agreement with respect to any
alleged State of Tennessee tax lien that currently appears on the
public reco
