Exhibit 10.11
THIRD AMENDMENT TO LOAN AGREEMENT
AND REVOLVING NOTE
This Third Amendment to Loan Agreement and Revolving Note is made and
entered into this 20th day of June, 2002, by and between U.S. Bank National
Association, a national banking association, with an address of 000 Xxxxx Xxxx
Xxxxxx, Post Xxxxxx Xxx 0000, Xxxxx Xxxxx, Xxxxx Xxxxxx 00000-0000 ("Lender")
and Daktronics, Inc., a South Dakota corporation, with an address of 000 00xx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxx 00000 ("Borrower").
RECITALS:
A. Lender and Borrower entered into a Loan Agreement dated October 14,
1998, which Loan Agreement was amended by an Amendment dated November 30, 1999
and an Amendment dated December 8, 2000.
B. In accordance with the Loan Agreement, Lender is the holder of a
Revolving Note dated October 14, 1998 signed on behalf of Borrower. Pursuant to
the Amendment to Loan Agreement dated November 30, 1999, the loan amount is
$20,000,000.00 (the "Revolving Loan").
C. Lender and Borrower mutually wish to extend the maturity date of the
Revolving Loan from October 1, 2003 to October 1, 2004 and modify some of the
covenants of Borrower.
NOW, THEREFORE, for good and valuable consideration, the parties agree
as follows:
1. The Revolving Loan Maturity Date is extended to October 1, 2004.
2. Section 6.1(e) of the Loan Agreement, requiring quarterly statements
from the Borrower as to no Default or Event of Default, is deleted.
3. Section 6.10 of the Loan Agreement is amended to read as follows:
Merger. The Borrower may merge, consolidate or enter into an
analogous reorganization without the prior written consent of the
Lender, provided that the transaction is valued at less than
$1,000,000.00 and the Borrower is in compliance with all covenants and
conditions of this Loan Agreement.
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4. Section 6.11 of the Loan Agreement is amended to read as follows:
Acquisitions. The Borrower will not acquire during any fiscal
year another business, firm or company in excess of $1,000,000.00,
without prior written approval from the Lender.
5. Schedule VI is amended to provide with respect to the Tangible Net
Worth covenant:
Tangible Net Worth. The Borrower will not permit its Tangible
Net Worth (the excess of its assets, excluding intangible assets, over
its liabilities) at any time to be less than $40,000,000.00.
6. Schedule VI is further amended to provide with respect to the
definition of "Adjusted Fixed Charge Coverage Ratio":
Minimum Adjusted fixed Charge Coverage Ratio. The Borrower
will not permit the Minimum Adjusted Fixed Charge Ratio, as of the last
day of any fiscal year for the four consecutive fiscal quarters ending
on that date to be less than 2 to 1.
For purposes hereof, the following definitions have the
following meanings:
"EBITDA": For any period of determination, the net income of
the Borrower before deductions for income taxes, interest expense, depreciation
and amortization, all as determined in accordance with GAAP.
"Adjusted Fixed Charge Coverage Ratio": For any period of determination
with respect to the Borrower, the ratio of
(a) EBITDA minus the sum of (i) any dividends or other
distributions, (ii) expenditures in the sum of $1,500,000.00
for fixed and capital assets not financed and (iii) tax
expenses,
to
(b) all required principal and interest payments with respect
to Indebtedness (including but not limited to all payments
with respect to capitalized lease obligations of the
Borrower), in each case determined for said period in
accordance with GAAP.
9. Section 6.1(a) is amended to read as follows:
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6.1(a) As soon as available in any event within ninety (90) days after
the end of each fiscal year of the Borrower, financial statements of
income cash flow and changes in stockholders' equity, a balance sheet
as at the end of such year, and notes thereto, setting forth each case
in comparative form corresponding figures from the previous annual
audit, certified without qualification by an independent Certified
Public Accountant of recognized regional standing selected by the
Borrower. Provided Borrower is in compliance with all filing
requirements of the Securities and Exchange Commission and timely files
all of the above information with the Securities and Exchange
Commission and within the timeframes required above, Borrower shall not
be obligated to provide such financial information to the Lender.
8. The following sentence is added to the end of Section 6.1(b):
Provided Borrower is in compliance with all filing
requirements of the Securities and Exchange Commission and timely files
all of the above information with the Securities and Exchange
Commission and within the timeframes required above, Borrower shall not
be obligated to provide such information directly to the Lender.
9. Sections 6.1(c) and 6.1(d) are deleted in their entirety.
10. All other terms and conditions of the Loan Agreement and Revolving
Note shall remain in full force and effect except as modified herein.
DAKTRONICS, INC. U.S. BANK NATIONAL ASSOCIATION
By /s/ Xxxxxxx X. Xxxxxxxxx By /s/ Xxxx Xxxxx
--------------------------- ---------------------------
Xxxxxxx X. Xxxxxxxxx Xxxx Xxxxx
Chief Financial Officer Vice President
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