Exhibit 10.1
WAIVER AND AMENDMENT NO. 1
TO
LOAN AND SECURITY AGREEMENT
THIS WAIVER AND AMENDMENT NO. 1 (this "Amendment") is entered into as of October
31, 2000, by and between XXXXX PRODUCTS CORPORATION ("Borrower") and XXXXX FARGO
BUSINESS CREDIT, INC., successor by assignment to Banc of America Commercial
Finance Corporation (formerly known as NationsCredit Commercial
Corporation)("Lender").
BACKGROUND
Borrower and Lender are parties to a Loan and Security Agreement dated as
of June 30, 1999 (as amended, restated, supplemented or otherwise modified from
time to time, the "Loan Agreement") pursuant to which Lender provides Borrower
with certain financial accommodations.
Borrower has requested that Lender waiver the violation of the Maximum
Cumulative Net Loss covenant contained in the Loan Agreement and Lender is
willing to do so on the terms and conditions hereafter set forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of credit
heretofore or hereafter made to or for the account of Borrower by Lender, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. All capitalized terms not otherwise defined herein shall
have the meanings given to them in the Loan Agreement.
2. Amendment to Loan Agreement. Subject to satisfaction of the conditions
precedent set forth in Section 4 below, Schedule A to the Loan Agreement is
hereby amended by amending Section 3 in its entirety to provide as follows:
3. Interest Rates:
(a) Revolving Loans: 2.75% per annum in excess of the Prime Rate
(b) Term Loan: 2.75% per annum in excess of the Prime Rate
3. Waiver. Subject to satisfaction of the conditions precedent set forth
in Section 4 below, Lender hereby waives the Event of Default which has occurred
or may occur as a result of the Maximum Cumulative Net Loss exceeding the
amounts permitted under the Loan Agreement but only to the extent that such
non-compliance occurred or occurs on or prior to November 30, 2000.
4. Conditions of Effectiveness. This Amendment shall become effective upon
satisfaction of the following conditions precedent: (i) Lender shall have
received this Amendment in form and substance
satisfactory to Lender executed by Borrower and (ii) Lender shall receive a fee
in the amount of $5,000 which shall be charged to Borrower loan account on the
date of this Amendment.
5. Appraisal. Borrower agrees that Lender will retain an independent
appraisal firm to prepare an appraisal of the Inventory and that Borrower will
pay all costs and expenses. Additionally, Lender reserves the right to complete
appraisals on the Borrower's Equipment and Real Property where Borrower will pay
all costs and expenses.
6. Representatives and Warranties. Borrower hereby represents and warrants
as follows:
(a)This Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of Borrower and are enforceable
against Borrower in accordance with their respective terms.
(b)Upon the effectiveness of this Amendment, Borrower hereby
reaffirms all covenants, representations and warranties made in the Loan
Agreement to the extent the same are not amended hereby and agree that all such
covenants, representations and warranties shall be deemed to have been remade as
of the effective date of this Amendment.
(c)No Event of Default or Default has occurred and is continuing or
would exist after giving effect to this Amendment.
(d)Borrower has no defense, counterclaim or offset with respect to
the Loan Agreement.
7. Effect on the Loan Agreement.
(a)Upon the effectiveness of Section 2 hereof, each reference in the
Loan Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of
like import shall mean and be a reference to the Loan Agreement as amended
hereby.
(b)Except as specifically amended herein, the Loan Agreement, and
all other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby
ratified and confirmed.
(c)The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided in Section 3, operate as a waiver of any
right, power or remedy of Lender, nor constitute a waiver of any provision of
the Loan Agreement, or any other documents, instruments or agreements executed
and/or delivered under or in connection therewith.
8. 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
New York.
9. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
10. Counterparts; Facsimile. This Amendment may be executed by the parties
hereto in one or more counterparts, each of which shall be deemed an original
and all of which when taken together shall constitute one and the same
agreement. Any signature delivered by a party by facsimile transmission shall be
deemed to be an original signature hereto.
IN WITNESS WHEREOF, this Amendment has been duly executed as of the day
and year first written above.
XXXXX PRODUCTS CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxx
Title: President and CEO
XXXXX FARGO BUSINESS CREDIT, INC.
By: /s/ Xxxx X. Xxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
