Exhibit 10.13
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ELEVENTH AMENDMENT TO CREDIT AGREEMENT
THIS ELEVENTH AMENDMENT TO CREDIT AGREEMENT (the "Eleventh Amendment")
is made and dated as of September 13, 2001, by and among UNITED CALIFORNIA BANK,
formerly known as Sanwa Bank California ("UCB"), those other banks (each,
including UCB, a "Lender" and, collectively, the "Lenders"), party with UCB to
the Agreement defined in Recital A below, UCB, as agent for the Lenders (in such
capacity, the "Agent") and as the L/C Bank (as defined in the Agreement), and
NTS TECHNICAL SYSTEMS, a California corporation (the "Borrower").
RECITALS
A. Pursuant to that certain Credit Agreement dated as of September 8,
1997 among the Agent, the Lenders and the Borrower (as amended, modified, or
waived, the "Agreement"), the Lenders agreed to extend credit to the Borrower on
the terms and subject to the conditions set forth therein. All capitalized terms
not otherwise defined herein shall have the meanings given to such terms in the
Agreement.
B. The Borrower has asked the Agent, the L/C Bank and the Lenders to
waive certain terms of the Agreement and to modify certain terms of the
Agreement.
C. The Agent, the L/C Bank and the Lenders have agreed to such requests
of the Borrower on the terms and conditions contained in this Eleventh
Amendment.
NOW, THEREFORE, in consideration of the foregoing Recitals and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1. Waiver. In reliance on the representations and warranties contained
in this Eleventh Amendment and subject to the other terms and conditions of this
Eleventh Amendment, as of the Effective Date, the Agent, the L/C Bank and the
Lenders waive the Potential Default and Event of Default occurring under the
Agreement by reason of the failure of the Borrower to have a Debt Coverage Ratio
of at least 1.10 to 1.00 as of July 31, 2001. This waiver is specific in time
and intent and does not constitute a waiver of any other right or provision in
the Agreement or in any other Loan Document.
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2. Amendment.
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(a) Paragraph 7(j)(5) of the Agreement is amended to read
as follows:
"(5) permit the Debt Coverage Ratio for the four fiscal quarters ending
(i) October 31, 2001 to be less than 1.00 to 1.00 or (ii) January 31,
2002 or the last day of any fiscal quarter thereafter, 1.25 to 1.00."
(b) A new Paragraph 6(l) is added immediately after
Paragraph 6(k) to read as follows:
"6(l) Appraisal. Deliver to the Agent and each Lender no later than
October 7, 2001 an appraisal of Property owned by the Borrower in
Saugus, California. The Borrower agrees to pay to the Agent on demand
its reasonable out-of-pocket costs, fees, and expenses incurred in
connection with an independent review of such appraisal."
3. Reaffirmation of Loan Documents. The Borrower hereby affirms and
agrees that, except as otherwise provided herein, (a) the execution and delivery
by the Borrower of and the performance of its obligations under this Eleventh
Amendment shall not in any way amend, impair, invalidate or otherwise affect any
of the Obligations of the Borrower or the rights of the Lenders under the Loan
Documents or any other document or instrument made or given by the Borrower in
connection therewith, (b) the term "Obligations" as used in the Security
Agreement includes, without limitation, the Obligations of the Borrower under
the Agreement as amended hereby, and (c) the Security Documents remain in full
force and effect and constitute a continuing first priority security interest in
and lien upon the Collateral described therein. The Borrower hereby reaffirms
its agreements under the Loan Documents and promises to pay Obligations incurred
under the Agreement as and when due.
4. Effective Date. Subject to the terms contained in the last
paragraph of this Paragraph 4, this Eleventh Amendment shall be effective on the
date (the "Effective Date") when all of the following conditions precedent have
been satisfied:
(a) The Borrower shall have delivered or shall have had
delivered to the Agent each of the following (with sufficient copies for each of
the Lenders):
(i) A duly executed copy of this Eleventh Amendment;
(ii) Such credit applications, financial statements,
authorizations and such information concerning the Borrower and its Guarantors
and their business, operations and condition (financial and otherwise) as any
Lender may reasonably request.
(b) The Borrower shall have paid to the Agent for the pro rata
account of the Lenders an amendment fee equal to $3,000 together with any and
all other fees and other amounts that are due and payable hereunder or under the
Agreement, and all acts and conditions (including, without limitation, the
obtaining of any necessary regulatory approvals and the making of any required
filings, recordings or registrations) required to be done and performed and to
have happened precedent to the execution, delivery and performance of this
Eleventh Amendment and to constitute the same legal, valid and binding
obligations, enforceable in accordance with their respective terms, shall have
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been done and performed and shall have happened in due and strict compliance
with all applicable laws.
(c) The representations and warranties made by or on behalf of
the Borrower and each Guarantor in or pursuant to the Loan Documents (and by
executing and delivering this Eleventh Amendment, the Borrower represents that
all such representations and warranties) shall be accurate and complete in all
material respects as if made on and as of such date (or as of the date of
financial statements last delivered to the Bank if such representations and
warranties relate to the financial results or condition of the Borrower).
(d) There shall not have occurred an Event of Default or
Potential Default not otherwise cured or waived.
5. Representations and Warranties. As an inducement to the Agent, the
L/C Bank and each Lender to enter into this Eleventh Amendment, the Borrower
represents and warrants to the Agent, the L/C Bank and each Lender that:
(a) Corporate Existence; Compliance with Law. The Borrower and
each Guarantor (1) is duly organized, validly existing and in good standing as a
corporation under the laws of the state of its incorporation and is qualified to
do business in each jurisdiction where its ownership of property or conduct of
business requires such qualification and where failure to qualify would have a
material adverse effect on it or its property and/or business or on its ability
to pay or perform the Obligations, (2) has the corporate power and authority and
the legal right to own and operate its property and to conduct business in the
manner in which it does and proposes so to do, and (3) is in compliance with all
Requirements of Law and Contractual Obligations.
(b) Corporate Power; Authorization; Enforceable Obligations.
The Borrower and each Guarantor has the corporate power and authority and the
legal right to execute, deliver and perform this Eleventh Amendment and the
Agreement as amended hereby to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Eleventh Amendment and the Agreement as amended hereby. This Eleventh Amendment
and the Agreement as amended hereby have been duly executed and delivered on
behalf of the Borrower and each Guarantor party thereto and constitute such
Person's legal, valid and binding obligations enforceable against it in
accordance with their respective terms, subject to the effect of applicable
bankruptcy and other similar laws affecting the rights of creditors generally
and the effect of equitable principles whether applied in an action at law or a
suit in equity.
(c) No Legal Bar. The execution, delivery and performance of
this Eleventh Amendment and the Agreement as amended hereby, the borrowings
hereunder and the use of the proceeds thereof, will not violate any Requirement
of Law or any Contractual Obligations of the Borrower or any Guarantor or create
or result in the creation of any Lien on any assets of the Borrower or any
Guarantor except as contemplated thereby.
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(d) No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrower or any Guarantor, threatened by or against the
Borrower or any Guarantor or against any of the Borrower's or any Guarantor's
properties or revenues which is likely to be adversely determined and which, if
adversely determined, is likely to have a material adverse effect on the
business, operations, property or financial or other condition of the Parent and
its Subsidiaries, taken as a whole.
(e) Consents, etc. No consent, approval, authorization of, or
registration, declaration or filing with any Governmental Authority is required
on the part of the Borrower or any Guarantor in connection with the execution
and delivery of this Eleventh Amendment and the Agreement as amended hereby or
the performance of or compliance with the terms, provisions and conditions
hereof or thereof.
(f) No Default. No Potential Default or Event of Default has
occurred under the Agreement which has not otherwise been cured or waived.
(g) Full Disclosure. None of the representations or warranties
made by the Borrower or any Guarantor in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Borrower or any Guarantor in connection with the Loan
Documents contains any untrue statement of a material fact or omits any material
fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they are made, not misleading
as of the time when made or delivered.
6. Miscellaneous Provisions.
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(a) Expenses. In accordance with Paragraph 6(g) of the
Agreement, the Borrower agrees to pay all reasonable out-of-pocket expenses of
the Agent incident to the preparation and negotiation of this Eleventh
Amendment.
(b) Entire Agreement. This Eleventh Amendment embodies the
entire agreement and understanding between the parties hereto and supersedes all
prior agreements and understandings relating to the subject matter hereof and
thereof.
(c) Governing Law. This Eleventh Amendment shall be governed
by and construed in accordance with the laws of the State of California, without
giving effect to choice of law rules.
(d) Counterparts. This Eleventh Amendment may be executed
in any number of counterparts, all of which together shall constitute one
agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Eleventh Amendment to be executed as of the day and year first above written.
NTS TECHNICAL SYSTEMS, a California corporation
By:______________________________
Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
UNITED CALIFORNIA BANK, as Agent and the L/C Bank
By:______________________________
Name: Xxxxxx Xxxxx
Title: Vice President
UNITED CALIFORNIA BANK, as a Lender
By:______________________________
Name: Xxxxxx Xxxxx
Title: Vice President
MELLON BANK, N.A., as a Lender
By:______________________________
Name: Xxxxx Xxxxxxxxx
Title: Vice President
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REAFFIRMATION OF GUARANTIES
Each of the undersigned Guarantors agrees to the terms of this Eleventh
Amendment and hereby ratifies and reaffirms its Guaranty of the Obligations of
the Borrower and its grant of a security interest in certain property to secure
such Guaranty in favor of the Agent, on behalf of itself, the Lender, and the
L/C Bank and agrees that, notwithstanding this Eleventh Amendment and any other
amendment or supplement to the Agreement entered into prior to this Eleventh
Amendment, its Guaranty shall remain in full force and effect with respect to
the Agreement as amended hereby.
NATIONAL TECHNICAL SYSTEMS, INC.
By:____________________________________
Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
ETCR, INC.
By:____________________________________
Name: Xxxxx Xxxxxxx
Title: Vice President
APPROVED ENGINEERING TEST
LABORATORIES, INC.
By:____________________________________
Name: Xxxxx Xxxxxxx
Title: Vice President
ACTON ENVIRONMENTAL TESTING CORPORATION
By:____________________________________
Name: Xxxxx Xxxxxxx
Title: Vice President
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XXCAL, INC.
By:______________________________________
Name: Xxxxx Xxxxxxx
Title: Vice President
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