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Exhibit 10.3.1.e
WAIVER AND AGREEMENT
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WAIVER AND AGREEMENT (this "Waiver"), dated as of December
29, 1998, to the Credit Agreement, dated as of March 8, 1996, by and among
Telxon Corporation (the "Borrower"), the Lenders party thereto, and The Bank of
New York, as Issuer, Swing Line Lender and Agent (as amended, the "AGREEMENT").
RECITALS
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I. Capitalized terms used herein which are not otherwise defined herein shall
have the respective meanings ascribed thereto in the Agreement.
II. The Borrower has requested that the Agent and the Lenders agree to waive
compliance by the Borrower with certain provisions of the Agreement upon the
terms and conditions contained herein.
Accordingly, in consideration of the Recitals and the
covenants and conditions hereinafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Borrower, the Agent and the Required Lenders hereby agree as follows:
1. WAIVERS. Subject to satisfaction of the conditions to
effectiveness set forth in Section 3 below, the Required Lenders hereby
waive compliance by the Borrower with the provisions of Section 7.13 of
the Agreement for the period (the "Waiver Period") from the Effective
Date (as defined in Section 3 hereof) until the earlier of (x) February
15, 1999 and (y) the date of the delivery by the Borrower of the
financial statements required by Section 7.7(b) of the Agreement for
the Borrower's fiscal quarter ending December 31, 1998, together with
the associated compliance certificate required by Section 7.7(d) of the
Agreement. In addition, during the Waiver Period the Required Lenders
hereby waive any Defaults or Events of Default currently existing under
Sections 7.7 and 7.13 of the Agreement in respect of the fiscal quarter
of the Borrower ending September 30, 1998 and any other Defaults or
Events of Default arising solely by reason of the restatement of the
Borrower's financial statements for such quarter. Unless otherwise
agreed to by the Required Lenders in writing, upon the expiration of
the Waiver Period, the waivers provided for herein
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shall be of no further force or effect and the Lenders may exercise any
and all rights and remedies available to any of them under the
Agreement, the other Loan Documents or applicable law.
2. AGREEMENTS BY THE BORROWER. Anything in the Agreement to
the contrary notwithstanding, in consideration of the waivers set forth
above, the Borrower hereby agree as follows during the Waiver Period:
(i) The aggregate Revolving Credit Exposure shall not
at any time exceed the lesser of (x) $60,000,000 and (y) the
sum of (I) 85% of an amount equal to Eligible Accounts
Receivable MINUS $8,000,000 and (II) 25% of the Eligible
Inventory.
(ii) All Loans made during the Waiver Period shall be
made only as ABR Advances and each outstanding Eurodollar
Advance shall convert to an ABR Advance on the last day of the
Interest Period in respect thereof. The Applicable Margin in
respect of all ABR Advances shall be increased to 2.00% and
the rate at which the Commitment Fee is payable pursuant to
Section 3.11 of the Agreement shall be increased to 0.625% per
annum.
(iii) The Borrower consents to the occurrences of the
Perfection Date and to the filing of the Notice Documents at
any time on or after the Effective Date.
(iv) The Borrower agrees that it will not make any
payments in respect of the outstanding principal amount of the
Bank One Credit Line and will not agree to any amendment or
modification thereof other than extensions of the maturity
thereof and the consent contemplated by Section 3(v) hereof.
(v) The Borrower agrees that it will not make or
permit any of its Subsidiaries to make any Re-
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stricted Payments other than those permitted by clause (a) of
Section 8.6 of the Agreement.
(vi) The Borrower agrees, without limiting any
restrictions thereon currently contained in the Agreement,
that it will not make any Dispositions, Investments or
Acquisitions outside the ordinary course of its business
except as described on Schedule 1 hereto.
(vii) The Borrower agrees to furnish to the Agent and
each Lender (x) no later than Tuesday of each week a report
setting forth in reasonable detail the Borrower's sources and
uses of cash for the preceding calendar week and a forecast of
the Borrower's sources and uses of cash for the week during
which such report is furnished and (y) no later than fifteen
Business Days after the end of each month an accounts
receivable aging report, the balance of such accounts
receivable owing from each of the top twenty customers of the
Borrower and an inventory report, in each case in such form as
may be reasonably acceptable to the Required Lenders.
The Borrower agrees that any violation of its agreements set
forth above shall constitute a Default under the Agreement. Unless
otherwise agreed to in writing by the Borrower, the foregoing
agreements of the Borrower shall be of no further force or effect upon
the expiration of the Waiver Period.
3. EFFECTIVE DATE. Paragraph 1 and 2 of this Waiver shall not
be effective until such date (the "Effective Date") as each of the
following conditions shall have been satisfied:
(i) The Agent or the Borrower shall have received
counterparts of this Amendment executed by the Required
Lenders and the current Guarantors.
(ii) The Borrower shall have paid the reasonable fees
and disbursements of Special Counsel which
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shall have accrued up to, and properly invoiced to the
Borrower no later than, the Effective Date.
(iii) On and as of the Effective Date after giving
effect to this Waiver, there shall exist no Default or Event
of Default, and all of the representations and warranties of
the Loan Parties contained in the Loan Documents shall be true
and correct with the same effect as though such
representations and warranties had been made on the Effective
Date.
(iv) The Borrower shall have reduced the Aggregate
Revolving Commitment Amount to $75,000,000 pursuant to Section
2.7 of the Agreement.
(v) Bank One shall have consented to the waivers and
agreements contemplated hereby with respect to the Bank One
Credit Line.
(vi) The Borrower shall have paid to each Lender that
has executed a counterpart of this Waiver on or prior to the
Effective Date a consent fee equal to 0.40% of such Lender's
Revolving Commitment Amount (after giving effect to the
reduction referred to in clause (iv) above).
4. AFFIRMATION. On each of the date hereof and the Effective
Date, the Borrower hereby (a) reaffirms and admits the validity and
enforceability of the Loan Documents and all of its obligations
thereunder, (b) agrees and admits that it has no defenses to or offsets
against any such obligations, and (c) represents and warrants that
after giving effect hereto, no Default or Event of Default has occurred
and is continuing, and that each of the representations and warranties
made by it in the Agreement is true and correct with the same effect as
though such representation and warranty had been made on such date.
5. WAIVERS LIMITED. In all other respects, the Loan Documents
shall remain in full force and effect, and no waiver or amend-
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ment in respect of any term or condition of any Loan Document contained
herein shall be deemed to be a waiver or amendment in respect of any
other term or condition contained in any Loan Document.
6. COUNTERPARTS. This Waiver may be executed in any number of
counterparts all of which, taken together shall constitute one waiver.
In making proof of this waiver, it shall only be necessary to produce
the counterpart executed and delivered by the party to be charged.
7. GOVERNING LAW. THIS WAIVER IS BEING EXECUTED AND DELIVERED
IN, AND IS INTENDED TO BE PERFORMED IN, THE STATE OF NEW YORK AND SHALL
BE CONSTRUED AND ENFORCEABLE IN ACCORDANCE WITH, AND BE GOVERNED BY,
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
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AS EVIDENCE of the agreement by the parties hereto to the
terms and conditions herein contained, each such party has caused this Waiver to
be executed on its behalf.
TELXON CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
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Title: SR. V. P. & Chief Financial Officer
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THE BANK OF NEW YORK, as Agent
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: VP
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Each of the following Lenders consents to the execution and delivery of this
Waiver by the Agent, hereby directs the Agent to so execute and deliver this
Waiver and agrees to all of the terms and conditions hereof:
THE BANK OF NEW YORK
in its capacity as a Lender, as the
Issuer and as the Swing Line Lender
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: VP
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BANK ONE, NA fka
BANK ONE, AKRON, N.A.
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
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Title: Vice President
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COMERICA BANK
By: /s/ Xxxxxxx X. Judge
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Name: Xxxxxxx X. Judge
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Title: Vice President
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THE HUNTINGTON NATIONAL BANK
By: /s/ Xxxxxxxxx X. Xxxxxx
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Name: Xxxxxxxxx X. Xxxxxx
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Title: Vice President
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PNC BANK, N.A.
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
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Title: Vice President
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SOCIETE GENERALE
By: /s/ Xxxxxx X. Xxxxxxx
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Name:
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Title:
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U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
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Title: Vice President
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THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: Joint General Manager
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Each of the Guarantors acknowledges the execution and delivery of this Waiver by
the Agent and by signing below, indicates its reaffirmation of the Guarantor
Obligations (as such term is defined in the Subsidiary Guaranty):
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PTC AIRCO, INC.
By: /S/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
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Title: Sr. V. P. & Chief Financial Officer
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META HOLDING CORPORATION
By: /S/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
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Title: Sr. V. P. & Chief Financial Officer
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TELETRANSACTION, INC.
By: /S/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
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Title: Sr. V. P. & Chief Financial Officer
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