EXHIBIT 10.1.3
AMENDMENT NUMBER THREE TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER THREE TO LOAN AND SECURITY AGREEMENT, dated as of
December 19, 2001 (this "Amendment"), amends that certain Loan and Security
Agreement, dated as of February 4, 1999 (as amended from time to time, the "Loan
Agreement"), by and between AMERIVISION COMMUNICATIONS, INC., an Oklahoma
corporation ("Borrower"), on the one hand, and COAST BUSINESS CREDIT, a division
of Southern Pacific Bank, a California corporation ("Coast"), on the other hand.
All initially capitalized terms used in this Amendment shall have the meanings
ascribed thereto in the Loan Agreement unless specifically defined herein.
RECITALS
WHEREAS, Borrower has requested that Coast temporarily waive an
existing Event of Default under the Loan Agreement pursuant to the terms and
provisions set forth in this Amendment;
WHEREAS, Borrower and Coast wish to amend the Loan Agreement pursuant
to the terms and provisions set forth in this Amendment; and
NOW, THEREFORE, the parties hereto agree as follows:
TEMPORARY WAIVER
Pursuant to Section 8.3(6) of the Schedule to the Loan
Agreement, as amended, Borrower was required to engage a national accounting
firm, acceptable to Lender, for the preparation of Borrower's December 31, 2000
fiscal year-end financial statements. The time period for compliance with this
requirement has been extended on two previous occasions with the last extension
expiring on September 30, 2001. Borrower's failure to comply with such
requirement as of September 30, 2001 is an Event of Default. Borrower has
requested, and Coast hereby consents to, a further extension through March 31,
2002 in which to comply with such requirement.
AMENDMENTS
Section 1. AMENDMENT TO SECTION 1 OF THE AGREEMENT TO ADD A
DEFINITION FOR "DEBT". The following definition of "Debt" is hereby added to the
definitions set forth in Section 1 of the Agreement:
""Debt" means, as of the date of determination, the sum, but without
duplication, of any and all of Borrower's: (i) indebtedness heretofore
or hereafter created, issued, incurred or assumed by such Borrower
(directly or indirectly) for or in respect of
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money borrowed; (ii) all obligations arising out of capital leases; and
(iii) all obligations for the deferred purchase price of property or
services."
Section 2. AMENDMENT TO SECTION 1 OF THE AGREEMENT TO ADD A
DEFINITION FOR "DEBT SERVICE COVERAGE RATIO". The following definition of "Debt
Service Coverage Ratio" is hereby added to the definitions set forth in Section
1 of the Agreement:
""Debt Service Coverage Ratio" means the ratio, for any time period,
whose numerator is the difference between EBITDA and the sum of
unfinanced a) capital expenditures and b) cash income taxes paid, and
whose denominator is all principal payments (less principal payments
formally deferred and subordinated to Coast) and interest payments
(less interest payments formally deferred or paid in kind) made by
Borrower on Debt."
Section 3. AMENDMENT TO SECTION 2.1 OF THE SCHEDULE TO THE
LOAN AGREEMENT REGARDING THE MAXIMUM DOLLAR AMOUNT. The first paragraph of
Section 2.1 of the Schedule to the Loan Agreement is hereby amended by deleting
such paragraph in its entirety and replacing it with the following:
"Loans in a total amount at any time outstanding not to exceed
the lesser of a total of Twenty Eight Million Five Hundred
Dollars ($28,500,000) at any one time outstanding (the
"Maximum Dollar Amount"), or the lesser of (a) [as set forth
in Amendment Number One dated September, 1999] and (b) [as set
forth in Amendment Number Two dated May 10, 2000] below:"
Section 4. AMENDMENT TO ADD A NEW SECTION 8.1(8) TO THE
SCHEDULE TO THE LOAN AGREEMENT. The following Section 8.1(8) is hereby added to
the Schedule to the Loan Agreement:
"8. As measured quarterly, commencing with the quarterly period
ending March 31, 2002, Borrower shall maintain an ongoing
minimum Debt Service Coverage Ratio, for the immediately
preceding trailing three (3) month period, as follows:
Quarterly Period Ending Applicable Debt Service Coverage Ratio
----------------------- --------------------------------------
March 31, 2002 1.10:1.00
June 30, 2002, and all
subsequent quarterly
periods 1.25:1.00"
Section 5. AMENDMENT TO SECTION 8.3(6) OF THE SCHEDULE TO THE
LOAN AGREEMENT REGARDING ANNUAL FINANCIAL STATEMENTS. Section 8.3(6) of the
Schedule to the Loan Agreement is hereby amended by deleting such paragraph in
its entirety and replacing it with the following:
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"On an ongoing basis, annual financial statements, as soon as
available, and in any event within ninety (90) days following
the end of Borrower's fiscal year, containing the unqualified
opinion of, and certified by, a certified public accounting
firm acceptable to Coast."
Section 6. CARRIER RESERVES. Pursuant to the terms of the Loan
Agreement, Coast is entitled to institute and maintain Carrier Reserves for the
payment of carrier accounts payable. Such a reserve is currently maintained for
accounts payable owing to WorldCom and Broadwing. We understand that Borrower
may wish to obtain services from additional carriers in the future. Coast agrees
to reduce the amount of Carrier Reserves for WorldCom once WorldCom agrees in
writing to reduce the reserve requirement currently contained within the
Intercreditor Agreement between Coast and WorldCom. Thereafter, the Carrier
Reserve for WorldCom will be equal to the Reserve amount required by WorldCom.
Furthermore, Carrier Reserves for all other carriers of Borrower will be based
on the requirements of each individual carrier, but in no event to be less than
Five Hundred Thousand Dollars ($500,000). The amount of reserves required by the
carriers is limited to no more than One Million Dollars ($1,000,000) in
aggregate at any time without prior Coast written approval. In connection with
the exercise by Coast of its discretion, Coast expressly reserves the right to
increase the amount of Carrier Reserves if Borrower's payments to any of its
carriers become delinquent at any time in the future.
Section 7. CONDITIONS PRECEDENT. The effectiveness of this
Amendment is expressly conditioned upon the receipt by Coast of:
(1) a fully executed copy of this Amendment; and
(2) a fully executed copy of that certain Amendment Number
Two to Syndicated Lender Rider.
Section 8. ENTIRE AGREEMENT. The Loan Agreement, as amended
hereby, embodies the entire agreement and understanding between the parties
hereto and supersedes all prior agreements and understandings relating to the
subject matter hereof. Borrower represents, warrants and agrees that in entering
into the Loan Agreement and consenting to this Amendment, it has not relied on
any representation, promise, understanding or agreement, oral or written, of, by
or with, Coast or any of its agents, employees, or counsel, except the
representations, promises, understandings and agreements specifically contained
in or referred to in the Loan Agreement, as amended hereby.
Section 9. CONFLICTING TERMS. In the event of a conflict
between the terms and provisions of this Amendment and the terms and provisions
of the Loan Agreement, the terms of this Amendment shall govern. In all other
respects, the Loan Agreement, as amended and supplemented hereby, shall remain
in full force and effect.
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Section 10. MISCELLANEOUS. This Amendment shall be governed by
and construed in accordance with the laws of the State of
California. This
Amendment may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any party hereto may execute this
Amendment by signing such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective officers thereunto duly
authorized as of the date first above written.
BORROWER:
AMERIVISION COMMUNICATIONS, INC.,
An Oklahoma corporation
By /s/ XXXXXXX X. XXXXX
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President
By /s/ XXXXX XXXXX
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Secretary or Ass't Secretary
COAST:
COAST BUSINESS CREDIT,
A DIVISION OF SOUTHERN PACIFIC BANK
By /s/ XXXX XXXXXXX
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Title Vice President
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