THIRD AMENDMENT TO REVOLVING
LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO REVOLVING LOAN AND SECURITY AGREEMENT (together
with all appendices, exhibits, schedules and attachments hereto, collectively
this "Amendment") is made and entered into as of January 6, 1997, by and
between THE XXXXX ORGANIZATION, INC., a Delaware corporation and TRO LEARNING
(CANADA), INC., a corporation organized under the laws of Canada
(collectively, the "Borrower") and SANWA BUSINESS CREDIT CORPORATION, a
Delaware corporation with its principal place of business at Xxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000 ("Lender").
RECITALS
WHEREAS, Borrower and Lender entered into that certain Revolving Loan
and Security Agreement dated as of August 2, 1995, as amended by that certain
First Amendment to Revolving Loan and Security Agreement dated as of April
26th 1996 and as further amended by that certain Second Amendment to
Revolving Loan and Security Agreement dated as of August 1, 1996
(collectively, the "Loan Agreement"), together with documents ancillary
thereto;
WHEREAS, Borrower wishes to increase the dollar cap on the Total
Facility from $10,000,000 to $12,500,000 for the period of time commencing on
January 1, 1997 and ending on March 14, 1997;
WHEREAS, Borrower and Lender acknowledge that the dollar cap on the
Total Facility shall return to $10,000,000 as of March 15, 1997;
WHEREAS, Borrower has advised Lender that there currently exists an
Event of Default under the Loan Agreement due to Borrower's failure to comply
with Section 10.1(B) of the Loan Agreement (Borrower's failure to maintain
Operating Profit measured quarterly) (the "Operating Profit Default");
WHEREAS, Borrower has requested Lender forbear from exercising any of
its rights and remedies available to it pursuant to the aforesaid Event of
Default;
WHEREAS, Lender is unable to commit to Borrower that it will forbear
from exercising its rights and remedies pursuant to the aforesaid Event of
Default, and makes no other agreements or promises to Borrower that it will
waive said Event of Default or forbear from exercising its rights and
remedies pursuant to said Event of Default;
NOW THEREFORE, for and in consideration of the premises, the mutual
covenants hereinafter set forth and other good and valuable consideration,
the receipt and sufficiency of which the parties hereby acknowledge, the
parties hereby agree as follows:
ARTICLE
1.
RECITALS AND DEFINITIONS
1.1. Borrower represents and warrants that the foregoing recitals are
true and correct and constitute an integral part of this Amendment and
Borrower and Lender hereby agree that all of the recitals of this Amendment
are hereby incorporated herein and made a part hereof.
1.2. Unless otherwise defined herein or the context otherwise requires,
all capitalized terms used herein shall have the same meanings as ascribed to
them in the Loan Agreement.
ARTICLE
2.
AMENDMENT OF THE LOAN AGREEMENT
2.1. Section 1.55 ("MAXIMUM AMOUNT") is deleted in its entirety and the
following substituted therefor:
1.55 "MAXIMUM AMOUNT" SHALL MEAN AN AMOUNT EQUAL TO (a) $12,500,000
MINUS ALL PERMITTED PREPAYMENTS MADE BY BORROWER PURSUANT TO SECTION 2.6
HEREIN, FOR THE PERIOD OF TIME COMMENCING ON JANUARY 1, 1997 AND ENDING ON
MARCH 14, 1997; AND (b) $10,000,000 MINUS ALL PERMITTED PREPAYMENTS MADE BY
BORROWER PURSUANT TO SECTION 2.6 HEREIN, FOR THE PERIOD OF TIME COMMENCING ON
MARCH 15, 1997 AND FOR ALL TIMES THEREAFTER.
2.2. Section 2.1 (TOTAL FACILITY) hereby is deleted in its entirety and
the following substituted therefor:
2.1 TOTAL FACILITY. PROVIDED THERE DOES NOT THEN EXIST AN EVENT OF
DEFAULT OR DEFAULT, AND SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THIS
AGREEMENT, LENDER AGREES TO MAKE AVAILABLE FOR BORROWER'S USE FROM TIME TO
TIME DURING THE TERM OF THIS AGREEMENT, UPON BORROWER'S REQUEST THEREFOR,
CERTAIN LOANS AND OTHER FINANCIAL ACCOMMODATIONS (THE "TOTAL FACILITY") AS
FOLLOWS:
(A) NOTWITHSTANDING THE OPERATING PROFIT DEFAULT, FOR THE PERIOD
COMMENCING ON JANUARY 1, 1997 AND ENDING ON MARCH 14, 1997, THE TOTAL
FACILITY SHALL CONSIST OF A REVOLVING LINE OF CREDIT CONSISTING OF ADVANCES
AGAINST ELIGIBLE ACCOUNTS, ELIGIBLE INSTALLMENT ACCOUNTS AND ELIGIBLE
INVENTORY (THE "REVOLVING LOAN") EVIDENCED BY A SUBSTITUTE REVOLVING NOTE, IN
THE FORM ATTACHED HERETO AS EXHIBIT 2.1(A), IN AN AGGREGATE
2
PRINCIPAL AMOUNT NOT TO EXCEED, AT ANY TIME OUTSTANDING, THE LESSER OF (i)
TWELVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($12,500,000) OR (ii) THE
BORROWING BASE AS REFLECTED IN A CERTIFICATE EXECUTED BY A DULY AUTHORIZED
OFFICER OF BORROWER AND DELIVERED TO LENDER ON THE CLOSING DATE AND BY 11:00
A.M. (CHICAGO TIME) ON EACH TUESDAY THEREAFTER DURING THE TERM AS OF THE
CLOSE OF BUSINESS ON THE IMMEDIATELY PRECEDING FRIDAY, EXCEPT TO THE EXTENT
PROVIDED IN SECTION 6.2 HEREIN (THE "BORROWING BASE CERTIFICATE"). AS USED
IN THIS AGREEMENT FOR THIS PERIOD OF TIME, "BORROWING BASE" SHALL MEAN AND,
AT ANY PARTICULAR TIME AND FROM TIME TO TIME, BE EQUAL TO THE SUM OF (a)
EIGHTY-FIVE (85%) (OR SUCH LESSER PERCENTAGE AS THE LENDER MAY, AT ANY TIME
AND FROM TIME TO TIME, DETERMINED IN THE EXERCISE OF ITS REASONABLE CREDIT
JUDGMENT) OF ELIGIBLE ACCOUNTS AS DETERMINED BY LENDER PLUS (b) SEVENTY
PERCENT (70%) (OR SUCH LESSER PERCENTAGE AS THE LENDER MAY, AT ANY TIME AND
FROM TIME TO TIME, DETERMINED IN THE EXERCISE OF ITS REASONABLE CREDIT
JUDGMENT) OF ELIGIBLE INSTALLMENT ACCOUNTS AS DETERMINED BY LENDER PLUS (c)
SIXTY PERCENT (60%) (OR SUCH LESSOR PERCENTAGE AS LENDER MAY AT ANY TIME AND
FROM TIME TO TIME, DETERMINE IN THE EXERCISE OF ITS REASONABLE CREDIT
JUDGMENT) OF ELIGIBLE INVENTORY. NOTWITHSTANDING THE FOREGOING, THE FOLLOWING
LIMITATIONS SHALL APPLY: (1) AGGREGATE AMOUNT OF ADVANCES AGAINST ELIGIBLE
INSTALLMENT ACCOUNTS SHALL NOT EXCEED, AT ANY TIME, THE LESSOR OF (x) SIX
MILLION TWO HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS ($6,250,000) OR (y)
FIFTY PERCENT (50%) OF THE MAXIMUM AMOUNT THEN IN EFFECT; AND (2) THE
AGGREGATE AMOUNT OF ADVANCES AGAINST ELIGIBLE INVENTORY SHALL NOT EXCEED, AT
ANY TIME, THE LESSER OF (x) ONE MILLION FIVE HUNDRED THOUSAND AND NO/100
DOLLARS ($1,500,000) OR (y) FIFTEEN PERCENT (15%) OF THE MAXIMUM AMOUNT THEN
IN EFFECT; PROVIDED, HOWEVER, THAT NOTHING CONTAINED HEREIN SHALL BE DEEMED A
WAIVER OF THE OPERATING PROFIT DEFAULT OR PRECLUDE LENDER'S EXERCISE OF ITS
RIGHTS AND REMEDIES ARISING THEREFROM PRIOR TO MARCH 14, 1997.
(B) FOR THE PERIOD COMMENCING ON MARCH 15, 1997 AND CONTINUING AT
ALL TIMES THEREAFTER DURING THE TERM, THE TOTAL FACILITY SHALL CONSIST OF A
REVOLVING LINE OF CREDIT CONSISTING OF ADVANCES AGAINST ELIGIBLE ACCOUNTS,
ELIGIBLE INSTALLMENT ACCOUNTS AND ELIGIBLE INVENTORY EVIDENCED BY A
SUBSTITUTE REVOLVING NOTE, IN THE FORM ATTACHED HERETO AS EXHIBIT 2.1(B), IN
AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED, AT ANY TIME OUTSTANDING, THE
LESSOR OF (i) TEN MILLION DOLLARS ($10,000,000) OR (ii) THE BORROWING BASE AS
REFLECTED IN A BORROWING BASE CERTIFICATE. NOTWITHSTANDING THE FOREGOING, THE
FOLLOWING LIMITATIONS SHALL APPLY: (1) THE AGGREGATE AMOUNT OF ADVANCES
AGAINST ELIGIBLE INSTALLMENT ACCOUNTS SHALL NOT EXCEED, AT ANY TIME, THE
LESSOR OF (X) FIVE MILLION AND NO/100 DOLLARS ($5,000,000) OR (y) FIFTY
PERCENT (50%) OF THE MAXIMUM AMOUNT THEN IN EFFECT; AND (2) THE AGGREGATE
AMOUNT OF ADVANCES AGAINST ELIGIBLE INVENTORY SHALL NOT EXCEED, AT ANY TIME,
THE LESSER OF (x) ONE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($1,500,000) OR (y) FIFTEEN PERCENT (15%) OF THE MAXIMUM AMOUNT THEN IN
EFFECT.
(C) SUBJECT TO THE PROVISIONS OF SECTION 2.1(A), IN ADDITION TO
THE FOREGOING, LENDER SHALL MAKE AVAILABLE TO BORROWER AN OVER ADVANCE
FACILITY (THE "OVER ADVANCE FACILITY") IN AN AMOUNT NOT TO EXCEED FIVE
HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000), PROVIDED THAT THERE SHALL BE
NO OUTSTANDING INDEBTEDNESS UNDER THE OVER
3
ADVANCE FACILITY FOR A PERIOD OF NOT LESS THAN THIRTY (30) CONSECUTIVE DAYS
DURING EACH CONTRACT YEAR. IN ADDITION TO THE FOREGOING, LENDER SHALL ALSO
MAKE AVAILABLE TO BORROWER A SEASONAL OVERADVANCE FACILITY (THE "SEASONAL
OVERADVANCE FACILITY") IN AN AMOUNT NOT TO EXCEED TWO MILLION AND NO/100
DOLLARS ($2,000,000) FOR THE PERIOD OF TIME COMMENCING ON APRIL 1 AND ENDING
ON JULY 31 OF EACH CALENDAR YEAR DURING THE TERM AND ONE MILLION AND NO/100
DOLLARS ($1,000,000) FOR THE PERIOD OF TIME COMMENCING ON AUGUST 1 AND ENDING
ON OCTOBER 31 OF EACH CALENDAR YEAR DURING THE TERM.
IN THE EVENT LENDER DECREASES THE ADVANCE PERCENTAGES TO BE APPLIED TO
ELIGIBLE ACCOUNTS AND ELIGIBLE INVENTORY WHICH ARE CONTAINED IN THIS SECTION
2.1, SUCH DECREASE SHALL BECOME EFFECTIVE IMMEDIATELY FOR THE PURPOSE OF
CALCULATING THE AMOUNT WHICH LENDER AGREES TO ADVANCE, OR ALLOW TO REMAIN
OUTSTANDING, AGAINST ELIGIBLE ACCOUNTS, ELIGIBLE INSTALLMENT ACCOUNTS AND
ELIGIBLE INVENTORY.
2.3 Section 2.3(A)(i) of the Loan Agreement hereby is deleted in its
entirety and replaced with the following:
(A)(i) SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING,
THE BORROWER SHALL PAY TO THE LENDER INTEREST ON THE TOTAL FACILITY AS
FOLLOWS: (v) BORROWER SHALL PAY INTEREST ON THE PRINCIPAL BALANCE OF THE
AMOUNT OUTSTANDING UNDER THE OVER ADVANCE FACILITY EQUAL TO TWO HUNDRED (200)
BASIS POINTS IN EXCESS OF THE PRIME RATE; (w) BORROWER SHALL PAY INTEREST ON
THE PRINCIPAL BALANCE OF THE AMOUNT OUTSTANDING UNDER THE SEASONAL OVER
ADVANCE FACILITY EQUAL TO TWO HUNDRED (200) BASIS POINTS IN EXCESS OF THE
PRIME RATE; (x) BORROWER SHALL PAY INTEREST ON THAT PORTION OUTSTANDING OF
PRINCIPAL BALANCE OF THE REVOLVING LOAN WHICH EXCEEDS TWELVE MILLION FIVE
HUNDRED THOUSAND AND NO/100 DOLLARS ($12,500,000) PURSUANT TO SECTION 2.1(A)
EQUAL TO TWO HUNDRED (200) BASIS POINTS IN EXCESS OF THE PRIME RATE; (y)
BORROWER SHALL PAY INTEREST ON THE OUTSTANDING PRINCIPAL BALANCE OF THE
REVOLVING LOAN WHICH EXCEEDS TEN MILLION AND NO/100 DOLLARS ($10,000,000)
PURSUANT TO SECTION 2.1(B) EQUAL TO TWO HUNDRED (200) BASIS POINTS IN EXCESS
OF THE PRIME RATE; AND (z) BORROWER SHALL PAY INTEREST AT THE APPLICABLE
DESIGNATED RATE ON THE OUTSTANDING PRINCIPAL BALANCE OF THE REVOLVING LOAN
WHICH DOES NOT EXCEED: (I) TWELVE MILLION FIVE HUNDRED THOUSAND AND NO/100
DOLLARS ($12,500,000) DURING THE PERIOD OF TIME COMMENCING ON JANUARY 1, 1997
AND ENDING ON MARCH 14, 1997; AND (II) TEN MILLION AND NO/DOLLARS
($10,000,000) FOR THE PERIOD COMMENCING ON MARCH 15, 1997 AND CONTINUING AT
ALL TIMES THEREAFTER DURING THE TERM; PROVIDED, HOWEVER, THAT UPON THE
OCCURRENCE AND DURING THE CONTINUATION OF AN EVENT OF DEFAULT, LENDER MAY, AT
ITS OPTION, RAISE THE INTEREST RATE CHARGES ON THE LIABILITIES TO THE DEFAULT
RATE WITH RESPECT TO THE LIABILITIES FROM THE DATE OF THE OCCURRENCE OF THE
DEFAULT UNTIL THE EARLIER OF (1) THE DEFAULT IS CURED OR WAIVED BY LENDER OR
(2) THE LIABILITIES ARE PAID IN FULL. NOTWITHSTANDING THE PROVISIONS OF THE
PREVIOUS SENTENCES, BORROWER SHALL RECEIVE A TEN (10) DAY PERIOD (COMMENCING
ON THE DATE OF THE OCCURRENCE OF SUCH APPLICATION OF THE DEFAULT) TO CURE ANY
NON-MONETARY DEFAULT BEFORE LENDER SHALL HAVE THE RIGHT TO RAISE THE INTEREST
RATE CHARGED ON THE LIABILITIES TO THE DEFAULT RATE. THE APPLICABLE BASIS FOR
DETERMINING THE RATE OF INTEREST WITH RESPECT TO THE
4
REVOLVING LOAN SHALL BE SELECTED BY THE BORROWER INITIALLY AT THE TIME A
REQUEST FOR AN ADVANCE IS GIVEN PURSUANT TO SECTION 12.3(J). THE BASIS FOR
DETERMINING THE INTEREST RATE WITH RESPECT TO THE REVOLVING LOAN MAY BE
CHANGED FROM TIME TO TIME BY BORROWER PURSUANT TO SECTION 2.3(E).
2.4. Section 2.1(E)(i) of the Loan Agreement is deleted in its entirety
and replaced with the following:
(i) CONVERT AT ANY TIME ALL OR ANY PARTY OF ANY OUTSTANDING BASE RATE
REVOLVING LOAN (EXCEPT FOR LOANS PURSUANT TO (W) THE SEASONAL OVER ADVANCE
FACILITY; (X) THE OVER ADVANCE FACILITY; (Y) THE REVOLVING LOAN TO THE EXTENT
OF ADVANCES IN EXCESS OF TWELVE MILLION FIVE HUNDRED THOUSAND AND NO/100
DOLLARS ($12,500,000) PURSUANT TO SECTION 2.1(A); AND (Z) THE REVOLVING LOAN
TO THE EXTENT OF ADVANCES IN EXCESS OF TEN MILLION AND NO/100 DOLLARS
($10,000,000) PURSUANT TO SECTION 2.1(B), EACH OF WHICH BEAR INTEREST AT THE
PRIME RATE PLUS TWO HUNDRED (200) BASIS POINTS, AND MAY NOT BE CONVERTED TO
LIBOR RATE LOANS) EQUAL TO FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($500,000) AND INTEGRAL MULTIPLES OF ONE HUNDRED THOUSAND AND NO/100 DOLLARS
($100,000) IN EXCESS OF THAT AMOUNT FROM A BASE RATE REVOLVING LOAN TO A
LIBOR RATE REVOLVING LOAN OR TO CONVERT A LIBOR RATE REVOLVING LOAN IN
AMOUNTS EQUAL TO FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000) AND
INTEGRAL MULTIPLES OF ONE HUNDRED THOUSAND AND NO/100 DOLLARS ($100,000) IN
EXCESS OF THAT AMOUNT FROM A LIBOR RATE REVOLVING LOAN TO A BASE RATE
REVOLVING LOAN; OR
2.5. Section 2.8 of the Loan Agreement is deleted in its entirety and
replaced with the following:
2.8 NON-USE FEE. (A) DURING THE PERIOD COMMENCING ON JANUARY 1, 1997
AND ENDING ON MARCH 14, 1997, BORROWER SHALL PAY TO LENDER A NON-USE FEE
EQUAL TO ONE-HALF OF ONE PERCENT (0.50%) PER ANNUM OF THE AMOUNT, IF ANY, BY
WHICH TWELVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($12,500,000) HAS EXCEEDED
THE AVERAGE DAILY CLOSING BALANCE OF THE REVOLVING LOAN DURING EACH CALENDAR
QUARTER OR PARTIAL QUARTER DURING SAID PERIOD. THE NON-USE FEE SHALL BE
PAYABLE IN ARREARS ON THE FIRST DAY OF EACH CALENDAR QUARTER AND SHALL BE
CALCULATED ON THE BASIS OF A 360-DAY YEAR FOR ACTUAL DAYS ELAPSED.
(B) DURING THE PERIOD COMMENCING ON MARCH 15, 1997 AND FOR ALL TIMES
THEREAFTER DURING THE TERM, BORROWER SHALL PAY TO LENDER A NON-USE FEE EQUAL
TO ONE-HALF OF ONE PERCENT (0.50%) PER ANNUM OF THE AMOUNT, IF ANY, BY WHICH
TEN MILLION DOLLARS ($10,000,000) HAS EXCEEDED THE AVERAGE DAILY CLOSING
BALANCE OF THE REVOLVING LOAN DURING EACH CALENDAR QUARTER OR PARTIAL QUARTER
DURING SAID PERIOD. THE NON-USE FEE SHALL BE PAYABLE IN ARREARS ON THE FIRST
DAY OF EACH CALENDAR QUARTER AND SHALL BE CALCULATED ON THE BASIS OF A
360-DAY YEAR FOR THE ACTUAL DAYS ELAPSED.
5
ARTICLE
3.
REPRESENTATIONS AND WARRANTIES
3.1. Borrower hereby makes the following representations and warranties
to Lender, which representations and warranties shall constitute the
continuing covenants of Borrower and shall remain true and correct until all
of Borrower's liabilities are paid and performed in full:
a. The representations and warranties of Borrower contained in
the Loan Agreement are true and correct on and as of the date hereof as
though made on and as of such date;
b. Except for Borrower's failure to maintain its Operating Profit
in compliance with Section 10.1(B) of the Loan Agreement (the "Operating
Profit Default"), no Event of Default or event which, but for the lapse of
time or the giving of notice, or both, would constitute an Event of Default
under the Loan Agreement has occurred and is continuing or would result from
the execution and delivery of this Amendment;
c. Except for the Operating Profit Default, Borrower is in full
compliance with all of the terms, conditions and all provisions of the Loan
Agreement and the other agreements;
d. This Amendment and all other agreements required hereunder to
be executed by Borrower and delivered to Lender, have been duly authorized,
executed and delivered on Borrower's behalf pursuant to all requisite
corporate authority and this Amendment and each of the other agreements
required hereunder to be executed and delivered by Borrower to Lender
constitute the legal, valid and binding obligations of Borrower enforceable
in accordance with their terms, except as enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to creditors' rights; and
e. Borrower hereby acknowledges and agrees that Borrower has no
defense, offset or counterclaim to the payment of said principal, interest,
fees or other liabilities and hereby waives and relinquishes any such
defense, offset or counterclaim and Borrower hereby releases Lender and its
respective officers, directors, agents, affiliates, successors and assigns
from any claim, demand or cause of action, known or unknown, contingent or
liquidated, which may exist or hereafter be known to exist relating to any
matter prior to the date hereof.
ARTICLE
4.
RATIFICATION
Except as expressly amended hereby, the Loan Agreement and all other
agreements executed in connection therewith shall remain in full force and
effect. The Loan Agreement, as
6
amended hereby, and all rights and powers created thereby and thereunder or
under such other agreements, are in all respects ratified and confirmed. From
and after the date hereof, the Loan Agreement shall be deemed amended and
modified as herein provided but, except as so amended and modified, the Loan
Agreement shall continue in full force and effect and the Loan Agreement and
this Amendment shall be read, taken and construed as one and the same
instrument. On and after the date hereof, the term "Agreement" as used in the
Loan Agreement and all other references to the Loan Agreement therein, in any
other instrument, document or writing executed by Borrower or any guarantor
or furnished to Lender by Borrower or any guarantor in connection therewith
or herewith shall mean the Loan Agreement as amended by this Amendment.
ARTICLE
5.
MISCELLANEOUS
5.1. Borrower shall promptly pay to Lender a closing fee in the amount
of Ten Thousand and No/100 Dollars ($10,000), which fee shall be deemed fully
earned and nonrefundable at the execution by Borrower of this Amendment and
shall be paid concurrently with Borrower's execution of this Amendment. Such
fee shall compensate Lender for the reasonable costs associated with the
origination, structuring, processing, approving and closing of the increase
in the Revolving Loan commitment and the transactions contemplated by this
Amendment, including, but not limited to, administrative, out-of-pocket,
general overhead and lost opportunity costs, but not including any expenses
for which Borrower has agreed to reimburse Lender pursuant to any other
provisions of this Amendment or any other Ancillary Agreement, such as, by
way of example, reasonable legal fees and expenses.
5.2. Borrower agrees to promptly pay or reimburse all out-of-pocket
costs and expenses of Lender, including without limitation, reasonable
attorneys' fees, costs, expenses incurred by Lender in connection with the
negotiation, preparation, execution and delivery of this Amendment and all
other matters pertaining hereto.
5.3. This Amendment may be signed in any number of counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
5.4. Nothing contained herein shall be deemed a waiver or forbearance
or create a course of conduct or otherwise estop Lender from exercising its
rights due to the Operating Profit Default or any future Events of Default
under the Loan Agreement.
5.5. Except as otherwise specified herein, this Amendment embodies the
entire agreement and understanding between Lender and Borrower with respect
to the subject matter
7
hereof and supersedes all prior agreements, consents and understandings
relating to such subject matter.
5.6. The headings in this Amendment have been inserted for convenience
only and shall be given no substantive meaning or significance in construing
the terms of this Amendment.
5.7. This Amendment shall inure to the benefit of Lender and its
successors and assigns and shall be binding upon and inure to the successors
and assigns of Borrower, except that Borrower may not assign any of its
rights in and to this Amendment.
IN WITNESS WHEREOF, Borrower and Lender have caused this Third Amendment
to Revolving Loan and Security Agreement to be executed and delivered as of
the day and year written above.
THE XXXXX ORGANIZATION, INC.
By: /s/Xxxxxx Xxxxxx
--------------------------
Name: XXXXXX XXXXXX
------------------------
Title: SR VP & CFO
-----------------------
TRO LEARNING CANADA, INC.
By: /s/Xxxxxx Xxxxxx
--------------------------
Name: XXXXXX XXXXXX
------------------------
Title: SR VP & CFO
-----------------------
SANWA BUSINESS CREDIT CORPORATION
By: /s/Xxxxxxxx X. Xxxxxx
--------------------------
Name: XXXXXXXX X. XXXXXX
------------------------
Title: VICE PRES
-----------------------
AMENDMENT IS CONTINUED ON NEXT PAGE
8
REAFFIRMATION OF
GUARANTY OF PAYMENT AND PERFORMANCE
THE UNDERSIGNED PARTY, as guarantor ("Guarantor") of the above Borrowers
pursuant to its Guaranty of Payment and Performance (the "Guaranty")
identified below, acknowledges the terms and conditions set forth in this
Third Amendment to Revolving Loan And Security Agreement and ratifies and
reaffirms its guaranty obligations as set forth in the Guaranty, as
reaffirmed. To further induce Lender to enter into this Amendment, Guarantor
hereby represents and warrants to Lender that it possesses no claims,
defenses, offsets, recoupment or counterclaims of any kind or nature against
or with respect to the enforcement of the Loan Agreement or any other
Ancillary Agreement, each as amended by this Amendment, or to the Guaranty
(collectively, the "Claims"), nor does Guarantor have any knowledge of any
facts that would or might give rise to any Claims. If facts now exist which
would or could give rise to any Claim against or with respect to the
enforcement of the Loan Agreement, any Ancillary Agreement, or the Guaranty,
Guarantor hereby unconditionally, irrevocably and unequivocally waives and
fully releases any and all such Claims as if such Claims where the subject of
a lawsuit, adjudicated to final judgment from which no appeal could be taken
and therein dismissed with prejudice.
DATED: As of January 6, 1997
TRO LEARNING, INC.
By: /s/Xxxxxx Xxxxxx
--------------------------
Name: XXXXXX XXXXXX
------------------------
Title: SR VP & CFO
-----------------------
(Guaranty of Payment and Performance
dated as of August 2, 1995, as
reaffirmed from time to time)
9
