SECOND AMENDMENT TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT,
dated as of September 24, 1997 (this "Amendment"), is by and between BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as successor by merger to Bank
of America Illinois (the "Lender"), and ELXSI, a California corporation (the
"Borrower").
W I T N E S S E T H:
WHEREAS, the Borrower and Lender are parties to that certain Amended and
Restated Loan and Security Agreement, dated as of December 30, 1996, as amended
by that certain letter agreement dated June 30, 1997 (and as further amended,
restated, supplemented or otherwise modified and in effect from time to time,
collectively, the "Loan Agreement"), pursuant to which the Lender has provided
to the Borrower credit facilities and other financial accommodations; and
WHEREAS, the Borrower has requested that the Lender amend the Loan
Agreement in certain respects as set forth herein, and the Lender is agreeable
to the same, subject to the terms and conditions hereof;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto hereby agree as
follows:
SECTION 1. Defined Terms. Unless otherwise defined herein, all capitalized
terms used herein have the meanings assigned to such terms in the Loan
Agreement.
SECTION 2. Amendments to the Loan Agreement. The Loan Agreement is, as of
the Effective Date (as defined below), hereby amended as follows:
(a) The definition of "Additional Revolving Credit Amount" appearing
in Section 1.1 of the Loan Agreement is hereby amended by deleting such
definition in its entirety and inserting the following in lieu thereof:
""Additional Revolving Credit Amount" means $0."
(b) The definition of "Credit Reduction Amount" appearing in Section
1.1 of the Loan Agreement is hereby amended by deleting such definition in its
entirety and inserting the following in lieu thereof:
""Credit Reduction Amount" means, for each Credit Reduction Date,
commencing with the first Credit Reduction Date to occur after the Second
Amendment Effective Date, an amount equal to $118,333.33, in each case subject
to adjustment as provided in Section 2.1.
(c) The definition of "Credit Reduction Date" appearing in Section 1.1
of the Loan Agreement is hereby amended by deleting such definition in its
entirety and inserting the following in lieu thereof:
""Credit Reduction Date" means the last day of each calendar month."
(d) The following new definition shall be inserted between the
definitions of "Hazardous Materials" and "Indebtedness" appearing in Section 1.1
of the Loan Agreement:
""Incremental Supplemental Revolving Loan" is defined in Section
2.1.6"
(e) The definition of "Revolving Credit Amount" appearing in Section
1.1 of the Loan Agreement is hereby amended by deleting such definition in its
entirety and inserting the following in lieu thereof:
""Revolving Credit Amount" means, from and after the Second Amendment
Effective Date, $9,000,000 as adjusted after such date pursuant to this
Agreement, including pursuant to Sections 2.1.3 and 2.1.4."
(f) The following new definition shall be inserted between the
definitions of "Revolving Loan Availability" and "Second Restatement Date"
appearing in Section 1.1 of the Loan Agreement:
""Second Amendment Effective Date" shall mean September 24, 1997."
(g) The definition of "Supplemental Revolving Credit Amount" appearing
in Section 1.1 of the Loan Agreement is hereby amended by deleting such
definition in its entirety and inserting the following in lieu thereof:
""Supplemental Revolving Credit Amount" means, from and after the
Second Amendment Effective Date, $7,100,000 as adjusted after such date pursuant
to this Agreement, including pursuant to Sections 2.1.3 and 2.1.4."
(h) The definition of "Termination Date" appearing in Section 1.1 of
the Loan Agreement is hereby amended by deleting "September 30, 1998" appearing
therein and substituting therefor "June 30, 1999".
(i) Section 2.1.3 of the Loan Agreement is hereby amended by deleting
clause (a) of such Section in its entirety and inserting the following in lieu
thereof:
"(a) On each Credit Reduction Date, the Supplemental Revolving Credit
Amount shall be reduced by the Credit Reduction Amount."
(j) Section 2.1.6 of the Loan Agreement is hereby amended by deleting
such Section in its entirety and inserting the following in lieu thereof: "2.1.6
Supplemental Revolving Loans.
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"2.1.6 Supplemental Revolving Loans.
(a) Borrower and Lender acknowledge the making of certain loans
or advances (individually each a "Supplemental Revolving Loan" and
collectively the "Supplemental Revolving Loans") by Lender to Borrower
in an aggregate principal amount of $5,100,000 which are outstanding
on the Second Amendment Effective Date in accordance with the terms of
this Agreement and agree that, from and after the Second Amendment
Effective Date, such Supplemental Revolving Loans shall continue to be
outstanding pursuant to the terms and conditions of this Agreement.
Subject to the terms and conditions of this Agreement and the Related
Agreements, and in reliance upon the warranties of Borrower set forth
herein and in the Related Agreements, Lender agrees to make such
additional Supplemental Revolving Loans (the "Incremental Supplemental
Revolving Loans") to the Borrower in the principal amount of up to
$2,000,000 from time to time on or after the Second Amendment
Effective Date and before the Termination Date as Borrower may from
time to time request; provided, however, that the aggregate principal
amount of all outstanding Supplemental Revolving Loans (including the
Incremental Supplemental Revolving Loan) shall not exceed the
Supplemental Revolving Credit Amount. Supplemental Revolving Loans
(including the Incremental Supplemental Revolving Loan) may be repaid
and, subject to the terms and conditions hereof, reborrowed to but not
including the Termination Date unless the Credit is otherwise
terminated as provided in this Agreement.
(b) All Supplemental Revolving Loans (including the Incremental
Supplemental Revolving Loan) hereunder shall be paid by Borrower on
the Termination Date, unless payable sooner pursuant to the provisions
of this Agreement, but may, at Borrower's election, be repaid in whole
or in part at any time prior to such date without premium or penalty.
(k) Section 5.1.3 of the Loan Agreement is hereby amended by deleting
such Section in its entirety and inserting the following in lieu thereof:
"5.1.3 [Intentionally Omitted]"
(l) Section 5.1.4 of the Loan Agreement is hereby amended by deleting
such Section in its entirety and inserting the following in lieu thereof:
"5.1.4 [Intentionally Omitted]"
(m) Section 5.15 of the Loan Agreement is hereby further amended by
deleting clause (f) of such Section in its entirety and inserting the following
new clauses (f), (g) and (h) in lieu thereof:
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"(f) Indebtedness of Borrower under that certain Loan Agreement dated
as of September 24, 1997 between Borrower and Orange County Industrial
Development Authority in an aggregate principal amount not to exceed $2,500,000
incurred in connection with the issuance of the Industrial Development Revenue
Bonds (ELXSI Project), Series 1997; (g) Indebtedness of Borrower in an aggregate
principal amount not to exceed $520,000 incurred in connection with the
acquisition of that certain real property and related fixtures located at 000
Xxxxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxxxx; and (h) other Indebtedness approved
in writing by Lender."
(n) Section 5.16 of the Loan Agreement is hereby amended by deleting
clause (n) of such Section in its entirety and inserting the following new
clauses (n), (o), and (p) in lieu thereof:
"(n) Liens on that certain real property located at 0000 Xxx Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxx Xxxxxx, Xxxxxxx and all buildings, structures and
improvements now or hereafter located on such real property and on certain
property adjacent thereto ("IDB Property") securing Indebtedness permitted under
Section 5.15 (f); (o) Liens on that certain property and related fixtures (and
proceeds thereof and accessions thereto) located at 000 Xxxxxx Xxxx Xxxx,
Xxxxxxxx, Xxxxxxxxxxxxx securing Indebtedness permitted under Section 5.15 (g);
and (p) Liens consented to in writing by Lender."
(o) Section 5.18 of the Loan Agreement is hereby amended by deleting
clause (l) of such Section in its entirety and inserting the following in lieu
thereof:
"(l) Investments in the nature of a loan by Borrower to Azimuth of the
proceeds of Incremental Supplemental Revolving Loans in an aggregate principal
amount of up to $2,000,000 to be used by Azimuth solely as provided in Section
5.25(d) (and any accrued interest thereon);"
(p) Section 5.18 of the Loan Agreement is hereby amended by deleting
clause (m) of such Section in its entirety and inserting the following new
clauses (m) and (n) in lieu thereof:
"(m) Investments in the nature of a loan by Borrower to Cadmus in an
aggregate principal amount not to exceed $2,000,000 to be used by Cadmus solely
for the purposes specified in that certain waiver letter dated June 30, 1997;
(n) Investments in the nature of loans by Borrower to the four (4) employees of
Borrower participating in the Xxxxxxxx'x phantom stock option plan in an
aggregate principal amount not to exceed $115,833 and any accrued interest
thereon; and (n) other Investments consented to by Lender in writing."
(q) Section 5.25 of the Loan Agreement is hereby amended by deleting
the phrase "(except as provided in clause (b) below)" appearing in clause (a)(i)
of such Section and inserting "(except as provided in clauses (b) and (d)
below)" in lieu thereof.
(r) Section 5.25 of the Loan Agreement is hereby further amended by
deleting the period at the end thereof and adding the following new clause (d)
at the end of such Section:
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", or (d) of the Incremental Supplemental Revolving Loan to be used
other than as a loan or loans by Borrower to Azimuth as permitted by Section
5.18(l) to be used by Azimuth solely to purchase equity securities as approved
in writing by Lender"
(s) Section 5.28 of the Loan Agreement is hereby amended by deleting
clauses (b) and (c) of such Section in their entirety.
(t) Supplement A to the Loan Agreement is hereby amended by deleting
such Supplement in its entirety and inserting Exhibit A attached hereto in lieu
thereof.
SECTION 3. Release of Lien. Lender hereby releases any Liens it may have on
any IDB Property and agrees to release any Liens it may have on Borrower's
property located at 000 Xxxxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxxxx in connection
with the incurrence by Borrower of the Indebtedness permitted under Section
5.15(g) of the Loan Agreement.
SECTION 4. Amendment Fee. In consideration of the execution of this
Amendment by the Lender, the Borrower hereby agrees to pay a fee of $25,000 (the
"Amendment Fee") to Lender.
SECTION 5. Representations and Warranties of the Borrower. The Borrower
represents and warrants to the Lender:
(a) the representations and warranties contained in the Loan Agreement
(as amended hereby) and the other Related Agreements and Supplemental
Documentation are true and correct in all material respects at and as of
the date hereof as though made on and as of the date hereof (except (x) to
the extent specifically made with regard to a particular date and (y) for
such changes as are a result of any act or omission specifically permitted
under the Loan Agreement (or under any Related Agreement) or otherwise
expressly permitted by Lender);
(b) no Event of Default or Default has occurred and is continuing;
(c) the execution, delivery and performance of this Amendment has been
duly authorized by all necessary action on the part of, and duly executed
and delivered by, the Borrower, and this Amendment is a legal, valid and
binding obligation of the Borrower enforceable against the Borrower in
accordance with its terms, except as the enforcement thereof may be subject
to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally and
general principles of equity (regardless of whether such enforcement is
sought in a proceeding in equity or at law); and
(d) the execution, delivery and performance of this Amendment does not
conflict with or result in a breach by the Borrower of any term of any
material
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contract, loan agreement, indenture or other agreement or instrument to which
the Borrower is a party or is subject.
SECTION 6. Conditions Precedent to Effectiveness of Amendment. This
Amendment shall become effective on the date (the "Effective Date") each of the
following conditions precedent is satisfied:
(a) the Lender shall have executed and delivered this Amendment;
(b) the Borrower shall have executed and delivered to Lender a new
Revolving Loan Promissory Note in the principal amount of $9,000,000;
promptly following the Effective Date and its receipt of a new Revolving
Loan Promissory Note, Lender shall deliver its original Revolving Loan
Promissory Note to Borrower for cancellation;
(c) the Borrower shall have executed and delivered to Lender a new
Supplemental Revolving Loan Promissory Note in the principal amount of
$7,100,000; promptly following the Effective Date and its receipt of a new
Supplemental Revolving Loan Promissory Note, Lender shall deliver its
original Supplemental Revolving Loan Promissory Note to Borrower for
cancellation. In addition, Lender shall deliver its original Additional
Revolving Loan Promissory Note to Borrower for cancellation;
(d) the Borrower shall have paid in full the Amendment Fee to Lender;
and
(e) the Lender shall have received all of the following, each duly
executed where appropriate and dated as of the Second Amendment Effective
Date (or such other date as shall be satisfactory to Lender), in form and
substance satisfactory to Lender:
(i) Resolutions. A copy, duly certified by an officer of
Borrower, of (1) resolutions of the Board of Directors of such
corporation authorizing, as applicable, (A) the borrowings by Borrower
hereunder and (B) the execution, delivery and performance of this
Amendment, (2) all documents evidencing any other necessary corporate
action on the part of such corporation with respect to this Amendment,
and (3) all approvals or consents, if any, with respect to this
Amendment;
(ii) Incumbency Certificates. A certificate of an officer of
Borrower certifying the names of the officers of such corporation
authorized to sign this Amendment, and all other documents and
certificates to be delivered by such corporation hereunder, together
with samples of the true signatures of such officers;
(iii) Borrower's Certificate. The certificate of the President or
Chairman of the Board of Borrower certifying to the fulfillment of all
conditions precedent (other than any waived by Lender) to closing the
transaction
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contemplated by this Amendment and to the truth and accuracy, as of
such date, of the representations and warranties of Borrower contained
in this Amendment, each Mortgage, the Trademark Security Agreement and
each other Related Agreement to which Borrower is a party (except (x)
to the extent specifically made with regard to a particular date and
(y) for such changes as are a result of any act or omission
specifically permitted under the Loan Agreement (or under any Related
Agreement) or otherwise expressly permitted by Lender);
(iv) Bylaws. A copy of Borrower's Bylaws duly certified by an
officer of Borrower (or a certification by such officer that the same
have not been amended since the last date the Bylaws were certified to
Lender);
(v) Articles. A copy of Borrower's Articles of Incorporation,
duly certified by the Secretary of State of the state of its
incorporation or by an officer of Borrower (or a certification by such
officer that the same have not been amended since the last date the
Articles were certified to Lender);
(vi) Registration; Good Standing. A copy, duly certified by the
applicable Secretary of State (or other appropriate officer), a
certificate of good standing for Borrower issued by the Secretary of
State (or other appropriate officer) of the jurisdiction of its
incorporation; and
(vii) Legal Opinion. Legal opinion from Dechert Price & Xxxxxx,
special counsel to Borrower and Parent, in form and substance
satisfactory to the Lender.
SECTION 7. Execution in Counterparts. This Amendment may be executed in
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same instrument.
SECTION 8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS,
WITHOUT REGARD TO THE INTERNAL CONFLICTS OF LAWS PROVISIONS THEREOF.
SECTION 9. Effect of Amendment; Reaffirmation of Loan Documents. The
parties hereto agree and acknowledge that (i) nothing contained in this
Amendment in any manner or respect limits or terminates any of the provisions of
the Loan Agreement or the other Related Agreements or Supplemental Documentation
other than as expressly set forth herein and (ii) the Loan Agreement (as amended
hereby) and each of the other Related Agreements and Supplemental Documentation
remain and continue in full force and effect and are hereby ratified and
reaffirmed in all respects.
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SECTION 10. 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 purposes.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the date
first written above.
ELXSI
By:___________________________________
Name:_________________________________
Title:________________________________
Address: 0000 Xxx Xxxxx Xxxxxx
Xxxxx X
Xxxxxxx, Xxxxxxx 00000
Attention: President
Facsimile number: 407/849-0625
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:___________________________________
Name:_________________________________
Title:________________________________
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Commercial Banking Division
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EXHIBIT A
TO SECOND AMENDMENT
TO LOAN AGREEMENT
SUPPLEMENT A
to
AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
Dated as of December 30, 1996 Between
ELXSI and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
(as successor by merger to Bank of America Illinois)
1. Loan Agreement Reference. This Supplement A, as it may be amended or
modified from time to time, is a part of the Amended and Restated Loan and
Security Agreement, dated as of December 30, 1996, between Borrower and
Lender (together with all amendments, restatements, supplements and other
modifications thereto, the "Loan Agreement"). Terms used and not defined
herein which are defined in the Loan Agreement shall have the meaning
ascribed to them therein unless the context requires otherwise.
2. Additional Covenants. Until all of Borrower's Liabilities are paid in full,
Borrower agrees that, unless Lender otherwise consents in writing, it will:
a. Net Worth. Not permit at any time during any fiscal quarter, measured
as of the last day of the most recently completed fiscal quarter set
forth below, Net Worth to be less than the amount set forth below
across from such fiscal quarter:
Fiscal Quarter Ending Net Worth
09/30/97 $28,000,000
12/31/97 $28,000,000
03/31/98 $28,000,000
06/30/98 $28,000,000
09/30/98 $28,000,000
12/31/98 and thereafter $32,000,000
b. Capital Expenditures. Not, and not permit any Subsidiary to, purchase
or otherwise acquire (including, without limitation, acquisition by
way of Capitalized Lease), or commit to purchase or otherwise acquire,
any fixed asset if, after giving effect to such purchase or other
acquisition, (A) the aggregate
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capitalized cost of all fixed assets purchased or otherwise acquired
(other than by means of a Capitalized Lease) by Borrower and its
Subsidiaries on a consolidated basis plus (B) the aggregate annual
payments under Capitalized Leases (excluding the portion thereof
representing imputed interest) of Borrower and its Subsidiaries on a
consolidated basis (excluding, in each of (A) and (B), (a) any fixed
asset which constitutes a replacement for an asset which was the
subject of a casualty or governmental taking to the extent the
purchase or other acquisition thereof is funded by insurance proceeds
or other payments received as a result of such casualty or taking; (b)
the first $675,000 of capital expenditures related solely to removal
of underground storage tanks or other environmental problems at
Borrower's restaurant locations; (c) any capital expenditures with the
proceeds from the Florida Industrial Development Bond offering to
finance the purchase of a new 32,000 square foot manufacturing/office
building in Orlando, Florida, construct improvements therein, purchase
certain equipment and renovate Borrower's existing facility; and (d)
any capital expenditures incurred in connection with the purchase of
real property and related fixtures located at 000 Xxxxxx Xxxx Xxxx,
Xxxxxxxx, Xxxxxxxxxxxxx) would exceed $3,500,000 in Fiscal Year 1997
and in any Fiscal Year thereafter.
c. Interest Coverage Ratio. Not permit, on the last day of any fiscal
quarter set forth below, the ratio of (a) Borrower's EBITDA for the
four (4) fiscal quarters then ended to (b) Borrower's consolidated
interest expense (but excluding from the calculation thereof all
interest expense with respect to Additional Revolving Loans) for the
four (4) fiscal quarters then ended to be less than the ratio set
forth below opposite such fiscal quarter:
Fiscal Quarter Ending Ratio
09/30/97 3.00:1
12/31/97 3.00:1
03/31/98 and thereafter 4.00:1
d. Funded Debt/EBITDA Ratio. Not permit, on the last day of any fiscal
quarter set forth below, the Funded Debt/EBITDA Ratio to be more than
the ratio set forth below opposite such fiscal quarter:
Fiscal Quarter Ending Ratio
09/30/97 2.50:1
12/31/97 2.25:1
03/31/98 2.25:1
06/30/98 2.25:1
09/30/98 2.25:1
12/31/98 2.25:1
03/31/99 and thereafter 2.00:1
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