Document:

Exhibit 10.37

 

SIXTH AMENDMENT TO

LOAN AGREEMENT

 

Sixth Amendment to Loan Agreement, dated August 29, 2011, by and between New Enterprise Stone & Lime Co., Inc., a Delaware corporation (the “Borrower”), and Citizens Bank of Pennsylvania (the “Bank”) (the “Sixth Amendment”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower and the Bank entered into that certain Loan Agreement, dated September 30, 2009, as amended by that certain: (i) First Amendment to Loan Agreement, dated May 27, 2010, by and between the Borrower and the Bank; (ii) Second Amendment to Loan Agreement, dated June 23, 2010, by and between the Borrower and the Bank; (iii) Third Amendment to Loan Agreement, dated July 30, 2010, by and between the Borrower and the Bank; (iv) Fourth Amendment to Loan Agreement, dated May 18, 2011, by and between the Borrower and the Bank; and (v) Fifth Amendment to Loan Agreement, dated July 18, 2011, by and between the Borrower and the Bank (as further amended, modified, supplemented or restated from time to time, the “Loan Agreement”); and

 

WHEREAS, the Borrower and the Bank desire to amend certain provisions of the Loan Agreement pursuant to the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the premises contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:

 

1.             All capitalized terms used herein which are defined in the Loan Agreement shall have the same meaning herein as in the Loan Agreement unless the context clearly indicates otherwise.

 

2.             Section 1.01 of the Loan Agreement is hereby amended by adding the following definitions in their proper alphabetical order:

 

“Permitted RE Indebtedness” shall mean Indebtedness in a maximum principal amount not to exceed Twenty Million and 00/100 Dollars ($20,000,000.00) secured only by Permitted RE Indebtedness Collateral (as defined in the Existing First Lien Credit Agreement).

 

“Sixth Amendment Closing Date” shall mean August 29, 2011 or such other date as the parties hereto may agree in writing.

 

3.             Section 1.01 of the Loan Agreement is hereby amended to delete the following definition in its entirety and to insert in its stead the following:

 

“Existing First Lien Credit Agreement” shall mean that certain Second Amended and Restated Credit Agreement, dated as

 

 

of January 11, 2008, by and among the Borrower, the financial institutions party thereto and the Agent party thereto, as amended from time to time prior to the Sixth Amendment Closing Date.

 

4.             Section 5.15 of the Loan Agreement is hereby deleted in its entirety and in its stead is inserted the following:

 

5.15         Financial Covenants.

 

The Borrower hereby covenants to any and all financial covenants which may be set forth in Article 6 of the Existing First Lien Credit Agreement (including, without limitation, those financial covenants set forth in Sections 6.1 [Net Worth], 6.2 [Fixed Charge Coverage Ratio], 6.3 [Total Leverage Ratio], 6.4 [Limitation on Capital Expenditures], 6.5 [Limitation on Operating Lease Expense] and 6.6 [Additional Provisions Respecting Calculation of Financial Covenants] of the Existing First Lien Credit Agreement), which are hereby collectively incorporated herein by this reference as if set forth herein at length, as such covenants exist on the Sixth Amendment Closing Date (collectively, the “Incorporated Provisions”). Any defined terms appearing in such Incorporated Provisions shall have the meanings ascribed to such terms in the Existing First Lien Credit Agreement, as it exists on the Sixth Amendment Closing Date. Any amendment or other modification of such Incorporated Provisions or any related defined terms shall not constitute an amendment to this Agreement without the express written agreement of the Bank that any such amendment or other modification shall constitute an amendment to this Agreement. If a Termination occurs, all of the Incorporated Provisions and all related defined terms shall survive the Termination and shall continue in full force and effect as part of this Agreement; provided that at any time after a Termination, the Borrower shall, upon the Bank’s request, execute and deliver to the Bank a supplement or amendment to this Agreement, which supplement or amendment shall expressly incorporate into this Agreement all or any number of the Incorporated Provisions of the terminated Existing First Lien Credit Agreement.

 

5.             Section 6.02 of the Loan Agreement is hereby amended (i) to delete the word “and” at the end of clause (j) and the period at the end of clause (k) and (ii) to insert “; and” at the end of clause (k) and as a new clause (l) the following:

 

(l)            Permitted RE Indebtedness.

 

6.     The provisions of Sections 2 through 5 of this Sixth Amendment shall not become effective until the Bank has received the following, each in form and substance acceptable to the Bank:

 

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(a)           this Sixth Amendment, duly executed by the Borrower and the Bank;

 

(b)           payment of all fees and expenses owed to the Bank and the Bank’s counsel in connection with this Sixth Amendment;

 

(c)           the documents listed in the Preliminary Closing Checklist set forth on Exhibit A attached hereto and made a part hereof; and

 

(d)           such other documents as may be reasonably requested by the Bank.

 

7.             The Borrower hereby reconfirms and reaffirms all representations and warranties, agreements and covenants made by and pursuant to the terms and conditions of the Loan Agreement and the other Loan Documents, except as such representations and warranties, agreements and covenants may have heretofore been amended, modified or waived in writing in accordance with the Loan Agreement and the other Loan Documents, and except any such representations or warranties made as of a specific date or time, which shall have been true and correct in all material respects as of such date or time.

 

8.             The Borrower acknowledges and agrees that each and every document, instrument or agreement which at any time has secured or will secure payment of the Debt including, but not limited to, the Loan Agreement, the Security Agreement and all applicable UCC-1 financing statements and other similar instruments executed and recorded with respect thereto continue to secure prompt payment when due of the Debt.

 

9.             The Borrower hereby represents and warrants to the Bank that (i) the Borrower has the legal power and authority to execute and deliver this Sixth Amendment; (ii) the officers of the Borrower executing this Sixth Amendment have been duly authorized to execute and deliver the same and bind the Borrower with respect to the provisions hereof; (iii) the execution and delivery hereof by the Borrower and the performance and observance by the Borrower of the provisions hereof and of the Loan Agreement and all documents executed or to be executed therewith, do not violate or conflict with the organizational documents of the Borrower or any law applicable to the Borrower or result in a breach of any provision of or constitute a default under any other agreement, instrument or document binding upon or enforceable against the Borrower and (iv) this Sixth Amendment, the Loan Agreement and the documents executed or to be executed by the Borrower in connection herewith or therewith constitute valid and binding obligations of the Borrower in every respect, enforceable in accordance with their respective terms.

 

10.           The Borrower represents and warrants that (i) no Event of Default exists under the Loan Agreement or the other Loan Documents, nor will any occur as a result of the execution and delivery of this Sixth Amendment or the performance or observance of any provision hereof; and (ii) the Borrower presently has no claims or actions of any kind at law or in equity against the Bank arising out of or in any way relating to the Loan Agreement or the other Loan Documents.

 

11.           Each reference to the Loan Agreement that is made in the Loan Agreement or any other document executed or to be executed in connection therewith shall hereafter be construed as a reference to the Loan Agreement as amended hereby.

 

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12.           The agreements, consent and waiver contained in this Sixth Amendment are limited to the specific agreements, consent and waiver made herein. Except as amended hereby, all of the terms and conditions of the Loan Agreement shall remain in full force and effect. This Sixth Amendment amends the Loan Agreement and is not a novation thereof.

 

13.           This Sixth Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts each of which, when so executed, shall be deemed to be an original, but all such counterparts shall constitute but one and the same instrument.

 

14.           This Sixth Amendment shall be governed by, and shall be construed and enforced in accordance with, the laws of the Commonwealth of Pennsylvania (without regard to any conflict of law principles thereof). Each of the parties hereto hereby consent to the nonexclusive jurisdiction of any Pennsylvania state court or federal court of the United States sitting in Allegheny County, Pennsylvania, and any appellate court from any thereof, in respect of actions brought against any such party as a defendant, with respect to any suit arising out of or mentioning this Sixth Amendment and hereby waives any right to which it may be entitled on account of place of residence or domicile.

 

[INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, and intending to be legally bound, the parties hereto, have caused this Sixth Amendment to be duly executed by their duly authorized officers the day and year first above written, as an instrument under seal.

 

 

	
ATTEST/WITNESS
    	
 
    	
New   Enterprise Stone & Lime Co., Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Pamela K. Bishop
    	
(SEAL)
    	
 
    	
By:
    	
/s/   Paul Detwiler, III
    	
(SEAL)
    
	
Name:
    	
Pamela   K. Bishop
    	
 
    	
Name:
    	
Paul   Detwiler, III
    
	
Title:
    	
Notary
    	
 
    	
Title:
    	
President
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
COMMONWEALTH   OF PENNSYLVANIA
    	
 
    	
Citizens   Bank of Pennsylvania
    
	
NOTARIAL SEAL
    	
 
    	
 
    	
 
    
	
PAMELA K. BISHOP, Notary Public
    	
 
    	
 
    	
 
    
	
City of Harrisburg, Dauphin   County
    	
 
    	
By:
    	
/s/   Joseph F. King
    
	
My Commission Expires June 5,   2015
    	
 
    	
 
    	
Joseph   F. King, Senior Vice President 
    
							

 

 

ACKNOWLEDGMENT

 

	
COMMONWEALTH   OF PENNSYLVANIA
    	
)
    	
 
    
	
 
    	
)
    	
SS:
    
	
COUNTY   OF BLAIR
    	
)
    	
 
    

 

On this 29 day of August, 2011, before me, a Notary Public, personally appeared Paul I Detwiler, III who acknowledged himself to be the President of New Enterprise Stone & Lime Co., Inc., a Delaware corporation (the “Company”), and that he as such officer, being authorized to do so, executed the foregoing instrument for the purposes therein contained by signing his name as President of and on behalf of the Company.

 

IN WITNESS WHEREOF, I hereunto set my hand and affix my seal.

 

 

	
 
    	
/s/   Pamela K. Bishop
    
	
 
    	
Notary Public
    

 

	
My   Commission Expires: 6/5/2015
    	
COMMONWEALTH   OF PENNSYLVANIA
    
	
 
    	
NOTARIAL SEAL
    
	
[SEAL]
    	
PAMELA K. BISHOP, Notary Public
    
	
 
    	
City of Harrisburg, Dauphin   County
    
	
 
    	
My Commission Expires June 5,   2015Exhibit 10.38

 

 

TERM NOTE

(Actual Balance Interest Accrual Method)

Pennsylvania

 

	
August 29, 2011
    	
$20,000,000
    

 

BORROWER 1 (Name): New Enterprise Stone & Lime Co., Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Delaware

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 2 (Name): Protection Services Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Pennsylvania

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 3 (Name): Gateway Trade Center Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): New York

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 4 (Name): Ell Transport Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Pennsylvania

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 5 (Name): Work Area Protection Corp.

(Organizational Structure): a for profit corporation

(State Law organized under): Illinois

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 6 (Name): SCI Products Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Pennsylvania

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 7 (Name): Precision Solar Controls Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Texas

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664

 

BORROWER 8 (Name): ASTI Transportation Systems, Inc.

(Organizational Structure): a for profit corporation

(State Law organized under): Delaware

(Address of residence/chief executive office): 3912 Brumbaugh Rd., New Enterprise, PA 16664 (Borrower 1, Borrower 2, Borrower 3, Borrower, 4, Borrower 5, Borrower 6, Borrower 7 and Borrower 8 are referred to herein collectively as “Borrower”)

 

BANK: MANUFACTURERS AND TRADERS TRUST COMPANY, a New York banking corporation with its banking offices at One M&T Plaza, Buffalo, NY 14203. Attention: Office of the General Counsel.

 

Promise to Pay. For value received, intending to be legally bound, Borrower promises to pay to the order of the Bank, on the dates set forth below, the principal sum of Twenty Million Dollars ($20,000,000) (the “Principal Amount”) or so much thereof as actually advanced, plus interest as agreed below, all payments required by the Bank to fund any escrow accounts for the payment of taxes, insurance and/or other charges (collectively, “Escrow”), and all fees and costs (including without limitation attorneys’ fees and disbursements whether for internal or outside counsel) the Bank incurs in order to collect any amount due under this Note, to negotiate or document a workout or restructuring, or to preserve its rights or realize upon any guaranty or other security for the payment of this Note (“Expenses”).

 

Interest. The unpaid Principal Amount of this Note shall earn interest calculated on the basis of a 360-day year for the actual number of days of each year (365 or 366), from and including the date the proceeds of this Note are disbursed to, but not including, the date all amounts hereunder are paid in full, at a rate per year which shall be variable based on 500 basis points above One-Month LIBOR with an effective Interest Period of equal duration. See attached LIBOR Rate Rider, the terms of which are incorporated herein by reference, for definitions and additional provisions.

 

 

Maximum Legal Rate. It is the intent of the Bank and Borrower that in no event shall interest be payable at a rate in excess of the maximum rate permitted by applicable law (the “Maximum Legal Rate”). Solely to the extent necessary to prevent interest under this Note from exceeding the Maximum Legal Rate, Borrower agrees that any amount that would be treated as excessive under a final judicial interpretation of applicable law shall be deemed to have been a mistake and automatically canceled, and, if received by the Bank, shall be refunded to Borrower, without interest.

 

Default Rate. If an Event of Default (defined below) occurs, the interest rate on the unpaid Principal Amount shall immediately be automatically increased to five (5) percentage points per year above the otherwise applicable rate per year, and any judgment entered hereon or otherwise in connection with any suit to collect amounts due hereunder shall bear interest at such default rate.

 

Origination Fee. On the date hereof the Borrower shall pay to the Bank an origination fee in the amount of $200,000.00. Such fee will be repayable in part upon a voluntary prepayment of the unpaid Principal Amount with the proceeds of a refinancing arranged by Bank of the Syndicated Loan (as defined herein); the amount of such fee repayable to Borrower will be reduced on a daily pro-rated basis at $1,098.90 per day, commencing on the day after the date hereof.

 

Payments. Payments shall be made in immediately available United States funds at any banking office of the Bank.

 

Preauthorized Transfers from Deposit Account. If a deposit account number is provided in the following blank, Borrower hereby authorizes the Bank to debit Borrower’s deposit account #                                   with the Bank automatically for any amount which becomes due under this Note.

 

Interest Accrual; Application of Payments. Interest will continue to accrue on the actual principal balance outstanding until the Principal Amount is paid in full. All installment payments (excluding voluntary prepayments of principal) will be applied as of the date each payment is received and processed. Payments may be applied in any order in the sole discretion of the Bank, but, prior to an Event of Default, may be applied chronologically (i.e., oldest invoice first) to unpaid amounts due and owing, in the following order: first to accrued interest, then to principal, then to Escrow, then to late charges and other fees, and then to all other Expenses.

 

“Payment Due Date” shall mean the first day of the applicable calendar month. If there is no numerically corresponding calendar day in a particular month, the Payment Due Date shall be the last calendar day of such month); provided, however, to the extent, if at all, that a LIBOR-based interest rate is applicable, if in any applicable month the day identified above is not a Joint Business Day, the Payment Due Date shall be extended to the next succeeding Joint Business Day unless such next succeeding Joint Business Day would fall in the next calendar month, in which case such Payment Due Date shall be the immediately preceding Joint Business Day, so as to, in all instances, coincide with the end of the applicable Interest Period. See attached LIBOR Rate Rider, the terms of which are incorporated herein by reference, for definitions and additional provisions.

 

The “First Installment Payment Date” shall be the Payment Due Date in the month of [October, 2011].

 

The “Maturity Date” of this Note is the Payment Due Date in the month of [March, 2012].

 

Repayment Terms. Borrower shall pay to the Bank the entire Principal Amount on the Maturity Date. In addition, until the outstanding Principal Amount is paid in full, Borrower shall pay to the Bank all accrued and unpaid interest, in amounts that may vary, on the Payment Due Date of each month beginning on the First Installment Payment Date, or as otherwise invoiced by the Bank.

 

Late Charge. If Borrower fails to pay, within five (5) days of its due date, any amount due and owing pursuant to this Note or any other agreement executed and delivered to the Bank in connection with this Note, including, without limitation, any Escrow payment due and owing, Borrower shall immediately pay to the Bank a late charge equal to the greatest of (a) $50.00, (b) five percent (5%) of the delinquent amount or (c) the Bank’s then current late charge as announced from time to time.

 

Prepayment Premium. During the term of this Note, Borrower shall have the option of paying the unpaid Principal Amount to the Bank in advance of the Maturity Date, in whole or in part, at any time and from time to time upon written notice received by the Bank at least three (3) days prior to making such payment without premium or penalty, but subject to any applicable Breakage Fee in accordance with the attached LIBOR Rate Rider. Any partial prepayment of principal shall be posted as of the date received and applied in inverse order of maturity. With any prepayment in full of the Principal Amount balance, Borrower shall also pay to the Bank all accrued interest and Expenses owing pursuant to this Note. In the event the Maturity Date of this Note is accelerated following an Event of Default, any tender of payment of the amount necessary to satisfy the entire indebtedness made after such Event of Default shall be expressly deemed a voluntary prepayment.

 

Representations, Warranties and Covenants. Borrower represents and warrants to and agrees and covenants with the Bank that now and until this Note is paid in full:

 

a.     Business Purpose. The Loan proceeds shall be used only for a business purpose and not for any personal, family or household purpose.

 

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b.     Good Standing; Authority. Borrower is an entity or sole proprietor (i) duly organized and existing and in good standing under the laws of the jurisdiction in which it was formed, (ii) duly qualified, in good standing and authorized to do business in every jurisdiction in which failure to be so qualified might have a material adverse effect on its business or assets and (iii) has the power and authority to own each of its assets and to use them as contemplated now or in the future.

 

c.     Legality. The execution, issuance, delivery to the Bank and performance by Borrower of this Note (i) are in furtherance of Borrower’s purposes and within its power and authority; (ii) do not (A) violate any statute, regulation or other law or any judgment, order or award of any court, agency or other governmental authority or of any arbitrator or (B) violate Borrower’s certificate of incorporation or other governing instrument, constitute a default under any agreement binding on Borrower, or result in a lien or encumbrance on any assets of Borrower; and (iii) have been duly authorized by all necessary corporate or partnership action.

 

d.     Compliance. The Borrower conducts its business and operations and the ownership of its assets in material compliance with each applicable statute, regulation and other law, including without limitation environmental laws. All approvals, including without limitation authorizations, permits, consents, franchises, licenses, registrations, filings, declarations, reports and notices (the “Approvals”) necessary to the conduct of Borrower’s business and for Borrower’s due issuance of this Note have been duly obtained and are in full force and effect. The Borrower is in compliance with all conditions of each Approval.

 

e.     Financial and Other Information. For each year until this Note is paid in full, Borrower shall provide to the Bank in form and number of copies and by accountants satisfactory to the Bank, within ninety (90) days after the end of each fiscal year of the Borrower, statements of income and cash flows and the financial position and balance sheet of the Borrower as of the fiscal year end, each in reasonable detail and certified by an officer or member of Borrower to have been prepared in accordance with generally accepted accounting principles to present fairly the results of Borrower’s operations and cash flows and its financial position in conformity with such principles, and to be correct, complete and in accordance with Borrower’s records. Promptly upon the reasonable request of the Bank from time to time, Borrower shall supply all additional information requested. If no Event of Default, then upon prior reasonable notice (not more than two (2) business days) and upon the occurrence and during the continuance of an Event of Default no prior notice is necessary, Borrower shall permit the Bank’s officers, employees, accountants, attorneys and other agents to (i) visit and inspect each of Borrower’s premises, (ii) examine, audit, copy and extract from Borrower’s records and (iii) discuss Borrower’s or its affiliates’ business, operations, assets, affairs or condition (financial or other) with its responsible officers and independent accountants.

 

f.      Accounting; Tax Returns and Payment of Claims. Borrower will maintain a system of accounting and reserves in accordance with generally accepted accounting principles, has filed and will file each tax return required of it and (other than taxes presently payable without penalty or interest and other than any charge or claim being contested in good faith by appropriate proceedings promptly initiated and diligently conducted and for which any reserve or other appropriate provision, if any, as shall be required by generally accepted accounting principles has been made therefore and, if the filing of a bond or other indemnity is necessary to avoid the creation of a lien against any of the assets of the Borrower or any of its subsidiaries, such bond has been filed or indemnity posted) has paid and will pay when due each tax, assessment, fee, charge, fine and penalty imposed by any taxing authority upon Borrower or any of its assets, income or franchises, as well as all amounts owed to mechanics, materialmen, landlords, suppliers and the like in the ordinary course of business.

 

g.     Title to Assets; Insurance. Borrower has good and marketable title to each of its assets free of security interests and mortgages and other liens except as disclosed in its financial statements or on a schedule attached to this Note or pursuant to the Bank’s prior written consent. Borrower will maintain its property in good repair (ordinary wear and tear excepted) and will maintain and on request provide the Bank with evidence of insurance coverage satisfactory to the Bank including without limitation fire and hazard, liability, worker’s compensation and business interruption insurance and flood hazard insurance as required.

 

h.     Judgments and Litigation. There is no pending or threatened claim, audit, investigation, action or other legal proceeding or judgment, order or award of any court, agency or other governmental authority or arbitrator (each an “Action”) which involves Borrower or its assets and might have a material adverse effect upon Borrower or threaten the validity of this Note or any related document or transaction. Borrower will immediately notify the Bank in writing upon acquiring knowledge of any such Action.

 

i.      Notice of Change of Address and of Default. Borrower will immediately notify the Bank in writing (i) of any change in its address or of the location of any collateral securing this Note, (ii) of the occurrence of any Event of Default defined below, (iii) of any material change in Borrower’s ownership or management and (iv) of any material adverse change in Borrower’s ability to repay this Note.

 

j.      No Transfer of Assets. Until this Note is paid in full, Borrower shall not without the prior written consent of the Bank (i) sell or otherwise dispose of substantially all of its assets, (ii) acquire substantially all of the assets of another entity, (iii) if it is a corporation or other entity, participate in any merger, consolidation or other absorption or (iv) agree to do any of these things, in each case unless to do so would otherwise be permitted under the Syndicated Loan, as defined herein, so long as the Syndicated Loan is outstanding.

 

Events of Default. The following constitute an event of default (“Event of Default”): (i) failure by Borrower to make any payment when due (whether at the stated maturity, by acceleration or otherwise) of the amounts due under this Note, or any part thereof, or there occurs any event or condition which after notice, lapse of time or both will permit such acceleration; (ii) Borrower defaults in the performance of any covenant or other provision with respect to this Note or any other agreement between Borrower and the Bank or any of its affiliates or subsidiaries (collectively, “Affiliates”); (iii) Borrower fails to pay when due (whether at the stated maturity, by acceleration or otherwise) any

 

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indebtedness for borrowed money owing to the Bank (other than under this Note), any third party or Affiliate or the occurrence of any event which could result in acceleration of payment of any such indebtedness or the failure to perform any agreement with any third party or Affiliate; (iv) the reorganization, merger, consolidation or dissolution of Borrower (or the making of any agreement therefor); the sale, assignment, transfer or delivery of all or substantially all of the assets of Borrower to a third party; or the cessation by Borrower as a going business concern; (v) the death or judicial declaration of incompetency of Borrower, if an individual; (vi) failure to pay, withhold or collect any tax as required by law; the service or filing against Borrower or any of its assets of any lien (other than a lien permitted in writing by the Bank), judgment, garnishment, order or award; (vii) if Borrower becomes insolvent or is generally not paying its debts as such debts become due; (viii) the making of any general assignment by Borrower for the benefit of creditors; the appointment of a receiver or similar trustee for Borrower or its assets; or the making of any, or sending notice of any intended, bulk sale; (ix) Borrower commences, or has commenced against it, any proceeding or request for relief under any bankruptcy, insolvency or similar laws now or hereafter in effect in the United States of America or any state or territory thereof or any foreign jurisdiction or any formal or informal proceeding for the dissolution or liquidation of, settlement of claims against or winding up of affairs of Borrower; (x) any representation or warranty made in this Note, any related document, any agreement between Borrower and the Bank or any Affiliate or in any financial statement of Borrower proves to have been misleading in any material respect when made; Borrower omits to state a material fact necessary to make the statements made in this Note, any related document, any agreement between Borrower and the Bank or any Affiliate or any financial statement of Borrower not misleading in light of the circumstances in which they were made; or, if upon the date of execution of this Note, there shall have been any material adverse change in any of the facts disclosed in any financial statement, representation or warranty that was not disclosed in writing to the Bank at or prior to the time of execution hereof; (xi) any pension plan of Borrower fails to comply with applicable law or has vested unfunded liabilities that, in the opinion of the Bank, might have a material adverse effect on Borrower’s ability to repay its debts; (xii) an adverse change in the Borrower, its business, assets, operations, management, ownership, affairs or condition (financial or otherwise) from the status shown on any financial statement or other document submitted to the Bank or any Affiliate, and which change the Bank determines will have a material adverse effect on (a) the Borrower, its business, assets, operations or condition (financial or otherwise), or (b) the ability of the Borrower to pay or perform any obligation to the Bank; (xiii) the occurrence of any event described in sub-paragraph (i) through and including (xii) hereof with respect to any guarantor or any other party liable for, or whose assets or any interest therein secures, payment of any of the amounts due under this Note (“Guarantor”); (xiv) Borrower fails to supply new or additional collateral within ten (10) days of request by the Bank; or (xv) the Bank in good faith deems itself insecure with respect to payment or performance under this Note or (xvi) there has been an Event of Default under the Syndicated Loan, as defined herein. Notwithstanding the foregoing, so long as the Syndicated Loan is outstanding none of the events described above shall be an Event of Default unless such events would otherwise constitute an Event of Default as defined in the Syndicated Loan, except that even if the following do not constitute an Event of Default under the Syndicated Loan, Bank may declare an Event of Default hereunder for a breach of (i) above or in the event that Borrower fails to maintain property insurance or pay real estate taxes on real property securing this loan after thirty (30) days notice and an opportunity to cure.

 

Rights and Remedies Upon Default. Upon the occurrence of any Event of Default, the Bank without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law) to or upon the Borrower or any other person (all and each of which demands, presentments, protests, advertisements and notices are hereby waived), may exercise all rights and remedies under the Borrower’s agreements with the Bank or its Affiliates, applicable law, in equity or otherwise and may declare all or any part of any amounts due hereunder not payable on demand to be immediately due and payable without demand or notice of any kind and terminate any obligation it may have to grant any additional loan, credit or other financial accommodation to the Borrower. All or any part of any amounts due hereunder whether or not payable on demand, shall be immediately due and payable automatically upon the occurrence of an Event of Default in sub-paragraph (ix) above, or at the Bank’s option, upon the occurrence of any other Event of Default. The provisions hereof are not intended in any way to affect any rights of the Bank with respect to any amounts due hereunder which may now or hereafter be payable on demand.

 

Right of Setoff. The Bank shall have the right to set off against the amounts owing under this Note any property held in a deposit or other account with the Bank or any Affiliates or otherwise owing by the Bank or any Affiliates in any capacity to Borrower or any Guarantor or endorser of this Note. Such setoff shall be deemed to have been exercised immediately at the time the Bank or such Affiliate elects to do so.

 

Miscellaneous. This Note, together with any related loan and collateral agreements and guaranties, contains the entire agreement between the Bank and Borrower with respect to the Note, and supersedes every course of dealing, other conduct, oral agreement and representation previously made by the Bank. All rights and remedies of the Bank under applicable law and this Note or amendment of any provision of this Note are cumulative and not exclusive. No single, partial or delayed exercise by the Bank of any right or remedy shall preclude the subsequent exercise by the Bank at any time of any right or remedy of the Bank without notice. No waiver or amendment of any provision of this Note shall be effective unless made specifically in writing by the Bank. No course of dealing or other conduct, no oral agreement or representation made by the Bank, and no usage of trade, shall operate as a waiver of any right or remedy of the Bank. No waiver of any right or remedy of the Bank shall be effective unless made specifically in writing by the Bank. Borrower agrees that in any legal proceeding, a copy of this Note kept in the Bank’s course of business may be admitted into evidence as an original. This Note is a binding obligation enforceable against Borrower and its successors and assigns and shall inure to the benefit of the Bank and its successors and assigns. If a court deems any provision of this Note invalid, the remainder of the Note shall remain in effect. Section headings are for convenience only. Singular number includes plural and neuter gender includes masculine and feminine as appropriate.

 

Notices. Any demand or notice hereunder or under any applicable law pertaining hereto shall be in writing and duly given if delivered to Borrower (at its address on the Bank’s records) or to the Bank (at the address on page one and separately to the Bank officer responsible for Borrower’s relationship with the Bank). Such notice or demand shall be

 

4

 

deemed sufficiently given for all purposes when delivered (i) by personal delivery and shall be deemed effective when delivered, or (ii) by mail or courier and shall be deemed effective three (3) business days after deposit in an official depository maintained by the United States Post Office for the collection of mail or one (1) business day after delivery to a nationally recognized overnight courier service (e.g., Federal Express). Notice by e-mail is not valid notice under this Note.

 

Joint and Several. If there is more than one Borrower, each of them shall be jointly and severally liable for all amounts and obligations that become due under this Note and the term “Borrower” shall include each as well as all of them.

 

Governing Law; Jurisdiction.

 

This Note has been delivered to and accepted by the Bank and will be deemed to be made in the Commonwealth of Pennsylvania. Except as otherwise provided under federal law, this Note will be interpreted in accordance with the laws of the Commonwealth of Pennsylvania excluding its conflict of laws rules. BORROWER HEREBY IRREVOCABLY CONSENTS TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT IN THE COMMONWEALTH OF PENNSYLVANIA IN A COUNTY OR JUDICIAL DISTRICT WHERE THE BANK MAINTAINS A BRANCH AND CONSENTS THAT THE BANK MAY EFFECT ANY SERVICE OF PROCESS IN THE MANNER AND AT BORROWER’S ADDRESS SET FORTH ABOVE FOR PROVIDING NOTICE OR DEMAND; PROVIDED THAT NOTHING CONTAINED IN THIS NOTE WILL PREVENT THE BANK FROM BRINGING ANY ACTION, ENFORCING ANY AWARD OR JUDGMENT OR EXERCISING ANY RIGHTS AGAINST BORROWER INDIVIDUALLY, AGAINST ANY SECURITY OR AGAINST ANY PROPERTY OF BORROWER WITHIN ANY OTHER COUNTY, STATE OR OTHER FOREIGN OR DOMESTIC JURISDICTION. Borrower acknowledges and agrees that the venue provided above is the most convenient forum for both the Bank and Borrower. Borrower waives any objection to venue and any objection based on a more convenient forum in any action instituted under this Note.

 

Waiver of Jury Trial. BORROWER AND THE BANK HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT TO TRIAL BY JURY BORROWER AND THE BANK MAY HAVE IN ANY ACTION OR PROCEEDING, IN LAW OR IN EQUITY, IN CONNECTION WITH THIS NOTE OR THE TRANSACTIONS RELATED HERETO. BORROWER REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE OR AGENT OF THE BANK HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK WILL NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THIS JURY TRIAL WAIVER. BORROWER ACKNOWLEDGES THAT THE BANK HAS BEEN INDUCED TO ENTER INTO THIS NOTE BY, AMONG OTHER THINGS, THE PROVISIONS OF THIS SECTION.

 

Power to Confess Judgment. BORROWER HEREBY EMPOWERS ANY ATTORNEY OF ANY COURT OF RECORD, AFTER THE OCCURRENCE OF ANY EVENT OF DEFAULT HEREUNDER, TO APPEAR FOR BORROWER AND, WITH OR WITHOUT COMPLAINT FILED, CONFESS JUDGMENT, OR A SERIES OF JUDGMENTS, AGAINST BORROWER IN FAVOR OF THE BANK OR ANY HOLDER HEREOF FOR THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE, ALL ACCRUED INTEREST AND ALL OTHER AMOUNTS DUE HEREUNDER, TOGETHER WITH COSTS OF SUIT AND AN ATTORNEY’S COMMISSION OF THE GREATER OF TEN PERCENT (10%) OF SUCH PRINCIPAL AND INTEREST OR $1,000 ADDED AS A REASONABLE ATTORNEY’S FEE, AND FOR DOING SO THIS NOTE OR A COPY VERIFIED BY AFFIDAVIT SHALL BE A SUFFICIENT WARRANT. BORROWER HEREBY FOREVER WAIVES AND RELEASES ALL ERRORS IN SAID PROCEEDINGS AND ALL RIGHTS OF APPEAL AND ALL RELIEF FROM ANY AND ALL APPRAISEMENT, STAY OR EXEMPTION LAWS OF ANY STATE NOW IN FORCE OR HEREAFTER ENACTED. INTEREST ON ANY SUCH JUDGMENT SHALL ACCRUE AT THE DEFAULT RATE. NO SINGLE EXERCISE OF THE FOREGOING POWER TO CONFESS JUDGMENT, OR A SERIES OF JUDGMENTS, SHALL BE DEEMED TO EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY COURT TO BE INVALID, VOIDABLE, OR VOID, BUT THE POWER SHALL CONTINUE UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS THE BANK SHALL ELECT UNTIL SUCH TIME AS THE BANK SHALL HAVE RECEIVED PAYMENT IN FULL OF THE DEBT, INTEREST AND COSTS.

 

Acknowledgment. Borrower acknowledges that it has read and understands all the provisions of this Note, including the provisions relating to Power to Confess Judgment, Governing Law, Jurisdiction and Waiver of Jury Trial, and has been advised by counsel as necessary or appropriate.

 

Cross Default. An Event of Default under and as defined in that certain Second Amended and Restated Credit Agreement dated as of January 11, 2008 (as amended, modified, or supplemented from time to time by and between Borrower, as borrower and Bank as Agent, Issuing Bank, Swing Lender and a Lender, the “Syndicated Loan”) shall be an Event of Default hereunder.

 

[Signatures on the Following Pages]

 

5

 

In Witness Whereof, this Note has been duly executed by Borrower the day and year first written above.

 

	
 
    	
New Enterprise Stone & Lime Co., Inc.
    
	
 
    	
a   Delaware corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   President
    

 

 

	
 
    	
Gateway Trade Center Inc.
    
	
 
    	
a   New York corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
EII Transport Inc.
    
	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
Protection Services Inc.
    
	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
Work Area Protection Corp.
    
	
 
    	
an   Illinois corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

[Signature Page to the Note]

 

6

 

	
 
    	
SCI Product Inc.
    
	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
Precision Solar Controls Inc.
    
	
 
    	
a   Texas corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
ASTI Transportation Systems, Inc.
    
	
 
    	
a   Delaware corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Paul Detwiler, III
    
	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    
	
 
    	
Title:   Vice President
    

 

[Signature Page to the Note]

 

7

 

ACKNOWLEDGMENT

 

	
COMMONWEALTH   OF PENNSYLVANIA
    	
)
    	
 
    
	
 
    	
:   SS.
    	
 
    
	
COUNTY   OF BLAIR
    	
)
    	
 
    

 

On the 29th day of August, in the year 2011, before me, the undersigned, a Notary Public in and for said State, personally appeared PAUL DETWILER, III, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.

 

	
 
    	
/s/   Pamela K. Bishop
    
	
COMMONWEALTH   OF PENNSYLVANIA
    	
Notary Public
    
	
NOTARIAL SEAL
    	
 
    
	
PAMELA K. BISHOP, Notary Public
    	
 
    
	
City of Harrisburg, Dauphin   County
    	
 
    
	
My Commission Expires June 5,   2015
    	
 
    

 

 

FOR BANK USE ONLY

 

	
Authorization   Confirmed:
    	
 
    	
 
    	
 
    	
 
    
	
Disbursement of Funds:
    	
 
    	
 
    	
 
    
	
Credit   A/C
    	
#
    	
 
    	
Off Ck    #  
    	
 
    	
Payoff Obligation
    	
 #
    	
 
    
	
 
    	
$
    	
 
    	
$ 
    	
 
    	
 
    	
 $
    	
 
    
									

 

8

 

 

Exhibit A

 

LIBOR RATE RIDER

(For Actual Balance Promissory Notes)

 

Borrower: New Enterprise Stone & Lime Co., Inc.

Protection Services Inc.

Gateway Trade Center Inc.

EII Transport Inc.

Work Area Protection Corp.

SCI Products Inc.

Precision Solar Controls Inc.

ASTI Transportation Systems, Inc.

 

Promissory Note Original Principal Amount: $20,000,000

 

Promissory Note Date: August              , 2011

 

DEFINITIONS. The above-referenced Promissory Note is referred to herein as the “Note”. As used in the Note and this Rider, each capitalized term shall have the meaning specified in the Note, and the following terms shall have the indicated meanings:

 

a.     “Base Rate” shall mean six (6%) percent above the rate of interest announced by the Bank each day as its prime rate of interest (“Prime Rate”).

 

b.     “Interest Period” shall mean, as used in connection with a non-daily adjusting LIBOR Rate, the period commencing on the date of this Note or any Rate Adjustment Date (as the case may be) and ending on, as applicable, the next succeeding Payment Due Date or the Payment Due Date of the calendar month that is one (1) or three (3) months thereafter (as applicable in accordance with the LIBOR Rate in effect); provided, however, that if an Interest Period would end on a day that is not a Joint Business Day, such Interest Period shall be extended to the next succeeding Joint Business Day unless such next succeeding Joint Business Day would fall in the next calendar month, in which case such Interest Period shall end on the immediately preceding Joint Business Day. To the extent that the preceding clause results in either the extension or shortening of an Interest Period, the Bank shall have the right (but not the obligation) to shorten or extend, respectively, the succeeding Interest Period so that it shall end on a day that numerically corresponds to the intended Payment Due Date indicated in the Note.

 

c.     “Joint Business Day” shall mean a day that is both a New York Business Day and a London Business Day.

 

d.     “LIBOR” shall mean the rate per annum (rounded upward, if necessary, to the nearest 1/16th of 1%) obtained by dividing (i) either the one-day (i.e., overnight), one-month or three-month interest period London Interbank Offered Rate (as applicable in accordance with the LIBOR Rate in effect), fixed by the British Bankers Association for United States dollar deposits in the London interbank market at approximately 11:00 a.m. London, England time (or as soon thereafter as practicable) as determined by the Bank from any broker, quoting service or commonly available source utilized by the Bank, by (ii) a percentage equal to 100% minus the stated maximum rate of all reserves required to be maintained against “Eurocurrency Liabilities” as specified in Regulation D (or against any other category of liabilities which includes deposits by reference to which the interest rate on LIBOR-based loans is determined or any category of extensions of credit or other assets which includes loans by a non-United States’ office of a bank to United States residents) on such date to any member bank of the Federal Reserve System. Notwithstanding any provision above, the practice of rounding to determine LIBOR may be discontinued at any time in the Bank’s sole discretion.

 

e.     “LIBOR Rate” shall mean the applicable LIBOR-based interest rate in effect from time to time, as provided for in the Note and this Rider.

 

f.      “London Business Day” shall mean any day on which dealings in United States dollar deposits are carried on by banking institutions in the London interbank market.

 

g.     “New York Business Day” shall mean any day other than Saturday, Sunday or other day in which commercial banking institutions in New York, New York are authorized or required by law or other governmental action to remain closed for business.

 

h.     “One-Month LIBOR” shall mean LIBOR as fixed for a one-month interest period.

 

i.      “Rate Adjustment Date” shall mean the effective date of a change in the applicable LIBOR Rate, as follows:

 

i.      For a daily-adjusting LIBOR Rate, the Rate Adjustment Date shall be each London Business Day.

 

ii.     For a monthly-adjusting LIBOR Rate (i.e., having an Interest Period of one (1) month), the Rate Adjustment

 

9

 

Date shall be, in each month, the calendar day of that month that corresponds with the Payment Due Date in such month (as may be adjusted pursuant to the definition of “Payment Due Date” in the Note).

 

iii.    For a quarterly-adjusting LIBOR Rate (i.e., having an Interest Period of three (3) months), the Rate Adjustment Date shall be, initially, the Payment Due Date that is three (3) months after the first day such LIBOR Rate is in effect (“Effective Date”), and thereafter, the Payment Due Date that is three (3) months after each prior Rate Adjustment Date, respectively; provided, however, that if the Effective Date is not a Payment Due Date, the first Rate Adjustment Date shall be the next succeeding Payment Due Date, after which a new three-month Interest Period shall begin with quarterly Rate Adjustment Dates thereafter, as provided above.

 

ADDITIONAL PROVISIONS:

 

Interest Rate Determinations and Adjustments.

 

1      To the extent a daily-adjusting LIBOR Rate is in effect, the LIBOR Rate shall be determined using the One-Month LIBOR in effect on the date of the Note (or if such day is not a London Business Day, on the immediately preceding London Business Day), and shall be adjusted thereafter on each subsequent Rate Adjustment Date using the One-Month LIBOR in effect on each respective Rate Adjustment Date.

 

2      To the extent a monthly-adjusting LIBOR Rate (i.e., a LIBOR Rate adjusting each month) or a quarterly-adjusting LIBOR Rate (i.e., a LIBOR Rate adjusting every three (3) months) is in effect, the initial LIBOR Rate shall be determined using the applicable LIBOR in effect two (2) London Business Days prior to the date of the Note (or two (2) London Business Days prior to the Amortization Commencement Date, as applicable), and shall be adjusted thereafter on each subsequent Rate Adjustment Date using the applicable LIBOR in effect (2) London Business Days prior to each Rate Adjustment Date, respectively.

 

Prepayment; Breakage Fee. Subject to the following, during the term of this Note, Borrower shall have the option of paying the Principal Amount to the Bank in advance of the Maturity Date, in whole or in part, at any time and from time to time upon written notice received by the Bank at least three (3) days prior to making such payment; provided, however, that if (i) Borrower prepays, in whole or in part, any Principal Amount, when a LIBOR Rate is in effect (other than on a Rate Adjustment Date), or (ii) the LIBOR Rate is converted to the Base Rate on any day other than a Rate Adjustment Date, then Borrower shall be liable for and shall pay the Bank, on demand, the higher of $250.00 or the actual amount of the liabilities, expenses, costs or funding losses that are a direct or indirect result of such prepayment or other condition described above, whether such liability, expense, cost or loss is by reason of (a) any reduction in yield, by reason of the liquidation or reemployment of any deposit or other funds acquired by the Bank, (b) the fixing of the interest rate payable on any LIBOR-based loan or (c) otherwise (collectively, the “Breakage Fee”). The determination by the Bank of the foregoing amount shall, in the absence of manifest error, be conclusive and binding upon Borrower. The provisions of this paragraph shall not be applicable if the LIBOR Rate in effect at the time of the prepayment has an Interest Period of one day.

 

Inability to Determine LIBOR Rates, Increased Costs, Illegality.

 

Increased Costs. If the Bank shall determine that, due to either (a) the introduction of any change (other than any change by way of imposition of or increase in reserve requirements included in the calculation of the LIBOR Rate) in or in the interpretation of any requirement of law or (b) the compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law), there shall be any increase in the cost to the Bank of agreeing to make or making, funding or maintaining any loans based on LIBOR, then Borrower shall be liable for, and shall from time to time, upon demand therefor by the Bank, pay to the Bank such additional amounts as are sufficient to compensate the Bank for such increased costs.

 

Inability to Determine Rates. If the Bank shall determine that for any reason adequate and reasonable means do not exist for ascertaining LIBOR, the Bank will give notice of such determination to Borrower. Thereafter, the Bank may not maintain the loan hereunder at the LIBOR Rate until the Bank revokes such notice in writing and, until such revocation, the Bank may convert the applicable interest rate to the Base Rate.

 

Illegality. If the Bank shall determine that the introduction of any law (statutory or common), treaty, rule, regulation, guideline or determination of an arbitrator or of a governmental authority or in the interpretation or administration thereof, has made it unlawful, or that any central bank or other governmental authority has asserted that it is unlawful for the Bank to make LIBOR-based loans, then, on notice thereof by the Bank to Borrower, the Bank may suspend the maintaining of the loan hereunder at the LIBOR Rate until the Bank shall have notified Borrower that the circumstances giving rise to such determination shall no longer exist. If the Bank shall determine that it is unlawful to maintain the loan hereunder based on LIBOR, the Bank may convert the applicable interest rate to the Base Rate.

 

Conversion To Base Rate Upon Default. Unless the Bank shall otherwise consent in writing, if (i) Borrower fails to pay when due, in whole or in part, the indebtedness under the Note (whether upon maturity, acceleration or otherwise), or (ii) there exists a

 

10

 

condition or event which with the passage of time, the giving of notice or both shall constitute an Event of Default, the Bank, in its sole discretion, may (i) permit the LIBOR Rate to remain in effect until a Rate Adjustment Date, at which time the applicable interest rate shall automatically be converted to the Base Rate, or (ii) convert the LIBOR Rate to the Base Rate at or before a Rate Adjustment Date. Nothing herein shall be construed to be a waiver by the Bank of the right to have the Principal Amount accrue interest at the Default Rate or the right of the Bank to charge and collect a Breakage Fee.

 

Repayment Upon Conversion To Base Rate. If a LIBOR Rate with an Interest Period duration of greater than one day is converted to the Base Rate at a time when the repayment terms under the Note require the Borrower to make principal payments to the Bank, Borrower shall thereafter pay the unpaid Principal Amount in consecutive monthly installments commencing on the first Payment Due Date after the date of such conversion and on the same Payment Due Date thereafter, plus accrued interest in amounts that may vary, until (a) conversion back to the LIBOR Rate (at which time Borrower shall resume the monthly, bi-monthly or quarterly installments in the amount set forth in the Note, or as otherwise agreed to by the Bank and Borrower in writing) or (b) the Maturity Date (at which time Borrower shall pay the Final Installment), with each such installment being equal and in the amount necessary to fully amortize the outstanding Principal Amount of the Note in full by the Maturity Date or such other date agreed to by the Bank and Borrower in writing. In the event of a Conversion to the Base Rate, then the Payment Due Date if not a New York Business Day shall be extended until the next New York Business Day. The determination by the Bank of the foregoing amount shall, in the absence of manifest error, be conclusive and binding upon Borrower.

 

[Signatures on the Following Pages]

 

11

 

In Witness Whereof, this Note has been duly executed by Borrower the day and year first written above.

 

	
 
    	
 
    	
New   Enterprise Stone & Lime Co., Inc.
    
	
 
    	
 
    	
a   Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   President
    

 

 

	
 
    	
 
    	
Gateway   Trade Center Inc.
    
	
 
    	
 
    	
a   New York corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

 

	
 
    	
 
    	
EII   Transport Inc.
    
	
 
    	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

	
 
    	
 
    	
Protection   Services Inc.
    
	
 
    	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

 

	
 
    	
 
    	
Work   Area Protection Corp.
    
	
 
    	
 
    	
an   Illinois corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

12

 

	
 
    	
 
    	
SCI Products Inc.
    
	
 
    	
 
    	
a   Pennsylvania corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

 

	
 
    	
 
    	
Precision   Solar Controls Inc.
    
	
 
    	
 
    	
a   Texas corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

 

	
 
    	
 
    	
ASTI   Transportation Systems, Inc.
    
	
 
    	
 
    	
a   Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ 
    	
 
    	
/s/   Paul Detwiler, III
    
	
Signature of Witness
    	
 
    	
Name:   Paul Detwiler, III
    
	
 
    	
 
    	
 
    
	
Typed Name of Witness
    	
 
    	
Title:   Vice President
    

 

13

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