AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND AMENDMENT TO AMENDED AND RESTATED FINANCIAL COVENANTS AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
Exhibit 10.1
AMENDMENT
TO AMENDED AND RESTATED CREDIT AGREEMENT
AND
AMENDMENT TO AMENDED AND RESTATED FINANCIAL COVENANTS AMENDMENT TO
AMENDED
AND RESTATED CREDIT AGREEMENT
This
Amendment to Amended and Restated Credit Agreement and Amendment to Amended and
Restated Financial Covenants Amendment to Amended and Restated Credit Agreement
(“Amendment”)
is made as of December 16, 2009, amending that certain Credit Agreement (as
defined below) between CASTLE
PINES CAPITAL LLC, a Delaware limited liability company (“CPC”), having its
chief executive office located at 000 Xxxxxxxxx Xxxxx Xxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxxx 00000 and INX INC., a Delaware
corporation, having its chief executive office located at 00000 Xxxx Xxxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxx 00000 (“Reseller”).
WHEREAS, INX and CPC entered
in to that certain Amended and Restated Credit Agreement dated April 30, 2007,
as amended by that certain Acquisition Facility Amendment to Amended and
Restated Credit Agreement dated August 1, 2007, as amended by that certain
Amended and Restated Financial Covenants Amendment to Amended and Restated
Credit Agreement effective as of the 31st day
of August, 2007, as amended by that certain Amendment to Amended and Restated
Credit Agreement adding Select, Inc. as a Reseller and as amended by the
Amendment dated the date hereof (collectively, the “Credit Agreement”)
between CPC and Reseller, providing the availability for credit to finance
inventory on behalf of Reseller; and
WHEREAS, Reseller has
requested that CPC (a) amend Section 1 of the Credit Agreement to increase the
Line of Credit; (b) amend Section 17 of the Credit Agreement to extend the
Termination Date to December 31, 2011, and (c) amend the Amended and Restated
Financial Covenants Amendment to Amended and Restated Credit Agreement;
and
WHEREAS, CPC is willing to
accommodate such request for credit upon and subject to the terms, conditions
and provisions of this Amendment and the Documents;
NOW, THEREFORE, in
consideration of the premises and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Reseller and CPC
hereby mutually covenant and agree as follows:
SECTION
1. Definitions. All capitalized
terms not otherwise defined herein shall have the meanings given to such terms
in the Credit Agreement.
SECTION
2. Amendments
to Credit Agreement.
A. Section 1 of the Credit
Agreement, Extensions
of Credit, is amended by deleting the first sentence of such section and
replacing same with the following new sentence:
“Subject
to the terms of this Amended and Restated Credit Agreement together with the
Amended and Restated Financial Covenants as set forth in that certain Amendment
to Amended and Restated Credit Agreement and Amendment to Amended and Restated
Financial Covenants Amendment to Amended and Restated Credit Agreement dated as
of December 16, 2009, and Paydown Amendment to Amended and Restated Credit
Agreement dated April 30, 2007 (collectively, this “Agreement”), CPC has
made a discretionary line of Credit up to a maximum aggregate amount of Seventy
Million Dollars ($70,000,000) outstanding funded indebtedness (the “Line of Credit”)
available to Reseller.”
B. Section 17 of the Credit
Agreement, Terms and
Termination, is amended by deleting the existing Section 17 in its
entirety and replacing same with the following:
“Terms and
Termination. The term of this Agreement, unless sooner
terminated in accordance with this Agreement, shall terminate on December 31,
2011 (subject to renewal as provided below, the “Termination Date”),
provided, however, that (a) this Agreement shall automatically renew for one (1)
year periods from year to year thereafter unless terminated by the Reseller upon
written notice at least 90 days prior to the current Termination Date; (b) CPC
may terminate this Agreement immediately (i) by written notice to Reseller if
Reseller shall lose or relinquish any right to sell or deal in any Financed
Inventory or (ii) upon a Default; or (c) CPC may terminate the Inventory
Facility and the Revolving Credit Facility at any time by at least 60 days prior
written notice by CPC to Reseller; provided however, where Reseller requests
further time be provided within the 60 day notice period CPC will agree to an
extension of 30 more days. Upon termination of this Agreement, all
Indebtedness owed to CPC shall become immediately due and payable without notice
or demand. Upon any termination, Reseller shall remain liable to CPC
for all Indebtedness to CPC, including without limitation interest, fees,
charges and expenses arising prior to or after the effective date of
termination, and all of CPC's rights and remedies and its security interest
shall continue until all Indebtedness to CPC is indefeasibly paid in full and
all obligations of Reseller are performed.”
SECTION
2. Amendment to Amended and Restated Financial
Covenants.
The
Amended and Restated Financial Covenants Amendment to the Credit Agreement, is
hereby amended and restated in its entirety as follows:
“AMENDED
AND RESTATED FINANCIAL COVENANTS AMENDMENT
TO
AMENDED AND RESTATED CREDIT AGREEMENT
1. ‘Current
Ratio. Reseller will at all times maintain on a consolidated
basis a ratio of current assets to Current Liabilities of at least
1.15:1.0.
For purpose of this paragraph ‘Current Liabilities’
includes (a) all obligations classified as current liabilities under generally
accepted accounting principles, plus (b) all
principal amounts outstanding under revolving lines of credit, whether
classified as current or long-term, which are not already included under (a)
above; provided, however, that (i) only scheduled principal payments in
connection with the CPC Acquisition Loan for any 12 month period shall be deemed
to be Current Liabilities for the purposes of compliance with this Current Ratio
covenant and (ii) ‘CPC
Acquisition Loan’ means the acquisition loan made by CPC to Reseller on
August 31, 2007, in the aggregate principal amount of Six Million Dollars
($6,000,000). This ratio will be calculated at the end of each fiscal
quarter, using fiscal year-to-date results on an annualized basis.’
2. ‘Tangible
Net Worth. Reseller will at all times maintain on a
consolidated basis tangible net worth equal to at least Eleven Million Dollars
($11,000,000).
For purpose of this
paragraph: (i) ‘Tangible Net Worth’
means as of any date the sum of Reseller’s (i) net worth as reflected on the
last twelve-month consolidated fiscal financial statements of Reseller, plus (ii) net
earnings since the end of such fiscal year, both after provision for taxes and
with Inventory determined on a first in, first out basis, plus (iii)
Subordinated Debt, minus the sum of
Reseller’s (A) intangible assets, including, without limitation, deposits,
unamortized leasehold improvements, goodwill, deferred income taxes, franchises,
licenses, patents, trade names, copyrights, service marks, brand names,
covenants not to compete and any other asset which would be treated as an
intangible under generally accepted accounting principles, plus (B) prepaid
expenses (however such item shall not include prepaid inventory), plus (C) franchise
fees, plus (D)
notes, Accounts and other amounts owed to Reseller by any Guarantor, affiliate
or employee of Reseller plus (E) losses since
the end of such fiscal year, plus (F) interest in
the cash surrender value of officers or shareholders life insurance policies;
and (ii) ‘Subordinated
Debt’ means liabilities subordinated to the Reseller’s obligations to CPC
in a manner acceptable to CPC, using CPC’s standard form. This
covenant will be tested at the end of each fiscal quarter.’
3. ‘Total
Liabilities to Tangible Net Worth Ratio. Reseller will at all
times maintain on a consolidated basis a ratio of Total Liabilities (excluding
liabilities subordinated to the Reseller’s obligations to CPC in a manner
acceptable to CPC, using CPC’s standard form) to Tangible Net Worth not
exceeding 6.00:1.00.
For purpose of this
paragraph: (i) ‘Total Liabilities’
means the sum of current liabilities plus long term
liabilities; and (ii) ‘Tangible Net Worth’
means as of any date the sum of (i) net worth as reflected on the last
twelve-month consolidated fiscal financial statements of Reseller, plus (ii) net
earnings since the end of such fiscal year, both after provision for taxes and
with Inventory determined on a first in, first out basis, plus (iii)
Subordinated Debt, minus the sum of
Reseller’s (A) intangible assets, including, without limitation, deposits,
unamortized leasehold improvements, goodwill, deferred income taxes, franchises,
licenses, patents, trade names, copyrights, service marks, brand names,
covenants not to compete and any other asset which would be treated as an
intangible under generally accepted accounting principles, plus (B) prepaid
expenses (however such item shall not include prepaid inventory), plus (C) franchise
fees, plus (D)
notes, Accounts and other amounts owed to Reseller by any Guarantor, affiliate
or employee of Reseller plus (E) losses since
the end of such fiscal year, plus (F) interest in
the cash surrender value of officers or shareholders life insurance
policies. This ratio will be calculated at the end of each fiscal
quarter, using fiscal year-to-date results on an annualized basis.”
SECTION 4. Full Force and
Effect. Except as specifically amended hereby, all of the
terms and conditions of the Credit Agreement as amended, the Documents, and all
other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and the same are
hereby ratified and confirmed. This Amendment, the Credit Agreement,
and the other Documents constitute legal, valid and binding obligations of
Reseller and are enforceable against Reseller in accordance with their
respective terms.
SECTION 5. Counterparts. This
Amendment may be executed in one or more counterparts, each of which shall be
deemed to be an original, and all of which shall constitute together but one and
the same agreement.
SECTION 6. 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
Colorado.
[signature
page(s) to follow]
IN WITNESS WHEREOF, Reseller
and CPC has caused this Amendment to be executed by its authorized officers as
of the day and year first above written.
| INX INC., as Reseller | ||||
| ATTEST: | ||||
|
By:
|
/s/ Xxxxx Xxxxxxx | |||
| /s/ Xxxxxx X. Xxxxxxx | Name: Xxxxx Xxxxxxx | |||
| Xxxxxx X. Xxxxxxx, Secretary | Title: Vice President & CFO | |||
| ATTEST: | ||||
| /s/ Xxxxx X. Xxxx | ||||
| Xxxxx X. Xxxx, Chief Executive Officer | ||||
| CASTLE PINES CAPITAL LLC | |||
|
|
By:
|
/s/ Xxxx Xxxxxxx | |
| Name: Xxxx Xxxxxxx | |||
| Title: Managing Partner | |||
