Exhibit 10(v)
SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT
AND COLLATERAL DOCUMENTATION
This Agreement, entered as of the 1st day of July, 1998, by and between
NATIONAL BANK OF CANADA, a chartered bank constituted under the Bank Act of
Canada, with offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
("Bank" or "Lender"), MEDIVATORS, INC., a Minnesota corporation with offices
at ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("MediVators") and DISPOSAL
SCIENCES, INC., a Minnesota corporation, with offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Disposal").
R E C I T A L S:
1. Borrowers are the "Borrowers" under a Loan and Security Agreement
dated May 22, 1996 with National Canada Finance Corp. ("NCFC"). The Loan and
Security Agreement, as amended by a First Amendment dated as of December 1,
1997 ("First Amendment"), is herein referred to as the "Loan Agreement".
Lender is the successor in interest of NCFC under the Loan Agreement. Any
capitalized terms utilized and not defined herein shall have the same
meanings as are ascribed to them in the Loan Agreement.
2. The Borrowers have requested, and Lender has agreed to, the
modification of certain terms of the Loan Documents in the manner herein
provided.
Now therefore, in consideration of the foregoing, and for other good
and valuable considerations the receipt and sufficiency of which are hereby
acknowledged, the parties do hereby agree as follows:
Section 1. Modification of Loan Agreement and Loan Documents.
1.1 Loan Agreement Amendments. The Loan Agreement is hereby amended as
follows:
(a) The last sentence of Section 2.1 is amended by deleting same in its
entirety and substituting the following in its place and stead:
The entire outstanding balance of principal, and any accrued and unpaid
interest thereon, shall be due and payable and the Revolving Line of
Credit Loan shall terminate on the earlier of: (i) May 1, 1999, or
(ii) acceleration of the Obligations upon an Event of Default (the
earlier of such dates being the "Revolving Line of Credit Termination
Date").
(b) Section 7.1 is modified by adding thereto the following sentence:
Notwithstanding any provision in this Section 7.1 or in this Agreement
to the contrary, Borrower may undertake an acquisition of ▇▇▇▇▇ ▇▇▇▇
Medical, Inc. for consideration of $1,625,000 of which $1,310,000 will
be paid in the stock of Borrower's Affiliate, Cantel Industries, Inc.
1.2 Affirmation. Except as modified herein, the Loan Agreement and Loan
Documents shall remain in full force and effect.
Section 2. Waiver of Defaults.
2.1 Waiver of Past Defaults. The Borrower is in Default of its
Obligations under Section 6.14 (Leverage Ratio) for the nine month period
ended April 30, 1998. Lender hereby waives such Default consistent with the
financial statements heretofore provided by Borrower to Lender. Nothing
contained herein and no
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action by Lender shall be deemed to constitute a waiver of any other Default
under the Loan Documents.
Section 3. Borrower Representations.
3.1 Corporate Authority. Borrowers have the authority to enter into
and perform their obligations under this Agreement. The execution, delivery
and performance of this Agreement has been duly authorized by all requisite
corporate action of Borrowers. Each of the Borrower's Locations, the current
locations of all Inventory, and the locations of each office at which each
Borrower maintains Records concerning its Accounts Receivable or other
Accounts and General Intangibles, and other financial matters, are solely as
set forth in Exhibit E annexed.
3.2 Enforceability. This Agreement constitutes the legal valid and
binding obligations of Borrowers and is enforceable against Borrowers in
accordance with its terms.
3.3 No Conflict. The execution and delivery of this Agreement and the
performance of the transactions contemplated hereby by each Borrower do not
conflict with or result in any violation of each Borrower's Certificate of
Incorporation or by-laws or any statute, rule or regulation applicable to or
binding upon either Borrower. The execution, delivery and performance of this
Agreement will not conflict with or result in any violation of any provision
of any agreement, contract, instrument, order, writ, judgment, decree or
other undertaking to which any Borrower is a party or is obligated or by
which any Borrower's property is bound.
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3.4 Authorization. The signatories executing this Agreement on behalf
of Borrowers have been authorized by Borrowers to so execute this Agreement
and the execution of this Agreement has been authorized by corporate
resolution of each Borrower.
3.5 Loan Agreement Representations. Borrowers hereby reaffirm all of
their representations and warranties set forth in Article 8 of the Loan
Agreement as of the date hereof, as modified with the substitution of
Exhibits A, C, D and E annexed hereto for such Exhibits annexed to the Loan
Agreement.
Section 4. General Provisions.
4.1 Reaffirmation of Indebtedness. Borrowers hereby acknowledge
principal indebtedness (plus interest accrued thereon) due to Bank as follows:
Loan Principal Date
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Revolving Line of $833,408.26 August 21, 1998
Credit Loan
Borrowers represent and warrant to Bank that they have no counterclaim,
defenses or offsets to any of its obligations under the Loan Agreement and
Loan Documents. Borrowers acknowledge that Bank has not by virtue of this
Agreement waived any right or remedy which it may possess by virtue of any
actions or defaults of Borrowers in conjunction with their obligations under
the Loan Documents.
4.2 Documents. By execution of this Agreement, Borrowers are
simultaneously modifying all Loan Documents, including any promissory notes
previously delivered by Borrowers,
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to conform to the terms of this Agreement, and all of such Loan Documents
shall be deemed so modified. The Loan Documents shall otherwise remain in
full force and effect.
4.3 Entire Agreement. This Agreement and the Loan Documents and the
instruments, agreements and certificates delivered simultaneously herewith,
if any, or referred to herein, constitute the entire agreement of the
parties with respect to the subject matter hereof, and supersede all prior
and contemporaneous agreements, whether written or oral, except as otherwise
provided herein.
4.4 Amendment. No provision of this Agreement may be waived or changed
orally, but only by instrument in writing, signed by the party against whom
enforcement of such change or waiver is sought.
4.5 Notices. All notices and other communications hereunder shall be
in writing and shall be effective when delivered personally or when mailed by
certified or registered mail (return receipt requested) addressed at the
addresses set forth hereinabove or to such other addresses as a party may
designate to the other in writing.
4.6 Effective Date. This Agreement and the amendments provided for
herein shall take effect as of the date provided for herein or otherwise as
of the date of this Agreement set forth hereinabove.
4.7 Unenforceability. Any provision of this Agreement which is
prohibited or unenforceable shall be deemed severed from
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this Agreement without invalidating the remaining provisions or affecting the
validity or unenforceability of the remainder of this Agreement.
4.8 Counterpart Execution. This Agreement may be signed in any number
of counterparts with the same effect as if the signatures thereto were upon
the same instrument.
4.9 Headings. The Section headings contained herein are for
convenience of reference only and are not intended to define, limit or
describe the scope or intent of any provision of this Agreement.
4.10 Third Parties. None of the obligations hereunder of any party
shall inure to or be enforceable by any party other than a party of
this Agreement.
4.11 Binding Effect. This Agreement shall be binding upon, and shall
inure to the benefit of, the successors in interest and the permitted
assigns of the parties hereto.
4.12 Default. Except as expressly set forth herein, Bank hereby
specifically reserves all of its rights and remedies under the Loan Agreement
and Loan Documents. If any Borrower fails to perform its obligations under
this Agreement, Borrowers shall be in default hereunder and said default
shall be a default under the Loan Documents.
4.13 Other Documents. Bank and Borrowers agree to execute any and all
other documents and to take such other actions as may be necessary to carry
out the terms of this Agreement. All other documents shall be in a form and
content acceptable to Bank.
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4.14. Release and Covenant Not to ▇▇▇. Each Borrower for itself, its
partners, officers and directors, affiliates, successors and assigns, and all
others claiming by or through them, hereby covenant that they will not bring,
commence, prosecute or maintain any suit, action or proceeding, either at law
or in equity, in any court of the United States or of any State thereof,
arising up to the date of this Agreement under or by virtue of the Loan
Documents or with respect to the Loans in any manner or arising out of any
negotiations or communications entertained in connection with this Agreement.
Each Borrower, for itself, its partners, officers and directors, affiliates,
successors and assigns, and all other claiming by or through it, hereby fully
and forever release and discharge Bank, its officers, directors, agents and
employees, affiliates, predecessors in interest, successors and assigns, from
any and all causes of action, whether sounding in contract or in tort, or
otherwise, and any and all liability, accrued or unaccrued, known or unknown,
fixed or contingent, on account of any and all claims, demands, and causes of
action for all losses, damages, expenses or liabilities to Borrowers, their
partners, officers and directors, affiliates, successors and assigns, and all
others claiming by or through them, arising up to the date of this Agreement
out of the Loan Documents or with respect to the Loans in any manner or
arising our of any negotiations or communications entertained in connection
with this Agreement. The parties acknowledge and agree that each Borrower's
release and covenant not to ▇▇▇ contained in this Section 4.14 does
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not apply to claims, actions and causes of action arising after the date of
this Agreement.
4.15 Waiver of Trial by Jury. EACH BORROWER HEREBY, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY, WAIVES ANY RIGHT SUCH BORROWER MAY HAVE OR
HEREAFTER ACQUIRE TO A TRIAL BY JURY IN RESPECT TO ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT. Each Borrower hereby
certifies that neither Bank nor any of its representatives, agents or counsel
has represented, expressly or otherwise, that Bank would not, in the event of
any such suit, action or proceeding seek to enforce this waiver of right to
trial by jury. Each Borrower acknowledges that it has made this waiver
knowingly, voluntarily and intentionally.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Agreement to be executed, all as of the day and year first above written.
ATTEST: MEDIVATORS, INC.
By: /s/ R. Rumble
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ATTEST: DISPOSAL SCIENCES, INC.
By: /s/ R. Rumble
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ATTEST: NATIONAL BANK OF CANADA
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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