EXHIBIT XX
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WAIVER AND AMENDMENT NO. 5
TO
REVOLVING CREDIT, TERM LOAN AND SECURITY AGREEMENT
THIS WAIVER AND AMENDMENT NO. 5 ("Amendment") is entered into as of
March 21, 2002, by and among Wireless Xcessories Group, Inc. (formerly known as
Batteries Batteries, Inc.) ("BATS"), Xxxxxx Electronics, Inc. ("TEI"), Specific
Energy Corporation ("SEC"), W.S. Battery & Sales Company, Inc. ("WSBS"), Battery
Network, Inc. ("BN"), Battery Acquisition Corp. ("BAC"), (BATS, TEI, SEC, WSBS,
BN and BAC, each a "Borrower" and collectively the "Borrowers"), IBJ Whitehall
Business Credit Corporation ("IBJWBCC"), each of the other financial
institutions named in the Loan Agreement or which hereafter become parties
thereto (IBJWBCC and such financial institutions, the "Lenders") and IBJWBCC as
agent for the Lenders (IBJWBCC in such capacity, the "Agent").
BACKGROUND
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Borrowers, Agent and Lenders are parties to a Revolving Credit, Term
Loan and Security Agreement dated as of January 7, 1997 (as amended,
supplemented or otherwise modified from time to time, the "Loan Agreement")
pursuant to which Lenders provide Borrowers with certain financial
accommodations.
Borrowers have requested that Agent and Lenders waive certain Events of
Default and amend certain provisions of the Loan Agreement, and Agent and
Lenders are willing to do so on the terms and conditions hereafter set forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of
credit heretofore or hereafter made to or for the account of Borrowers by Agent
and Lenders, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions. All capitalized terms not otherwise defined herein
shall have the meanings given to them in the Loan Agreement.
2. Amendment to Loan Agreement. Subject to satisfaction of the
conditions precedent set forth in Section 4 below, the Loan Agreement is hereby
amended as follows:
2.1. Section 2.1(a)(y) is amended by amending subsection (ii)
thereof in its entirety to provide as follows:
"(i) up to the lesser of (A) 40%, subject to the
provisions of Section 2.1(b) hereof ("Inventory Advance Rate"),
of the value of the Eligible Inventory (the Receivables Advance
Rate and the Inventory Advance Rate shall be referred to
collectively, as the "Advance Rates") or (B) $1,500,000 in the
aggregate at any one time, plus"
2.2. Section 6.8 is amended in its entirety to provide as
follows:
"6.8 EBITDA. Maintain as of the end of each fiscal
quarter set forth below EBITDA of at least the amount set
opposite such fiscal quarter below:
Fiscal Quarter EBITDA
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December 31, 2001 ($ 42,000)
March 31, 2002 ($267,000)
June 30, 2002 $ 34,000
September 30, 2002 $156,000
December 31, 2002 and as
of the end of each fiscal
quarter thereafter during the Term $369,000"
2.3. Section 9.2 is amended by inserting the following
sentence after the first sentence thereof to read as follows:
"Deliver to Agent on or before the fifteenth (15th) day following
each fiscal quarter, as and for the prior quarter, an Inventory
ageing report."
2.4. Section 13.1 is amended as follows:
(a) The first sentence is amended in its entirety to provide
as follows:
"This Agreement, which shall inure to benefit of and shall be
binding upon the respective successors and permitted assigns of
each Borrower, Agent and each Lender, shall become effective on
the date hereof and shall continue in full force and effect until
January 7, 2004 (the "Term") unless sooner terminated as herein
provided."
(b) The last sentence is amended in its entirety to provide
as follow:
"In the event the Obligations are prepaid in full prior to the
last day of the Term (the date of such prepayment hereinafter
referred to as the "Early Termination Date"), Borrowers shall pay
to Agent for the benefit of Lenders an early termination fee in
an amount equal to (x) $50,000 if the Early Termination Date
occurs on or before January 6, 2003 and (y) $25,000 if the Early
Termination Date occurs after January 6, 2003 but on or before
January 6, 2004."
3. Waiver. Subject to satisfaction of the conditions precedent set
forth in Section 4 below, Agent and Lenders hereby waive the Events of Default
that have occurred for the fiscal quarter ending December 31, 2001 as a result
of Borrowers' non-compliance with Section 6.8 of the Loan Agreement solely as
respects the failure to maintain the EBITDA required pursuant to Section 6.8 of
the Loan Agreement.
4. Conditions of Effectiveness. This Amendment shall become
effective, when and only when (a) Agent shall have received an original copy of
this Amendment duly executed on
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behalf of each Borrower and (b) Agent shall receive a fee in the amount of
$10,000, which fee may be charged to Borrowers' loan account on the effective
date of this Amendment.
5. Representations and Warranties. Each Borrower hereby represents
and warrants as follows:
(a) This Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of each Borrower and are
enforceable against each Borrower in accordance with their respective terms.
(b) Upon the effectiveness of this Amendment, each Borrower
hereby reaffirms all covenants, representations and warranties made in the Loan
Agreement to the extent the same are not amended hereby and agrees that all such
covenants, representations and warranties shall be deemed to have been remade as
of the effective date of this Amendment.
(c) No Event of Default or Default has occurred and is
continuing or would exist after giving effect to this Amendment.
(d) No Borrower has any defense, counterclaim or offset with
respect to the Loan Agreement.
6. Effect on the Loan Agreement.
(a) Upon the effectiveness of Section 2 hereof, each
reference in the Loan Agreement to "this Agreement," "hereunder," "hereof,"
"herein" or words of like import shall mean and be a reference to the Loan
Agreement as amended hereby.
(b) Except as specifically amended herein, the Loan
Agreement, and all other documents, instruments and agreements executed and/or
delivered in connection therewith, shall remain in full force and effect, and
are hereby ratified and confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided in Section 3 operate as a
waiver of any right, power or remedy of Agent or any Lender, nor constitute a
waiver of any provision of the Loan Agreement, or any other documents,
instruments or agreements executed and/or delivered under or in connection
therewith.
7. Governing Law. This Amendment shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
and shall be governed by and construed in accordance with the laws of the State
of New York.
8. Headings. Section headings in this Amendment are included herein
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.
9. Counterparts. This Amendment may be executed by the parties
hereto in one or more counterparts, each of which shall be deemed an original
and all of which taken together shall be deemed to constitute one and the same
agreement.
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day
and year first written above.
WIRELESS XCESSORIES GROUP, INC.
(formerly known as BATTERIES
BATTERIES, INC.)
XXXXXX ELECTRONICS, INC.
SPECIFIC ENERGY CORPORATION
BATTERY NETWORK, INC.
W.S. BATTERY & SALES COMPANY, INC.
BATTERY ACQUISITION CORP.
By:_______________________________
Name: ____________________________
The _____ of each of the foregoing
Corporations
IBJ WHITEHALL BUSINESS CREDIT
CORPORATION, as Agent and as Lender
By:_______________________________
Name:_____________________________
Title:____________________________
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