Document:

Irwin J

Exhibit 10.49

 

	

  Irwin

  J. Gruverman

  	

   

  	

  December 31, 2001

  

16 Tanglewood Road

Needham, MA  02194

 

Dear Mr. Gruverman:

 

This will confirm our Agreement concerning your compensation as

Chairman and CEO of MFIC.­

 

Subject to approval by the Board, we will pay you at a base rate

of  $60,000 per year, beginning January

1,2002. You will participate in a bonus pool, if any, for management employees,

and the Board will consider a Special Bonus if financial results and stock

performance warrant it.  You agree that

MFIC will withhold money from your compensa­tion to pay appropriate taxes. You

will be included in MFIC’s insurance and medical programs as in past years, at

no cost to you, as part of your compensation.

 

 

	

  MFIC

  CORPORATION

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

  Irwin

  Gruverman, CEO, Chairman

  	

   

  	

  Irwin

  Gruverman, for myselfExhibit 10

Exhibit

10.50

 

 

SECOND AMENDMENT TO

REVOLVING CREDIT AND TERM LOAN AGREEMENT

 

 

This Second

Amendment to Revolving Credit and Term Loan Agreement (the “Amendment”) is made

as of the      th day of March, 2002 by

and among

 

MFIC

Corporation  (the “Borrower”), a

Delaware corporation with its principal executive offices at 30 Ossipee Road,

Newton, Massachusetts 02464; and

 

PNC Bank, N.A., a

national banking association (the “Lender”) with a place of business at 70 East

55th Street, 14th floor, New York,  New York 10022;

 

 

in consideration of the

mutual covenants herein contained and benefits to be derived herefrom.

 

 

W I T N E S S E T

H:

 

WHEREAS, the

Borrower and National Bank of Canada (“NBC”) entered into a certain Revolving

Credit and Term Loan Agreement dated as of February 28, 2000 (as amended in

effect,  the “Loan Agreement”); and

 

WHEREAS,  NBC has assigned all of its right, title and

interest in and to the Loan Agreement and the documents, instruments and

agreements executed and delivered in connection therewith to the Lender; and

 

WHEREAS,  certain Events of Default have occurred

under the Loan Agreement, and the Borrower has requested that the Lender waive

such Events of Default and otherwise modify and amend certain provisions of the

Loan Agreement; and

 

WHEREAS, the

Lender has agreed to waive such Events of Default and otherwise modify and

amend certain provisions of the Loan Agreement on the terms and  conditions set forth herein.

 

NOW, THEREFORE, it

is hereby agreed as follows:

 

1.                                       Definitions.

 

(a)                                  All capitalized terms used herein and not

otherwise defined shall have the same meanings herein as in the Loan Agreement.

 

(b)                                 Section 1 of the Loan Agreement is hereby

amended by inserting the following definition therein:

 

“Consolidated

Pre-Tax Net Income (or Deficit).  With respect to any fiscal period, the consolidated net income

(or deficit) of the Borrower and its Subsidiaries, after deduction of all ex­penses

and other proper charges, but prior to the deduction of all taxes, determined

in accor­dance with Generally Accepted Accounting Principles.”

 

“Impairment

Charge. The amount to be determined by the Borrower which shall

not be less than $2,200,000.00 and not greater than $2,700,000.00, which

constitutes the loss recognized by the Borrower as a result of  the adjustment by the Borrower of the

carrying amount of 

 

 

goodwill to its

new accounting basis, which impairment charge shall be taken by the Borrower

one-time and no later than the end of the Borrower’s second quarter of fiscal

year 2002.”

 

“Applicable

Profit Margin” means, for any fiscal quarter of the

Borrower,  that amount equal to fifty

percent (50%) of the Borrower’s Consolidated Net Income (but in no event less

than zero (0) dollars) for such fiscal quarter.”

 

2.                                       Waiver of Event of Default. The Borrower has advised the Lender

that the Borrower is in default of (w) the Consolidated Tangible Net Worth

Covenant set forth in Section 8.1 of the Loan Agreement for the Borrower’s

fiscal quarter ending December 31, 2001, (x) the Liabilities to Worth

(Leverage) Ratio set forth in Section 8.2 of the Loan Agreement for the

Borrower’s fiscal quarter ending December 31, 2001, (y) the Consolidated Net

Income Covenant set forth in Section 8.3 of the Loan Agreement  for the Borrower’s fiscal quarter ending

December 31, 2001, and (z) the Minimum Debt Service Covenant set forth in

Section 8.4 of the Loan Agreement for the Borrower’s fiscal quarter ending

December 31, 2001.  The Borrower has

requested that the Lender waive the Events of Default which have arisen by

virtue of the Borrower’s failure to have complied with the foregoing covenants

as of  December 31, 2001.  The Lender is willing to, and does hereby,

waive the Events of Default occasioned thereby as of December 31,  2001, subject to the following:

 

(a)                                  The waiver of the Borrower’s compliance

with (w) the Consolidated Tangible Net Worth Covenant set forth in Section 8.1

of the Loan Agreement for the Borrower’s fiscal quarter ending December 31,

2001, (x) the Liabilities to Worth (Leverage) Ratio set forth in Section 8.2 of

the Loan Agreement for the Borrower’s fiscal quarter ending December 31, 2001,

(y) the Consolidated Net Income Covenant set forth in Section 8.3 of the Loan

Agreement  for the Borrower’s fiscal

quarter ending December 31, 2001, and (z) the Minimum Debt Service Covenant set

forth in Section 8.4 of the Loan Agreement for the Borrower’s fiscal quarter

ending December 31, 2001 are a one-time waiver, and shall not be deemed to

constitute a waiver of those covenants with respect to any other fiscal periods

of the Borrower.  Further, nothing

contained herein shall be deemed to constitute a waiver of any other Event of

Default which may exist as of the date hereof.

 

(b)                                 The payment by the Borrower of a waiver

fee in the amount of $5,000.00 (the 

“Waiver Fee”).  The Waiver Fee

shall be fully earned as of the date hereof and is non-refundable and shall not

be applied by the Lender in reduction of the Liabilities.

 

2

 

 

3.                                       Amendments to Section 8.

 

(a)                                  Section 8.1 of the Loan Agreement

(Consolidated Tangible Net Worth)  is

hereby amended by deleting the following portion of the table therefrom:

 

	

  Fiscal

  2002

  
	

  Quarter End

  	

   

  	

  $ Amount

  
	

  3/31/02

  	

   

  	

  3,500,000

  
	

  6/30/02

  	

   

  	

  3,600,000

  
	

  9/30/02

  	

   

  	

  3,700,000

  
	

  12/31/02

  	

   

  	

  3,950,000

  

 

and substituting

the following table in its stead:

 

 

	

  Fiscal

  2002

  
	

  Quarter End

  	

   

  	

  $ Amount

  
	

  3/31/02

  	

   

  	

  $1,900,000 plus the

  Applicable Profit Margin

  
	

  6/30/02

  	

   

  	

  the required

  Consolidated Tangible Net Worth for the previous quarter plus the Applicable Profit

  Margin.

  
	

  9/30/02

  	

   

  	

  the required

  Consolidated Tangible Net Worth for the previous quarter plus the Applicable

  Profit Margin.

  
	

  12/31/02

  	

   

  	

  the required

  Consolidated Tangible Net Worth for the previous quarter plus the Applicable

  Profit Margin.

  

 

The

Borrower and the Lender acknowledge and agree that the foregoing covenant shall

be calculated exclusive of the Impairment Charge for the fiscal quarter in

which the Borrower recognizes the Impairment Charge.

 

 

(b)                                 Section 8.2 of the Loan Agreement

(Liabilities to Worth (Leverage) Ratio) 

is hereby amended by deleting the table therefrom and substituting the

following  in its stead:

 

“§8.2  Intentionally Omitted”

 

(c)                                  Section 8.3 of the Loan Agreement

(Consolidated Net Income) is hereby deleted in its entirety, and the following

substituted in its stead:

 

3

 

§8.3  Consolidated Pre-Tax Net Income. As

of December 31, 2002, the Borrower shall achieve the aggregate of (x)

Consolidated Pre-Tax Net Income (or Deficit) plus (y) the Impairment Charge, in

an amount of not less than $500,000.00.

 

(d)                                 Section 8.4 of the Loan Agreement

(Minimum Debt Service)  is hereby

amended by deleting the following portion of table therefrom

 

   

	

  Fiscal

  2002

  
	

  Quarter End

  	

   

  	

  Ratio

  
	

  3/31/02

  	

   

  	

  1.75 : 1.0

  
	

  6/30/02

  	

   

  	

  1.75 : 1.0

  
	

  9/30/02

  	

   

  	

  1.75 : 1.0

  
	

  12/31/02

  	

   

  	

  2.00 : 1.0

  

 

and substituting

the following table in its stead:

 

	

  Fiscal

  2002

  
	

  Quarter End

  	

   

  	

  Ratio

  
	

  3/31/02

  	

   

  	

  1.50 : 1.0

  
	

  6/30/02

  	

   

  	

  1.50 : 1.0

  
	

  9/30/02

  	

   

  	

  1.50 : 1.0

  
	

  12/31/02

  	

   

  	

  1.50 : 1.0

  

 

The

Borrower and the Lender acknowledge and agree that the foregoing covenant shall

be calculated exclusive of the Impairment Charge for the fiscal quarter in

which the Borrower recognizes the Impairment Charge.

 

(e)                                  Section 8.5 of the Loan Agreement

(Maximum Capital Expenditures) is hereby amended by deleting the following

there from:

 

“$200,000.00”

 

and substituting

the following in its stead:

 

“$250,000.00”

 

4.                                       Conditions to Effectiveness. 

This Amendment shall not be effective until each of the following

conditions precedent have been fulfilled to the satisfaction of the Lender:

 

4

 

(a)                                  This Amendment shall have been duly

executed and delivered by the respective parties hereto and, shall be in full

force and effect and shall be in form and substance satisfactory to the Lender.

 

(b)                                 All action on the part of the Borrower

necessary for the valid execution, delivery and performance by the Borrower of

this Amendment shall have been duly and effectively taken and evidence thereof

satisfactory to the Lender shall have been provided to the Lender. The Lender

shall have received from the Borrower true copies of the resolutions adopted by

its board of directors authorizing the transactions described herein, certified

by the Borrower’s secretary to be true and complete.

 

(c)                                  The Borrower shall have paid the Waiver

Fee.

 

(d)                                 The Borrower shall have paid to the

Lender all fees and expenses then due and owing pursuant to the Agreement,

including, without limitation, the Lender’s attorneys’ fees and expenses.

 

(e)                                  No Default or Event of Default shall have

occurred and be continuing.

 

(f)                                    The Borrower shall have provided such

additional instruments and documents to the Lender as the Lender and the

Lender’s counsel may have reasonably requested.

 

5.                                       Ratification of Loan Documents. 

Except as provided herein, all terms and conditions of the Loan

Agreement and the other Loan Documents remain in full force and effect.  The Borrower hereby ratifies, confirms, and

reaffirms all representations, warranties, and covenants contained therein and

acknowledges and agrees that the Liabilities, are and continue to be secured by

the Collateral.  The Borrower further

acknowledges and agrees that Borrower does not have any offsets, defenses, or

counterclaims against the Lender thereunder, and to the extent that any such

offsets, defenses, or counterclaims may exist, the Borrower hereby waives and

releases the Lender therefrom.

 

6.                                       Miscellaneous.

 

(a)                                  This Amendment may be executed in several

counterparts and by each party on a separate counterpart, each of which when so

executed and delivered shall be an original, and all of which together shall

constitute one instrument.

 

(b)                                 This Amendment expresses the entire

understanding of the parties with respect to the transactions contemplated

hereby.  No prior negotiations or

discussions shall limit, modify, or otherwise affect the provisions hereof.

 

5

 

IN WITNESS

WHEREOF, the undersigned have hereunto executed this Amendment as a sealed

instrument as of the date first above written.

 

	

   

  	

  MFIC CORPORATION

  
	

   

  	

   

  
	

  By:

  	

   

  
	

   

  	

  Name:

  
	

   

  	

  Title:

  
	

   

  	

   

  
	

   

  	

  PNC BANK, N.A.

  
	

   

  	

   

  
	

  By:

  	

   

  
	

   

  	

  Name:

  
	

   

  	

  Title:

  

 

 

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}]]