1
EXHIBIT 10.18.2
AMENDMENT NUMBER TWO TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT, dated as of May
10, 2000 (this "Amendment"), amends that certain Loan and Security Agreement,
dated as of February 4, 1999 (as amended from time to time, the "Loan
Agreement"), by and between AMERIVISION COMMUNICATIONS, 1NC., an Oklahoma
corporation ("Borrower"), on the one hand, and COAST BUSINESS CREDIT, a division
of Southern Pacific Bank, a California corporation ("Coast"), on the other hand.
All initially capitalized terms used in this Amendment shall have the meanings
ascribed thereto in the Loan Agreement unless specifically defined herein.
R E C I T A L S
WHEREAS, Borrower and Coast wish to amend the Loan Agreement pursuant
to the terms and provisions set forth in this Amendment; and
NOW, THEREFORE, the parties hereto agree as follows:
AMENDMENT
Section 1. AMENDMENT TO SECTION 1 OF THE AGREEMENT TO ADD A DEFINITION
FOR NON-CASH ADJUSTMENTS. The following definition of "Non-Cash Adjustments" is
hereby added to the definitions set forth in Section 1 of the Agreement:
"Non-Cash Adjustments" means adjustments to the calculation of Borrower's
"Net Earnings" to reflect the addition of the following non-cash items:
deferred income tax expense and expenses in connection with the granting of
stock options, stock bonuses and warrants on stock. Such Non-Cash
Adjustments will only be allowed to the extent there is an offsetting Net
Loss Carry-forward (as determined in accordance with GAAP).
Section 2. AMENDMENT TO SECTION 2.1 OF THE SCHEDULE TO THE LOAN
AGREEMENT REGARDING THE MAXIMUM DOLLAR AMOUNT. The first paragraph of Section
2.1 of the Schedule to the Loan Agreement is hereby amended by deleting such
paragraph in its entirety and replacing it with the following:
"Loans in a total amount at any time outstanding not to exceed the lesser
of a total of Thirty-Five Million Dollars ($35,000,000)* at any one time
outstanding (the "Maximum Dollar Amount"), or the sum of (a) and (b)
below:"
2
The following paragraph indicated by an asterisk ("*") is added to the
conclusion of Section 2.1 of the Schedule.
"*An increase in the Maximum Dollar Amount from $30,000,000 to $35,000,000
is expressly subject to Coast's having entered into a co-lending
arrangement with another lender whereby such lender agrees to participate
in providing Loans to Borrower in the amount of $7,500,000. Such co-lending
arrangement shall be evidenced by a Syndicated Lender Rider and other
documentation acceptable to Coast in its sole and absolute discretion."
Section 3. AMENDMENT TO SECTION 2.1 (a) OF THE SCHEDULE TO THE LOAN
AGREEMENT' REGARDING THE CREDIT LIMIT. The following concluding paragraph of
Section 2.I(a) of the Schedule to the Loan Agreement is hereby deleted in its
entirety:
"If Borrower requests an increase in the Maximum Dollar Amount from Thirty
Million Dollars ($30,000,000) to Thirty Five Million Dollars ($35,000,000)
after January 30, 2000 and prior to or on January 30, 2001, Borrower shall
provide Coast with 90 days written notice prior to the proposed effective
date of any such increase. To be eligible for the increase: (1) the
provisions of this Section 2.1, with the exception of the Maximum Dollar
Amount limitation, must otherwise allow for Loans in a total amount of
$35,000,000, (2) an Event of Default shall not then exist or result from
such increase, and (3) Coast must determine, in its sole and absolute
discretion, that any funds which may become available for borrowing from
such an increase will be utilized by Borrower for proper business purposes.
If such an increase becomes effective, Borrower shall pay Coast a fee equal
to one percent (1%) of the amount that the Maximum Dollar Amount is
increased, with said fee to be fully earned and payable concurrently with
the effectiveness of such an increase."
Section 4. AMENDMENT TO SECTION 2.1(b) OF THE SCHEDULE REGARDING THE
EBITDA LIMITER. Section 2.1(b) of the Schedule to the Loan Agreement is hereby
amended by deleting such paragraph in their entirety and replacing it with the
following:
"(b) Three and one-half times EBITDA based on a rolling 12 months."
Section 5. AMENDMENT TO SECTION 8.1(1) OF THE SCHEDULE TO THE LOAN
AGREEMENT. The first numbered paragraph of Section 8.1 of the Schedule to the
Loan Agreement is hereby amended by deleting such paragraph in its entirety and
replacing it with the following:
"1. Borrower shall at all times maintain a Net Worth no more negative than
negative ($12,000,000), with such amount to become less negative by an
amount equal to 80% of Borrower's quarterly Net Income (calculated in
accordance with GAAP and taking into account year-end adjustments) on a
cumulative basis commencing from Borrower's fiscal quarter ending March
31, 2000."
Section 6. AMENDMENT TO THE THIRD PROVISO OF SECTION 8.1(6) OF
3
THE SCHEDULE TO THE LOAN AGREEMENT. The third proviso of Section 8.1(6) of the
Schedule to the Loan Agreement is hereby amended by deleting such proviso in its
entirety and replacing it with the following:
"provided lastly, in addition to the above principal payments, so long as
(i) no Event of Default has occurred and is continuing under the terms of
this Agreement, (ii) subject to the above set forth availability test,
Borrower may further repay the principal balance of the debt owing to
Hebron Communications Corporation, Inc., in an amount (exclusive of the
specific payments to Xxxx Xxxxxxxx discussed above) not to exceed 25% of
Borrower's quarterly "Net Earnings" (defined as net income after tax net of
extraordinary gains plus Non-Cash Adjustments, measured on a cumulative
basis for Borrower's current fiscal year, and based on quarterly reviewed
financial statements) (the "SubDebt Net Earnings Payments"). Additionally,
so long as no Event of Default has occurred and is continuing under the
terms of the Agreement, Borrower may pay from quarterly Net Earnings,
dividend or distribution payments on ownership interests of Borrower (which
include, without limitation, the scheduled settlement payments for the
$1,000,000 obligation listed in Section 6.10 of the Schedule), as provided
for in Section 8.1(j)(i) of the Agreement, in an amount up to 50% of
Borrower's quarterly Net Earnings less any SubDebt Net Earnings Payments."
Section 7. AMENDMENT TO ADD A NEW SECTION 8.1(7) TO THE SCHEDULE TO THE
LOAN AGREEMENT. The following Section 8.1(7) is hereby added to the Schedule to
the Loan Agreement:
"7. At all times, Borrower's ratio of Senior Debt to EBITDA shall be no
greater than 3.50 to 1.00. For purposes of this paragraph, "Senior
Debt" is defined as the total amount of Borrower's Obligations owing
to Coast under this Agreement."
Section 8. ISSUES AFFECTING SECTION 8.3(6) OF THE SCHEDULE TO THE LOAN
AGREEMENT REGARDING ANNUAL FINANCIAL STATEMENTS. Section 8.3(6) of the Schedule
to the Loan Agreement provides, among other things, that Borrower provide annual
financial statements certified by an independent certified public accountant
acceptable to Coast. Pursuant to this Section, Coast will require that Borrower
change its accounting firm to a "big-six" accounting firm, acceptable to Coast,
for preparation of Borrower's December 31, 2000 fiscal year end financial
statements.
Section 9. CONDITIONS PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon the receipt by Coast of:
(1) a fully executed copy of this Amendment together with copies
of all other agreements, instruments and documents as Coast
may require in connection with the transactions contemplated
hereby;
(2) a fully executed copy of that certain Syndicated Lender Rider;
and
(3) a line increase fee in the amount of Fifty Thousand Dollars
($50,000) (the "Line Increase Fee").
3
4
Section 10. ENTIRE AGREEMENT. The Loan Agreement, as amended hereby,
embodies the entire agreement and understanding between the parties hereto and
supersedes all prior agreements and understandings relating to the subject
matter hereof. Borrower represents, warrants and agrees that in entering into
the Loan Agreement and consenting to this Amendment, it has not relied on any
representation, promise, understanding or agreement, oral or written, of, by or
with, Coast or any of its agents, employees, or counsel, except the
representations, promises, understandings and agreements specifically contained
in or referred to in the Loan Agreement, as amended hereby.
Section 11. CONFLICTING TERMS. In the event of a conflict between the
terms and provisions of this Amendment and the terns and provisions of the Loan
Agreement, the terms of this Amendment shall govern. In all other respects, the
Loan Agreement, as amended and supplemented hereby, shall remain in full force
and effect.
Section 12. MISCELLANEOUS. This Amendment shall be governed by and
construed in accordance with the laws of the State of California. This Amendment
may be executed in any number of counterparts, all of which taken together shall
constitute one agreement, and any party hereto may execute this Amendment by
signing such counterpart.
[Signature Page to Follow]
4
5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective officers thereunto duly authorized as of the
date first above written.
BORROWER:
AMERIVISION COMMUNICATIONS, INC.,
An Oklahoma corporation
By /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
President or Vice President
By /s/ Xxxxx Xxxxx
--------------------------------
Secretary or Ass't Secretary
COAST:
COAST BUSINESS CREDIT,
a division of Southern Pacific Bank
By /s/ Xxxx X. Xxxxxx
--------------------------------
Title Vice President
-----------------------------
5
