EXHIBIT 4.25
AMENDMENT NUMBER SEVEN TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
This Amendment Number Seven to Amended and Restated Loan and Security
Agreement ("Amendment") is entered into as of December 1, 1998 by and between
FOOTHILL CAPITAL CORPORATION, a California corporation ("Foothill"), and PORTA
SYSTEMS CORP., a Delaware corporation ("Borrower"), in light of the following:
FACT ONE: Borrower and Foothill have previously entered into that certain
Amended and Restated Loan and Security Agreement, dated as of November 28, 1994,
as amended as of February 13, 1995, March 30, 1995, March 12, 1996, August 26,
1997 and November 30, 1997 and August 1, 1998 (collectively, the "Agreement").
FACT TWO: Borrower and Foothill desire to further amend the Agreement as
provided for and on the conditions herein.
NOW, THEREFORE, Borrower and Foothill hereby amend the Agreement as
follows:
1. DEFINITIONS. All initially capitalized terms used in this Amendment
shall have the meanings given to them in the Agreement unless specifically
defined herein.
2. AMENDMENT.
A. The definition of the "Renewal Date" in Section 1.1 of the Agreement is
hereby amended to read as follows:
"'Renewal Date' means January 2, 2001."
B. Section 2.9 of the Agreement is hereby amended to read as follows:
"2.9 Loan Amortization. In addition to all other payments required
to be made by Borrower, Borrower shall make payments to Foothill in the
amount of $400,000 on the last day of each calendar quarter commencing on
December 31, 1998 and on the last day of each calendar quarter thereafter
during the term of the Agreement. In addition to the foregoing payments,
in the event that Borrower's "Adjusted Cash Flow Amount" for any of the
above-referenced calendar quarter exceeds the amount of the
above-referenced payment to be made in the last day of such calendar
quarter, Borrower shall pay Foothill fifty percent (50%) of such excess
amount by not later than 45 days after each such calendar quarter except
that such excess amount shall be paid by not later than 90 days after each
calendar quarter ending on December 31. For
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purposes hereof, the "Adjusted Cash Flow Amount" for each calendar quarter
shall be calculated in accordance with the following formula: operation
income plus depreciation plus amortization plus any other one time
accounting adjustments that are non-cash items minus all interest minus
all fees paid to Foothill and minus $625,000. Borrower shall deliver to
Foothill by no later than 45 days after each calendar quarter, a
certificate signed by Borrower's chief financial officer setting forth the
calculation of Borrower's Adjusted Cash Flow Amount for such calendar
quarter except that such certificate may be delivered to Foothill by not
later than 90 days after each calendar quarter ending on December 31."
C. Section 3.4 of the Agreement is hereby amended to read as follows:
"3.4 Term. This Agreement shall become effective upon the execution
and delivery hereof by Borrower and Foothill and shall continue in full
force and effect for a term ending January 2, 2001, and the maturity date
of the Term Note, the Deferred Funding Fee Note and the NEW Deferred Fee
Note shall also be January 2, 2001. The foregoing notwithstanding,
Foothill shall have the right to terminate its obligations under this
Agreement immediately and without notice upon the occurrence and during
the continuation of an Event of Default."
3. REPRESENTATIONS AND WARRANTIES. Borrower hereby affirms to Foothill
that all of Borrower's representation and warranties set forth in the Agreement
are true, complete and accurate in all respects as of the date hereof.
4. NO DEFAULTS. Borrower hereby affirms to Foothill that no Event of
Default has occurred and is continuing as of the date hereof.
5. CONDITION PRECEDENT. The effectiveness of this Amendment is expressly
conditioned upon receipt by Foothill of an executed copy of this Amendment.
6. COSTS AND EXPENSES. Borrower shall pay to Foothill all of Foothill's
out-of-pocket costs and expenses (including, without limitation, the fees and
expenses of its counsel, which counsel may include any local counsel deemed
necessary, search fees, filing and recording fees, documentation fees, appraisal
fees, travel expenses, and other fees) arising in connection with the
preparation, execution, and delivery of this Amendment and all related
documents.
7. LIMITED EFFECT. In the event of a conflict between the terms and
provisions of this Amendment and the terms and provisions of the Agreement, the
terms and provisions of this Amendment shall govern. In all other respects, the
Agreement, as amended and supplemented hereby, shall remain in full force and
effect.
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8. COUNTERPARTS; EFFECTIVENESS. This Amendment may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which when executed and delivered shall be deemed to be an original. All such
counterparts, taken together, shall constitute one and the same Amendment. This
Amendment shall become effective upon the execution of a counterpart of this
Amendment by each of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first set forth above.
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/ M. E. Xxxxxxx
---------------------------------
M. E. Xxxxxxx
Vice President
PORTA SYSTEMS CORP.,
a Delaware corporation
By: Xxxxxxx X. Xxxxxx
---------------------------------
Title: CEO
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Each of the undersigned affiliates of Porta Systems Corp. ("Porta") is
aware of the terms of the above Amendment Number Seven to the Amended and
Restated Loan and Security Agreement, dated as of December 1, 1998 (the "Loan
Agreement"), and acknowledges that all of such affiliate's obligations under any
of the Collateral Documents (as defined in the Assignment Agreement) are and
shall continue in full force and effect in favor of Foothill Capital Corporation
("Foothill"), including the obligations pursuant to the terms of such Collateral
Documents. "Assignment Agreement" shall have the meaning given to it on the Loan
Agreement.
ASTER CORPORATION
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
CPI HOLDING CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
CRITERION PLASTICS, INC.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
DISPLEX, INC.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
MIROR TELEPHONY SOFTWARE, INC.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
4
PORTA FOREIGN SALES CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
PORTA SYSTEMS EXPORT CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
PORTA SYSTEMS INTERNATIONAL CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
PORTA SYSTEMS LEASING CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
PORTA SYSTEMS OVERSEAS CORP.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
LERO INDUSTRIES LTD.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
5
PORTA SYSTEMS, LIMITED
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
XXXXXXXXXX BUSINESS SYSTEMS LTD.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
XXXXXXXXXX COMMUNICATIONS LTD.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
PORTA SYSTEMS S.A. de C.V.
By: Xxxxxxx X. Xxxxxx
-------------------------------
Name:
Title:
