Waiver, Consent and Second Amendment to Loan and Security Agreement among Bairnco Corporation, Subsidiaries, and Bank of America, N.A.

 Exhibit 4.31 WAIVER, CONSENT AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT THIS WAIVER, CONSENT AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment") is made and entered into as of April 24, 2007, by and among Bairnco Corporation, a Delaware corporation ("Bairnco"), Arlon, Inc., a Delaware corporation ("Arlon"), Kasco Corporation, a Delaware corporation ("Kasco"), Bertram & Graf GmbH, a Gesellschaft mit beschrankter Haftung organized under the laws of the Federal Republic of Germany ("German Borrower"), Atlantic Service Co. Ltd, a corporation organized under the laws of Canada ("Canadian Borrower"), Atlantic Service Co. (UK) Ltd., an English company ("UK Borrower"), EuroKasco S.A., a societe anonyme organized under the laws of France ("French Borrower"; and, together with Bairnco, Arlon, Kasco, German Borrower, Canadian Borrower and UK Borrower, collectively, "Borrowers"), and Bank of America, N.A., a national banking association, individually as the sole Lender as of the date hereof and in its capacity as agent for the Lenders (together with its successors in such capacity, "Agent"). RECITALS: Borrowers, Lenders and Agent are parties to that certain Loan and Security Agreement dated as of November 9, 2006, as amended by that certain Waiver and First Amendment to Loan and Security Agreement dated March 23, 2007 (the "Loan Agreement"), pursuant to which Agent and Lenders have made certain loans and other financial accommodations to Borrowers. Borrowers have advised Agent that an Event of Default has occurred and currently exists under the Loan Agreement as a result of Borrowers' breach of SECTIONS 10.1.9 AND 10.2.11 of the Loan Agreement (the "Stipulated Default"). The Stipulated Default exists because Arlon formed a new Subsidiary, Arlon India Private Ltd., a private limited company organized under the laws of India ("Arlon India"), without giving notice to Agent as required under the Loan Agreement. Borrowers have further advised Agent that Arlon intends to make an initial contribution of equity to Arlon India in an amount not to exceed $25,000 (the "Contribution"). The Borrowers hereby acknowledge that pursuant to SECTION 10.2.6 of the Loan Agreement, Arlon is not permitted to consummate the Contribution without the consent of Agent and Lenders. Borrowers have further advised Agent that, simultaneously with the execution and delivery of this Amendment and the consummation of the Permitted Merger, Bairnco will become a borrower under a Loan and Security Agreement, dated as of April 17, 2007, with Steel Partners II, L.P. (the "Bridge Lender") and BZ Acquisition Corp. ("BZ"), pursuant to which Bridge Lender has provided a subordinated secured bridge term loan credit facility in an aggregate principal amount not to exceed $90,000,000 (together with any amendments or modifications thereto and any restatements, renewals, extensions or refinancings thereof, in each case on terms satisfactory to Agent, the "Bridge Facility") to BZ to finance the purchase of the equity interests of Bairnco pursuant to BZ's consummated tender offer to the holders of such equity interests (the "Tender Offer"), which Bridge Facility will, simultaneously with the execution and delivery of this Amendment and the consummation of the Permitted Merger, become guaranteed by the Obligors other than Bairnco pursuant to a Guarantee, Pledge and Security Agreement by and among Bairnco and the other Obligors, BZ and Bridge Lender. Borrowers have further advised Agent that, simultaneously with the execution and delivery of this Amendment and the consummation of the Permitted Merger, Bairnco and the other Obligors will become obligors under a Guarantee, Pledge and Security Agreement with the Bridge Lender, BZ and certain other  parties (the "WHX Note Guarantee"), pursuant to which Bairnco and the other Obligors will guarantee the obligations under a $15,000,000 promissory note issued by WHX Corporation, a Delaware corporation ("WHX"), in favor of the Bridge Lender (the "WHX Note"). In connection with the closing of the Bridge Facility and the WHX Note Guarantee, Borrowers have requested that Agent and Lenders waive the Stipulated Default, consent to the Contribution, and agree to certain amendments to the Loan Agreement, and Agent and Lenders are willing to do so, upon the terms and subject to the conditions contained herein. NOW, THEREFORE, for the sum of TEN DOLLARS ($10.00) in hand paid and other good and valuable consideration, the receipt and sufficiency of which are hereby severally acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 1. DEFINITIONS. Each capitalized term used in this Amendment, unless otherwise defined herein, shall have the meaning ascribed to such term in the Loan Agreement. 2. WAIVER OF STIPULATED DEFAULT. In reliance on the representations, warranties and agreements of Borrowers set forth in this Amendment, Agent and the sole Lender hereby waive the Stipulated Default. In no event shall anything contained herein be deemed to constitute a waiver of (a) any Default or Event of Default in existence on the date hereof or hereafter arising, other than the Stipulated Default, or (b) Borrowers' obligation to comply with all of the terms and conditions of the Loan Agreement and the other Loan Documents, as the same may be amended at any time hereafter, from and after the date hereof. 3. CONSENT TO CONTRIBUTION. In reliance on the representations, warranties and agreements of Borrowers set forth in this Amendment, Agent and the sole Lender hereby consent to the Contribution, notwithstanding Section 10.2.6 of the Loan Agreement, PROVIDED, that the Contribution shall be consummated no later than May 31, 2007 (or such later date as Agent may approve in writing). 4. AMENDMENTS TO LOAN AGREEMENT. In reliance on the representations, warranties and agreements of Borrowers set forth in this Amendment, the Loan Agreement is hereby amended as follows: (a) By adding to SECTION 1.1 of the Loan Agreement, in proper alphabetical sequence, the following new definitions: APPROVED ADDBACK EXPENSES - those expenses previously identified by Borrowers to Agent as expenses to be eliminated by Borrowers immediately upon the Second Amendment Date, the aggregate dollar amount of which shall not exceed $1,750,000 for the Fiscal Month ending April 30, 2007, and shall be reduced by one-twelfth (1/12) each Fiscal Month thereafter. BRIDGE FACILITY - as defined in the Second Amendment. BRIDGE LENDER - as defined in the Second Amendment. INTERCREDITOR AGREEMENT - that certain Intercreditor Agreement dated as of April 24, 2007, by and between the Agent and the Bridge Lender with respect to the Collateral and the Obligations (as at any time amended, restated, supplemented or otherwise modified). 2  SECOND AMENDMENT - that certain Waiver, Consent and Second Amendment to Loan and Security Agreement, dated as of April 24, 2007, by and among Borrowers, Lenders and Agent. SECOND AMENDMENT DATE - April 24, 2007. WHX - as defined in the Second Amendment. WHX NOTE - as defined in the Second Amendment. WHX NOTE GUARANTEE - as defined in the Second Amendment. (b) By deleting the phrase "; provided, however, that for purposes of this Agreement, Steel Partners II, LLP, which has made a tender offer for the stock of Bairnco, is not an Affiliate of Borrower" from the definition of "Affiliate" contained in SECTION 1.1 of the Loan Agreement. (c) By deleting the definition of "Change of Control" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: CHANGE OF CONTROL - the occurrence of any of the following at any time: (i) any "person" (as that term is used in Section 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act")) (other than Steel Partners II, L.P., a Delaware limited partnership ("Steel Partners"), or any of its Affiliates) becomes, directly or indirectly, the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act as in effect on the date hereof) of securities representing fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of any Borrower or any successor thereof; (ii) during any period of two (2) consecutive years or less, individuals who at the beginning of such period constituted the board of directors of any Borrower cease, for any reason, to constitute at least a majority of such board of directors, unless the election or nomination for election of each new member of the board was approved by a vote of at least two-thirds of the members of the board then still in office who were members of the board at the beginning of the period (EXCEPT that the appointment of directors designated by Steel Partners or any of its Affiliates to the board of directors of any Borrower shall not constitute a "Change of Control" hereunder); (iii) the equityholders of any Borrower approve any merger or consolidation to which such Borrower is a party as a result of which the persons who were equityholders of such Borrower, immediately prior to the effective date of the merger or consolidation (and excluding, however, any shares held by any party to such merger or consolidation and their Affiliates) shall have beneficial ownership of less than fifty percent (50%) of the combined voting power for election of members of the board of directors (or equivalent) of the surviving entity following the effective date of such merger or consolidation (EXCEPT that the Permitted Merger shall not constitute a "Change of Control" hereunder); or 3  (iv) the equityholders of any Borrower approve any merger or consolidation as a result of which the equity interests of such Borrower shall be changed, converted or exchanged (other than a merger with a wholly-owned Subsidiary of such Borrower or a reincorporation merger) or any liquidation of such Borrower or any sale or other disposition of fifty percent (50%) or more of the assets or earnings power of such Borrower (EXCEPT that the Permitted Merger shall not constitute a "Change of Control" hereunder). (d) By deleting the definition of "Commitment Termination Date" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: COMMITMENT TERMINATION DATE - the earliest to occur of (a) the Revolver Termination Date; (b) the date on which Borrowers terminate the Revolver Commitments pursuant to SECTION 2.1.4; (c) the date on which the Revolver Commitments are terminated pursuant to SECTION 11.2; or (d) such date on or after May 31, 2008, that Agent may elect to make the Commitment Termination Date (the "Elected Date") if the Debt under the Bridge Facility has not been refinanced on terms satisfying the Refinancing Conditions (but with a final maturity date not sooner than the date that is ninety (90) days after the then Term Loan Maturity Date) on or before May 31, 2008; PROVIDED, HOWEVER, that, (i) Agent shall give Borrowers one (1) Business Day notice of the Elected Date if the Elected Date is to occur between May 31, 2008, and June 30, 2008 (both inclusive), and five (5) Business Days notice of the Elected Date if the Elected Date is to occur on or after July 1, 2008, and (ii) if the Debt under the Bridge Facility is refinanced, on or before May 31, 2008, on terms satisfying the Refinancing Conditions (but with a final maturity date not sooner than the date that is ninety (90) days after the then Term Loan Maturity Date), then Agent shall not have the right to elect a Commitment Termination Date under this clause (d). (e) By deleting the definition of "EBITDA" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: EBITDA - determined on a consolidated basis for Borrowers and Subsidiaries, net income, calculated before interest expense, provision for income taxes, depreciation and amortization expense, gains or losses arising from the sale of capital assets, gains or losses arising from the write-up or write-down of assets, and any extraordinary gains or losses (in each case, to the extent included in determining net income); PROVIDED, that (i) for each Fiscal Month ended prior to the Second Amendment Date, EBITDA shall be determined (A) on a pro forma basis by including Sellers' Adjusted EBITDA for such Fiscal Month (subject to Agent's satisfaction with Sellers' financial reporting), (B) before any non-recurring expenses related to the Tender Offer, subject to approval by Agent, which approval shall not be unreasonably withheld, and (C) before any non-recurring pre-production expenses related to Borrower's Chinese facility incurred prior to the Closing Date, not to exceed in the aggregate $606,000, and (ii) for each Fiscal Month ended after the Second Amendment Date, EBITDA shall be determined (A) on a pro forma basis by including Sellers' Adjusted EBITDA for such Fiscal Month (subject to Agent's satisfaction with Sellers' financial reporting), (B) before any Approved Addback Expenses (to the extent included in 4  determining net income), and (C) before any non-recurring expenses related to the closing of the Second Amendment and the transactions contemplated therein (including, without limitation, the Tender Offer, the Permitted Merger, the Bridge Facility, the WHX Note and the WHX Guarantee), subject to approval by Agent, which approval shall not be unreasonably withheld. (f) By deleting the definition of "Fixed Charge Coverage Ratio" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: FIXED CHARGE COVERAGE RATIO - the ratio, determined on a consolidated basis for Borrowers and Subsidiaries for the most recent twelve (12) Fiscal Months, of (a) EBITDA MINUS Capital Expenditures (except those financed with Borrowed Money other than Revolver Loans) and cash taxes paid, to (b) Fixed Charges; PROVIDED, that (i) for purposes of calculating the Fixed Charge Coverage Ratio for any Fiscal Month ended prior to the Second Amendment Date, there shall be excluded (A) all Distributions made prior to the Closing Date, and (B) the aggregate amount of Capital Expenditures related to Borrowers' Chinese facility made prior to the Closing Date, and (ii) for purposes of calculating the Fixed Charge Coverage Ratio for any Fiscal Month ended after the Second Amendment Date, there shall be excluded (X) all Distributions made prior to the Second Amendment Date, (Y) the aggregate amount of Capital Expenditures related to Borrowers' Chinese facility made prior to the Closing Date, and (Z) all cash taxes paid prior to the Second Amendment Date. (g) By deleting the definition of "Fixed Charges" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: FIXED CHARGES - for any period, the sum of interest expense (other than payment-in-kind), scheduled principal payments on Borrowed Money, and Distributions made, determined as of the last day of such period for Borrowers and Subsidiaries on a consolidated basis; PROVIDED, that (i) for each Fiscal Month ended after the Closing Date and prior to the Second Amendment Date, interest expense and scheduled principal payments on Borrowed Money shall be deemed to be an amount calculated by adding the sum of all such interest expense and principal payments made from the Closing Date through the date of determination, multiplying such sum by 365, and dividing the product by the number of days elapsed since the Closing Date, and (ii) for each Fiscal Month ending after the Second Amendment Date, through and including the Fiscal Month ending March 31, 2008, interest expense and scheduled principal payments on Borrowed Money shall be deemed to be an amount calculated by adding the sum of all such interest expense and principal payments made from the Second Amendment Date through the date of determination, multiplying such sum by 365, and dividing the product by the number of days elapsed since the Second Amendment Date. 5  (h) By deleting the definition of "Leverage Ratio" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: LEVERAGE RATIO - the ratio, determined as of the end of any Fiscal Quarter, of (a) Debt for Borrowed Money of Borrowers and Subsidiaries as of the last day of such Fiscal Quarter (excluding any such Debt owing by Borrowers to Bridge Lender under the Bridge Facility and, as long as each Refinancing Condition is satisfied, any Refinancing Debt related thereto), to (b) EBITDA for the four (4) Fiscal Quarters then ending. (i) By deleting the definition of "Loan Documents" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: LOAN DOCUMENTS - this Agreement, the Intercreditor Agreement, the Other Agreements and the Security Documents. (j) By deleting the definition of "Permitted Merger" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: PERMITTED MERGER - the merger, effective as of the Second Amendment Date, of BZ Acquisition Corp., a Delaware corporation and an affiliate of Steel Partners ("BZ"), with and into Bairnco with Bairnco continuing as the surviving entity, pursuant to that certain Agreement and Plan of Merger, dated as of February 23, 2007, by and among Steel Partners, BZ and Bairnco (the "BZ Merger Agreement"). (k) By deleting the definition of "Permitted Option Settlement" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: PERMITTED OPTION SETTLEMENT - with respect to all outstanding options to purchase Equity Interests of Bairnco, the payment by Bairnco of a cash amount to each holder of such options in settlement of such options, which payment shall have been consummated prior to the Second Amendment Date on the terms contemplated by the BZ Merger Agreement (or other terms satisfactory to Agent in all respects). (l) By deleting the definition of "Subordinated Debt" contained in SECTION 1.1 of the Loan Agreement in its entirety and by substituting in lieu thereof the following: SUBORDINATED DEBT - Debt incurred by an Obligor that is expressly subordinate and junior in right of payment to Full Payment of all Obligations and is on terms (including maturity, interest, fees, repayment, covenants and subordination) satisfactory to Agent (including, without limitation, Debt owing by the Obligors to the Bridge Lender under the Bridge Facility and pursuant to the WHX Note Guarantee, so long as and to the extent that such Debt is subject to the Intercreditor Agreement). (m) By deleting the period at the end of SECTION 10.2.2(I) of the Loan Agreement and substituting ";" in lieu thereof, and by adding the following new subsections (j) and (k) immediately thereafter: 6  (j) Liens in favor of the Bridge Lender securing the Bridge Facility, so long as all such Liens are subject to the terms and conditions of the Intercreditor Agreement; and (k) Liens in favor of the Bridge Lender securing the WHX Note and the WHX Note Guarantee, so long as all such Liens are subject to the terms and conditions of the Intercreditor Agreement. (n) By inserting the parenthetical "(including, as applicable, the Intercreditor Agreement)" immediately after the word "Debt" and prior to the existing parenthetical contained in SECTION 10.2.9(A) of the Loan Agreement. (o) By deleting the period at the end of SECTION 10.2.18 of the Loan Agreement and by substituting in lieu thereof the phrase "; (g) the transactions contemplated by the Bridge Facility; and (h) the transactions contemplated by the WHX Note and the WHX Note Guarantee". (p) By deleting SECTION 11.1(F) of the Loan Agreement in its entirety and by substituting in lieu thereof the following: (f) Any breach or default of an Obligor occurs under any document, instrument or agreement to which it is a party or by which it or any of its Properties is bound, relating to any Debt owing to the Bridge Lender under the Bridge Facility or to the Bridge Lender under the WHX Note Guarantee or any other Debt (other than the Obligations) in excess of $250,000, if the maturity of or any payment with respect to such Debt may be accelerated or demanded due to such breach; (q) By deleting the schedule attached to EXHIBIT E to the Loan Agreement in its entirety and by substituting in lieu thereof the Schedule to Exhibit E attached hereto. (r) By deleting SCHEDULE 9.1.4 of the Loan Agreement in its entirety and by substituting in lieu thereof Schedule 9.1.4 attached hereto. 5. ACKNOWLEDGMENTS AND STIPULATIONS. To induce Agent and the sole Lender to enter into this Amendment and grant the accommodations set forth herein, each Borrower hereby acknowledges and stipulates that (A) the Loan Agreement (as amended hereby) and the other Loan Documents executed by such Borrower are legal, valid and binding obligations of such Borrower that are enforceable against such Borrower in accordance with the terms thereof, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally; (B) nothing contained herein shall modify, amend or alter in any manner the obligations of Guarantors under their respective Guaranties; and (C) the unpaid principal amount of the Loans and the issued and outstanding Letters of Credit on and as of the close of business on April 23, 2007, totaled $19,144,762.76. 6. RATIFICATION AND REAFFIRMATION. To induce Agent and the sole Lender to enter into this Amendment and grant the accommodations set forth herein, each Borrower (including Bairnco as the surviving entity of the Permitted Merger) hereby ratifies and reaffirms the Obligations, the Loan Agreement (as amended hereby) and each of the other Loan Documents and all of such Borrower's covenants, duties, indebtedness and liabilities under the Loan Documents to which such Borrower is a party, in each case as modified herein. 7  7. REPRESENTATIONS AND WARRANTIES. To induce Agent and the sole Lender to enter into this Amendment and grant the accommodations set forth herein, each Borrower hereby represents and warrants to Agent and the sole Lender as follows: (a) prior to the execution and delivery of this Amendment, WHX has made an equity contribution in an amount not less than $15,000,000 to BZ; (b) the Bridge Facility funded prior to April 24, 2007, in an amount not less than $85,000,000, the proceeds of which were applied by BZ to purchase the equity interests in Bairnco pursuant to the Tender Offer; (c) simultaneously with the execution and delivery of this Amendment, Borrowers are delivering to Agent the following: (i) true, correct and complete copies of the definitive loan documents evidencing the Bridge Facility, which documents are in the form previously delivered to Agent; (ii) true, correct and complete copies of the definitive loan documents evidencing the WHX Note and the WHX Note Guarantee, which documents are in the form previously delivered to Agent; and (iii) a certificate of a duly authorized officer of Bairnco, as the surviving entity of the Permitted Merger, upon which Agent may conclusively rely until Agent is otherwise notified by Bairnco in writing, certifying as follows: (A) that attached copies of Bairnco's Organic Documents (including the certificate of merger evidencing the Permitted Merger) are true and complete, and in full force and effect simultaneously with the execution and delivery of this Amendment, without amendment except as shown; (B) that an attached copy of resolutions authorizing Bairnco's execution, delivery and performance of this Amendment and the other documents contemplated herein and Bairnco's consummation of the transactions contemplated herein and therein and is true and complete, and that such resolutions are in full force and effect simultaneously with the execution and delivery of this Amendment, are duly adopted by the directors of Bairnco as the surviving entity of the Permitted Merger, and have not been amended, modified or revoked; and (C) to the title, name and signature of each Person authorized to sign this Amendment and the other Loan Documents on behalf of Bairnco as the surviving entity of the Permitted Merger; (d) except to the extent waived herein and giving effect to the amendments set forth herein, no Default or Event of Default exists on the date hereof or would result from the Contribution, the Permitted Merger, the Bridge Facility or the WHX Note Guarantee; (e) giving effect to the amendments set forth herein, no Lien on any Property of any Obligor, other than Permitted Liens, exists on the date hereof or results from the Permitted Merger; 8  (f) the execution, delivery and performance of this Amendment have been duly authorized by all requisite corporate action on the part of such Borrower and this Amendment has been duly executed and delivered by such Borrower; and (g) each representation and warranty made by such Borrower in the Loan Agreement (as amended hereby and giving effect to the waiver and consent contained herein) is true and correct on and as of the date hereof, except to the extent that any such representation or warranty explicitly relates solely to an earlier date. 8. REFERENCE TO LOAN AGREEMENT. Each reference in the Loan Agreement to "this Agreement," "hereunder," or words of like import shall mean and be a reference to the Loan Agreement as amended by this Amendment. 9. BREACH OF AMENDMENT. This Amendment shall be part of the Loan Agreement and a breach of any representation, warranty or covenant contained herein shall constitute an Event of Default. 10. EXPENSES OF AGENT. Each Borrower, jointly and severally, agrees to pay, ON DEMAND, all costs and expenses incurred by Agent in connection with the preparation, negotiation and execution of this Amendment and any other Loan Documents executed pursuant hereto and any and all amendments, modifications, and supplements thereto, including, without limitation, the costs and fees of Agent's legal counsel and any taxes or expenses associated with or incurred in connection with any instrument or agreement referred to herein or contemplated hereby. 11. GOVERNING LAW. This Amendment shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to conflict of laws principles, and is intended to take effect as a document under seal. 12. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. 13. NO NOVATION, ETC. Except as otherwise expressly provided in this Amendment, nothing herein shall be deemed to waive, release, amend or modify any provision of the Loan Agreement or any of the other Loan Documents, each of which shall remain in full force and effect. Notwithstanding any prior, temporary mutual disregard of any of the terms of any contracts among the parties, Borrowers shall be required strictly to comply with all of the terms of the Loan Agreement (as amended hereby) and each of the other Loan Documents on and after the date hereof. This Amendment is not intended to be, nor shall it be construed to create, a novation or accord and satisfaction, and the Loan Agreement as herein modified shall continue in full force and effect. 14. COUNTERPARTS; ELECTRONIC DELIVERY OF SIGNATURES. This Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original but all of which shall together constitute one and the same instrument. Delivery of a manually executed counterpart of this Amendment by telefacsimile or electronic mail transmission shall be equally effective as delivery of an original executed counterpart of this Amendment, and any party delivering a manually executed counterpart by telefacsimile or electronic mail transmission shall also deliver an original executed counterpart, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment. 15. FURTHER ASSURANCES. Each Borrower agrees to take such further actions as Agent reasonably requests from time to time in connection herewith to evidence or give effect to the amendments set forth herein or any of the transactions contemplated hereby. 9  16. SECTION TITLES. Section titles and references used in this Amendment shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreements among the parties hereto. 17. RELEASE OF CLAIMS. TO INDUCE AGENT AND THE SOLE LENDER TO ENTER INTO THIS AMENDMENT AND GRANT THE ACCOMMODATIONS SET FORTH HEREIN, EACH BORROWER HEREBY RELEASES, ACQUITS AND FOREVER DISCHARGES AGENT AND THE SOLE LENDER, AND ALL OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS OF AGENT AND THE SOLE LENDER, FROM ANY AND ALL LIABILITIES, CLAIMS, DEMANDS, ACTIONS OR CAUSES OF ACTION OF ANY KIND OR NATURE (IF THERE BE ANY), WHETHER ABSOLUTE OR CONTINGENT, DISPUTED OR UNDISPUTED, AT LAW OR IN EQUITY, OR KNOWN OR UNKNOWN, THAT SUCH BORROWER NOW HAS OR EVER HAD AGAINST AGENT OR THE SOLE LENDER ARISING ON OR PRIOR TO THE DATE HEREOF UNDER OR IN CONNECTION WITH ANY OF THE LOAN DOCUMENTS. EACH BORROWER HEREBY REPRESENTS AND WARRANTS TO AGENT AND THE SOLE LENDER THAT SUCH BORROWER HAS NOT TRANSFERRED OR ASSIGNED TO ANY PERSON ANY CLAIM THAT SUCH BORROWER EVER HAD OR CLAIMED TO HAVE AGAINST AGENT OR THE SOLE LENDER. 18. WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HERETO HEREBY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, COUNTERCLAIM OR PROCEEDING ARISING OUT OF OR RELATED TO THIS AMENDMENT. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK - SIGNATURES COMMENCE ON FOLLOWING PAGE] 10  IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective duly authorized officers on the date first written above. BORROWERS: BAIRNCO CORPORATION By: /s/ Name: Title: ARLON, INC. By: /s/ Name: Title: KASCO CORPORATION By: /s/ Name: Title: BERTRAM & GRAF GMBH By: /s/ Name: Title: ATLANTIC SERVICE CO. LTD By: /s/ Name: Title: ATLANTIC SERVICE CO. (UK) LTD. By: /s/ Name: Title: EUROKASCO, S.A. By: /s/ Name: Title: [SIGNATURES CONTINUE ON FOLLOWING PAGE] WAIVER, CONSENT AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (BOFA-BAIRNCO)  BANK OF AMERICA, N.A., as Agent and sole Lender By: /s/ Sherry Lail ------------------------------- Name: Sherry Lail Title: Senior Vice President WAIVER, CONSENT AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (BOFA-BAIRNCO)  RATIFICATION AND REAFFIRMATION OF GUARANTORS Each of the undersigned, being a Guarantor of the Obligations of Borrowers at any time owing to Agent and Lenders, hereby (i) acknowledges receipt of a copy of the foregoing Waiver, Consent and Second Amendment to Loan and Security Agreement; (ii) consents to Borrowers' execution and delivery thereof and of the other documents, instruments or agreements Borrowers agree to execute and deliver pursuant thereto; (iii) agrees to be bound thereby; (iv) affirms that nothing contained therein shall modify in any respect whatsoever such Guarantor's guaranty of the Obligations and that each Guaranty to which such Guarantor is a party shall remain in full force and effect; and (v) ratifies and reaffirms the Obligations, each Loan Document to which such Guarantor is a party, and all of such Guarantor's covenants, duties, indebtedness and liabilities under the Loan Documents to which such Guarantor is a party, in each case as modified by such Waiver, Consent and Second Amendment to Loan and Security Agreement. IN WITNESS WHEREOF, each of the undersigned has executed this Ratification and Reaffirmation of Guarantors as of the date of such Waiver, Consent and Second Amendment to Loan and Security Agreement. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK - SIGNATURES COMMENCE OF FOLLOWING PAGE] RATIFICATION AND REAFFIRMATION OF GUARANTORS (BOFA-BAIRNCO)  GUARANTORS: ARLON ADHESIVES & FILMS, INC. By: /s/ Name: Title: ARLON MED INTERNATIONAL LLC By: /s/ Name: Title: ARLON PARTNERS, INC. By: /s/ Name: Title: ARLON SIGNTECH, LTD. By: ARLON ADHESIVES & FILMS, INC., Its General Partner1 By: /s/ Name: Title: ARLON VISCOR LTD. By: ARLON ADHESIVES & FILMS, INC., Its General Partner By: /s/ Name: Title: KASCO MEXICO LLC By: /s/ Name: Title: SOUTHERN SAW ACQUISITION CORPORATION By: /s/ Name: Title: RATIFICATION AND REAFFIRMATION OF GUARANTORS (BOFA-BAIRNCO)  SCHEDULE to EXHIBIT E to Loan and Security Agreement - ---------------------------------------------------------------------------------------------------------------------- Period Ended _______________ Bairnco Scarlett Total - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- EBITDA - ---------------------------------------------------------------------------------------------------------------------- Net Income - ---------------------------------------------------------------------------------------------------------------------- + Interest Expense - ---------------------------------------------------------------------------------------------------------------------- + Income Taxes - ---------------------------------------------------------------------------------------------------------------------- + Depreciation/Amortization - ---------------------------------------------------------------------------------------------------------------------- +(-) Losses/Gains on Asset Sales - ---------------------------------------------------------------------------------------------------------------------- +(-) Losses/Gains on Asset Revaluation - ---------------------------------------------------------------------------------------------------------------------- +(-) Extraordinary Losses/Gains - ---------------------------------------------------------------------------------------------------------------------- + Approved Non-Recurring Expenses - ---------------------------------------------------------------------------------------------------------------------- + "Approved Addback Expenses" - ---------------------------------------------------------------------------------------------------------------------- TOTAL EBITDA - ---------------------------------------------------------------------------------------------------------------------- - - Capital Expenditures (unfinanced)* - ---------------------------------------------------------------------------------------------------------------------- - - Cash Taxes** - ---------------------------------------------------------------------------------------------------------------------- TOTAL EBITDA FOR FIXED CHARGE CALCULATION - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Fixed Charges - ---------------------------------------------------------------------------------------------------------------------- Interest Expense*** - ---------------------------------------------------------------------------------------------------------------------- + Scheduled Principal Payments*** - ---------------------------------------------------------------------------------------------------------------------- + Distributions** - ---------------------------------------------------------------------------------------------------------------------- TOTAL FIXED CHARGES - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- FIXED CHARGE COVERAGE RATIO - ---------------------------------------------------------------------------------------------------------------------- *Excludes all Capital Expenditures related to Borrowers' Chinese facility made prior to the Closing Date. **Excludes all Cash Taxes paid and Distributions made prior to the Second Amendment Date. ***(A) for each Fiscal Month ended after the Closing Date and prior to the Second Amendment Date, interest expense and scheduled principal payments on Borrowed Money shall be deemed to be an amount calculated by adding the sum of all such interest expense and principal payments made from the Closing Date through the date of determination, multiplying such sum by 365, and dividing the product by the number of days elapsed since the Closing Date, and (B) for each Fiscal Month ending after the Second Amendment Date, through and including the Fiscal Month ending March 31, 2008, interest expense and scheduled principal payments on Borrowed Money shall be deemed to be an amount calculated by adding the sum of all such interest expense and principal payments made from the Second Amendment Date through the date of determination, multiplying such sum by 365, and dividing the product by the number of days elapsed since the Second Amendment Date.  SCHEDULE 9.1.4 to Loan and Security Agreement NAMES AND CAPITAL STRUCTURE 1. The corporate names, jurisdictions of incorporation, and authorized and issued Equity Interests of each Borrower and Subsidiary as of the effective time of the Permitted Merger are as follows: - ------------------------------------------------------------------------------------------------------------------------ Number and Class Number and Class Name Jurisdiction of Authorized Shares of Issued Shares ---- ------------ -------------------- ---------------- - ------------------------------------------------------------------------------------------------------------------------ Bairnco Corporation Delaware Common - 1,000 Common - 100 - ------------------------------------------------------------------------------------------------------------------------ Arlon, Inc. Delaware Common - 200 Common - 200 - ------------------------------------------------------------------------------------------------------------------------ Arlon Partners, Inc. Delaware Common - 3,000 Common - 3,000 - ------------------------------------------------------------------------------------------------------------------------ Arlon Viscor Ltd. Texas N/A N/A - ------------------------------------------------------------------------------------------------------------------------ Arlon MED International LLC Delaware N/A N/A - ------------------------------------------------------------------------------------------------------------------------ Arlon Materials for China N/A N/A Electronics Co. Ltd. - ------------------------------------------------------------------------------------------------------------------------ Arlon Material China N/A N/A Technologies Co. Ltd. - ------------------------------------------------------------------------------------------------------------------------ Arlon Adhesives & Films, Delaware Common - 1,000 Common - 1,000 Inc. - ------------------------------------------------------------------------------------------------------------------------ Arlon Signtech Ltd. Texas N/A N/A - ------------------------------------------------------------------------------------------------------------------------ Kasco Corporation Delaware Common - 1,000 Common - 100 - ------------------------------------------------------------------------------------------------------------------------ Southern Saw Acquisition Delaware Common - 10,000 Common - 10,000 Corporation - ------------------------------------------------------------------------------------------------------------------------ Kasco Mexico LLC Delaware N/A N/A - ------------------------------------------------------------------------------------------------------------------------ Kasco Ensambly S.A. de C.V. Mexico N/A N/A - ------------------------------------------------------------------------------------------------------------------------ Atlantic Service Company, United Kingdom Ordinary - 90 Ordinary - 32 Ltd. (UK) Redeemable - 8 Redeemable - 8 Preferred - 2 Preferred - 2 - ------------------------------------------------------------------------------------------------------------------------  - ------------------------------------------------------------------------------------------------------------------------ Number and Class Number and Class Name Jurisdiction of Authorized Shares of Issued Shares ---- ------------ -------------------- ---------------- - ------------------------------------------------------------------------------------------------------------------------ Atlantic Service Company, Canada Common - Unlimited Common - UNKNOWN, 100% owned by Kasco Ltd. Corporation Preference - Unlimited Preference - UNKNOWN, 100% owned by Kasco Corporation - ------------------------------------------------------------------------------------------------------------------------ EuroKasco S.A.S. France UNKNOWN UNKNOWN - 100% owned by Kasco Corporation - ------------------------------------------------------------------------------------------------------------------------ Bertram & Graf GmbH Germany UNKNOWN UNKNOWN - 100% owned by Kasco Corporation - ------------------------------------------------------------------------------------------------------------------------ Arlon India Private Ltd. India Common - 1,000 Common - 1,000 - ------------------------------------------------------------------------------------------------------------------------ 2. The record holders of Equity Interests of each Borrower and Subsidiary as of the effective time of the Permitted Merger are as follows: - ------------------------------------------------------------------------------------------------------------------------ Name Class of Stock Number of Shares Record Owner - ------------------------------------------------------------------------------------------------------------------------ Bairnco Corporation Common 100 WHX Corporation - ------------------------------------------------------------------------------------------------------------------------ Arlon, Inc. Common 200 Bairnco Corporation - ------------------------------------------------------------------------------------------------------------------------ Arlon Partners, Inc. Common 3,000 Arlon, Inc. - ------------------------------------------------------------------------------------------------------------------------ Arlon Adhesives & Common 1,000 Arlon, Inc. Films, Inc. - ------------------------------------------------------------------------------------------------------------------------ Kasco Corporation Common 100 Bairnco Corporation - ------------------------------------------------------------------------------------------------------------------------ Southern Saw Common 10,000 Kasco Corporation Acquisition Corporation - ------------------------------------------------------------------------------------------------------------------------ Atlantic Service Ordinary 32 Kasco Corporation Company, Ltd. (UK) Redeemable 8 Kasco Corporation Preferred 2 Kasco Corporation - ------------------------------------------------------------------------------------------------------------------------ Arlon India Private Common 997 Arlon, Inc. Ltd. 1 Ronald Hopkins (officer) 1 Richard Trombino (officer) 1 Claudia Lazar (officer) - ------------------------------------------------------------------------------------------------------------------------  3. All agreements binding on holders of Equity Interests of Borrowers and Subsidiaries with respect to such interests are as follows: Loan and Security Agreement, dated as of April 17, 2007, between BZ Acquisition Corp. and Bairnco Corporation, as borrowers, and Steel Partners II, L.P., as lender Guarantee, Pledge and Security Agreement, dated as of April 17, 2007, by and between BZ Acquisition Corp. and Obligors, as obligors, and Steel Partners II, L.P., as secured party, with respect to the $15,000,000 promissory note issued by WHX Corporation to Steel Partners II, L.P. Guarantee, Pledge and Security Agreement, dated as of April 17, 2007, by and between BZ Acquisition Corp. and Obligors, as obligors, and Steel Partners II, L.P., as secured party, with respect to the Bridge Facility See also bylaws attached with closing and incumbency certificates. 4. The name of each Affiliate of a Borrower and the nature of the affiliation are as follows: See Borrowers and Subsidiaries listed above. In addition, as of the effective time of the Permitted Merger, WHX Corporation, a Delaware corporation, is the owner of 100% of the issued and outstanding Equity Interests of Bairnco Corporation, and Steel Partners II, L.P., a Delaware limited partnership, is the owner of the majority of the issued and outstanding Equity Interests of WHX Corporation.