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Exhibit 10.18  


 
 

FOURTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT,
  TERM LOAN AND SECURITY AGREEMENTS, AND RELATED DOCUMENTS    
    


        This Fourth Amendment to Revolving Credit and Security Agreement, Term Loan and Security Agreements, and Related Documents ("Agreement") is executed by ALLIED
MOTION TECHNOLOGIES, INC. ("Allied Motion"), MOTOR PRODUCTS CORPORATION ("Motor Products"), ALLIED MOTION CONTROL CORPORATION ("Allied Motion Control"), EMOTEQ CORPORATION ("Emoteq"), COMPUTER
OPTICAL PRODUCTS, INC. ("Computer Optical"), AMOT I, INC. ("AMOT I"), AMOT II, INC. ("AMOT II"), AMOT III, INC. ("AMOT III"), STATURE ELECTRIC, INC. f/k/a
AMOT, Inc. ("New Stature"), AHAB INVESTMENT COMPANY ("Ahab"), PNC BANK, NATIONAL ASSOCIATION ("Agent") as agent for itself, Silicon Valley Bank, and any other lenders under the Revolving Credit
Agreement (collectively "Lenders"), PNC BANK, NATIONAL ASSOCIATION ("PNC"), and SILICON VALLEY BANK ("SVB") for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, as
of November 1, 2005. Hereinafter, Allied Motion, Motor Products, Emoteq, Computer Optical, AMOT I, AMOT II, AMOT III, New Stature, and Ahab may be referred to individually as a "Borrower" and
collectively as the "Borrowers." 


Recitals  


        A.    Borrowers
executed and delivered to Agent and Lenders a Revolving Credit and Security Agreement and other loan documents on and after May 7, 2004. Hereinafter, the
Revolving Credit and Security Agreement and any amendments, modifications, replacements or substitutions thereto may be referred to collectively as the "Revolving Credit Loan Agreement" and the
Revolving Credit Loan Agreement, any related loan documents, and any amendments, modifications, replacements or substitutions to any of the foregoing may be referred to collectively as the "Revolving
Credit Loan Documents". 


        B.    Borrowers
executed and delivered to PNC a Term Loan and Security Agreement and other loan documents on and after May 7, 2004. Hereinafter, the Term Loan and
Security Agreement and any amendments, modifications, replacements or substitutions thereto may be referred to collectively as the "PNC Term Loan Agreement" and the PNC Term Loan Agreement, any
related loan documents, and any amendments, modifications, replacements or substitutions to any of the foregoing may be referred to collectively as the "PNC Term Loan Documents. 


        C.    Borrower
executed and delivered to SVB a Term Loan and Security Agreement and other loan documents on and after May 7, 2004. Hereinafter, the Term Loan and
Security Agreement and any amendments, modifications, replacements or substitutions thereto may be referred to collectively as the "SVB Term Loan Agreement" and the SVB Term Loan Agreement, any
related loan documents, and any amendments, modifications, replacements or substitutions to any of the foregoing may be referred to collectively as the "SVB Term Loan Documents". 


        D.    Borrowers
wish to modify the Revolving Credit Loan Documents, PNC Term Loan Documents, and SVB Term Loan Documents (collectively "Loan Documents") as set forth in this
Agreement. 


        E.    Agent,
Lenders, PNC and SVB are unwilling to modify the Loan Documents unless Borrowers execute and agree to abide by the terms and conditions set forth in this
Agreement. 


Agreements  


        1.     Borrowers
hereby acknowledge the validity and enforceability of the Loan Documents and reaffirm the truth and accuracy of all of the representations, warranties and other
statements contained in the Loan Documents as of the date of this Agreement. 







 

        2.     The
outstanding principal balance on Borrowers' obligations to Lenders under the Revolving Credit Loan Documents amounted to approximately $4,737,432.33 as of
November 1, 2005 and interest, fees, and expenses are accruing thereon as set forth in the Revolving Credit Loan Documents. 


        3.     The
outstanding principal balance on Borrowers' obligations to PNC under the PNC Loan Documents amounted to approximately $3,990,880.00 as of November 1, 2005 and
interest, fees, and expenses are accruing thereon as set forth in the Loan Documents. 


        4.     The
outstanding principal balance on Borrowers' obligations to SVB under the SVB Loan Documents amounted to approximately $1,624,999.96 as of November 1, 2005 and
interest, fees, and expenses are accruing thereon as set forth in the Loan Documents. 


        5.     Section 6.6 of the Revolving Credit Loan Agreement hereby are amended to read: 



6.6
Fixed Charge Coverage Ratio. Maintain a Fixed Charge Coverage ratio of not less than (a) 1.25 to 1.00 for the period from the date of this
Agreement to September 29, 2005, (b) 1.10 to 1.00 for the period from on September 30, 2005 to March 31, 2006; and (c) 1.25 to 1.00 at all times after
March 31, 2006, in each case, measured as of the end of each calendar quarter. The calculations of Fixed Charge Coverage Ratio shall not include: (i) on and after September 30,
2004, the results of operations from the date of acquisition and the assets or liabilities of Allied Motion Technologies B.V. or any of its Dutch affiliates; or (ii) on and after
September 30, 2005, non-financed capital expenditures pertaining to the commencement of Borrowers' business operations in the Peoples' Republic of China that have been or shall be
incurred in calendar year 2005. 




        6.     Sections 5 and 6 of the First Amendment to Revolving Credit and Security Agreement, Term Loan and Security
Agreements, and Related Documents among Borrowers, Agent, and Lenders dated as of August 19, 2004 hereby are amended to read: 



5.
Notwithstanding anything to the contrary contained in the Loan Documents but subject to the terms and conditions set forth in Section 6 below,
Agent, Lenders, PNC and SVB hereby acknowledge and agree that: 


        (a)   Allied
Motion shall be entitled to form and own 100% of the outstanding stock of Allied Motion Technologies B.V. ("Allied Motion B.V."); 


        (b)   Allied
Motion B.V. shall be entitled to acquire 100% of Premotec Beheer, B.V.'s ("Beheer") stock; 


        (c)   Allied
Motion B.V. shall be entitled to obtain a loan ("First Fortis Bank Loan") in the principal amount of 1,600,000.00 Euros or less in the aggregate from Fortis Bank
(Nederland) N.V. ("Fortis Bank") and Precision Motor Technology B.V. ("Precision Motor") shall be entitled to obtain a loan
("Second Fortis Bank Loan") in the principal amount of 200,000 Euros or less in the aggregate from Fortis Bank (collectively, "Fortis Bank Loans"); 



        (d)   Precision
Motor shall be entitled to obtain a loan ("Fortis Commercial Loan") in the principal amount of 1,500,000.00 Euros or less in the aggregate from Fortis
Commercial Finance, N.V. ("Fortis Commercial"); 


        (e)   Precision
Motor shall be entitled to lease equipment containing a purchase price of 250,000 Euros or less from Fortis Bank ("Fortis Bank Lease"); 


        (f)    Allied
Motion shall be entitled to pay $450,000.00 or less of the closing costs associated with Allied Motion's purchase of Beheer's stock, the First Fortis Bank Loan,
and the Fortis Commercial Loan; and 


        (g)   Allied
Motion shall be entitled to guaranty the payment of Allied Motion B.V.'s and Precision Motors' obligations to Fortis Bank and Fortis Commercial under the First
Fortis Bank 



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Loan,
Second Fortis Bank Loan, Fortis Commercial Loan, and Fortis Bank Lease (hereinafter, Allied Motion B.V., Precision Motors, and any related Dutch affiliates may be referred to collectively as the
"Dutch Subsidiaries"). 


6.
The acknowledgment and consent of Agent, Lenders, PNC and SVB to the actions described in Section 5 above is subject to the following
conditions: 


        (a)   Allied
Motion B.V.'s purchase price for 100% of the outstanding Beheer stock does not exceed 3,750,000 Euros (excluding closing costs) in the aggregate; 


        (b)   the
principal amount of the First Fortis Bank Loan does not exceed 1,600,000.00 Euros in the aggregate at any time and the principal amount of the Second Fortis Bank
Loan does not exceed $200,000 Euros in the aggregate at any time at any time after November 1, 2005 (unless Borrowers and the Dutch Subsidiaries obtain the prior written consent of Agent, PNC
and SVB which may be withheld in their sole discretion); 


        (c)   the
principal amount of the Fortis Commercial Loan does not exceed 1,500,000.00 Euros in the aggregate at any time after November 1, 2005 (unless Borrowers and
Dutch Subsidiaries obtain the prior written consent of Agent, PNC and SVB which may be withheld in their sole discretion); 


        (d)   the
purchase price of the leased equipment under the Fortis Bank Lease does not exceed 250,000 Euros at any time (unless Borrowers and Dutch Subsidiaries obtain the
prior written consent of Agent, PNC and SVB which may be withheld in their sole discretion); 


        (e)   the
First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial Loan, and Fortis Bank Lease are not guarantied by any of the Borrowers except for Allied Motion; 


        (f)    the
First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial Loan, and Fortis Bank Lease are not secured by any of the Borrowers' assets; 



        (g)   the
Dutch Subsidiaries do not obtain any loans or other financing arrangements except for the First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial loan,
Fortis Bank Lease, and trade credit in the ordinary course of business without obtaining the prior written consent of Agent, PNC and SVB which may be withheld in their sole discretion. Nothing
contained herein shall limit the Dutch Subsidiaries from raising additional capital through the issuance and sale of additional stock; 


        (h)   Except
for the $450,000.00 in closing costs and Allied Motion's unsecured guaranty of the First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial Loan, and
Fortis Bank Lease, no Borrower provides any Dutch Subsidiary with any monies or other things of value (except for the sale of goods and provision of services in arm's length transactions that are
incurred in the ordinary course of business), secures, or otherwise becomes responsible for the payments and/or performance of any Dutch Subsidiary's indebtedness, liabilities or other obligations to
any person or entity without obtaining the prior written consent of Agent, PNC and SVB which may be withheld in their sole discretion. In the event that any Dutch Subsidiary receives any monies or
other things of value from any Borrower that are prohibited by the preceding sentence, the Dutch Subsidiary shall hold such monies or other things of value in trust for Agent, Lenders, PNC and SVB and
promptly remit such monies or other things of value to Agent for the benefit of Agent, Lenders, PNC and SVB whereupon such monies or other things of value shall be applied against the outstanding
indebtedness, liabilities and other obligations owing to Agent, Lenders, PNC and SVB under the Loan Documents in any order determined by Agent, PNC and SVB; 


        (i)    Borrowers
and the Dutch Subsidiaries provide Agent, PNC and SVB with accurate and complete copies of the First Fortis Bank Loan documents, Second Fortis Bank Loan
documents, 



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Fortis
Commercial Loan documents, and Fortis Bank Lease documents and any amendments, modifications, replacements or substitutions thereto promptly upon the execution of such documents; 



        (j)    Borrowers
and the Dutch Subsidiaries refrain from amending, modifying, replacing or substituting the First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial
Loan, and/or Fortis Bank Lease without obtaining the prior written consent of Agent, PNC and SVB which may be withheld in their sole discretion; and 


        (k)   The
occurrence of any event of default upon the First Fortis Bank Loan, Second Fortis Bank Loan, Fortis Commercial Loan, Fortis Bank Lease, or any other financing
arrangements for the Dutch Subsidiaries that are guarantied or secured by any Borrower or its assets shall constitute an additional event of default under the Loan Documents. 




        7.     Borrowers
hereby represent and warrant to Agent and Lenders that Premotec Beheer, B.V. has been merged into Allied Motion Technologies B.V. 


        8.     Borrowers
hereby release, waive and forever discharge Lender and its shareholders, directors, officers, employees, and agents from all known and unknown, absolute and
contingent, claims, defenses, setoffs, counterclaims, causes of action, actions, suits or other legal proceedings of any kind existing or accrued as of the date of this Agreement. 


        9.     Borrowers
shall be, jointly and severally, liable for the payment and performance of all of their present and future obligations under the Loan Documents and all of such
obligations shall be secured by all of the collateral described in the Loan Documents. 


        10.   Borrowers,
jointly and severally, hereby represent and warrant to and covenant with Lender that Lender's liens, security interests, encumbrances and claims against the
collateral described in the Loan Agreement and other Loan Documents shall continue to be prior and superior to any other liens, security interests, encumbrances or claims of any kind except for those
specifically provided otherwise in the Loan Documents. Borrowers, jointly and severally, represent and warrant to Lender that no event of default exists under the Loan Documents as of the date of this
Agreement and no material adverse changes have occurred in Borrowers' financial condition since the date of the last financial statements provided to Agent. 


        11.   The
Loan Documents shall remain in full force and effect except as amended by this Agreement and any additional Loan Documents. 


        12.   Borrowers,
jointly and severally, shall pay Lenders a loan modification fee in the amount of Fifteen Thousand and No/100 Dollars ($15,000.00) and all of Agent's,
Lenders', PNC's and SVB's attorneys' fees and other expenses incurred in connection with the negotiation, drafting, execution, filing and recording of this Agreement and any related Loan Documents.
The amounts described in this paragraph shall be in addition to, and not in lieu of, the interest, fees and other charges owing under the Loan Documents. 


        13.   Borrowers
shall take any additional actions and execute and deliver to Lender any additional documents reasonably requested by Lender to carry out the intent and
purposes of this Agreement and any related Loan Documents. 


        14.   This
Agreement and any related documents shall inure to the benefit of and be binding upon the successors and permitted assigns of the parties hereto. 


        15.   This
Agreement shall be governed by the laws of the State of Colorado. 


        16.   The
parties hereto consent to the jurisdiction and venue of any Court located in the City and County of Denver, State of Colorado, in the event of any litigation
pertaining to this Agreement or any 


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related
Loan Document or the enforcement of any liability, obligation, right or remedy described therein. 



        17.   This
Agreement may be executed in counterparts and shall be effective when at least one (1) counterpart has been executed by each party hereto. 


        18.   This
Agreement and the various documents described herein represent the complete and integrated understanding between the parties pertaining to the subject matter
hereof. All prior and contemporaneous understandings and agreements, written or oral, express or implied, shall be of no further force and effect to the extent inconsistent herewith. 



        19.   THE
PARTIES HERETO WAIVE THEIR RESPECTIVE RIGHTS TO DEMAND A JURY TRIAL IN THE EVENT OF ANY LITIGATION PERTAINING TO THIS AGREEMENT, ANY RELATED LOAN DOCUMENTS, OR THE
ENFORCEMENT OF ANY LIABILITY, OBLIGATION, RIGHT OR REMEDY DESCRIBED THEREIN. 



	

 	
 	

ALLIED MOTION TECHNOLOGIES INC.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary and Treasurer
	

 	
 	

MOTOR PRODUCTS CORPORATION
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary and Treasurer
	

 	
 	

ALLIED MOTION CONTROL CORPORATION
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary and Treasurer
	

 	
 	

EMOTEQ CORPORATION
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary and Treasurer
	

 	
 	

COMPUTER OPTICAL PRODUCTS, INC.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary and Treasurer
	 	 	 	 	 





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AMOT I, INC.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary
	

 	
 	

AMOT II, INC.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary
	

 	
 	

AMOT III, INC.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary
	

 	
 	

STATURE ELECTRIC, INC. f/k/a AMOT, Inc.
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary
	

 	
 	

AHAB INVESTMENT COMPANY
	

 	
 	

By:	
 	


	 	 	Name:	 	Susan M. Chiarmonte
	 	 	Title:	 	Secretary
	

 	
 	

PNC BANK, NATIONAL ASSOCIATION, AS AGENT FOR ITSELF, SILICON VALLEY BANK AND ANY OTHER LENDERS UNDER THE REVOLVING CREDIT LOAN AGREEMENT
	

 	
 	

By:	
 	


	 	 	Name:	 	John Wattinger
	 	 	Title:	 	Vice President
	 	 	 	 	 



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PNC BANK, NATIONAL ASSOCIATION
	

 	
 	

By:	
 	


	 	 	Name:	 	John Wattinger
	 	 	Title:	 	Vice President
	

 	
 	

SILICON VALLEY BANK
	

 	
 	

By:	
 	


	 	 	Name:	 	Renee S. Hudnall
	 	 	Title:	 	Relationship Manager




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FOURTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT, TERM LOAN AND SECURITY AGREEMENTS, AND RELATED DOCUMENTS