Document:

ex10_1.htm

Exhibit 10.1

SECOND AMENDMENT TO CREDIT AGREEMENT

This Second Amendment to Credit Agreement (this "Amendment") is dated as of the 1st day of October, 2011 and is by and between Orbit International Corp., Behlman Electronics, Inc., Tulip Development Laboratory, Inc. and Integrated Consulting Services, Inc. d/b/a Integrated Combat Systems (each a "Borrower" and collectively, the "Borrowers"), and Capital One, National Association ("Bank") (this "Amendment").

WHEREAS, on March 10, 2010 the Bank made available to the Borrowers a line of credit in the amount of $3,000,000.00 and a term loan in the amount of $4,654,761.84 pursuant to a Credit Agreement dated as of March 10, 2010 between the Borrowers and the Bank (as amended from time to time, the "Credit Agreement") and evidenced by, respectively, a Line of Credit Note dated March 10, 2010 from the Borrowers to the Bank (as amended from time to time, the "Line of Credit Note") and the Term Loan Note dated March 10, 2010 from the Borrowers to the Bank (as amended from time to time, the "Term Loan Note") and secured by a Security Agreement dated March 10, 2010 from the Borrowers to the Bank (the "Security Agreement");

WHEREAS, on August 9, 2011 the Bank and Borrower entered into a Amendment to Credit Agreement which among other things extended the Maturity Date of the Line of Credit Note to October 1, 2011 (the “Amended Credit Agreement”) (the Credit Agreement, the Amended Credit Agreement, the Line of Credit Note, the Term Loan Note, the Security Agreement, and all other documents executed and delivered in connection therewith, collectively, the "Financing Documents");

WHEREAS, the Borrowers have requested that the Bank once again extend the maturity of the Line of Credit to which the Bank has agreed provided the Borrowers enter into this Amendment;

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Borrowers and the Bank hereby agree as follows:

1.             Capitalized terms not defined herein shall have the meaning set forth in the Credit Agreement.

2.             The definition of "Line of Credit Maturity Date" set forth in Section 1.01 of the Credit Agreement is hereby amended to read in its entirety as follows:

"Line of Credit Maturity Date" means June 1,  2012.

3.             The form “Borrowing Base Certificate” listed as Exhibit D in the Credit Agreement is replaced in its entirety with the new Borrowing Base Certificate form attached as Exhibit A hereto.

  

  

  

4.             The obligation of the Bank to enter into this Amendment is subject to the following:

(a)           Receipt by the Bank of a fully executed counterpart of this Amendment from the Borrowers;

(b)           The Borrowers shall pay to the Bank all of its out-of-pocket fees and disbursements incurred by the Bank in connection with this Amendment, including legal fees incurred by the Bank in the preparation, consummation, administration and enforcement of this Amendment.

5.             The Borrowers ratify and reaffirm the Financing Documents and the Financing Documents, as hereby amended, shall remain in full force and effect.

6.             The principal amount due and owing in connection with the Term Loan is  $3,258,333.36 as of September  23, 2011, without defense, counterclaim or offset.

7.             The Borrowers represent and warrant that (a) the representations and warranties contained in the Credit Agreement are true and correct in all material respects as of the date of this Amendment, (b) no condition, at, or event which could constitute an event of default under the Credit Agreement, the Notes or any other Financing Documents exists, and (c) no condition, event, act or omission has occurred, which, with the giving of notice or passage of time, would constitute an event of default under the Credit Agreement, the Notes or any other Financing Document.

8.             The Borrowers acknowledge that as of the date of this Amendment they have no offsets or defenses with respect to all amounts owed by it to the Bank arising under or related to the Financing Documents on or prior to the date of this Amendment.  The Borrowers fully, finally and forever release and discharge the Bank and its successors, assigns, directors, officers, employees, agents and representatives from any and all claims, causes of action, debts and liabilities, of whatever kind or nature, in law or in equity, whether now known or unknown to them, which they may have and which may have arisen in connection with the Financing Documents or the actions or omissions of the Bank related to the Financing Documents on or prior to the date hereof.  The Borrowers acknowledge and agree that this Amendment is limited to the terms outlined above and shall not be construed as an agreement to change any other terms or provisions of the Financing Documents.  This Amendment shall not establish a course of dealing or be construed as evidence of any willingness on the Bank’s part to grant other or future agreements, should any be requested.

9.             This Amendment is a modification only and not a novation.  Except for the above-quoted modifications, the Financing Documents, any loan agreements, credit agreements, reimbursement agreements, security agreements, mortgages, deeds of trust, pledge agreements, assignments, guaranties, instruments or documents executed in connection with the Financing Documents, and all the terms and conditions thereof, shall be and remain in full force and effect with the changes herein deemed to be incorporated therein.  This Amendment is to be considered attached to the Financing Documents and made a part thereof.  This Amendment shall not release or affect the liability of any guarantor of the Notes or credit facility executed in reference to the Financing Documents, if any, or release any owner of collateral granted as security for the Financing Documents.  The validity, priority and enforceability of the Financing Documents shall not be impaired hereby.  To the extent that any provision of this Amendment conflicts with any term or condition set forth in the Financing Documents, or any document executed in conjunction therewith, the provisions of this Amendment shall supersede and control.  The Bank expressly reserves all rights against all parties to the Financing Documents.

  

  

  

10.           In order to induce Bank to enter into this Agreement Borrower acknowledge and agree that in the event Borrower (a) files or is the subject of any petition seeking, or an order for relief for, reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating to bankruptcy, insolvency, or other relief for debtors, or (b) has sought or consented to or acquiesced in the appointment of any trustee, receiver, conservator, or liquidator, without prejudice to Bank's right to seek relief at any time from any stay imposed under Title 11 of the United States Bankruptcy Code, as now or hereafter amended, or any other federal or state act or law, the Bank will be entitled to relief terminating such stay after the expiration of one hundred twenty (120) days from the filing of any bankruptcy or insolvency proceeding, and any action taken by the Bank in this regard will not be defended or contested by Borrower, provided however, nothing herein shall preclude Bank from seeking any relief in the aforesaid bankruptcy or insolvency proceedings at any time including within the aforesaid one hundred twenty (120) day period.

11.           This Amendment shall be governed and construed in accordance with the laws of the State of New York

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IN WITNESS WHEREOF, the undersigned have caused this Amendment to be executed as of the day and year first above written.

	  	
BORROWERS:

	  	
ORBIT INTERNATIONAL CORP.

	  	  	  
	  	
By:

	
/s/ David Goldman

	  	
Name:

	
David Goldman

	  	
Title:

	
Chief Financial Officer

	  	  	  
	  	
BEHLMAN ELECTRONICS, INC.

	  	  	  
	  	
By:

	
/s/ David Goldman

	  	
Name:

	
David Goldman

	  	
Title:

	
Chief Financial Officer

	  	  	  
	  	
TULIP DEVELOPMENT

LABORATORY, INC.

	  	  	  
	  	
By:

	
/s/ David Goldman

	  	
Name:

	
David Goldman

	  	
Title:

	
Chief Financial Officer

	  	  	  
	  	
INTEGRATED CONSULTING

SERVICES, INC.

	  	  	  
	  	
By:

	
/s/ David Goldman

	  	
Name:

	
David Goldman

	  	
Title:

	
Chief Financial Officer

	  	  	  
	  	
BANK:

	  	  	  
	  	
CAPITAL ONE,

	  	
NATIONAL ASSOCIATION

	  	  	  
	  	
By:

	
/s/ Jeffrey B. Carstens

	  	
Name:

	
Jeffrey B. Carstens

	  	
Title:

	
Senior Vice PresidentUnassociated Document

EMPLOYMENT AGREEMENT

The parties to this Agreement dated as of September 28, 2011 are Q Lotus Holdings, Inc, a Nevada corporation (the "Company")

and Daniel Kurzweil  (the "Employee").

The Company wishes to employ the Employee, and the Employee wishes to accept employment with the Company on the terms and subject to the conditions set forth in this Agreement.   It is therefore agreed as follows:

 

1. Employment. The Company shall employ and the Employee, and serve the Company, as its Chief Operating Officer with such duties and responsibilities as may be assigned to the Employee by the Board of Directors of the Company as normally associated with a position of that nature. The Employee shall devote his best efforts and such business time as necessary to the performance of his duties under this Agreement and shall perform them faithfully, diligently, and competently and in a manner consistent with the policies of the Company as determined from time to time by the Board of Directors of the Company.

 

2. Term of Employment. The Employee's employment by the Company under this agreement shall commence on the date of this Agreement and, subject to earlier termination pursuant hereto, shall terminate on a date one year thereafter. This Agreement may also be extended as needed by a written amendment pursuant to section 7.

 

3. Compensation. As compensation for all services rendered  by the Employee to the Company under this Agreement, the Company shall pay to the Employee the compensation set forth as follows:

 

Salary: Twelve Thousand ($12,000) per month paid on the regular payroll dates for the Company

 

4. Fringe Benefits; Expenses

 

A. The Employee shall be entitled to receive all health benefits, if any, provided by the Company to its employees generally and shall also be entitled to participate in all benefit plans, if any, provided by the Company to its employees generally.

 

B. The Company shall reimburse the Employee for all reasonable and necessary expenses incurred by him in connection with the performance of his services for the Company in accordance with the Company's policies, upon submission of appropriate expense reports and documentation in accordance with the Company's policies and procedures.

 

5. Disability or Death

 

A.    If, as the result of any physical or mental disability, the Employee shall have failed or is unable to perform his duties for a period of  (45 consecutive days, the Company may, by notice to the Employee subsequent thereto, terminate his employment under this Agreement as of the date of the notice without any further payment or the furnishing of any benefit by the Company under this Agreement (other than accrued and unpaid salary and expenses and benefits which have accrued pursuant to any plan or by law).

 

B. The term of the Employee's employment under this Agreement shall terminate upon his death without any further payment or the furnishing of any benefit by the Company under this Agreement (other than accrued and unpaid salary, and expenses and benefits which have accrued pursuant to any plan or by law).

6. Termination. The Company shall have the right to terminate this Agreement and the Employee’s employment with the Company for cause.  For purposes of this Agreement, the term “cause” shall mean:

A.  Any breach of the Employee's obligations under this Agreement;

 

  

  

  

B. Fraud, theft, or gross malfeasance on the part of the Employee, including, without limitation, conduct of a felonious or criminal nature, conduct involving moral turpitude, embezzlement, or misappropriation of assets;

C. The habitual use of drugs or intoxicants to an extent that it impairs the Employee's ability to properly perform his/her duties;

D. Violation by the Employee of his/her obligations to the Company, including, without limitation, conduct which is inconsistent with the Employee's position and which results or is reasonably likely to result (in the opinion of Company Chairman or CEO in an adverse effect (financial or otherwise) on the business or reputation of the Company or any of its subsidiaries, divisions, or affiliates;

 

E: The Employee's fail.ure, or neglect to perform his/her duties contemplated herein within a reasonable period under the circumstances after written notice from Company Chairman or CEO, describing the alleged breach and offering the Employee a reasonable opportunity to cure same;

 

F: Repeated violation by the employee of any of the written work rules or written policies of the Company after written notice of violation from the Board of Director, Company Chairman or CEO;

 

G. Breach of standards adopted by the Company governing professional independence or conflicts of interest.

 

If the employment of the Employee is terminated for cause, the Company shall not be obligated to make any further payment to the Employee (other than accrued and unpaid salary and expenses to the date of termination), or continue to provide any benefit (other than benefits which have accrued pursuant to any plan or by law) to the Employee under this Agreement.

 

7. Miscellaneous

 

A. This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, applicable to agreements made and performed in Illinois, and shall be construed without regard to any presumption or other rule requiring construction against the party causing the Agreement to be drafted.

 

B. This agreement contains a complete statement of all the arrangements between the Company and the Employee with respect to its subject matter, supersedes all previous agreements, written or oral, among them relating to its subject matter, and cannot be modified, amended, or terminated orally. Amendments may be made to this Agreement at any time mutually agreed upon in writing.

 

C. Any amendment, notice, or other communication under this Agreement shall be in writing and shall be considered given when received and shall be delivered personally or mailed by Certified Mail, Return Receipt Requested, to the Company at the office of its  registered agent, and to the Employee at his/her address then on the books and records of the Company.

 

D. The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement. Any waiver must be in writing.

 

E. Each of the parties irrevocably submits to the exclusive jurisdiction of any court of the State of Illinois sitting in  Cook County or the Federal District Court of Northeastern Illinois over any action, suit, or proceeding relating to or arising out of this Agreement and the transactions contemplated hereby. EACH OF THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY SUCH ACTION, SUIT, OR PROCEEDING. Each party hereby irrevocably waives any objection, including, without limitation, any objection to the laying of venue or based on the grounds of forum non conviens which such party may now or hereafter have to the bringing of any such action, suit, or proceeding in any such court and irrevocably agrees that process in any such action, suit, or proceeding may be served upon that party personally or by Certified or Registered Mail, Return Receipt Requested.

 

  

  

  

F. The invalidity or unenforceability of any term or provision of this Agreement shall not affect the validity or enforceability of the remaining terms or provisions of this Agreement which shall remain in full force and effect and any such invalid or unenforceable term or provision shall be given full effect as far as possible. If any term or provision of this Agreement is invalid or unenforceable in one jurisdiction, it shall not affect the validity or enforceability of that term or provision in any other jurisdiction.  It is further agreed that this Agreement may be executed in counterparts, each of which when considered together shall constitute the original contract.

 

G. This Agreement is not assignable by either party except that it shall inure to the benefit of and be binding upon any successor to the Company by merger or consolidation or the acquisition of all or substantially all of the Company’s   assets, provided such successor assumes all of the obligations of the Company, and shall inure to the benefit of the heirs and legal representatives of the Employee.

 

 

	 Employee: /S/ Daniel Kurzweil               	 	

Date: 9/28/11

	 	 	 
	Accepted by: /S/ GARY ROSENBERG 	Title:  CEO	Date:  9/28/11

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