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Execution Copy
FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER
THIS FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER (this "Amendment
and Waiver") dated as of November 12, 1998, by and among PNI SYSTEMS, LLC, a
Georgia limited liability company (the "Company"), PREFERRED NETWORKS, INC., a
Georgia corporation (the "Parent", the Parent, together with the Company, the
"Borrowers"), and NATIONSBANK, N.A., successor to NationsBank, N.A. (South) (the
"Lender").
WHEREAS, the Borrowers and the Lender have entered into that certain
Credit Agreement dated as of August 8, 1996, as amended as of December 20, 1996,
as of March 12, 1997, as of April 11, 1997 and as of March 19, 1998 (as so
amended, the "Credit Agreement"); and
WHEREAS, the Borrowers and the Lender desire to amend certain
provisions of the Credit Agreement on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
Section 1. Amendment to Credit Agreement. The parties hereto agree that
the Credit Agreement is amended by deleting Section 8.5 thereof in its entirety
and substituting in its place the following:
"8.5 EBITDA TO PROJECTED EBITDA
The Parent shall not permit the EBITDA of the Parent and its
Subsidiaries determined on a consolidated basis for the period of four
consecutive fiscal quarters ending on the dates set forth below to be
less than the corresponding percentage set forth below of Projected
EBITDA of the Parent and its Subsidiaries determined on a consolidated
basis for such four quarter period:
FOUR QUARTER PERIOD ENDING: PERCENTAGE OF PROJECTED EBITDA:
December 31, 1998 25%
Each March 31, June 30, September 30 and December 75%
31 thereafter
Section 2. Interest Rate Restriction. Notwithstanding anything set
forth in the Credit Agreement to the contrary, all Loans made to the Borrowers
after the date hereof shall be Base Rate Loans. Any LIBOR Loan outstanding on
the date hereof shall automatically convert to a Base Rate Loan on the last day
of such LIBOR Loan's current Interest Period and may not be continued by either
Borrower as a LIBOR Loan.
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Section 3. Waiver. The Lender hereby waives the Event of Default that
has occurred pursuant to Section 9.4(i) of the Credit Agreement arising by
reason of the failure of the Parent to perform its obligations under Section 8.5
of the Credit Agreement during the fiscal quarter of the Parent ending September
30, 1998.
Section 4. Conditions Precedent to Effectiveness of this Amendment and
Waiver. The effectiveness of this Amendment and Waiver is subject to receipt by
the Lender of each of the following, each in form and substance satisfactory to
the Lender:
(a) A counterpart of this Amendment and Waiver duly executed by
the Company, the Parent and each Guarantor;
(b) Payment of a fee to the Lender in the amount of $13,750; and
(c) Such other documents, instruments and agreements as the Lender
may reasonably request.
Section 5. Representations. Each of the Borrowers represents and
warrants to the Lender that:
(a) Authorization; No Conflict. The execution and delivery by the
Borrowers of this Amendment and Waiver and the performance by the Borrowers of
this Amendment and Waiver and the Credit Agreement, as amended by this Amendment
and Waiver, in accordance with their respective terms (a) have been duly
authorized by all requisite corporate and, to the extent required, stockholder
action (or membership action in the case of a limited liability company) on the
part of each Borrower and (b) will not (i) violate any provision of Applicable
Law, or any order of any Governmental Authority or any provision of the
certificate in incorporation, articles of organization or other comparable
organizational instrument or by-laws or operating agreement of either Borrower,
(ii) violate, conflict with, result in a breach of or constitute (alone or with
notice or lapse of time or both) a default or an event of default under any
Material Contract to which either Borrower is a party or by which each Borrower
or any of its property is or may be bound, or (iii) result in the creation or
imposition of any Lien upon any property or assets of the Borrowers.
(b) Enforceability. This Amendment and Waiver has been duly executed
and delivered by a duly authorized officer of each Borrower and each of this
Amendment and Waiver and the Credit Agreement, as amended by this Amendment and
Waiver, is a legal, valid and binding obligation of the Borrowers enforceable
against the Borrowers in accordance with its respective terms except as the same
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other laws affecting generally the enforcement of creditors'
rights and by general principles of equity (regardless of whether considered in
a proceeding in equity or at law).
Section 6. Reaffirmation by Borrowers. Each Borrower hereby repeats and
reaffirms all representations and warranties made by such Borrower to the Lender
in the Credit Agreement and the other Loan Documents to which it is a party on
and as of the date hereof with the same force
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and effect as if such representations and warranties were set forth in this
Amendment and Waiver in full.
Section 7. Reaffirmation by Guarantors. Each of the Guarantor reaffirms
its continuing obligations to the Lender under its Guaranty, and agrees that
this Amendment and Waiver shall not in any way affect the validity and
enforceability of such Guaranty, or reduce, impair or discharge the obligations
of such Guarantor thereunder.
Section 8. Certain References. Each reference to the Credit Agreement
in any of the Loan Documents shall be deemed to be a reference to the Credit
Agreement as amended by this Amendment and Waiver.
Section 9. Expenses. The Company shall reimburse the Lender upon demand
for all costs and expenses (including attorneys' fees) incurred by the Lender in
connection with the preparation, negotiation and execution of this Amendment and
Waiver and the other agreements and documents executed and delivered in
connection herewith.
Section 10. Benefits. This Amendment and Waiver shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns.
Section 11. GOVERNING LAW. THIS AMENDMENT AND WAIVER SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
Section 12. Effect. Except as expressly herein amended, the terms and
conditions of the Credit Agreement and the other Loan Documents remain in full
force and effect. The amendment contained in Section 1 herein shall be deemed to
have prospective application only. The waiver contained in Section 2 herein
shall not be construed to be a waiver of any other Event of Default that may be
in existence as of the date hereof. Further, this Amendment and Waiver shall not
be construed as a waiver of any future violation of Section 8.5 or any of the
other terms and conditions of the Credit Agreement nor shall the Borrowers, by
receipt of this waiver, expect that such a waiver will be given in the future.
Section 13. Counterparts. This Amendment and Waiver may be executed in
any number of counterparts, each of which need not contain the signature of more
than one party and all of which taken together shall constitute one and the same
original instrument.
Section 14. Definitions. All capitalized terms not otherwise defined
herein are used herein with the respective definitions given them in the Credit
Agreement.
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment
to Credit Agreement and Waiver to be executed as of the date first above
written.
THE LENDER:
NATIONSBANK, N.A.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
THE PARENT:
PREFERRED NETWORKS, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Chief Executive Officer
THE COMPANY:
PNI SYSTEMS, LLC
By: Preferred Networks, Inc., its Manager
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Chief Executive Officer
[Signatures Continued on Next Page]
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[SIGNATURE PAGE TO FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER DATED
AS OF NOVEMBER 12, 1998 FOR PREFERRED NETWORKS, INC.]
THE GUARANTORS:
PNI SPECTRUM, LLC PREFERRED TECHNICAL
SERVICES, INC.
By: Preferred Networks, Inc., its Manager
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
By:/s/ Xxxx X. Xxxxx Title: Chief Executive Officer
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Name: Xxxx X. Xxxxx
Title: Secretary
PNI GEORGIA, INC. EPS WIRELESS, INC.
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxxxx Name: Xxxx X. Xxxxx
Title: Chief Executive Officer Title: Vice President & Secretary
MERCURY PAGING & HTB COMMUNICATIONS, INC.
COMMUNICATIONS, INC.
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx Name: Xxxx X. Xxxxxxx
Title: Chief Executive Officer Title: Chief Executive Officer
CUSTOM PAGE, INC. M.P.C. DISTRIBUTORS, INC.
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx Name: Xxxx X. Xxxxxxx
Title: Chief Executive Officer Title: Chief Executive Officer
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