EXHIBIT 10T
FIRST AMENDMENT TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED LOAN AND
SECURITY AGREEMENT (this "Amendment") is entered into as of July
30, 1998, among MULTIGRAPHICS, INC. f/k/a AM INTERNATIONAL, INC.,
a Delaware corporation ("Multigraphics"), PUBLISHING SOLUTIONS
INC., an Ohio corporation ("PSI") and FOOTHILL CAPITAL CORPORATION
("Lender").
WHEREAS, Multigraphics, PSI and Lender are parties to
that certain Amended and Restated Loan and Security Agreement
dated as of February 19, 1998 (as amended, the "Loan Agreement");
and
WHEREAS, Multigraphics and PSI (collectively,
"Borrowers") have requested that Lender amend various provisions
of the Loan Agreement, and Lender has agreed to do so subject to
the terms and conditions contained herein;
NOW THEREFORE, in consideration of the premises and
mutual agreements herein contained, the parties hereto agree as
follows:
1. Defined Terms. Unless otherwise defined herein,
capitalized terms used herein shall have the meanings ascribed to
such terms in the Loan Agreement.
2. Amendments to Loan Agreement.
(a) Section 1.1.
(i) A new definition of the term "EBITDA" is hereby
added to Section 1.1 of the Loan Agreement, in the
appropriate alphabetical order, as follows:
"'EBITDA' means, for any period, the sum of
net income (or net loss) before interest, taxes,
depreciation and amortization for such period, all
as determined for Borrowers on a consolidated basis
in accordance with GAAP."
(ii) The definition of the term "Maximum Revolving
Amount" contained in Section 1.1 of the Loan Agreement is
hereby amended and restated in its entirety, as follows:
"'Maximum Revolving Amount' means
$10,000,000; provided, that from time to time
Borrowers may increase the Maximum Revolving
Amount in increments of $1,000,000, by providing
Foothill with written notice thereof at least 3
Business Days prior to the effective date of such
increase as specified in such notice; provided,
further, that (i) no such increase shall be
effective at any time that a Default or an Event
of Default is in effect and (ii) the Maximum
Revolving Amount shall at no time exceed
$15,000,000. Each such notice of increase shall
be irrevocable when given by Borrowers and shall
be accompanied by the appropriate line increase
fee set forth in Section 2.11 (a)."
(iii) A new definition of the term "Renewal Date" is
hereby added to Section 1.1 of the Loan Agreement, in the
appropriate alphabetical order, as follows:
"'Renewal Date' has the meaning set forth in Section 3.4."
(iv) The definition of the term "Termination Date"
contained in Section 1.1 of the Loan Agreement is hereby
deleted.
(b) Section 2.1(a). Clause (y) of the definition of
the term "Borrowing Base" applicable to each of Multigraphics and
PSI, respectively, and contained in Section 2.1(a) of the Loan
Agreement, is hereby amended by deleting therefrom the amount
"$5,000,000" and inserting in its place the amount "$7,000,000".
(c) Section 2.6(b). Section 2.6(b) of the Loan
Agreement is hereby amended and restated in its entirety, as
follows:
"(b) Letter of Credit Fee. Each Borrower
shall pay Foothill a fee (in addition to the
charges, commissions, fees, and costs set forth
in Section 2.2(d)) equal to 0.75% per annum times
the aggregate undrawn amount of all outstanding
Letters of Credit issued for the account of such
Borrower; provided, that such fee shall be
prospectively reduced by one-quarter percentage
point one day after receipt by Lender of
Borrowers' unqualified annual audited financial
statements for the 1998 fiscal year delivered
pursuant to Section 6.3(b), if the interest rate
applicable to the Obligations is being reduced on
such date pursuant to Section 2.6(a)."
(d) Section 2.6(c). Clause (ii) of Section 2.6(c) of
the Loan Agreement is hereby amended and restated in its entirety,
as follows:
"(ii) the Letter of Credit fee provided
in Section 2.6(b) shall be prospectively
increased to a per annum rate equal to 2.00
percentage points above the otherwise applicable
Letter of Credit fee provided in Section 2.6(b)."
(e) Section 2.11(a). Section 2.11(a) of the Loan
Agreement is hereby amended and restated in its entirety, as
follows:
"(a) Line Increase Fee. A fee equal to
1.00% of the amount of each increase in the Maximum
Revolving Amount, payable on the effective date of
such increase."
(f) Section 2.11(d). The last clause of Section
2.11(d) is hereby amended and restated in its entirety, as
follows:
"and, on each anniversary of May 30, 1997
prior to the date that this Agreement terminates,
Foothill's customary fee of $1,000 per year for its
loan documentation review."
(g) Section 3.4. Section 3.4 of the Loan
Agreement is hereby amended and restated in its entirety, as follows:
"3.4 Term; Automatic Renewal.
This Agreement shall become effective upon the
execution and delivery hereof by each Borrower and
Foothill and shall continue in full force and
effect for a term ending on May 30, 2002 (the
"Renewal Date") and automatically shall be renewed
for one additional year period thereafter, unless
terminated pursuant to the terms hereof. Either
party may terminate this Agreement effective on the
Renewal Date or on the first anniversary of the
Renewal Date by giving the other party at least 60
days prior written notice. The foregoing
notwithstanding, Foothill shall have the right to
terminate its obligations under this Agreement
immediately and without notice upon the occurrence
and during the continuance of an Event of Default."
(h) Section 3.5. Section 3.5 of the Loan Agreement is
hereby amended by adding the following at the end thereof:
"If Borrowers have sent a notice of
termination pursuant to the provisions of Section
3.4 for a termination on the Renewal Date, but fail
to pay the Obligations in full on the date set
forth in said notice, then Foothill may, but shall
not be required to, renew this Agreement for an
additional term of one year."
(i) Section 3.6. Section 3.6 of the Loan Agreement is
hereby amended and restated in its entirety, as follows:
"3.6 Early Termination by Borrowers.
The provisions of Section 3.4 that allow
termination of this Agreement by Borrowers
only on the Renewal Date and certain
anniversaries thereof notwithstanding,
Borrowers have the option, at any time upon 60
days prior written notice to Foothill, to
terminate this Agreement by paying to
Foothill, in cash, the Obligations, in full
(provided, that any contingent reimbursement
obligations of either Borrower with respect to
outstanding Letters of Credit shall be
satisfied in the manner set forth in Section
2.2(e)), together with a premium (the "Early
Termination Premium") equal to (a) 2% of the
Maximum Revolving Amount if such termination
occurs on or before November 30, 1998, (b) 3%
of the Maximum Revolving Amount if such
termination occurs after November 30, 1998,
but on or before November 30, 1999, (c) 2% of
the Maximum Revolving Amount if such
termination occurs after November 30, 1999 but
on or before November 30, 2000, (d) 1% of the
Maximum Revolving Amount if such termination
occurs after November 30, 2000 but before May
30, 2002 and (e) if this Agreement is renewed
pursuant to Section 3.4, 1% of the Maximum
Revolving Amount if such termination occurs on
or after the Renewal Date but before May 30,
2003; provided, that if Borrowers terminate
this Agreement due to Foothill's refusal to
consent to a proposed acquisition that would
violate Section 7.13(a) or (c) below, the
applicable Early Termination Premium shall be
reduced by one-half of the amount otherwise
payable hereunder."
(j) Section 7.20(c). A new Section 7.20(c) is
hereby added to the Loan Agreement, as follows:
"(c) EBITDA. EBITDA of at least $1,300,000 on
the last day of each fiscal quarter commencing with the
first fiscal quarter of the 1999 fiscal year, for the 12
month period ending on such day."
(k) Section 7.21. Section 7.21 of the Loan Agreement is
hereby amended and restated in its entirety, as follows:
"7.21 Capital Expenditures.
Make capital expenditures in any fiscal year
in excess of $ 1,000,000 in the aggregate for both
Borrowers."
3. Ratification and Effectiveness. This Amendment shall
constitute an amendment to the Loan Agreement and all of the Loan
Documents as appropriate to express the agreements contained
herein. Upon proper execution by Borrowers and Lender and
satisfaction of the conditions set forth herein, this Amendment
shall be deemed to have been effective as of July _, 1998. In all
other respects, the Loan Agreement and the Loan Documents shall
remain unchanged and in full force and effect in accordance with
their original terms.
4. Miscellaneous.
(a) Warranties and Absence of Defaults. In order to
induce Lender to enter into this Amendment, each Borrower hereby
warrants to Lender, as of the date hereof, that:
(i) The warranties of each Borrower contained in the
Loan Agreement, as herein amended, are true and correct as of
the date hereof as if made on the date hereof.
(ii) All information, reports and other papers and data
heretofore furnished to Lender by either Borrower in
connection with this Amendment, the Loan Agreement and the
other Loan Documents are accurate and correct in all material
respects and complete insofar as may be necessary to give
Lender true and accurate knowledge of the subject matter
thereof. Each Borrower has disclosed to Lender every fact of
which it is aware which would reasonably be expected to
materially and adversely affect the business, operations or
financial condition of either Borrower or the ability of
either Borrower to perform its obligations under this
Amendment, the Loan Agreement or under any of the other Loan
Documents. None of the information furnished to Lender by or
on behalf of either Borrower contained any material
misstatement of fact or omitted to state a material fact or
any fact necessary to make the statements contained herein or
therein not materially misleading.
(iii) No Event of Default or event which, with
giving of notice or the passage of time, or both would become
an Event of Default, exists a of the date hereof.
(b) Expenses. Borrowers jointly and severally agree to
pay on demand all costs and expenses of Lender (including the
reasonable fees and expenses of outside counsel for Lender) in
connection with the preparation, negotiation, execution, delivery
and administration of this Amendment and all other instruments or
documents provided for herein or delivered or to be delivered
hereunder or in connection herewith. In addition, Borrowers
jointly and severally agree to pay, and save Lender harmless from
all liability for, any stamp or other taxes which may be payable
in connection with the execution or delivery of this Amendment or
the Loan Agreement, as amended hereby, and the execution and
delivery of any instruments or documents provided for herein or
delivered or to be delivered hereunder or in connection herewith.
All obligations provided in this Section 4(b) shall survive any
termination of this Amendment and the Loan Agreement as amended
hereby.
(c) Governing Law. This Amendment shall be a contract
made under and governed by the internal laws of the State of
California.
(d) Counterparts. This Amendment may be executed in
any number of counterparts, and by the parties hereto on the same
or separate counterparts, and each such counterpart, when executed
and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
Amendment.
(e) Reference to Loan Agreement. On and after the
effectiveness of the amendment to the Loan Agreement accomplished
hereby, each reference in the Loan Agreement to "this Agreement",
"hereunder," "hereof," "herein" or words of like import, and each
reference to the Loan Agreement in any Loan Documents, or other
agreements, documents or other instruments executed and delivered
pursuant to the Loan Agreement, shall mean and be a reference to
the Loan Agreement, as amended by this Amendment.
(f) Successors. This Amendment shall be binding upon
each Borrower, Lender and their respective successors and assigns,
and shall inure to the benefit of each Borrower, Lender and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be executed by their respective officers
thereunto duly authorized and delivered as of the date first
above written.
MULTIGRAPHICS, INC. f/k/a
AM INTERNATIONAL, INC.
By ___________________________________
Its _________________________________
PUBLISHING SOLUTIONS INC.
By __________________________________
Its __________________________________
FOOTHILL CAPITAL CORPORATION
By __________________________________
Its __________________________________
