AMENDMENT No. 6
to
AMENDED AND RESTATED CREDIT AGREEMENT AND OTHER AGREEMENTS
This June 9, 1997, Amendment No. 6 to Amended and Restated
Credit Agreement and Other Agreements (the "Amendment No. 6"), is made by and
among XXXXXX X. XXXXXXX XX, an individual having an office at 000 Xxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000 (the "Lender" or "Xxxxxxx"), XXXXXX X.
XXXXXXX, the wife of Xxxxxxx, with an address of 000 Xxxx Xxxxx Xxxx, Xxxxxxxxx,
Xxx Xxxx 00000 ("Xxxxxx Xxxxxxx"), DELTA COMPUTEC INC., a New York corporation
having its principal place of business located at 000 Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxx Xxxxxx 00000 ("DCI"), DELTA DATA NET, INC., a New York corporation having
its principal place of business located at 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx
Xxxxxx 00000 ("DDI", DCI and DDI are referred to collectively as the
"Borrower"), and SAI/Delta, Inc., a Florida corporation and a wholly-owned
subsidiary of DCI.
W I T N E S S E T H
A. This Amendment No. 6 is intended to amend in certain respects as set
forth herein, the terms and conditions of a certain Amended and Restated Credit
Agreement and Other Agreements (the "October 1996 Credit Agreement", which term
refers to the original agreement issued on October 10, 1996, and as amended by
Amendments Nos. 1, 2, 3, 4 and 5 thereto, as described below) between the
Borrower and Xxxxxxx and Xxxxxx Xxxxxxx whereby Xxxxxxx and Xxxxxx Xxxxxxx have
agreed to provide the Borrower with Loans (as defined in the October 1996 Credit
Agreement) up to $2,950,000.
B. Pursuant to a document entitled Amended No. 1 to Amended and
Restated Credit Agreement and Other Agreements ("Amendment No. 1"), the interest
rate relative to the Xxxxxxx Commitment, the Additional Advances and the October
1996 Credit Agreement was reduced.
C. Pursuant to a document entitled Amended No. 2 to Amended and
Restated Credit Agreement and Other Agreements ("Amendment No. 2"), among other
matters dealt with therein, the Maturity Date of the October 1996 Credit
Agreement was extended to March 31, 1997, and certain other amendments or
waivers were made with regard to any non-compliance which may have existed with
the Borrowing Base (as defined in the October 1996 Credit Agreement.
D. Pursuant to a document entitled Amended No. 3 to Amended and
Restated Credit Agreement and Other Agreements ("Amendment No. 3"), Xxxxxxx
transferred to Xxxxxx Xxxxxxx half of Xxxxxxx'x rights, benefits, obligations
and interest with regard to: (i) an 8% Subordinated Debenture issued in October
1992 in the original face amount of $600,001; (ii) May, 1995 Letter Agreement
whereby Xxxxxxx agreed to provide the Xxxxxxx Commitment to the Borrower in the
original amount of $400,000; (iii) 1996 Additional Xxxxxxx Advances for the
period from July 25, 1996 through October 9, 1996 in the aggregate amount of
$633,600; (iv) Loan and the October 1996 Credit Agreement in an amount of up to
$2,550,000; and (v) the Overbase Loans and the Overbase Loan Documents for the
amounts in whereby the Loans exceed the Borrowing Base as set forth in the
October 1996 Credit Agreement.
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E. Pursuant to a document entitled Amendment No. 4 to Amended and
Restated Credit Agreement and Other Agreements ("Amendment No. 4"), among other
matters dealt with therein, the Maturity Date of the October 1996 Credit
Agreement was extended to April 30, 1997, and certain other amendments or
waivers were made with regard to any non-compliance which may have existed with
the Borrowing Base (as defined in the October 1996 Credit Agreement).
F. Pursuant to a document entitled Amendment No. 5 to Amended and
Restated Credit Agreement and Other Agreements ("Amendment No. 5"), among other
matters dealt with therein, the Maturity Date of the October 1996 Credit
Agreement was extended to June 30, 1998, and certain other amendments or waivers
were made with regard to any non-compliance which may have existed with the
Borrowing Base (as defined in the October 1996 Credit Agreement.
NOW, THEREFORE, it is agreed as follows:
1. Incorporation of Recitals. The recitals set forth in the
recital paragraphs of this Amendment No. 6 are intended to be, and are,
incorporated into this Amendment No. 6 as a part hereof.
2. Amendment to Loan and October 1996 Credit Agreement.
(a) The parties hereto agree that, from and after the
date of this Amendment No. 6, Section 2.1 of the October 1996 Credit Agreement
is deleted in its entirety, and the following Section 2.1 is substituted in its
place and stead:
"2.1 Borrowing Base. As long as neither DCI
nor DDI are in default of any of their obligations to the Lender, the Lender may
lend to the Borrower, and the Borrower may borrow from the Lender, from time to
time, up to an aggregate outstanding principal amount at any time of $2,950,000,
or such lesser amount which is, with regard to Eligible Receivables which were
outstanding as of June 6, 1997 ("Pre-June 7 Eligible Receivables"), 130%, and,
with regard to Eligible Receivables which are created from and after June 7,
1997 ("Post-June 6 Eligible Receivables"), 100% of DCI's, DDI's and SAI/Delta's
Eligible Receivables. Borrower shall prepare and forward to Lender a report of
the Pre-June 7 Eligible Receivables and the Post-June 6 Eligible Receivables
within 3 business days of the 15th day and the last day of every calendar
month."
(b) Schedule 2.1 of the October 1996 Credit Agreement is
hereby revised by adding eligibility factors for Eligible Receivables (as that
term is defined in the October 1996 Credit Agreement) for the Pre-June 7
Eligible Receivables, as follows: "130%", and for "Post-June 6 Eligible
Receivables, as follows: "100%".
(c) A new Section 2.4(c) is added to the Credit Agreement as
follows:
"(c) In the event that, without maturity,
whether by acceleration or otherwise, the Borrower ever requests that the Lender
provide, and the Lender actually provides, Loans in excess of the Borrowing Base
as defined in Section 2.1 (such excess loans being defined as "Excess Borrowing
Base Loans", then, with regard to those Excess Borrowing Base Loans, the
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Borrower agrees to pay interest on the outstanding principal amounts of those
Excess Borrowing Base Loans at the rate of five percent (5%) per annum above the
Prime Rate. All Excess Borrowing Base Loans are a part of the definition of
"Loans" as set forth in Section 1. The provisions of this Section 2.4(c) shall
not diminish or revise the provisions of Section 2.4 (providing for the payment
of interest on the outstanding principal amount of Loans both prior to maturity
(at one and three quarters of one percent [1 and 3/4% prior to maturity) and
after maturity (at three and three quarters percent [3 and 3.4%] after maturity)
by acceleration or otherwise."
3. Termination of May 1, 1995, Letter Agreement.
(a) As of May 1, 1995, Borrower, and DCI's subsidiary DDI
SAI/Delta, Inc. ("SAI/Delta", and together with Borrower, "Delta"), entered into
a letter agreement (the "Overadvance Letter Agreement") with National Canada
Finance Corp. ("NCFC"), then the Borrower's commercial lender, to provide for an
overadvance facility which permitted the Borrower to borrow up to an additional
$700,000 over the amount which would otherwise have been permitted by the
Borrower to borrow from NCFC under the then existing Credit Agreement between
the Borrower and NCFC. The overadvance facility whereby the Borrower was
permitted to exceed its borrowing base is referred to as the "Overadvance
Facility". Of the Overadvance Facility, the Overadvance Letter Agreement
provided that $400,000 would be advanced to the Borrower by Xxxxxxx prior to the
time that any funds were advanced by NCFC.
(b) As of October 10, 1996, Delta, Xxxxxxx and NCFC entered
into a series of agreements (collectively the "NCFC Restructuring") whereby,
among other matters, Xxxxxxx acquired from NCFC a portion of its various credit
facilities provided to Borrower, including, but not limited to, the then
outstanding portion of the Overadvance Facility then provided by NCFC to the
Borrower. As such, the NCFC portion of the Overadvance Facility was then
terminated.
(c) In 1997, Xxxxxxx transferred to his spouse, Xxxxxx X.
Xxxxxxx ("Xxxxxx Xxxxxxx"), half of his interest in the Overadvance Facility and
half of his interest in the Overadvance Letter Agreement, and Xxxxxxx and Xxxxxx
Xxxxxxx became the "Lender" under the October 1996 Credit Agreement.
(d) As of May 1, 1997, the Borrower repaid the Lender the
balance of the then outstanding portion of the Overadvance Facility then
provided by the Lender to the Borrower. As such, as of May 1, 1997, the
Overadvance Facility then provided by the Lender to the Borrower was terminated.
The Overadvance Letter Agreement is also acknowledged by the parties to this
Amendment No. 6 to be null and void and of no further force and effect.
4. Certain Waivers. Lender hereby waives any non-compliance
which may have existed with regard to the Borrowing Base for the period between
April 30, 1997, the date of Amendment No. 5, and June 9, 1997, the date of this
Amendment No. 6.
5. Reaffirmation of Terms. Except as amended by this
Amendment No. 6, and by the previous Amendments Nos. 1, 2, 3, 4 and 5, the terms
and conditions
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of the original October 1996 Credit Agreement are hereby reaffirmed in their
entirety.
IN WITNESS WHEREOF, the parties have caused this Amendment No. 6 to
be duly executed and delivered by individual signatories and by the proper and
duly authorized officers of the Borrower as of the date first above written.
/s/ Xxxxxx X. Xxxxxxx XX
Xxxxxx X. Xxxxxxx XX
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
DELTA COMPUTEC INC.
By: /s/ Xxxx XxXxxx
Xxxx XxXxxx, President
DELTA DATA NET, INC.
By: /s/ Xxxx XxXxxx
Xxxx XxXxxx, President
SAI/DELTA, INC.
By: __________________
Xxxx XxXxxx, President
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