EXHIBIT 10.11.2
SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT
This Second Amendment to Loan and Security Agreement ("Amendment") is
entered into as of August 20, 1996, by and between BankAmerica Business Credit,
Inc. (the "Lender") and Universal International, Inc. and Only Deals, Inc.
(collectively, the "Borrowers," and individually, the "Borrower").
RECITALS
This Amendment is entered into in reference to the following facts:
(a) The Borrowers and the Lender entered into a certain Loan and
Security Agreement (as amended, modified, and supplemented prior to the date
hereof, the "Loan Agreement"), dated as of November 21, 1995. All capitalized
terms, not expressly defined herein, shall have the meanings assigned thereto in
the Loan Agreement.
(b) The Borrowers desire to amend the Loan Agreement in certain
respects.
(c) The Lender is willing to amend the Loan Agreement subject to the
terms and conditions contained herein.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto hereby agree as follows:
ARTICLE 1 - AMENDMENTS
1.1 AMENDMENT OF "ELIGIBLE ACCOUNT". The definition of "Eligible Account"
is hereby amended by the addition of a new paragraph "(v)," to be inserted in
the Loan Agreement immediately after paragraph "(u)," which shall read in its
entirety as follows:
"(v) for any Account as to which any invoice included in the unpaid
balance thereof is for Ten Thousand Dollars ($10,000) or more, the
Borrowers have failed to deliver to the Lender copies of such invoices and
bills of lading and such other documents relating thereto as may be
requested by the Lender and more than five (5) Business Days have elapsed
since the date such Account was first included in the Availability of any
of the Borrowers."
1
1.2 AMENDMENT OF SECTION 7.5 Section 7.5 of the Loan Agreement is hereby
amended and restated to read in its entirety as follows:
"7.5 APPRAISALS. Whenever a Default or Event of Default exists, and
at such other times not more frequently than once a year, the Lender may,
at the Borrower's expense (which expense shall be limited to Twenty
Thousand Dollars ($20,000) if the appraisal is conducted in the absence of
a Default or Event of Default), prepare or cause to be prepared appraisals
or updates thereof in form satisfactory to the Lender of any or all of the
Collateral from an independent appraiser appointed by the Lender."
1.3 AMENDMENT OF SECTION 7.8. Section 7.8 of the Loan Agreement is hereby
amended and restated to read in its entirety as follows:
"7.8 COLLATERAL REPORTING. Each Borrower will provide the Lender with
the following documents at the following times in form satisfactory to the
Lender: (a) on a daily basis, a borrowing base certificate in the form of
EXHIBIT C hereto; (b) on at least a weekly basis, a schedule of accounts
created since the last such schedule; (c) on a daily basis, a schedule of
remittance advices, credit memos and reports, and a schedule of collections
of accounts receivable; (d) upon request, copies of invoices, credit memos,
shipping and delivery documents; (e) by the fifteenth day of each month
monthly agings of accounts receivable; (f) by Friday of each week, a weekly
warehouse perpetual inventory report for the preceding week listing the
type and quantity of all inventory located at all of Borrower's warehouses
and an aging of all such inventory setting forth the amount of time that
all such inventory has been owned by such Borrower (such report will
designate the book value of all retail Inventory and the Aged Percentage
thereof); (g) by Friday of each week, a weekly summary for the preceding
week of inventory held for retail sale on a location-by-location basis (but
Retail Inventory need not be designated on a location-by-location basis),
and in each case including a listing by product category of quantities of
all inventory owned by Borrower; (h) by the fifteenth day of each month,
monthly agings of accounts payable; (i) upon request, copies of purchase
orders, invoices, and delivery documents for Inventory and Equipment
acquired by such Borrower; (j) such other reports as to the Collateral as
the Lender shall request from time to time; and (k) certificates of an
officer of such Borrower certifying as to the foregoing; (l) on at least a
weekly basis, copies of all invoices for Ten Thousand Dollars ($10,000) or
more and all bills of lading and such other documents relating thereto the
Lender may request. If any of either Borrower's records
2
or reports of the Collateral are prepared by an accounting service or other
agent, such Borrower hereby authorizes such service or agent to deliver
such records, reports, and related documents to the Lender."
ARTICLE 2 - CONDITIONS PRECEDENT
The amendments to the Loan Agreement provided for in this Amendment shall
become effective upon satisfaction of all of the conditions precedent specified
in this Article 2.
2.1 DELIVERY OF DOCUMENTS. The Lender shall have received all of the
following documents, each duly executed where appropriate and dated the date of
execution thereof (or such other date as shall be acceptable to the Lender), in
form and substance satisfactory to the Lender: (a) this Amendment and (b) a
copy, certified by the secretary or an assistant secretary of the Borrowers, of
resolutions of the board of directors of the Borrowers authorized or ratifying
the execution and delivery of this Amendment and the borrowings under the Loan
Agreement, as amended hereby.
ARTICLE 3 - GENERAL PROVISIONS
3.1 WARRANTIES AND ABSENCE OF DEFAULTS. In order to induce the Lender to
enter into this Amendment, the Borrowers hereby warrant to the Lender, as of the
date of the execution of this Amendment by the Borrowers, that: (a) except to
the extent permitted by the Loan Agreement, as herein amended, the warranties of
the Borrowers contained in the Loan Agreement are true and correct as of such
date as if made on such date, and (b) no Event of Default or Default exists
which is continuing as of such date.
3.2 EXPENSES. The Borrowers agree to pay on demand all costs and expenses
of the Lender (including the reasonable fees and expenses of in-house counsel
for the Lender) in connection with the preparation, negotiation, execution, and
delivery of this Amendment and all other instruments or documents provided for
herein or delivered or to be delivered hereunder or in connection herewith.
3.3 GOVERNING LAW. This Amendment shall be a contract made under and
governed by the internal laws of the state of Illinois.
3.4 COUNTERPARTS. This Amendment may be executed in any number of
counterparts, and by the parties hereto on the same or separate counterparts,
and each such counterpart, when executed and delivered, shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same Amendment.
3
3.5 SUCCESSORS. This Amendment shall be binding upon the Borrowers, the
Lender, and their respective successors and assigns, and shall inure to the
benefit of the Lender and the successors and assigns of the Lender.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized and delivered as
of the date first written above.
"BORROWERS"
UNIVERSAL INTERNATIONAL, INC.
By
---------------------------
Name
--------------------------
Title
-------------------------
ONLY DEALS, INC.
By
---------------------------
Name
--------------------------
Title
-------------------------
"LENDER"
BANKAMERICA BUSINESS CREDIT, INC.
By
---------------------------
Name
--------------------------
Title
-------------------------
4
