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EXHIBIT 10.67
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment")
is made and entered into this 16th day of April, 1996, by and between XXXXX
MICROCOMPUTER PRODUCTS, INC., a Georgia corporation (hereinafter referred to as
"Borrower") with its chief executive office and principal place of business at
0000 Xxxxxxxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxx 00000, and THE CIT GROUP/CREDIT
FINANCE, INC., a Delaware corporation (hereinafter, together with its
successors and assigns, referred to as "Lender") with an office at 000 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
RECITALS:
Lender and Borrower are parties to a certain Loan and Security
Agreement and a certain Conditions Precedent Rider thereto, both dated December
21, 1995 (collectively, as at any time amended, the "Loan Agreement") pursuant
to which Lender may make revolving credit and term loans to Borrower in
accordance with the terms thereof.
The parties desire to amend the Loan Agreement as hereinafter set
forth.
NOW, THEREFORE, for and in consideration of TEN DOLLARS ($10.00) in
hand paid and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, agree as follows:
1. DEFINITIONS. All capitalized terms used in this Amendment,
unless otherwise defined herein, shall have the meanings ascribed to such terms
in the Loan Agreement.
2. AMENDMENT TO AGREEMENT. The Loan Agreement is hereby amended
as follows:
(a) By inserting after the word "Inventory" in the third
line of Section 2.1(h) the phrase", which is located at a location
owned by Borrower or leased by Borrower from a landlord who has
executed in favor of Lender a landlord's waiver agreement in form and
substance satisfactory to Lender and with respect to which Lender has
received assurances from counsel as to due execution and
enforceability of such waiver"
(b) By deleting from the fifth line of Section 2.2(a)
the reference to "$2,608,000," and by substituting in lieu thereof a
reference to "$2,027,000";
(c) By inserting after the word "Lender" in the third
line of Section 6.16 the phrase "and the Bringdown Certificate dated
March 29, 1996, from Borrower to Lender,";
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(d) By deleting Section 6.12(iv) in its entirety;
(e) By deleting from the first and second lines of
Section 6.22 the phrase "Within 60 days after the date hereof," and by
substituting in lieu thereof the phrase "On or before the close of
business on May 31, 1996,";
(f) By adding immediately after Section 6 the following
new Section 6A:
Section 6A. Additional Covenants
6A.1 Additional Covenants. Borrower covenants
that, unless otherwise consented to by Lender in writing, it
shall:
(a) On or before the close of business
on May 15, 1996, execute and deliver, or cause to be
executed or delivered, to Lender all Intellectual
Property Documents granting or perfecting security
interests in favor of Lender in patents, trademarks
and copyrights of Borrower or any Subsidiary that
are registered in countries other than the United
States, Canada or England;
(b) On or before the close of business
on May 15, 1996, execute and deliver, or cause to be
executed and delivered, to Lender all Foreign
Perfection Filings with respect to all of the
Collateral and other property subject to the foreign
Subsidiary Security Agreements (the "Subsidiary
Collateral"), except Collateral in the Subsidiary
Collateral located in Denmark, France or Mexico; and
(c) On or before the close of business
on April 30, 1996, deliver to Lender favorable
written opinions of foreign counsel to each of the
foreign Subsidiaries that each of the foreign
Subsidiaries has all requisite power and authority
to execute and deliver each of the Transaction
Documents to be signed by it and has duly executed
and delivered the Transaction Documents through duly
authorized officers, and that the Transaction
Documents create legal, valid and binding
obligations of the signatories thereto that are
enforceable in accordance with their respective
terms, and such written opinions shall otherwise be
in form, content and scope satisfactory to Lender.
(g) By deleting Section 7.1(c)(i) in its entirety and by
substituting the following in lieu thereof:
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(i) any covenant contained in Sections 5.1,
5.7, 5.9, 5.10, 6.4, 6.6, 6.7, 6.12, 6.14 and 6A; or
(h) By deleting from Section 9.2(i)(B) the reference to
"Northern Telecom Inc." and by substituting therefor "Rinzai Limited";
(i) By changing the word "seond" in clause (c) of
Section 9.2(i)(B) relating to the time of termination of the Loan
Agreement to "second";
(j) By deleting Section 10.1(a) in its entirety and
substituting the following in lieu thereof:
(a) Maximum Credit: $70,000,000, except as
otherwise provided in this paragraph (a). Borrower
acknowledges and understands that the conditions precedent
set forth in Section 2(z) of the Conditions Precedent Rider
dated December 21, 1995, as amended, has not been satisfied
because Key Bank of New York ("Key Bank"), one of the
required participants, has declined to purchase a
participation in the Revolving Loans, Term Loans and
Accommodations (the "Loans). By reason of Key Bank's
declination to purchase such a participation, Lender has no
obligation to proceed with funding. Nevertheless, Lender has
agreed to waive the satisfaction of that condition, provided
that, unless and until Lender sells an additional
participation to a new participant satisfactory in all
respects to Lender in a maximum amount of $5,500,000, the
principal amount of the Obligations outstanding at any time
shall not exceed $64,500,000. Lender shall have no obligation
whatsoever to solicit the purchase of any such participation
and shall have no liability to Borrower for any failure to
procure or delay in procuring a participant to replace Key
Bank.
(k) By deleting Sections 10.2(a) and 10.2(b) in its
entirety and by substituting in lieu thereof the following:
10.2 Term Loans:
(a) Term Loan A
Amount: $2,027,000
Final Maturity Date: the earlier of (i) April 1, 2002, or
(ii) the date of termination under
Sections 9.1 or 9.2
(b) Term Loan B
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Amount: $7,500,000
Final Maturity Date: the earlier of (i) April 1,
2002, or (ii) the date of
termination under Sections
9.1 or 9.2
(l) By deleting the telecopier number for Borrower in
Section 10.6(b) and by inserting in lieu thereof the telecopier number
"(000) 000-0000";
(m) By adding immediately above the phrase "Tour Neptune
Cedex 20" in Section 10.6(d)(1) the name "Xxxxx Microcomputer Products
(France) S.A.R.L."
(n) By deleting from 10.6(d)(2) the following:
Comptronix Corporation
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
China National Postal and Telecommunications
Appliances Corporation (Service Center)
40 Xxx Xxxx Xxxx
Xxxxxxx, Xxxxx 000000
AEI Dateline Logistics, Limited (Warehouse)
Xxxx 0, Xxxxxxxxx Xxxx
Xxxxxxxxx, XX00 0XX Xxxxxxx
(o) By adding immediately after 10.6(d)(2) the following:
(3) Service Centers:
40 Xxx Xxxx Xxxx
Xxxxxxx, Xxxxx 000000
(4) Warehouse maintained by warehouseman:
AEI Dateline Logistics, Limited (Warehouse)
Xxxx 0, Xxxxxxxxx Xxxx
Xxxxxxxxx, XX00 0XX
Xxxxxxx
(p) By deleting the parenthetical phrase in clause (iv)
of the definition of "Properly Contested" in Schedule A to the Loan
Agreement and by substituting therefor
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the phrase "(other than a lien for property taxes having priority
under applicable state xxx)".
0. CONSENT TO SCALEABLE TRANSACTION. Borrower has informed
Lender that Borrower and Borrower's subsidiary, Xxxxx Microcomputer Products
(Canada) Limited ("Xxxxx-Canada"), a Canadian corporation, intend to enter into
an Asset Purchase Agreement (the "Purchase Agreement"), a draft of which is
attached hereto as Exhibit A. Pursuant to the terms of the Purchase Agreement,
Scaleable Software Solutions, Inc., an Ontario corporation ("Scaleable"), will
purchase U.S. Assets and Canada Assets (as such terms are defined in the
Purchase Agreement) from Borrower and Xxxxx-Canada, respectively. Borrower has
further informed Lender that in consideration of the U.S. Assets and the Canada
Assets, Scaleable will transfer to Borrower thirty thousand (30,000) shares of
common stock of Scaleable (the "Purchased Shares"). The consummation of the
transactions contemplated by the Purchase Agreement (the "Transactions")
requires the prior written consent of Lender under the Loan Agreement and that
certain General Security Agreement, dated the date hereof, between Xxxxx-Canada
and Lender (the "Xxxxx-Canada Security Agreement"). Lender hereby consents to
the Transactions and agrees that the Transactions shall not constitute an Event
of Default under the Loan Agreement or an Event of Default under (and as
defined in) the Xxxxx-Canada Security Agreement, provided that each of the
following conditions is promptly satisfied following consummation of the
Transactions:
(a) Borrower delivers to Lender a copy of the Asset
Purchase Agreement and all amendments thereto, certified by a duly
authorized officer of Borrower;
(b) As security for the payment and performance of all
of the Obligations, Borrower pledges to Lender all of the Purchase
Shares pursuant to a Stock Pledge Agreement substantially in the form
of Exhibit B attached hereto;
(c) Borrower executes and delivers an Irrevocable Stock
Power substantially in the form of Exhibit C attached hereto;
(d) Borrower delivers to Lender the original stock
certificates evidencing the Purchased Shares;
(e) No Event of Default exists under the Loan Agreement;
(f) Lender receives evidence satisfactory to it that the
Transactions will not (i) violate any provisions of the Articles of
Incorporation or by-laws of Borrower or the Xxxxx-Canada (ii) result
in or constitute a default under any agreement or instrument to which
Borrower or Xxxxx-Canada is a party or any of its properties is bound
(iii) violate any provision of judicial or administrative law, rule or
regulation, or any judgment, decree or determination by which Borrower
or Xxxxx-Canada or any of its property is bound; or (iv) cause, result
in or require the creation or imposition in favor of anyone
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of any lien upon or security interest in any property now or hereafter
acquired by Borrower or Xxxxx-Canada; and
(g) Lender receives such other documents, instruments
and agreement that it may reasonable request in connection with the
Transactions.
4. RATIFICATION AND REAFFIRMATION. Borrower hereby ratifies and
reaffirms each of the Transaction Documents as modified by the Bringdown
Certificate executed by the President of Borrower, Xxxxxx X. Xxxxx, and dated
the date hereof (the "Bringdown Certificate"), and all of Borrower's covenants,
duties and liabilities thereunder.
5. ACKNOWLEDGEMENTS AND STIPULATIONS. Borrower acknowledges and
stipulates that the Loan Agreement and the other Transaction Documents executed
by Borrower are legal, valid and binding obligations of Borrower that are
enforceable against Borrower in accordance with the terms thereof; all of the
Obligations are owing and payable without defense, offset or counterclaim (and
to the extent there exists any such defense, offset or counterclaim on the date
hereof, the same is hereby waived by Borrower); and the security interests and
liens granted by Borrower in favor of Lender are duly perfected, first priority
security interests and liens.
6. REPRESENTATIONS AND WARRANTIES. Borrower represents and
warrants to Lender, to induce Lender to enter into this Amendment, that no
Event of Default exists on the date hereof; the execution, delivery and
performance of this Amendment have been duly authorized by all requisite
corporate action on the part of Borrower and this Amendment has been duly
executed and delivered by Borrower; and except as may have been disclosed in
writing by Borrower to Lender prior to the date hereof or in the Bringdown
Certificate, all of the representations and warranties made by Borrower in the
Loan Agreement are true and correct on and as of the date hereof.
7. EXPENSES OF LENDER. Borrower agrees to pay, ON DEMAND, all
costs and expenses incurred by Lender in connection with the preparation,
negotiation and execution of this Amendment and any other Transaction Documents
executed pursuant hereto and any and all amendments, modifications, and
supplements thereto, including, without limitation, the costs and fees of
Lender's legal counsel and any taxes or expenses associated with or incurred in
connection with any instrument or agreement referred to herein or contemplated
hereby.
8. GOVERNING LAW. This Amendment shall be governed by and
construed in accordance with the internal laws of the State of Georgia.
9. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns.
10. NO NOVATION, ETC.. Except as otherwise expressly provided in
this Amendment, nothing herein shall be deemed to amend or modify any provision
of the Loan Agreement, the Subsidiary Security Agreements, or any of the other
Transaction Documents, each of which shall
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remain in full force and effect. This Amendment is not intended to be, nor
shall it be construed to create, a novation or accord and satisfaction, and the
Loan Agreement as herein modified shall continue in full force and effect.
Notwithstanding any prior mutual temporary disregard of any of the terms of any
of the Transaction Documents, the parties agree that the terms of each of the
Transaction Documents shall be strictly adhered to on and after the date
hereof.
11. COUNTERPARTS; TELECOPIED SIGNATURES. This Amendment may be
executed in any number of counterparts and by different parties to this
Agreement on separate counterparts, each of which, when so executed, shall be
deemed an original, but all such counterparts 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.
12. RELEASE OF CLAIMS. TO INDUCE LENDER TO ENTER INTO THIS
AMENDMENT, BORROWER HEREBY RELEASES, ACQUITS AND FOREVER DISCHARGES LENDER, AND
ALL OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS OF LENDER,
FROM ANY AND ALL LIABILITIES, CLAIMS, DEMANDS, ACTIONS OR CAUSES OR ACTIONS OF
ANY KIND OR NATURE (IF THERE BE ANY), WHETHER ABSOLUTE OR CONTINGENT, DISPUTED
OR UNDISPUTED, AT LAW OR IN EQUITY, OR KNOWN OR UNKNOWN, THAT BORROWER NOW HAS
OR EVER HAD AGAINST LENDER ARISING UNDER OR IN CONNECTION WITH ANY OF THE
TRANSACTION DOCUMENTS OR OTHERWISE.
13. WAIVER OF JURY TRIAL. THE PARTIES HERETO EACH HEREBY WAIVES
THE RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, COUNTERCLAIM OR PROCEEDING
ARISING OUT OF OR RELATED TO THIS AMENDMENT.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed under seal in Atlanta, Georgia, and delivered by their
respective duly authorized officers on the date first written above.
ATTEST: XXXXX MICROCOMPUTER PRODUCTS,
INC. ("Borrower")
By:/s/ Xxxxxx X. Xxxxx
----------------------------- ----------------------------
Secretary XXXXXX X. XXXXX, President
[CORPORATE SEAL]
Accepted and Agreed to:
THE CIT GROUP/CREDIT FINANCE,
INC. ("Lender")
By:/s/
----------------------------
Title: Vice President
-------------------------
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CONSENT AND REAFFIRMATION
The undersigned guarantors of the Obligations of Borrower at any time
owing to Lender hereby (i) acknowledge receipt of a copy of the foregoing First
Amendment to Loan and Security Agreement; (ii) consent to Borrower's execution
and delivery thereof and of the other documents, instruments or agreements
Borrower agrees to execute and deliver pursuant thereto; (iii) agree to be
bound thereby; and (iv) affirm that nothing contained therein shall modify in
any respect whatsoever its respective guaranty of the Obligations and reaffirm
that such guaranty is and shall remain in full force and effect.
IN WITNESS WHEREOF, the undersigned has executed this Consent and
Reaffirmation on and as of the date of such First Amendment to Loan and
Security Agreement.
XXXXX MICROCOMPUTER PRODUCTS
(AUSTRALIA) PTY LIMITED
By: /s/ Xxxxxx X. Xxxxx
---------------------------
XXXXXX X. XXXXX, Director
XXXXX MICROCOMPUTER PRODUCTS
(CANADA) LIMITED
By: /s/ Xxxxxx X. Xxxxx
---------------------------
XXXXXX X. XXXXX, President
PRACTICAL PERIPHERALS (EUROPE)
LIMITED
By: /s/ Xxxxxx X. Xxxxx
---------------------------
XXXXXX X. XXXXX, Director
[Signatures continued on following page]
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XXXXX MICROCOMPUTER PRODUCTS
(FRANCE) S.A.R.L.
By: /s/ Xxxxxx X. Xxxxx
------------------------------
XXXXXX X. XXXXX,
Authorized Representative
XXXXX MICROCOMPUTER PRODUCTS
DE MEXICO S.A. DE C.V.
By: /s/ Xxxxxx X. Xxxxx
------------------------------
XXXXXX X. XXXXX, Sole
Administrator
XXXXX MICROCOMPUTER PRODUCTS
(SCANDINAVIA) APS
By: /s/ Xxxxxx X. Xxxxx
------------------------------
XXXXXX X. XXXXX, Managing
Director
By: /s/ Xxxxxxx Xxxxx Xxxxxx
------------------------------
XXXXXXX XXXXX XXXXXX,
Managing Director
XXXXX MICROCOMPUTER PRODUCTS
(INTERNATIONAL) LIMITED
By: /s/ Xxxxxx X. Xxxxx
------------------------------
XXXXXX X. XXXXX, President
[Signatures continued on following page]
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ENTERPRISE TECHNOLOGIES, INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------
XXXX X. XXXXXX, President
XXXXX GOVERNMENT SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxx
-----------------------------
XXXXXX X. XXXXX, President
/s/ Xxxxxx X. Xxxxx (SEAL)
-----------------------------
XXXXXX X. XXXXX
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XXXXX MICROCOMPUTER PRODUCTS, INC.
SECRETARY'S CERTIFICATE
OF
BOARD OF DIRECTORS RESOLUTIONS
I, Xxxxx X. Xxxxx, DO HEREBY CERTIFY, that I am the Secretary of XXXXX
MICROCOMPUTER PRODUCTS, INC. (the "Corporation"), a corporation duly organized
and existing under and by virtue of the laws of the State of Georgia and am
keeper of the records and seal thereof; that the following is a true, correct
and compared copy of the resolutions duly adopted by the unanimous consent of
all members of the Board of Directors of said Corporation effective as of April
16, 1996; and that said resolutions are still in full force and effect:
RESOLVED, that the Chairman of the Board, President, any Vice
President, or any other officer or board member of this Corporation (or the
designee of any of them), each be, and each hereby is, authorized and empowered
(either alone or in conjunction with any one or more of the other officers of
the Corporation) to take, from time to time, all or any part of the following
actions on or in behalf of the Corporation: (i) to make, execute and deliver to
THE CIT GROUP/CREDIT FINANCE, INC. ("Lender") (1) a First Amendment to Loan and
Security Agreement (the "Loan Amendment") providing for the amendment of
certain terms of that certain Loan and Security Agreement dated December 21,
1995 between the Corporation and Lender, as amended (the "Loan Agreement"), (2)
a First Amendment to Conditions Precedent Rider ("Conditions Amendment")
providing for the amendment of certain terms of that certain Conditions
Precedent Rider dated December 21, 1995, and (3) all other agreements,
documents and instruments contemplated by or referred to in the Loan Amendment
and Conditions Amendment or executed by the Corporation in connection
therewith; said Loan Amendment or Conditions Amendment to be substantially in
the form presented by Lender with such additional, modified or revised terms as
may be acceptable to any officer or director of the Corporation, as
conclusively evidenced by his or her execution thereof; and (ii) to carry out,
modify, amend or terminate any arrangements or agreements at any time existing
between the Corporation and Lender.
RESOLVED, that any arrangements, agreements, security agreements, or
other instruments or documents referred to or executed pursuant to the Loan
Amendment and Conditions Amendment by Xxxxxx X. Xxxxx, any other officer or
director of the Corporation, or by an employee of the Corporation acting
pursuant to delegation of authority, may be attested by such person and may
contain such terms and provisions as such person shall, in his or her sole
discretion, determine.
RESOLVED, that the Loan Agreement and each amendment to the Loan
Agreement heretofore executed by any officer or director of the Corporation and
any actions taken under the Loan Agreement as thereby amended are hereby
ratified and approved.
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I DO FURTHER CERTIFY that Xxxxxx X. Xxxxx is the Chairman of the Board
and President of the Corporation and Xxxxx X. Xxxxx is the Secretary of the
Corporation and each is duly elected, qualified and acting as such,
respectively.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Seal
of the Corporation in Atlanta, Georgia, this 16th day of April, 1996.
/s/ Xxxxx X. Xxxxx
-----------------------------
Xxxxx X. Xxxxx, Secretary
[CORPORATE SEAL]
I, Xxxxxx X. Xxxxx, President of said Corporation, do hereby certify
that the foregoing is a correct copy of the resolutions passed by the Board of
Directors of the Corporation and that Xxxxx X. Xxxxx is Secretary of the
Corporation and is duly authorized to attest to the passage of said
resolutions.
/s/ Xxxxxx X. Xxxxx
-----------------------------
Xxxxxx X. Xxxxx, President
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