Exhibit 4(b)(1)(C)
GMAC COMMERCIAL CREDIT LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
as of September 26, 2001
TII INDUSTRIES, INC.
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Re: CONSENT AND AMENDMENT
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Gentlemen:
Reference is made to the Revolving Credit, Term Loan and Security
Agreement dated April 30, 1998 (the "Industries Loan Agreement") by and among
GMAC Commercial Credit LLC, formerly known as BNY Factoring LLC, as successor by
merger to BNY Financial Corporation ("Lender"), TII Industries, Inc.
("Industries") and TII Corporation ("Corporation"); the Revolving Credit, Term
Loan and Security Agreement dated April 30, 1998 (the "Crown Loan Agreement";
and together with the Industries Loan Agreement, collectively, the "Loan
Agreements" ) by and between Lender and Crown Tool & Die Company, Inc.
("Crown"); the Guaranty dated April 30, 1998 executed by Industries in favor of
Lender (the "Industries Guaranty"); the Guaranty dated April 30, 1998 executed
by Corporation in favor of Lender (the "Corporation Guaranty"); the Guaranty
dated April 30, 1998 executed by TII-Dominicana Inc. ("Dominicana") in favor of
Lender (the "Dominicana Guaranty"); the Guaranty dated April 30, 1998 executed
by TII International, Inc. ("International") in favor of Lender (the
"International Guaranty"); the Guaranty dated April 30, 1998 executed by
Telecommunications Industries, Inc. ("Telecommunications"; and together with
Industries, Corporation, Crown, Dominicana and International, collectively, the
"Obligors" ) in favor of Lender (the "Telecommunications Guaranty"; and together
with the Industries Guaranty, the Corporation Guaranty, the Dominicana Guaranty
and the International Guaranty, collectively, the "Guaranties") and each of the
notes, instruments, mortgages, agreements and other documents executed and/or
delivered in connection therewith (all of the foregoing, as the same now exists
or hereafter be amended, restated, renewed, extended, supplemented or otherwise
modified, collectively, the "Loan Documents"). All capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms as set
forth in the Loan Agreements.
Obligors have requested that Lender consent to certain transactions
which are prohibited under the Loan Documents and have further requested that
Lender amend certain provisions of the Loan Documents, all as more fully set
forth herein. Lender has consented to such transactions and has agreed to amend
certain provisions of the Loan Documents subject to the terms and conditions set
forth herein.
In consideration of the foregoing, the parties hereby agree as follows:
I. CONSENTS
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A. Dissolution and Liquidations. Industries has requested that Lender
consent to the liquidation and dissolution of each of International, Dominicana,
Corporation, Crown and Telecommunications prior to January 31, 2002. Lender
hereby consents to the dissolution and liquidation
TII INDUSTRIES, INC.
September 26, 2001
Page 2
of each of International, Dominicana, Corporation and Telecommunications prior
to January 31, 2002, provided that:
1. Not less than five (5) Business Days prior to the
consummation of any contemplated dissolution and liquidation, Industries shall
provide Lender with written notice of its intention to consummate such
transaction(s) together with a Pro Forma Balance Sheet for Industries after
giving effect to the contemplated transaction(s);
2. Prior to the consummation of, and immediately after giving
effect to, each such contemplated liquidation and dissolution, no Event of
Default under the Industries Loan Agreement shall exist;
3. Concurrently with the liquidation of each such entity,
Industries and the entity which is the subject of the liquidation (the
"Liquidated Entity") will enter into one or more Assignment and Assumption
Agreements, in form and content satisfactory to Lender in its sole discretion,
pursuant to which Industries will be assigned all of the assets of the
Liquidated Entity subject to the liens and security interest of Lender, and
Industries shall assume all of the liabilities of the Liquidated Entity,
including, without limitation, the Obligations of such Liquidated Entity to
Lender;
4. The consummation of any contemplated liquidation and
dissolution of a Liquidated Entity shall not have a material adverse effect on
Industries, its business, its assets or the Collateral, as determined by GMACCC
in its sole discretion;
5. Industries and any Liquidated Entity (prior to the
liquidation and dissolution of such Liquidated Entity) shall execute and deliver
to Lender, upon Lender's request, such documents and agreements as Lender may,
from time to time, request to carry out the purposes, terms or conditions of
this agreement;
6. As of the date hereof, Crown shall have no further right to
request, and Lender shall have no further obligation to make, loans, advances or
other financial accommodations under the Crown Loan Agreement; and
7. As of the date hereof, (a) Corporation shall have no
further right to request, and Lender shall have no further obligation to make,
loans, advances or other financial accommodations under the Industries Loan
Agreement and (b) all references to "Borrowers" appearing in the Industries Loan
Agreement shall be deemed amended and restated to mean solely Industries and its
permitted successors and assigns.
B. Sale of Assets. Industries has requested that Lender consent to the
sale by Industries of its condominium located at Villa Caparra Executive Cond.
(Apt. 7-G), Puerto Rico. Lender hereby consents to the sale by Industries of
such condominium, provided that, the gross sale price of the condominium shall
not be less than $150,000 and within five (5) Business Days after the
consummation of such sale, Industries will remit the net proceeds of such sale
to Lender for application to the Obligations.
TII INDUSTRIES, INC.
September 26, 2001
Page 3
II. AMENDMENT Paragraph 6.5 of the Industries Loan Agreement is hereby
amended and restated in its entirety to read as follows:
"6.5 Net Worth. Cause to be maintained at all times a
consolidated Net Worth in an amount not less than $19,500,000
("Minimum Net Worth"). For each of Borrowers' fiscal quarters
during the Term commencing with the fiscal quarter beginning
on June 30, 2001, Minimum Net Worth shall be increased by an
amount equal to fifty percent (50%) of Net Income for each
such quarter."
III. GENERAL
A. Industries hereby acknowledges, confirms and agrees that within
thirty (30) days from the date hereof, Industries shall deliver to Lender
schedules, in form and content satisfactory to Lender, of Industries' patents,
trademarks and other intellectual property, and the failure by Industries to
timely deliver such schedules shall constitute an Event of Default under the
Industries Loan Agreement.
B. In consideration of the consents and amendments given by Lender
herein, Industries agrees to pay a non-refundable fee to Lender in the amount of
$5,000, which fee shall be fully earned as of the date hereof and shall be
charged by Lender to Industries as of the date hereof.
C. Except as specifically set forth herein, no other changes or
modifications to the Loan Documents are intended or implied, and in all other
respects, the Loan Documents shall continue to remain in full force and effect
in accordance with their respective terms as of the date hereof. Except as
specifically set forth herein, nothing contained herein shall evidence a waiver
or amendment by Lender of any other provision of the Loan Documents nor shall
anything contained herein be construed as a consent by Lender to any transaction
other than that specifically consented to herein.
D. The terms and provisions of this Agreement shall be for the benefit
of the parties hereto and their respective successors and assigns; no other
person, firm, entity or corporation shall have any right benefit or interest
under this Agreement. This Agreement may be signed in counterparts, each of
which shall be an original and all of which when taken together shall constitute
one agreement. In making proof of this Agreement, it shall not be necessary to
produce or account for more than one counterpart signed by the party to be
charged.
E. This Agreement sets forth the entire agreement and understanding of
the parties with respect to the matter set forth herein. This Agreement cannot
be changed, modified, amended or terminated except in writing executed by the
party to be charged.
Very truly yours,
GMAC COMMERCIAL CREDIT LLC
By: /s/ Xxxxx Xxxxxxxx
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Title: SVP
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ACKNOWLEDGED AND AGREED:
TII INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
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Title: VP Finance and Treasurer
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TII CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
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Title: VP Finance and Treasurer
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TII INDUSTRIES, INC.
September 26, 2001
Page 4
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CROWN TOOL & DIE COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Title: President
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TII-DOMINICANA, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Title: President
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TII INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Title: President
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TELECOMMUNICATIONS INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Title: President
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