February 6, 2002
JACO ELECTRONICS, INC. ("Jaco")
000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
NEXUS CUSTOM ELECTRONICS, INC. ("Nexus")
Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
INTERFACE ELECTRONICS CORP. ("Interface")
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Gentlemen:
Reference is made to the Second Restated and Amended Loan and
Security Agreement in effect between us as successor by merger to BNY Financial
Corporation which was merged into GMAC Commercial Credit LLC ("GMAC"), as Agent
and Lender, and Fleet Bank, N.A., f/k/a Natwest Bank, N.A ("Fleet") as Lender,
dated September 13, 1995, as supplemented and amended from time to time, (the
"Agreement"). Both GMAC and Fleet may hereinafter be referred to jointly as the
"Lenders", and individually, as a "Lender". Initially capitalized terms not
defined herein shall have the meanings ascribed to such terms in the Agreement.
WHEREAS, you have requested that we amend the Agreement as
follows below; and
WHEREAS, the Lenders are willing to agree to such amendments,
subject to the terms and conditions hereof.
NOW THEREFORE IT IS HEREBY AGREED AS FOLLOWS:
Effective as of December 31, 2001, the Agreement is hereby
amended as follows:
1. Section 17(d) of the Agreement shall be deleted in its
entirety and replaced by the following section 17(d):
"17(d) Debtor shall maintain at all times, on a
consolidated basis, a ratio of EBIT to total interest charges
due during any quarter of no less than the ratios stated
below opposite each quarter calculated on rolling four
quarter basis, beginning with the quarter ending 3/31/03.
"EBIT" shall mean earnings before interest, taxes,
extraordinary gains, and extraordinary non cash losses:
Quarter Ending Ratio
3/31/03 1.0 to 1.0
6/30/03 (and at all times thereafter)1.5 to 1.0"
2. Section 18(g) of the Agreement shall be deleted in its
entirety and replaced by the following:
"The Debtors shall attain at the end of each quarter,
on a consolidated basis, EBITDA for such quarter, in
amounts of no less than the amounts stated opposite
the fiscal quarters stated below:
Fiscal Quarter Minimum EBIDTA Amount
quarter ended 9/30/01 ($1,000,000)
quarter ended 12/31/01 ($1,100,000)
quarter ended 3/31/02 $ 0,000
quarter ended 6/30/02 $ 680,000
quarter ended 9/30/02 $1,000,000
quarter ended 12/31/02
and any quarter thereafter $1,200,000"
The Debtor hereby agrees to at all times, from the
date hereof, through June 30, 2002, to maintain an undrawn
availability under the Agreement of an aggregate amount of at
least $2,000,000.
By their signatures below, Jaco, Nexus and Interface
hereby ratify the Agreement and agree to be jointly and
severally liable for all Obligations under the Agreement and
agree that all of the outstanding amounts of the Loans under
the Agreement, as of the date hereof, shall be valid and
binding Obligations of each of them, and shall be deemed
Obligations outstanding under the Agreement, and hereby agree
and promise to repay to the Agent, for the benefit of the
Lenders, such Obligations (including but not limited to all
applicable interest) in accordance with the terms of the
Agreement, but in no event, later than the Termination Date
(for purposes hereof, "Termination Date" shall mean September
14, 2003, or any extended termination date, or any earlier
termination date, whether by acceleration or otherwise).
By their signatures below, Jaco, Nexus and Interface
hereby ratify and affirm to the Agent that as of the date
hereof, they are in full compliance with all covenants under
the Agreement and certify that all representations and
warranties of the Agreement are true and accurate as of the
date hereof, with the same effect as if they had been made as
of the date hereof.
Except as herein specifically amended, the Agreement shall
remain in full force and effect in accordance with its original terms, except as
previously amended.
If the foregoing accurately reflects our understanding, kindly
sign the enclosed copy of this letter and return it to our office as soon as
practicable.
Very truly yours,
GMAC COMMERCIAL CREDIT LLC,
(as Agent and Lender)
By: /s/ Xxxxx Xxxxxxxx
-----------------------------
Title: Senior Vice President
AGREED AND ACCEPTED:
JACO ELECTRONICS, INC. FLEET BANK, N.A.
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxx Xxxxxxxx
----------------------------- -----------------------------
Title: Chief Financial Officer Title: Vice President
NEXUS CUSTOM ELECTRONICS, INC. INTERFACE ELECTRONICS CORP.
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
----------------------------- -----------------------------
Title: Chief Financial Officer Title: Chief Financial Officer
RATIFICATION OF GUARANTOR
By its signature below, Jaco Overseas, Inc. hereby ratifies its guaranty of the
Agreement, as such Agreement has been amended from time to time, including but
not limited to a certain amendment dated June 6, 2000, (the "Amendment") and
hereby agrees to be liable for all of the Obligations under the Guaranty with
respect to the Agreement as amended from time to time, including but not limited
to by this amendment and the Amendment, and hereby agrees that the said Guaranty
shall continue to apply and remain in full force and effect with respect to the
amended Agreement and hereby agrees and consents that a certain General Loan and
Security Agreement dated January 20, 1989, shall continue to be in full force
and effect and apply to the amended Agreement, and it further hereby agrees to
make all payments of all its Obligations under the said Guaranty and General
Loan and Security Agreement to GMAC Commercial Credit LLC as Agent and Lender,
and to Fleet Bank, N.A. as Lender, as successors in interest to the previous
Agent and Lenders respectively.
RATIFIED, ACCEPTED AND CONSENTED:
JACO OVERSEAS, INC.
By: /s/ Xxxxxxx X. Xxxx
----------------------------------------
Title: Chief Financial Officer
