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Exhibit 10(f)
as of December 10, 1996
CIC Systems, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Re: Second Amendment to Financing Agreements - DFS Intercreditor Agreement
("Second Amendment")
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Gentlemen:
Reference is made to the Amended and Restated Loan and Security Agreement
dated July 1, 1995, between you and the undersigned as amended by a First
Amendment thereto dated September 30, 1996 (the "Loan Agreement"). All
capitalized terms not otherwise defined herein shall have the meanings given
such terms in the Loan Agreement.
Borrower has requested that Lender permit Borrower to enter into a floor
plan financing arrangement with Deutsche Financial Services Corporation ("DFS"),
and Lender has agreed, subject to the terms and conditions of this Amendment.
Subject to the terms and conditions hereof, the Lender agrees with the Borrower
as follows:
(1) Section 7.3 of the Loan Agreement is amended to add the following
clause (j) at the end thereof:
"and (j) Borrower shall ensure that all inventory that it finances
through DFS shall be separately identified on its books and records,
that all reports concerning inventory that Borrower furnishes to
Lender under Section 7.1 shall include separate reporting as to DFS
financed inventory and that all DFS inventory that Borrower has in its
possession shall be clearly and distinctly identifiable as DFS
collateral."
(2) Section 9.8 of the Loan Agreement is amended by deleting the following
clause (g): (g) the security interest and liens set forth on Schedule 8.4
hereto" and by substituting the following clauses in lieu thereof:
"(g) the security interest of DFS in the DFS Products, as such term is
defined in the Intercreditor Agreement dated December 10, 1996 among
the Lender, DFS and HP (the "DFS Agreement") and the subordinated
security interest of DFS in the Collateral provided that such security
interest is and remains subordinate to the Lender's security interest
in a manner satisfactory to Lender; and (h) the security interest and
liens set forth on Schedule 8.4 hereto."
(3) Section 9.9 of the Loan Agreement is amended by adding the following
clause (f) to the end thereof:
"and (f) indebtedness owing from time to time to DFS, PROVIDED THAT
the aggregate amount thereof shall not at any time exceed $6,000,000
and PROVIDED
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CIC Systems, Inc.
December 10, 1996
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FURTHER that (i) Borrower shall only make regularly scheduled payments
of principal and interest in respect of such indebtedness in
accordance with the terms of the instrument or agreement evidencing or
giving rise to such indebtedness as in effect on the date of the
Second Amendment, (ii) Borrower shall not, directly or indirectly,
unless approved in writing by Lender (A) amend, modify, alter or
change the terms of such indebtedness or any agreement, document or
instrument related thereto as in effect on the date hereof or (B)
redeem, retire, defease, purchase or otherwise acquire such
indebtedness, or set aside or otherwise deposit or invest any sums for
such purpose, (iii) Borrower shall comply in all respects with the
terms of the DFS Agreement, and (iv) Borrower shall furnish to Lender
all notices or demands concerning or arising out of a breach or
default under such indebtedness either received by Borrower or on its
behalf, promptly after the receipt thereof, or sent by Borrower or on
its behalf, concurrently with the sending thereof, as the case may
be."
(4) In connection with the execution and delivery of this Second Amendment
the Borrower and Guarantor shall furnish to the Lender upon Lender's request
certified copies of all requisite corporate action and proceedings of the
Borrower and Guarantor in connection with this Second Amendment and a legal
opinion of Borrower's and Guarantor's counsel as to the due authorization of
this Second Amendment and the enforceability hereof.
(5) Borrower confirms and agrees that (a) all representations and
warranties contained in the Loan Agreement and in the other Financing Agreements
are on the date hereof true and correct in all material respects (except for
changes that have occurred as permitted by the covenants in Section 9 of the
Loan Agreement or as permitted under this Second Amendment), and (b) it is
unconditionally liable for the punctual and full payment of all Obligations,
including, without limitation, all charges, fees, expenses and costs (including
attorneys' fees and expenses) under the Financing Agreements, and that Borrower
has no defenses, counterclaims or setoffs with respect to full, complete and
timely payment of all Obligations.
(6) Guarantor, for value received, hereby assents to the Borrower's
execution and delivery of this Second Amendment, and to the performance by the
Borrower of its agreements and obligations hereunder. This Second Amendment and
the performance or consummation of any transaction or matter contemplated under
this Amendment, shall not limit, restrict, extinguish or otherwise impair the
Guarantor's liability to Lender with respect to the payment and other
performance obligations of the Guarantor pursuant to the Guarantee, dated July
1, 1995 executed for the benefit of Lender. Guarantor acknowledges that it is
unconditionally liable to Lender for the full and complete payment of all
Obligations including, without limitation, all charges, fees, expenses and costs
(including attorney's fees and expenses) under the Financing Agreements and that
Guarantor has no defenses, counterclaims or setoffs with respect to full,
complete and timely payment of any and all Obligations.
(7) Borrower hereby agrees to pay to Lender all reasonable attorney's fees
and costs which have been incurred or may in the future be incurred by Lender in
connection with the
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CIC Systems, Inc.
December 10, 1996
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negotiation and preparation of this Second Amendment and any other documents and
agreements prepared in connection with this Second Amendment. The Borrower
confirms that the Financing Agreements remain in full force and effect without
amendment or modification of any kind, except for the amendments explicitly set
forth herein. The Borrower further confirms that after giving effect to this
Second Amendment, no Event of Default or events which with notice or the passage
of time or both would constitute an Event of Default have occurred and are
continuing. The execution and delivery of this Second Amendment by Lender shall
not be construed as a waiver by Lender of any Event of Default under the
Financing Agreements. This Second Amendment shall be deemed to be a Financing
Agreement and, together with the other Financing Agreements, constitute the
entire agreement between the parties with respect to the subject matter hereof
and supersedes all prior dealings, correspondence, conversations or
communications between the parties with respect to the subject matter hereof.
If you accept and agree to the foregoing please sign and return the
enclosed copy of this letter. Thank you.
Very truly yours,
CONGRESS FINANCIAL CORPORATION
(NEW ENGLAND)
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
Title: First Vice President
AGREED:
CIC SYSTEMS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Chief Financial Officer
COMPUTER INTEGRATION CORP.
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Chief Financial Officer
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