EXHIBIT 00.xx
LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 1
(Financial Covenants)
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This Loan and Security Agreement Amendment is made as of September 30,
1999 and is annexed to and made a part of the Loan and Security Agreement dated
as of December 4, 1998 between KEYCORP LEASING, A DIVISION OF KEY CORPORATE
CAPITAL INC., ("Lender") and AZURE INVESTMENTS, INC., as Borrower (the
"Agreement"). Lender and Borrower hereby agree as follows:
1) The terms of this Amendment replace and supersede in their entirety the
terms of all prior Financial Covenants. COMMODORE HOLDINGS, LTD.
("Guarantor") shall comply with the following financial covenants.
2) This Amendment is effective from and after September 30, 1999.
1. Tangible Net Worth: Its Tangible Net Worth (including the XX Xxxxxxx
or preferred share proceeds executed prior to the closing on the
facility agreements) shall not be less than $30,000,000 through
September 2000, and $50,000,000 thereafter, as measured on a quarterly
basis.
2. Leverage Ratio: Its Leverage Ratio shall not exceed 2.35 to 1.00, as
of September 1999, 2.00 to 1.00 as of September 1999 and thereafter,
as measured on a quarterly basis.
3. Debt Service Coverage Ratio: Its Debt Service Coverage Ratio shall not
be less than 1.25 to 1.00, through September 2002, and 1.50 to 1.00
thereafter, as measured on a quarterly basis.
4. Minimum Liquidity: Its minimum liquidity will be $13,500,000 through
the debt closing for the Crown Dynasty acquisition and $7,500,000
thereafter, as measured on a quarterly basis. (Only to include freely
available and unencumbered cash but to include all minimum liquidity
held with the Borrower).
5. Minimum Capital (Sovency) Ratio: Its Capital Ratio (including the XX
Xxxxxxx or preferred share proceeds executed prior to the closing on
the facility agreements) shall not be less than 30% until September
30, 2001, 35% until September 2002, and 40% thereafter, as measured on
a quarterly basis.
6. DEFINITIONS:
a) "Tangible Net Worth" shall mean (1) the gross book value of all
assets, excluding goodwill, patents, trademarks, licenses, trade
names, organizational expenses, treasury stock, unamortized debt
discount and expense, deferred research and developmental costs,
and other like intangibles, less (2) Total Liabilities.
b) "Total Liabilities" shall mean all debt and other obligations,
including, without limitation, Current Liabilities and long term
debt (including, without limitation, term loans, bond issuances,
debentures or notes, capital leases and deferred credit).
c) "Leverage Ratio" shall mean the ratio of Total Liabilities to
Tangible Net Worth.
d) "Current Assets" shall mean the gross book value of all assets
that are expected to be realized in cash or sold or consumed
during a normal operating cycle or within one year, including,
without limitation, cash, cash equivalents, accounts, and notes
receivable, and inventories, but excluding prepaid expenses.
e) "Current Liabilities" shall mean all debt and other obligations
that are to be paid by use of Current Assets during a normal
operating cycle or within one year, including, without
limitation, deposits received, advance payments, trade
acceptances, accrued expenses, notes payable, short-term bank
loans, current maturities of long term debt and capital leases,
accrued and deferred income taxes, and any reserves against
assets.
f) "Debt Service Coverage Ratio" shall mean the ratio of (1) the sum
of net income before taxes, interest expense, depreciation,
amortization and other non-cash expenses, excluding any
extraordinary gains or losses, to (2) the sum of interest
expense, current maturities of long term debt and capital lease
obligations, excluding the balloon payment due in October 2001 on
the bridge loan facility.
7. Any default in the covenants contained herein shall be a default
under the Agreement.
EXCEPT AS EXPRESSLY MODIFIED HEREBY, ALL OF THE TERMS, COVENANTS AND
CONDITIONS OF THE AGREEMENT SHALL REMAIN IN FULL FORCE AND EFFECT AND ARE IN ALL
RESPECTS HEREBY RATIFIED AND AFFIRMED.
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IN WITNESS WHEREOF, Lender and Borrower have executed this Security
Agreement Amendment as of the 30th day of September, 1999.
LENDER: BORROWER:
KEYCORP LEASING, AZURE INVESTMENTS, INC.
A DIVISION OF KEY CORPORATE
CAPITAL INC.
By: /s/ XXXXX X. XXXXXX By:/s/ XXXXXXXXX X. XXXXX
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Name: XXXXX X. XXXXXX Name: XXXXXXXXX X. XXXXX
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Title: REGIONAL BUSINESS PROCESSING MANAGER Title: ATTORNEY-IN-FACT
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GUARANTOR:
COMMODORE HOLDINGS, INC.
By: /s/ XXXXXXXXX X. XXXXX
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Name: XXXXXXXXX X. XXXXX
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Title: VICE CHAIRMAN OF THE
BOARD & CEO
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