AMENDMENT TO BUSINESS CREDIT AND SECURITY AGREEMENT
(Amendment No. 9)
This Amendment to Business Credit and Security Agreement ("Amendment") is made
by and among Deutsche Financial Services Corporation ("DFS"), Elcom Services
Group, Inc. ("Elcom Services"), and Elcom, Inc. f/k/a xxxxx.xxx, inc. ("Elcom,
Inc.") (Elcom Services and Elcom, Inc. are referred to herein collectively as
"Borrower).
WHEREAS, DFS and Borrower are parties to that certain Business Credit
and Security Agreement dated March 1, 1997, as amended ("Agreement"); and
WHEREAS, DFS and Borrower desire to amend the Agreement as provided
herein.
NOW, THEREFORE, for and in consideration of the premises, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, DFS and Borrower agree as follows:
1. Total Credit Facility. The first sentence of Section 3.1 is hereby
deleted in its entirety and replaced with the following:
"In consideration of Borrower's payment and performance of its
Obligations and subject to the terms and conditions contained in
this Agreement, DFS agrees to provide, and Borrower agrees to
accept, an aggregate credit facility (the "Credit Facility") of
up to Twenty-Two Million Dollars ($22,000,000) ("Total Credit
Limit"); provided, however, that on and after March 15, 2001,
the Total Credit Facility shall be reduced to Ten Million
Dollars ($10,000,000)."
2. Floorplan Inventory Loan Facility. The first sentence of Section
3.2 is hereby deleted in its entirety and replaced with the following:
"Subject to the terms of this Agreement, DFS may provide to
Borrower floorplan financing for the acquisition of Inventory
from vendors approved by DFS in DFS' reasonable credit judgment
(each advance being a "Floorplan Inventory Loan"), up to an
aggregate unpaid principal amount at any time not to exceed
Twenty-Two Million Dollars ($22,000,000) (collectively, the
"Floorplan Inventory Loan Facility"); provided, however, that at
no time will the sum of principal amount outstanding under the
Floorplan Inventory Loan Facility plus the principal amount of
outstanding Working Capital Loans exceed, in the aggregate,
Twenty-Two Million Dollars ($22,000,000.00); and provided,
further, that on and after March 15, 2001, the Floorplan
Inventory Loan Facility will be reduced to Ten Million Dollars
($10,000,000) and at no time on or after March 15, 2001 will the
sum of the principal amount outstanding under the Floorplan
Inventory Loan Facility plus the principal amount of outstanding
Working Capital Loans exceed, in the aggregate, Ten Million
Dollars ($10,000,000.00)."
3. Total Working Capital Credit Limit.
3.1 Total Working Capital Credit Limit. The first sentence of Section
3.3 is hereby deleted in its entirety and replaced with the following:
"Subject to the terms of this Agreement, DFS agrees, for so long
as no Default exists, to provide to Borrower, and Borrower
agrees to accept, working capital financing (each advance being
a "Working Capital Loan") on Eligible Accounts and Eligible
Inventory in the maximum aggregate unpaid principal amount at
any time equal to the lesser of (i) the Borrowing Base and (ii)
Twenty-Two Million Dollars ($22,000,000) ("Total Working Capital
Credit Limit"); provided, however, that at no time will the sum
of the principal amount outstanding under the Floorplan
Inventory Loan Facility plus the principal amount of outstanding
Working Capital Loans exceed, in the aggregate, Twenty-Two
Million Dollars ($22,000,000.00); and provided, further, that on
and after March 15, 2001, the Floorplan Inventory Loan Facility
will be reduced to Ten Million Dollars ($10,000,000) and at no
time on or after March 15, 2001 will the sum of the principal
amount outstanding under the Floorplan Inventory Loan Facility
plus the principal amount of outstanding Working Capital Loans
exceed, in the aggregate, Ten Million Dollars ($10,000,000.00)."
4. The paragraphs that were added to the Agreement pursuant to Section 1
of that certain Amendment to Business Credit and Security Agreement
(Amendment No. 8) dated as of November 20, 2000, are hereby deleted in
their entirety and replaced with the following:
"1. Not later than November 27, 2000, Borrower hereby agrees to
cause Elcom International, Inc. to cause an institution
acceptable to DFS to issue one or more Irrevocable Letter(s) of
Credit, in the aggregate amount of Fifteen Million U.S. Dollars
($15,000,000.00), in form, substance and with expiration dates
satisfactory to DFS. The Irrevocable Letter(s) of Credit will be
in favor of DFS and Deutsche Financial Services (UK) Limited
(DFS U.K.). If DFS fails to receive the Irrevocable Letter(s) of
Credit on or before November 27, 2000, a Default shall have
occurred under the Agreement and under that certain Standard
Conditions for the Sale and Purchase of Debts dated as of
December 3, 1997 between Elcom Group Limited (Elcom Ltd.) and
DFS U.K., as amended (the U.K. Agreement).
2. Borrower hereby agrees to cause the above referenced
Irrevocable Letter(s) of Credit to be payable to DFS upon
demand. If (i) Borrower fails to pay in full all amounts due to
DFS under the Agreement on or before May 7, 2001; or (ii) a
Default by Borrower or Elcom Ltd. occurs under the Agreement or
the U.K. Agreement, respectively, each of DFS and DFS U.K. may
(x) exercise any and all of its rights and remedies under the
Agreement and the U.K. Agreement
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accruing upon the occurrence of a Default including, but not
limited to, the right to repossess the Collateral from Borrower
and Elcom Ltd.; and (y) exercise any and all of its rights to
draw upon any Irrevocable Letter of Credit issued in favor of
DFS and/or DFS U.K.
3. Upon receipt by DFS U.K. of payment in full of all amounts
owed by Elcom Ltd. to DFS U.K., DFS will make a partial draw
under the Irrevocable Letter(s) of Credit in the amount of Five
Million Dollars ($5,000,000), which amount will be paid to Elcom
International, Inc.
4. Upon DFS receipt of the Irrevocable Letter of Credit, Section
10(w) of the Agreement shall be deleted in its entirety."
5. Conditions Precedent. Notwithstanding the foregoing, this Amendment
shall not be effective unless and until satisfaction of the following
terms and conditions, each as acceptable to DFS, in its sole discretion:
(a) execution and delivery of this Amendment by all parties
hereto;
(b) a reaffirmation by Elcom International, Inc. of the existing
guaranties of the obligations of Borrower to DFS;
(c) the Irrevocable Letter of Credit referenced in the preceding
paragraphs; and
(d) such other and further documents and agreements as DFS may
determine in connection with any of the foregoing.
6. No Other Modifications. Except as expressly modified or amended
herein, all other terms and provisions of the Agreement shall remain
unmodified and in full force and effect and the Agreement, as hereby
amended, is ratified and confirmed by DFS and Borrower.
7. Capitalized Terms. Except as otherwise defined herein, all
capitalized terms will have the same meanings set forth in the
Agreement.
IN WITNESS WHEREOF, DFS, Elcom Services and Elcom, Inc. have executed
this Amendment as of the 13 day of February, 2001.
ELCOM SERVICES GROUP, INC.
ATTEST:
/s/ Xxxx Xxxxxxx By: /s/ Xxxxx Xxxxxxx
(Assistant) Secretary
Print Name: Xxxxx Xxxxxxx
Title: Chief Financail Officer
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ELCOM, INC.
ATTEST:
/s/ Xxxx Xxxxxxx By:/s/ Xxxxx Xxxxxxx
(Assistant) Secretary
Print Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
DEUTSCHE FINANCIAL SERVICES
CORPORATION
By:/s/ Xxxx Xxxxxxxxx
Print Name: Xxxx Xxxxxxxxx
Title: Vice-President Operations
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Guarantor Consent and Agreement
The undersigned Guarantor hereby acknowledges and consents to the terms of the
foregoing Amendment to Business Credit and Security Agreement (Amendment No. 9),
and does hereby ratify and confirm each and every guaranty of Borrower
(inclusive of Elcom, Inc.) in all respects.
ELCOM INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxxxxx
Print Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
Date: February 13, 2001
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U:\48\BCSA\elcom 9th amend.doc (02-2001)
