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EXHIBIT 10.6
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[LOGO] BANK OF AMERICA
AMENDMENT TO DOCUMENTS
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THIRD AMENDMENT TO BUSINESS LOAN AGREEMENT
This Third Amendment to Business Loan Agreement is entered into as of October
15, 1998, between Bank of America Texas, N.A. ("Bank") and Xxxxxx Industries,
Inc. ("Borrower").
RECITALS
A. WHEREAS, Bank and Borrower have entered into that certain Business Loan
Agreement dated August 21, 1997, and amended on September 16, 1998 and September
25, 1998 (collectively the "Agreement"); and
B. WHEREAS, Borrower and Bank desire to amend certain terms and provisions of
said Agreement as more specifically hereinafter set forth.
AGREED
NOW, THEREFORE, in consideration of the foregoing recitals and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Bank and Borrower mutually agree to amend said Agreement as follows:
1. In Paragraph 1.5 (Letters of Credit) of the Agreement, the amount "Fifteen
Million and No/100 Dollars ($15,000,000.00)" is substituted for the amount
"Twenty Million and No/100 Dollars ($20,000,000.00)".
This Amendment will become effective as of the date first written above,
provided that each of the following conditions precedent have been satisfied in
a manner satisfactory to Bank:
The Bank has received from the Borrower a duly executed original of this
Amendment, together with a duly executed Guarantor Acknowledgment and
Consent in the form attached hereto (the "Consent").
Except as provided in this Amendment, all of the terms and provisions of the
Agreement and the documents executed in connection therewith shall remain in
full force and effect. All references in such other documents to the Agreement
shall hereafter be deemed to be references to the Agreement as amended hereby.
THIS WRITTEN AMENDMENT AND THE DOCUMENTS EXECUTED IN CONNECTION HEREWITH
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
IN WITNESS WHEREOF, this Amendment has been executed by the parties hereto as of
the date first written above.
BANK OF AMERICA TEXAS, X.X. XXXXXX INDUSTRIES, Inc.
By: /s/ XXXXXX XXXXXXXXX By: /s/ X.X. XXXXX
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Xxxxxx Xxxxxxxxx, Vice President X.X. Xxxxx, Vice President
AMEND. TX (7/96) 1
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[LOGO] BANK OF AMERICA
AMENDMENT TO DOCUMENTS
================================================================================
SECOND AMENDMENT TO BUSINESS LOAN AGREEMENT
This Second Amendment to Business Loan Agreement is entered into as of 25 SEPT,
1998, between Bank of America Texas, N.A. ("Bank") and Xxxxxx Industries, Inc.
("Borrower").
RECITALS
A. WHEREAS, Bank and Borrower have entered into that certain Business Loan
Agreement dated August 21, 1997, as amended by that First Amendment to Business
Loan Agreement dated as of September 16, 1998 (as amended, the "Agreement"); and
B. WHEREAS, Borrower and Bank desire to amend certain terms and provisions of
said Agreement as more specifically hereinafter set forth.
AGREED
NOW, THEREFORE, in consideration of the foregoing recitals and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Bank and Borrower mutually agree to amend said Agreement as follows:
1. The first paragraph of Section 2.5 of the Agreement is amended in its
entirety to read as follows:
2.5 LIBOR RATE. The Borrower may elect to have all or portions of the
principal balance of the Facility No. 2 Commitment bear interest at the
rate equal to the lesser of (a) the Maximum Rate or (b) the LIBOR Rate plus
the Applicable Margin then in affect, corresponding to the Funded Debt to
EBITDA Ratio then in effect, as specified below:
Funded Debt to EBITDA Ratio Applicable Margin
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Less than 1.00:1.00 0.75%
Greater than or equal to 1.00:1.00, but
less then 1.50:1.00 1.00%
Greater than or equal to 1.50:1.00 1.25%
This Amendment will become effective as of the date first written above,
provided that each of the following conditions precedent have been satisfied in
a manner satisfactory to Bank:
The Bank has received from the Borrower a duly executed original of this
Amendment, together with duly executed Guarantor Acknowledgments and
Consents In the form attached hereto (the "Consent").
Except as provided in this Amendment, all of the terms and provisions of the
Agreement and the documents executed in connection therewith shall remain in
full force and effect. All references in such other documents to the Agreement
shall hereafter be deemed to be references to the Agreement as amended hereby.
THIS WRITTEN AMENDMENT AND THE DOCUMENTS EXECUTED IN CONNECTION HEREWITH
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
IN WITNESS WHEREOF, this Amendment has been executed by the parties hereto as of
the date first written above.
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AMEND.TX (7/96)
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BANK OF AMERICA TEXAS, X.X. XXXXXX INDUSTRIES, Inc.
By: /s/ XXX XXXXXXXXX By: /s/ X.X. XXXXX
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Xxx Xxxxxxxxx, Vice President X.X. Xxxxx, Vice President
AMEND.TX (7/96) 2
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[LOGO] BANK OF AMERICA
AMENDMENT TO DOCUMENTS
================================================================================
FIRST AMENDMENT TO BUSINESS LOAN AGREEMENT
This First Amendment to Business Loan Agreement is entered into as 16 September,
1998, between Bank of America Texas, N.A. ("Bank") and Xxxxxx Industries, Inc.
("Borrower").
RECITALS
A. WHEREAS, Bank and Borrower have entered into that certain Business Loan
Agreement dated August 21, 1997 (the "Agreement"); and
B. WHEREAS, Borrower and Bank desire to amend certain terms and provisions of
said Agreement as more specifically hereinafter set forth.
AGREED
NOW, THEREFORE, in consideration of the foregoing recitals and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Bank and Borrower mutually agree to amend said Agreement as follows:
1. Paragraph 1 (LINE OF CREDIT AMOUNT AND TERMS) of the Agreement 14 amended
and restated in its entirety to read as follows:
1. FACILITY NO. 1: LINE OF CREDIT AMOUNT AND TERMS.
2. Paragraph 1.1 (Line of Credit Amount) of the Agreement is amended in its
entirety to read as follows:
1.1 LINE OF CREDIT AMOUNT. During the availability period described below,
the Bank will provide a line of credit to the Borrower. The amount of the
line of credit (the "Facility No. 1 Commitment") is Fifteen Million and
No/100 Dollars ($15,000,000.00).
This is a revolving line of credit with a within line facility for letters
of credit. During the availability period, the Borrower may repay principal
amounts and reborrow them.
Each advance must be for at least One Hundred Thousand and No/100 Dollars
($100,000.00), or for the amount of the remaining available line of credit,
if less.
The Borrower agrees not to permit the outstanding principal balance of the
line of credit plus the outstanding amounts of any letters of credit,
including amounts drawn on letters of credit and not yet reimbursed, to
exceed the Facility No. 1 Commitment.
3. The first Paragraph of Paragraph 1.3 (Interest Rate) of the Agreement is
amended and restated in its entirety to read as follows:
1.3 INTEREST RATE. Unless the Borrower elects an optional interest rate as
described below, the interest rate is the lesser of (a) the maximum lawful
rate of interest permitted under applicable usury laws, now or hereafter
enacted (the "Maximum Rate"), of (b) the rate (the "Basic Rate") that is
equal to the Bank's Reference Rate minus 1/2% for Basic Rate borrowings up
to Five Million and No/100 Dollars ($5,000,000.00) In the aggregate for
advances under the Facility No. 1 Commitment and the Facility No. 2
Commitment, and the Bank's Reference Rate for the portion of any Basic Rate
borrowings exceeding Five Million and No/100 Dollars ($5,000,000.00) in
the aggregate for advances under the Facility No. 1 Commitment and the
Facility No. 2 Commitment.
AMEND.TX (7/96) 1
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4. Sections 2 (FEES AND EXPENSES) through 8 (ENFORCING THIS AGREEMENT;
MISCELLANEOUS) are hereby renumbered as Sections 3 through 9 respectively.
5. A new Paragraph 2 (FACILITY NO. 2: TERM LOAN AMOUNT AND TERMS) is added to
the Agreement in its entirety to read as follows:
2. FACILITY NO. 2: TERM LOAN AMOUNT AND TERMS.
2.1 LOAN AMOUNT. The Bank agrees to provide a term loan to the Borrower in
the amount of Ten Million and No/100 Dollars ($10,000,000.00) (the
"Facility No. 2 Commitment").
The loan is available in one disbursement from the Bank between the date of
this Agreement and September 30, 1998 unless the Borrower is in default.
2.2 INTEREST RATE. Unless the Borrower elects an optional interest rate as
described below, the interest rate is the lesser of (a) (Maximum Rate), or
(b) the (Basic Rate).
Notwithstanding the foregoing, if at any time the Basic Rate shall exceed
the Maximum Rate and thereafter the Basic Rate shall become less then the
Maximum Rate, the Rate of interest payable shall be the Maximum Rate until
the Bank shall have received the amount of interest it otherwise would have
received if the interest payable had not been limited by the Maximum Rate
during the period of time the Basic Rate exceeded the Maximum Rate.
2.3 REPAYMENT TERMS.
(a) The Borrower will pay Interest on December 31, 1998 and on the last
day of each quarter thereafter until payment in full of any principal
outstanding under this term loan. (b) The Borrower will repay principal in
19 successive quarterly installments of Three Hundred Fifty Seven Thousand
One Hundred Forty Two and 86/100 Dollars ($357,142.86) each, starting
December 31, 1998, and in one final installment on September 30, 2003, in
the amount of the remaining principal balance plus all accrued unpaid
interest. (c) Subject to paragraph 2.5 (g) below, the Borrower may prepay
the loan in full or in part at any time. The prepayment will be applied to
the most remote installment of principal due under this Agreement
2.4 OPTIONAL INTEREST RATES. Instead of the interest rate based on the
Bank's Reference Rate, the Borrower may elect to have all or portions of
the Facility No. 2 Commitment (during the availability period) bear
interest at the rate(s) described below during an interest period agreed to
by the Bank and the Borrower; provided, however, that the Borrower shall
not have the option or right to elect to have all or any portion of the
loan bear interest at the rate(s) described in Section 2.5 below when such
rate(s) exceeds the Maximum Rate. Each interest rate is a rate per year.
Interest will be paid on the last day of the applicable interest period. At
the end of any interest period, the interest rate will revert to the rate
based on the Reference Rate, unless the Borrower has designated another
optional interest rate for the portion.
2.5 LIBOR RATE. The Borrower may elect to have all or portions of the
principal balance of the Facility No. 2 Commitment bear interest at the
rate equal to the lesser of (a) the Maximum Rate or (b) the LIBOR Rate plus
the Applicable Margin then in effect, as indicated below, corresponding to
the Funded Debt to EBITDA Ratio then in effect, as specified below (a
"Eurodollar Rate"):
Funded Debt to EBITDA Ratio Applicable Margin
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Less than or equal to 0.50:1.00 0.50%
Greater than 1.00:1.00 but
less than 1.50:1.00 1.00%
Greater than or equal to 1.50:1.00 1.25%
For purposes of determining the Applicable Margin in effect on any date,
the "Funded Debt to EBITDA Ratio" means the ratio of (i) the Borrower's
consolidated Funded Debt, to (ii) the Borrower's consolidated EBITDA,
AMEND.TX (7/96) 2
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as such ratio is defined and calculated in paragraph 7.5 of this Agreement.
(The sum of the LIBOR Rate plus the Applicable Margin is referred to herein
as the "Eurodollar Rate").
Borrower shall give Bank notice of its election of a Eurodollar Rate by
such time, and in such manner, as shall be acceptable to Bank. Each such
election shall be for an interest period of not less than one month or more
than 3 months. At the end of any Interest period, the interest rate will
revert to the Basic Rate unless the Borrower has elected another Eurodollar
Rate interest period.
Designation of a Eurodollar Rate portion is subject to the following
requirements:
(a) The interest period during which the Eurodollar Rate will be in
effect will be 30, 60 or 90 days. The last day of the interest period
will be determined by the Bank using the practices of the London
inter-bank market.
(b) Each Eurodollar Rate portion will be for an amount not less than Five
Hundred Thousand Dollars ($500,000).
(c) The Borrower shall irrevocably request a Eurodollar Rate portion no
later than 11:00 a.m. Houston time three (3) banking days before the
commencement of the interest period.
(d) The "LIBOR Rate" means the interest rate determined by the following
formula, rounded upward to the nearest 1/100 of one percent. (All
amounts in the calculation will be determined by the Bank as of the
first day of the interest period.)
LIBOR Rate = London Rate
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(1.00 - Reserve Percentage)
Where,
(i) "London Rate" means the interest rate (rounded upward to the
nearest 1/16th of one percent) at which the London Branch,
London, Great Britain, of Bank of America National Trust and
Savings Association, would offer U.S. dollar deposits for the
applicable interest period to other major banks in the London
inter-bank market at approximately 11:00 a.m. London time two
(2) Banking Days prior to the commencement of the interest
period.
(ii) "Reserve Percentage" means the total of the maximum reserve
percentages for determining the reserves to be maintained by
member banks of the Federal Reserve System for Eurocurrency
Liabilities, as defined in Federal Reserve Board Regulation D,
rounded upward to the nearest 1/100 of one percent. The
percentage will be expressed as a decimal, and will include,
but not be limited to, marginal, emergency, supplemental,
special, and other reserve percentages.
(e) The Borrower may not elect an Eurodollar Rate with respect to any
portion of the principal balance of the line of credit which is
scheduled to be repaid before the last day of the applicable interest
period.
(f) Any portion of the principal balance of the line of credit already
bearing interest at the Eurodollar Rate will not be converted to a
different rate during its interest period.
(g) Each prepayment of an Eurodollar Rate portion will be accompanied by
the amount of accrued interest on the amount prepaid; and a
prepayment fee equal to the amount (if any) by which:
(i) the additional interest which would have been payable on the
amount prepaid had it not been paid until the last day of the
interest period, exceeds
(ii) the interest which would have been recoverable by the Bank by
placing the amount prepaid on deposit in the offshore dollar
market for a period starting on the date on which it was
prepaid and ending on the last day of the interest period for
such portion.
(h) The Bank will have no obligation to accept an election for a
Eurodollar Rate portion if any of the following described events has
occurred and is continuing:
(i) Dollar deposits in the principal amount and for periods equal
to the interest period, of a
AMEND.TX (7/96) 3
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Eurodollar Rate portion are not available in the London
inter-bank markets; or
(ii) the Eurodollar Rate does not accurately reflect the cost of an
Eurodollar Rate portion.
(i) If at any time during any applicable interest period the Eurodollar
Rate shall exceed the Maximum Rate and thereafter the Eurodollar Rate
shall become less than the Maximum Rate, the rate of interest payable
shall be the Maximum Rate until the Bank shall have received the
amount of interest it otherwise would have received if the interest
payable had not been limited by the Maximum Rate during the period of
time the Eurodollar Rate exceeded the Maximum Rate.
6. A new Paragraph 6(i) (REPRESENTATIONS AND WARRANTIES) is added to the
Agreement in its entirety to read as follows:
(i) Borrower represents and warrants that it has instituted, and is
in the process of implementing, a plan ("Year 2000 Plan") for
addressing the "Year 2000 issue" (that is, the inability of
computers, as well as embedded microchips in non-computing devices,
to perform properly date-sensitive functions with respect to certain
dates prior to and after December 31, 1999). Borrower reasonably
believes that under its Year 2000 Plan, Borrower's systems and
equipment will be year 2000 compliant (that is, the ability to
perform property date-sensitive functions with respect to certain
dates prior to and after December 31, 1999) provided, however:
BORROWER DOES NOT WARRANT AND EXPRESSLY DISCLAIMS ANY WARRANTY
THAT ITS YEAR 2000 PLAN WILL RESULT IN YEAR 2000 COMPLIANCE BY
BORROWER, OR ANY OF ITS SUPPLIERS, VENDORS OR CUSTOMERS.
The Borrower represents that it will take such actions with respect
to its operations and properties as may be reasonably necessary to
properly address any adverse impacts of the year 2000 problem on its
operations, properties, and prospects, or ability to repay the
Borrowers obligations to the Bank.
7. Paragraph 7.1 (Use of Proceeds) of the Agreement is amended and restated in
its entirety to read as follows:
7.1 USE OF PROCEEDS. To use the proceeds of the credit only for the
following:
FACILITY NO. 1: working capital, letters of credit and other general
corporate purposes.
FACILITY NO. 2: repaying the principal outstanding balance on the
existing revolving line of credit, previously incurred capital
expenditures, and other corporate purposes.
8. The second Paragraph of Paragraph 7.5 (Funded Debt to EBITDA Ratio) of the
Agreement is amended and restated in its entirety to read as follows:
"EBITDA" means the sum of net income before taxes, plus interest expense,
depreciation and amortization, less taxes paid, excluding non-recurring
charges taken in the Borrower's third (3rd) fiscal quarter of 1998 not to
exceed Eight Million and No/100 Dollars ($8,000,000.00).
9. In Paragraph 7.6 (d) (Other Debts) of the Agreement, the amount "Five
Million and No/100 Dollars ($5,000,000.00)" is substituted for the amount
"Ten Million and No/100 Dollars ($10,00,000.00)".
10. A new Paragraph 7.18 (Fixed Charge Coverage Ratio) is added to the
Agreement in its entirety to read as follows:
7.18 FIXED CHARGE COVERAGE RATIO. To maintain on a consolidated basis a
Fixed Charge Coverage Ratio of at least 1.25:1.0.
"FIXED CHARGE COVERAGE RATIO" means the ratio of EBITDA to the sum of
interest expense, dividends paid, capital expenditures and the current
portion of long-term debt.
For the definition of EBITDA, refer to Paragraph 7.5 of this Agreement.
AMEND.TX (7/96) 4
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This ratio will be calculated at the end of each fiscal quarter, using the
results of that quarter and each of the 3 immediately preceding quarters.
The current portion of long term debt will be measured as of the last day
of the preceding fiscal quarter.
This Amendment will become effective as of the date first written above,
provided that each of the following conditions precedent have been satisfied in
a manner satisfactory to Bank:
The Bank has received from the Borrower a duly executed original of this
Amendment, together with a duly executed Guarantor Acknowledgments and
Consents in the form attached hereto (the "Consent").
The Bank has received from the Borrower a Corporate Resolution authorizing
loans in the aggregate amount of Twenty Five Million and No/100 Dollars
($25,000,000.00).
The Bank has received from the Borrower a duly executed original Corporate
Resolution Authorizing Execution of Guaranty signed by the authorized
officers of Xxxxxx Electrical Manufacturing Company, Delta-Unibus Corp.,
Unibus, Inc., Xxxxxx-XXXX Company and Transdyn Controls, Inc. each in the
aggregate amount of Twenty Five Million and No/100 Dollars
($25,000,000.00).
The Bank has received guaranties signed by Xxxxxx Electrical Manufacturing
Company, Delta-Unibus Corp., Unibus, Inc., Xxxxxx-XXXX Company and Transdyn
Controls, Inc. each in the amount of Twenty Five Million and No/100 Dollars
($25,000,000.00).
The Bank has received from the Borrower a duly executed Compliance
Certificate.
Except as provided in this Amendment, all of the terms and provisions of the
Agreement and the documents executed in connection therewith shall remain in
full force and effect. All references in such other documents to the Agreement
shall hereafter be deemed to be references to the Agreement as amended hereby.
THIS WRITTEN AMENDMENT AND THE DOCUMENTS EXECUTED IN CONNECTION HEREWITH
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
IN WITNESS WHEREOF, this Amendment has been executed by the parties hereto as of
the date first written above.
BANK OF AMERICA TEXAS, X.X. XXXXXX INDUSTRIES, INC.
By: /s/ XXX XXXXXXXXX By: /s/ X.X. XXXXX
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Xxx Xxxxxxxxx, Vice President X.X. Xxxxx, Vice President
AMEND.TX (7/96) 5
