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EXHIBIT 10.17
WAIVER AND AMENDMENT NO. 3
TO
LOAN AND SECURITY AGREEMENT
THIS WAIVER AND AMENDMENT NO. 3 ("Amendment") is entered into as
of February 26, 1999, by and among Let's Talk Cellular & Wireless, Inc., a
corporation organized under the laws of the State of Florida ("LTC"), Telephone
Warehouse, Inc., a corporation organized under the laws of the State of Delaware
("TWI"), Cellular Warehouse Inc., a corporation organized under the laws of the
State of Georgia ("CWI"), Cellular USA, a corporation organized under the laws
of the State of Nevada ("USA"), Xxxxxxx Enterprises, Inc., a corporation
organized under the laws of the State of Georgia ("SEI") and National Cellular
Incorporated, a corporation organized under the laws of the State of Texas
("NCI") ("LTC, TWI, CWI, USA, SEI and NCI, each a "Borrower" and jointly and
severally, the "Borrowers"), the undersigned financial institutions (each, a
"Lender" and collectively, the "Lenders") and The Chase Manhattan Bank, a
corporation organized under the laws of the State of New York ("Chase") as agent
for Lenders (Chase in such capacity, the "Agent").
BACKGROUND
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Borrowers, Agent and Lenders are parties to a Loan and Security
Agreement dated as of April 2, 1998 (as amended, restated, supplemented or
otherwise modified from time to time, the "Loan Agreement"), pursuant to which
Agent and Lenders provide Borrowers with certain financial accommodations.
Borrowers have requested that Agent and Lenders waive certain financial
covenant defaults that have occurred and amend certain provisions of the Loan
Agreement and Agent and Lenders are willing to do so on the terms and conditions
hereafter set forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of
credit heretofore or hereafter made to or for the account of Borrowers by Agent
and Lenders, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. DEFINITIONS. All capitalized terms not otherwise defined herein
shall have the meanings given to them in the Loan Agreement.
2. WAIVER. Subject to satisfaction of the conditions precedent set
forth in Section 5 below, Agent and Lenders hereby waives the Event of Default
which has occurred as a result of Borrowers' non-compliance with Section 7.21(i)
of the Loan Agreement to the extent the Leverage Ratio at the end of the fiscal
quarter ended January 31, 1999 with respect to the immediately preceding four
fiscal quarter period was no more than 2.56 to 1.00, but, in each case, only to
the extent the non-compliance with such Sections occurred prior to such periods.
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3. AMENDMENTS TO LOAN AGREEMENT. Subject to satisfaction of the
conditions precedent set forth in Section 4 below, the Loan Agreement is hereby
amended as follows:
(a) The following defined terms are added to Section 1.2 of the
Loan Agreement in their appropriate alphabetical order:
"AMENDMENT NO. 3" shall mean Amendment No. 3 to this Agreement
dated as of February 26, 1999.
"AMENDMENT NO. 3 EFFECTIVE DATE" shall mean the date on which all
of the conditions precedent contained in Section 5 of the Amendment
No. 3 shall have been satisfied.
(b) Section 2.2(h) of the Loan Agreement is amended in its entirety
to provide as follows:
"2.2(h) REDUCTION PERIOD. Borrowers shall reduce all outstanding
Revolving Advances to not more than $9,000,000 and not permit
outstanding Revolving Advances to be more than $9,000,000 for the
period of June 1, 1999 through and including July 15, 1999."
4. FIELD EXAM; CONSULTANTS.
(i) Notwithstanding the proviso in Section 3.4 of the Loan
Agreement, Borrowers agree to pay Agent for all field examination expenses in
accordance with Section 3.4 of the Loan Agreement for a field exam to be
scheduled by Agent following the Amendment No. 3 Effective Date. The obligation
of Borrowers to pay for such field examination expenses shall be in addition to
Borrowers' obligation to pay for field examination expenses pursuant to the
proviso of Section 3.4 of the Loan Agreement.
(ii) Borrowers agree to pay Agent for all costs incurred by
Agent in arranging for a consultant to meet with the management of Borrowers
and all costs of the consultant in assessing Borrowers' future financial plans.
5. CONDITIONS OF EFFECTIVENESS. This Amendment shall become effective
upon satisfaction of the following conditions precedent: Agent shall have
received (i) four (4) copies of this Amendment executed by each Borrower and
each Lender, (ii) a non-refundable waiver and amendment fee in the amount of
$60,000 and all legal fees and (iii) such other certificates, instruments,
documents, agreements and opinions of counsel as may be required by Agent,
Lenders or their counsel, each of which shall be in form and substance
satisfactory to Agent, Lenders and their counsel.
6. REPRESENTATIONS AND WARRANTIES. Borrowers hereby represent and
warrant as follows:
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(a) This Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of Borrowers and are
enforceable against Borrowers in accordance with their respective terms.
(b) Upon the effectiveness of this Amendment, Borrowers hereby
reaffirm all covenants, representations and warranties made in the Loan
Agreement to the extent the same are not amended hereby and agree that all such
covenants, representations and warranties shall be deemed to have been remade
as of the effective date of this Amendment.
(c) No Event of Default or Default has occurred and is continuing
or would exist after giving effect to this Amendment.
(d) Borrowers have no defense, counterclaim or offset with respect
to the Loan Agreement.
7. EFFECT ON THE LOAN AGREEMENT.
(a) Upon the effectiveness of this Amendment, each reference in the
Loan Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of
like import shall mean and be a reference to the Loan Agreement as amended
hereby.
(b) Except as specifically amended herein, the Loan Agreement, and
all other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby
ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided in Section 2, operate as a waiver of
any right, power or remedy of Lender, nor constitute a waiver of any provision
of the Loan Agreement, or any other documents, instruments or agreements
executed and/or delivered under or in connection therewith.
8. GOVERNING LAW. This Amendment shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
and shall be governed by and construed in accordance with the laws of the State
of New York.
9. HEADINGS. Section headings in this Amendment are included herein
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.
10. COUNTERPARTS. This Amendment may be executed by the parties hereto
in one or more counterparts, each of which shall be deemed an original and all
of which when taken together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the
day and year first written above.
LET'S TALK CELLULAR & WIRELESS, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
TELEPHONE WAREHOUSE, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
CELLULAR WAREHOUSE, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
NATIONAL CELLULAR INCORPORATED
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
CELLULAR USA
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
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XXXXXXX ENTERPRISES, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: CFO
THE CHASE MANHATTAN BANK, as Agent and a
Lender
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: Vice President
Commitment Percentage: 25%
BANK OF AMERICA, FSB, Lender
By:
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Name:
Title:
Commitment Percentage: 25%
IBJ WHITEHALL BANK & TRUST COMPANY,
Lender
By: /s/ Xxxxxxxx X. XxXxxxxxx
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Name: Xxxxxxxx X. XxXxxxxxx
Title: Director
Commitment Percentage: 25%
XXXXXXX XXXXX BUSINESS FINANCIAL
SERVICES, Lender
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
Commitment Percentage: 25%
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