Xxxxxxx Corporation Exhibit 4.5
August 4, 1998
Xxxxxxx Communications, Inc.
00000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
RE: FIRST AMENDMENT
Gentlemen:
XXXXXXX COMMUNICATIONS, INC., a Georgia corporation ("Borrower") and
LaSalle National Bank, a national banking association ("Bank") have entered into
that certain Loan and Security Agreement dated June 5, 1996 (the "Security
Agreement"). From time to time thereafter, Xxxxxxxx and Bank may have executed
various amendments (each an "Amendment" and collectively the "Amendments") to
the Security Agreement (the Security Agreement and the Amendments hereinafter
are referred to, collectively, as the "Agreement"). Borrower and Bank now desire
to further amend the Agreement as provided herein, subject to the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual
covenants and agreements set forth herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. The Agreement hereby is amended as follows:
(a) Paragraph (1) of Exhibit A of the Agreement is deleted in its entirety
and the following is substituted in its place:
(1) LOAN LIMITS: Bank may, in its sole discretion, advance an amount
up to the sum of the following sublimits (the "Loan Limit"):
(a) Subject to subparagraph (4)(a) of this Exhibit A, up to
eighty percent (80%) of the face amount (less maximum
discounts, credits and allowances which may be taken by or
granted to Account Debtors in connection therewith) of
Xxxxxxxx's Eligible Accounts; plus
(b) Subject to subparagraph (4)(b) of this Exhibit A, up to
eighty percent (80%) of the face amount (less maximum
discounts, credits and allowances which may be taken
Xxxxxxx Communications, Inc. Xxxxxxx Corporation
August 4, 1998 Exhibit 4.5
Page 2
by or granted to Account Debtors in connection therewith) of
Xxxxxxxx's Eligible Accounts or Five Hundred Thousand and
No/100 Dollars ($500,000.00), whichever is less; plus
(c) Subject to subparagraph (5)(a) of this Exhibit A, up to
twenty percent (20%) of the lower of the cost or market
value of Borrower's Eligible Inventory; plus
(d) Subject to subparagraph (5)(b) of this Exhibit A, up to
twenty percent (20%) of the lower of the cost or market
value of Borrower's Eligible Inventory; plus
(e) Subject to subparagraph (5)(c) of this Exhibit A, up to
forty percent (40%) of the lower of the cost or market value
of Borrower's Eligible Inventory; plus
(f) Subject to subparagraph (5)(d) of this Exhibit A, up to
fifty percent (50%) of the lower of the cost or market value
of Borrower's Eligible Inventory; plus
(g) Subject to subparagraph (2)(a) of this Exhibit A, up to
eighty percent (80%) of the purchase price of the Equipment
purchased with such advances (exclusive of sales taxes,
delivery charges and other "soft" costs related to such
purchases), to be used by Borrower from time to time to
purchase new Equipment, or One Million and No/100 Dollars
($1,000,000.00), whichever is less; provided, that prior to
any advance under this subparagraph, Borrower shall furnish
to Bank an invoice and acceptance letter for the Equipment
being purchased and shall have executed such documents and
taken such other actions as Bank shall require to assure
that Bank has a first perfected security interest in such
Equipment; and further provided, that each advance under
this subparagraph shall equal or exceed One Hundred Thousand
and No/100 Dollars ($100,000.00) and may be made not more
frequently than quarterly; plus
Xxxxxxx Communications, Inc. Xxxxxxx Corporation
August 4, 1998 Exhibit 4.5
Page 3
(h) Subject to subparagraph (2)(b) of this Exhibit A, up to
seventy percent (70%) of the fair market value (as
determined by an appraiser acceptable to Bank) of that
certain real property described in subparagraph (14)(a) of
this Exhibit A or One Million Five Hundred Thousand and
No/100 Dollars ($1,500,000.00), whichever is less; minus
(i) Such reserve as Bank elects, in its sole discretion, to
establish from time to time;
provided, that the aggregate amount of Loans made pursuant
to subparagraphs (1)(c), (1)(d), (1)(e) and (1)(f) of this
Exhibit A shall in no event exceed Two Million and No/100
Dollars ($2,000,000.00);
further provided, that the aggregate amount of Loans made
pursuant to subparagraphs (1)(a), (1)(b), (1)(c), (1)(d),
(1)(e), (1)(f) and (1)(g) of this Exhibit A shall in no
event exceed Eight Million Five Hundred Thousand and No/100
Dollars ($8,500,000.00); and
further provided, that the aggregate Loan Limit shall in no
event exceed TEN MILLION AND NO/100 DOLLARS
($10,000,000.00), except as such amount may be increased or
decreased by Bank, in its sole discretion, from time to
time.
(b) Paragraph (2) of Exhibit A of the Agreement is amended to add the
following provision:
(b) The availability described in subparagraph (1)(h) of this Exhibit
A shall be curtailed monthly by an amount sufficient (assuming a
like curtailment each month) to reduce said availability to zero
at the end of thirty-five (35) months. Each such curtailment
shall automatically occur on the thirtieth (30th) day following
the date of disbursement under subparagraph (1)(h) of this
Exhibit A and on the corresponding day of each month thereafter
until the earliest to occur of (i) the date on which said
availability shall be reduced in full; (ii) the date upon which
demand for
Xxxxxxx Communications, Inc. Xxxxxxx Corporation
August 4, 1998 Exhibit 4.5
Page 4
repayment is made by Bank; and (iii) the date upon which this
Agreement terminates pursuant to the provisions of Paragraph 9 of
the Agreement.
(c) Paragraph (6) of Exhibit A of the Agreement is deleted in its entirety
and the following is substituted in its place:
(6) INTEREST RATE: (I) All Loans made pursuant to subparagraphs
(1)(a), (1)(b), (1)(c), (1)(d), (1)(e), (1)(f), and (1)(g) of
this Exhibit A shall bear interest at Bank's publicly announced
prime rate (which is not intended to be Bank's lowest or most
favorable rate in effect at any time) (the "Prime Rate") in
effect from time to time. Interest shall be payable on the last
business day of each month, in arrears. Each rate of interest set
forth herein shall increase or decrease with each increase of
decrease in the Prime Rate, effective on the effective date of
each such change in the Prime Rate. Upon the occurrence of an
Event of Default and the continuance thereof, each Loan shall
bear interest at the rate of two percent (2%) per annum in excess
of the interest rate otherwise payable thereon, which interest
shall be payable on demand; and (II) all Loans made pursuant to
subparagraph (1)(h) of this Exhibit A shall bear interest at the
fixed rate of 250 basis points per annum in excess of the five
(5) year Treasury Rate in effect at the time of disbursement of
the Loans under subparagraph (1)(h) of this Exhibit A. All
interest shall be calculated upon the basis of a 360-day year.
(d) Paragraph (7) of Exhibit A of the Agreement is deleted in its entirety
and the following is substituted in its place:
(7) FEES AND CHARGES:
(a) FACILITIES FEES: With respect to the first Five Million Five
Hundred Thousand and No/100 Dollars ($5,500,000.00) of loans
and advances made pursuant to subparagraphs (1)(a), (1)(b),
(1)(c), (1)(d), (1)(e), (1)(f), and (1)(g) of this Exhibit
A, Borrower shall pay to Bank an annual facilities fee equal
to one percent (1%) of Five Million Five Hundred Thousand
and No/100 Dollars ($5,500,000.00), payable and earned as of
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August 4, 1998 Exhibit 4.5
Page 5
June 21, 1998 and on the same date of each year thereafter
during the Original Term and any Renewal Term. At such time
as the loans and advances made pursuant to subparagraphs
(1)(a), (1)(b), (1)(c), (1)(d), (1)(e), (1)(f), and (1)(g)
of Exhibit A exceed Five Million Five Hundred Thousand and
No/100 Dollars ($5,500,000.00), Borrower shall pay to Bank
and Bank shall fully earn at the time of such payment, an
annual facilities fee equal to three-fourths of one percent
(3/4ths of 1%) of Three Million and No/100 Dollars
($3,000,000.00), or a pro-rata amount thereof if paid after
June 21 of any year but before June 21 of the following
year. Thereafter, Borrower shall pay to Bank, and Bank shall
fully earn a fee equal to three-fourths of one percent
(3/4ths of 1%) of Three Million and No/100 Dollars
($3,000,000.00) on June 21st of each year during the
Original Term and any Renewal Term. For purposes of
determining whether Borrower has received any advances
against the availability set forth in subparagraph (1)(h) of
this Exhibit A, advances to Borrower shall first be deemed
to be advanced against the availability set forth in
subparagraphs (1)(h) of this Exhibit A (subject to any
sublimits contained in Paragraph (1) of this Exhibit A)
until the amount so advanced equals the availability under
that paragraph, and then to the availability under
subparagraphs (1)(a), (1)(b), (1)(c), (1)(d), (1)(e), (1)(f)
and (1)(g) of this Exhibit A (subject to any sublimits
contained in Paragraph (1) of this Exhibit A).
(b) REAL ESTATE CLOSING FEE: Borrower shall pay to Bank a real
estate closing fee equal to Seven Thousand Five Hundred and
No/100 Dollars ($7,500.00), which fee shall be fully earned
by Bank and payable on the date of this Amendment.
(e) Paragraph (7) of Exhibit A of the Agreement is amended to add the
following provision:
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August 4, 1998 Exhibit 4.5
Page 6
(7).(1) ORIGINAL TERM: The date of the Original Term set forth in
Paragraph 9 of the Agreement is deleted and the date of June
21, 2000 is substituted in its place.
(f) Paragraph (11) of Exhibit A of the Agreement is amended to add the
following provision:
(11).(1) YEAR 2000: Borrower and its Subsidiaries have reviewed the
areas within their business and operations which could be
adversely affected by, and have developed or are developing
a program to address on a timely basis, the "Year 2000
Problem" (that is, the risk that computer applications used
by Borrower and its Subsidiaries may be unable to recognize
and perform properly date-sensitive functions involving
certain dates prior to and any date on or after December 31,
1999), and have made related appropriate inquiry of material
suppliers and vendors. Based on such review and program,
Xxxxxxxx believes that the "Year 2000 Problem" will not have
a material adverse effect on its business, assets or
condition, financial or otherwise. From time to time, at the
request of Bank, Borrower and its Subsidiaries shall provide
to Bank such updated information or documentation as is
requested regarding the status of their efforts to address
the "Year 2000 Problem."
2. This Amendment shall not become effective until fully executed by all
parties hereto.
3. Except as expressly amended hereby and by any other supplemental
documents or instruments executed by either party hereto in order to effectuate
the transactions contemplated hereby, the Agreement and Exhibit A thereto hereby
are ratified and confirmed by the parties hereto and remain in full force and
effect in accordance with the terms thereof.
LASALLE NATIONAL BANK,
A NATIONAL BANKING ASSOCIATION
By: /s/ Xxxxxx X. Xxxxx
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Title: Vice President
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Xxxxxxx Communications, Inc. Xxxxxxx Corporation
August 4, 1998 Exhibit 4.5
Page 7
Accepted and agreed to this 26th day of August, 1998.
XXXXXXX COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------
Title: Chairman and CEO
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Consented and agreed to by the following guarantor of the
obligations of XXXXXXX COMMUNICATIONS, INC. to LaSalle
National Bank.
XXXXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-------------------------
Title: Chairman and CEO
----------------------
Date: August 26, 1998
