<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
EXCHANGE ACT OF 1934
For quarter ended June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to __________
Commission file number 0-22716
BOLLINGER INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 75-2502577
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
222 W. AIRPORT FREEWAY, IRVING, TEXAS 75062
(Address of principal executive offices)
(Zip Code)
(214) 445-0386
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--------- ---------
As of June 30, 1996, 4,000,210 shares of the registrant's common
stock, $0.01 par value per share, were outstanding.
<PAGE> 2
BOLLINGER INDUSTRIES, INC.
INDEX
Page No.
--------
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets - June 30,
1996, and March 31, 1996 3
Consolidated Statements of Operations -
Thirteen Week Period Ended June 30, 1996,
and Three Months Ended June 30, 1995 4
Consolidated Statements of Cash Flows -
Thirteen Week Period Ended June 30, 1996,
and Three Months Ended June 30, 1995 5
Notes to Consolidated Financial Statements 6 - 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8 - 9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
SIGNATURES 11
INDEX TO EXHIBITS AND EXHIBITS 12
<PAGE> 3
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, March 31,
1996 1996
----------------- ---------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 1,056,662 $ 408,871
Accounts receivable
Trade, net of allowance for doubtful accounts . . . . . . . . 19,540,495 18,344,827
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230,849 229,735
Income Tax Refund . . . . . . . . . . . . . . . . . . . . . . . . 2,307,235 2,307,235
Inventories (Note C) . . . . . . . . . . . . . . . . . . . . . . 27,048,245 30,112,934
Current assets of discontinued operations - net . . . . . . . . 1,699,139 1,601,954
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . 805,175 525,272
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . 66,309 66,309
------------- -------------
Total current assets . . . . . . . . . . . . . . 52,754,109 53,597,137
PROPERTY PLANT AND EQUIPMENT . . . . . . . . . . . . . . . . . . . 1,884,806 2,015,282
Non current assets of discontinued operations . . . . . . . . . . 144,017 161,999
OTHER ASSETS
Goodwill and other intangibles - Net . . . . . . . . . . . . . . 1,216,254 1,233,482
Notes receivable and other assets . . . . . . . . . . . . . . . . 1,302,675 1,373,003
------------- -------------
TOTAL ASSETS $ 57,301,861 $ 58,380,903
============= =============
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $ 419,336 $ 78,026
Notes payable (Note D) . . . . . . . . . . . . . . . . . . . . 23,300,000 22,605,549
Accounts payable - trade . . . . . . . . . . . . . . . . . . . 15,698,730 16,913,821
Federal income tax payable (Note E) . . . . . . . . . . . . . - 43,847
Other current liabilities . . . . . . . . . . . . . . . . . . 2,057,432 1,674,046
Provision for restructuring of operations . . . . . . . . . . 3,561,105 3,960,000
------------- -------------
Total current liabilities . . . . . . . . . . . . . . . 45,036,603 45,275,289
LONG-TERM LIABILITIES
Long term debt, net of current portion . . . . . . . . . . . . 501,141 576,777
Deferred income taxes . . . . . . . . . . . . . . . . . . . . 66,309 66,309
------------- -------------
Total long-term liabilities . . . . . . . . . . . . . . 567,450 643,086
------------- -------------
Total liabilities . . . . . . . . . . . . . . . . . . . 45,604,053 45,918,375
------------- -------------
COMMITMENTS AND CONTINGENCIES . . . . . . . . . . . . . . . . . .
STOCKHOLDERS' EQUITY
Preferred stock -- $.01 par value; 1,000,000 shares
authorized; none issued . . . . . . . . . . . . . . . . . .
Common stock -- $.01par value; 8,000,000 shares authorized;
issued and outstanding 4,000,210 at June 30, 1996 and
March 31, 1996 . . . . . . . . . . . . . . . . . . . . . . 40,001 40,001
Capital in excess of par . . . . . . . . . . . . . . . . . . . 15,323,059 15,323,059
Retained earnings (accumulated deficit) . . . . . . . . . . . (3,665,252) (2,900,532)
------------- -------------
Total stockholders' equity . . . . . . . . . . . . . . . 11,697,808 12,462,528
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 57,301,861 $ 58,380,903
============= =============
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE> 4
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Thirteen Week Three Months
Period Ended Ended
June 30, June 30,
------------------- -------------------
1996 1995
------------------- ------------------
<S> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 22,433,893 $ 12,761,598
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . 17,654,045 9,697,802
-------------- --------------
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . 4,779,848 3,063,796
Selling expenses . . . . . . . . . . . . . . . . . . . . . . . . 2,080,381 1,312,508
Distribution, general and administrative expenses . . . . . . . 2,823,934 2,498,793
-------------- --------------
4,904,315 3,811,301
-------------- --------------
Operating profit (loss) . . . . . . . . . . . . . . . . . . . (124,467) (747,505)
Other expense (income)
Interest expense . . . . . . . . . . . . . . . . . . . . . . 649,766 450,301
Interest income . . . . . . . . . . . . . . . . . . . . . . . (9,513) (21,447)
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . - (12,059)
-------------- --------------
640,253 416,795
-------------- --------------
Earnings (loss) from continuing operations before income
taxes . . . . . . . . . . . . . . . . . . . . . . . . . (764,720) (1,164,300)
Income tax expense (benefit) . . . . . . . . . . . . . . . . . . - (461,668)
-------------- --------------
Earnings (loss) from continuing operations . . . . . . . . . (764,720) (702,632)
Discontinued operations
(Loss) from discontinued Healthcare operation net of
income tax benefit ($48,000) . . . . . . . . . . . . . . - (292,199)
-------------- --------------
Net earnings (loss) $ (764,720) $ (994,831)
============== ==============
Per share data
Earnings (loss) from continuing operations . . . . . . . . . $(.19) $(.18)
====== ======
Net earnings (loss) $(.19) $(.25)
====== ======
Weighted average common and common equivalent shares
outstanding . . . . . . . . . . . . . . . . . . . . . . . . . 4,000,210 3,971,072
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE> 5
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Thirteen Week Three Months
Period Ended Ended
June 30, June 30,
------------------- -------------------
1996 1995
------------------- ------------------
<S> <C> <C>
Cash flows from operating activities
Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . $ (764,720) $ (994,831)
Adjustments to reconcile net earnings (loss) to net cash
provided by (used in) operating activities . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . 210,933 131,287
Changes in operating assets and liabilities
Trade accounts receivable . . . . . . . . . . . . . . . . . (1,195,668) 3,229,254
Other receivables . . . . . . . . . . . . . . . . . . . . . (1,114) (471,725)
Inventories . . . . . . . . . . . . . . . . . . . . . . . . 3,064,689 (2,057,522)
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . (279,903) 228,501
Notes receivable and other assets . . . . . . . . . . . . . (19,430) 7,806
Accounts payable - Trade . . . . . . . . . . . . . . . . . . (1,215,091) 3,481,329
Federal income tax payable . . . . . . . . . . . . . . . . . (43,847) (200,000)
Other current liabilities 383,386 1,379,068
Provision for restructuring of operations . . . . . . . . . (398,895) -
Current assets of discontinued operations . . . . . . . . . (97,185) -
-------------- --------------
Net cash provided by (used in)
operating activities . . . . . . . . . . . . . . . . (356,845) 4,733,167
Cash flows from investing activities
Purchases of property and equipment . . . . . . . . . . . . . . . (8,958) (88,901)
Payments on note receivable . . . . . . . . . . . . . . . . . . . 35,487 27,094
Non-current assets from discontinued operations . . . . . . . . 17,982 -
-------------- --------------
Net cash provided by (used in)
operating activities . . . . . . . . . . . . . . . . 44,511 (61,807)
Cash flows from financing activities
Net proceeds from (payments on) note payable . . . . . . . . . . 694,451 (4,058,100)
Proceeds from short term debt . . . . . . . . . . . . . . . . . 341,310 -
Payments on long-term debt . . . . . . . . . . . . . . . . . . . (75,636) (9,083)
Proceeds from long-term debt . . . . . . . . . . . . . . . . . . - 21,954
-------------- --------------
Net cash provided by (used in) financing activities 960,125 (4,045,229)
-------------- --------------
Net increase in cash . . . . . . . . . . . . . . . . 647,791 626,131
Cash at beginning of period . . . . . . . . . . . . . . . . . . . . . . 408,871 116,476
-------------- --------------
Cash at end of period . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,056,662 $ 742,607
============== ==============
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE> 6
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - GENERAL
The consolidated interim financial statements include the accounts of
Bollinger Industries, Inc., its wholly owned subsidiaries and Bollinger
Industries, L.P., a partnership wholly owned by Bollinger's subsidiaries
(collectively the "Company").
The consolidated interim financial statements included herein have
been prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosure normally included in financial statements prepared in accordance
with generally accepted accounting principals have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading. It
is suggested that these financial statements be read in conjunction with the
consolidated financial statements and notes for the year ended March 31, 1996.
The Company has adopted a 13 week quarter ending on the Sunday nearest
the end of the calendar quarter for Fiscal 1997.
In the opinion of management, the unaudited interim consolidated
financial information of the Company contains all adjustments, consisting only
of those of a normal recurring nature, necessary to present fairly the
Company's financial position and the results of its operations and cash flows
for the periods presented. The results of operations for the periods presented
are not necessarily indicative of the results to be expected for the full year.
NOTE B - CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental disclosures:
<TABLE>
<CAPTION>
Thirteen Week Three Months
Period Ended Ended
June 30, June 30,
------------- -----------
1996 1995
------------- -----------
<S> <C> <C>
Interest paid $ 844,126 $ 508,051
Income taxes paid -- $ 200,000
</TABLE>
6
<PAGE> 7
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(continued)
NOTE C - INVENTORIES
<TABLE>
<CAPTION>
June 30, March 31,
1996 1996
------------ ------------
<S> <C> <C>
Raw materials $ 3,745,673 $ 8,765,659
Work-in-process 1,268,280 189,462
Finished goods 23,146,264 22,226,786
Reserve for obsolescence (1,111,972) (1,068,973)
------------ ------------
$ 27,048,245 $ 30,112,934
============ ============
</TABLE>
NOTE D - NOTES PAYABLE
During May 1996, the Company's maximum credit limit under its
revolving credit facility with a bank was raised to $23,300,000. The Company
continues to be in default on certain covenants of the loan agreement; those
defaults were subsequently waived. The Company is pursuing alternative
financing.
NOTE E - INCOME TAXES
The Company's effective income tax rates for the three months ended
June 30, 1996, and 1995 were 0% and 40%, respectively. The 0% tax charge
results from a 100% valuation allowance being recorded against the deferred tax
benefit. The 40% tax charge results from certain expenses not being deductible
for income tax purposes.
7
<PAGE> 8
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Company's Form
10-K and consolidated financial statements for the fiscal year ended March
31, 1996; the Company's Form 10Q for the quarter ended June 30, 1995; and the
consolidated financial statements and related notes, for the quarter ended June
30, 1996, elsewhere in this report.
THIRTEEN WEEKS ENDED JUNE 30, 1996, COMPARED TO
THREE MONTHS ENDED JUNE 30, 1995
Consolidated net sales for the quarter ended June 30, 1996, increased by $9.7
million as compared to the quarter ended June 30, 1995, an increase of 76%.
The increase in consolidated net sales resulted from an increase in net sales
of the trampoline product line of approximately $5.5 million, and an increase
in net sales of other fitness accessory products of approximately $ 4.2
million. The increase in net sales was primarily the result of promotional
orders from high volume customers. The Company introduced trampolines to its
Fitness accessory product line during May 1994. Since that time sales of
trampolines have rapidly increased. The Company expects sales of trampolines
to remain strong although it is unlikely the growth will be maintained at the
same rate in the future, since many major mass merchandisers now carry the
product line.
Gross profit for the quarter ended June 30, 1996, increased approximately
$1,716,000 as compared to the quarter ended June 30, 1995, but decreased as a
percentage of net sales from 24.0% to 21.3% for the same period. Gross profit
for trampolines as a percentage of net sales is lower than for other Fitness
accessory products. During the first quarter of fiscal 1997 trampoline net
sales accounted for a higher proportion of the Company's total net sales than
during the first quarter of fiscal 1996. This change in product mix is the
primary reason gross profit declined as a percentage of net sales. The
increased gross profit in dollars primarily resulted from the increase in net
sales.
Selling expenses for the quarter ended June 30, 1996, increased by
approximately $768,000 as compared to the three months ended June 30, 1995, but
decreased as a percentage of net sales from 10.3% to 9.3%. The dollar increase
in selling expenses was primarily the result of increased commissions to
support higher sales volume. Certain selling expenses are relatively fixed in
nature leading to a percentage decrease due to higher net sales.
Distribution, general and administrative expenses for the quarter ended June
30, 1996, increased by approximately $300,000 as compared to the three months
ended June 30, 1995, but decreased as a percentage of net sales from 19.6% to
12.6%. The primary reason for the increase resulted from the addition of
distribution payroll, as well as other categories of expense, to sustain
increased annual volume. Most of the expenses in the distribution, general
and administrative expenses category are relatively fixed in nature. Therefore,
during a relatively high volume quarter, these expenses as a percentage of net
sales will decrease. The anticipated effects of the restructuring plan will
not be experienced until the second and third quarters.
8
<PAGE> 9
While the Company sustained an operating loss from continuing operations for
the quarter ended June 30, 1996, the loss was reduced by approximately $623,000
as compared to an operating loss for the three months ended June 30, 1995. Due
to the factors discussed above, operating loss as a percentage of net sales for
the quarter ended June 30, 1996, improved to a loss of .6% as compared to a
loss of 5.9% for the quarter ended June 30, 1995.
Interest expense for the quarter ended June 30, 1996, increased approximately
$200,000 as compared to the three months ended June 30, 1995, due to a higher
effective interest rate.
LIQUIDITY AND CAPITAL RESOURCES
To date, the Company's principal source of financing has been short-term
borrowings from its lenders, including financial institutions, and its initial
public offering. Net cash used by operating activities for the quarter ended
June 30, 1996, was approximately $300,000 compared to net cash provided by
operating activities for the quarter ended June 30, 1995, of $4.7 million. The
increase in receivables from higher sales was partially funded by a concerted
effort to decrease inventory. Further, the Company continues to concentrate on
enhancing vendor relations by reducing payables.
The Company has a revolving credit facility with a bank that provides a maximum
line of credit of $22.5 million through November 16, 1996 subject to borrowing
base requirements and certain covenants. Based upon anticipated sales volume,
the line was extended to $23,300,000 through July 31, 1996. Outstanding
balances in the first quarter of fiscal 1997 bore interest at an approximate
rate of 11.25% compared to a rate of 8.25% for the first quarter of fiscal
1996. The Company has obtained an agreement from another financial
institution, subject to documentation and an audit, to refinance the credit
facility for $30 million, at more favorable interest rates, and a three year
term. The Company believes the agreement will close by August 16, 1996;
however, there is no guarantee the Company will be successful in completing
this financing, or obtaining a further extension from its current bank.
The Company believes cash from operations and the revolving credit facility, as
re-negotiated or refinanced, will satisfy its working capital requirements.
9
<PAGE> 10
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
<TABLE>
<S> <C> <C>
(a) Exhibits
10.1 Tenth Amendment to Loan and Security Agreement dated
July 8, 1996, between Bollinger Industries, L.P.,
and NationsBank of Texas, N.A.
11.1 Computation of Earnings Per Share
27.1 Financial Data Schedule
(b) No reports on Form 8-K were filed during the thirteen week
period ended June 30, 1996.
</TABLE>
10
<PAGE> 11
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BOLLINGER INDUSTRIES, INC.
Date: August 14, 1996 /s/ Glenn D. Bollinger
----------------------------- -------------------------------------
Glenn D. Bollinger
Chairman of the Board and
Chief Executive Officer
Date: August 14, 1996 /s/ John T. Pryor
----------------------------- -------------------------------------
John T. Pryor
Senior Vice President - Finance,
Chief Financial Officer, Treasurer
and Secretary
Date: August 14, 1996 /s/ Robert B. Logan
----------------------------- -------------------------------------
Robert B. Logan
Controller and
Chief Accounting Officer
11
<PAGE> 12
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibits Description
- -------- -----------
<S> <C>
10.1 Tenth Amendment to Loan and Security Agreement dated July 8, 1996,
between Bollinger Industries, L.P., and NationsBank of Texas, N.A.
11.1 Computation of Earnings Per Share
27.1 Financial Data Schedule
</TABLE>
12
<PAGE> 1
NATIONSBANK
NationsBank of Texas, N.A.
TENTH AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
THIS TENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (the "AMENDMENT")
is dated as of July 8, 1996, and entered into by and between NATIONSBANK OF
TEXAS, N.A., a national banking association ("LENDER") with offices at 901 Main
Street, 11th Floor, Dallas, Texas 75201, and BOLLINGER INDUSTRIES, L.P., a
Texas limited partnership ("BORROWER") with offices at 222 Airport Freeway,
Irving, Texas 75062.
WHEREAS, Lender and Borrower have entered into a Loan and Security
Agreement (the "LOAN AGREEMENT"), dated as of September 9, 1994;
WHEREAS, Lender and Borrower on October 28, 1994 have entered into a
First Amendment to Loan and Security Agreement (the "FIRST AMENDMENT"), which
was dated effective as of September 9, 1994;
WHEREAS, Lender and Borrower on December 8, 1994 have entered into a
Second Amendment to Loan and Security Agreement (the "SECOND AMENDMENT");
WHEREAS, Lender and Borrower on March 3, 1995 have entered into a
Third Amendment to Loan and Security Agreement (the "THIRD AMENDMENT"), which
was dated effective as of December 31, 1994;
WHEREAS, Lender and Borrower on May 15, 1995 have entered into a
Fourth Amendment to Loan and Security Agreement (the "FOURTH AMENDMENT"), which
was dated effective as of January 31, 1995;
WHEREAS, Lender and Borrower, effective on September 9, 1995, have
entered into a Fifth Amendment to Loan and Security Agreement (the "FIFTH
AMENDMENT");
WHEREAS, Lender and Borrower, effective on December 29, 1995, have
entered into a Sixth Amendment to Loan and Security Agreement (the "SIXTH
AMENDMENT");
WHEREAS, Lender and Borrower, effective on March 8, 1996, have entered
into a Seventh Amendment to Loan and Security Agreement (the "SEVENTH
AMENDMENT");
WHEREAS, Lender and Borrower, effective on May 8, 1996, have entered
into an Eighth Amendment to Loan and Security Agreement (the "EIGHTH
AMENDMENT"); and
WHEREAS, Lender and Borrower, effective on May 17, 1996, have entered
into a Ninth Amendment to Loan and Security Agreement (the "NINTH AMENDMENT")
(the Loan Agreement together with the First Amendment, the Second Amendment,
the Third Amendment, the Fourth Amendment, the Fifth Amendment, the Sixth
Amendment, the Seventh Amendment, the Eighth Amendment and the Ninth Amendment
shall hereinafter be referred to as the "AGREEMENT"); and
WHEREAS, Lender and Borrower desire to further amend the Agreement as
hereinafter set forth.
<PAGE> 2
NOW, THEREFORE, in consideration of the mutual conditions and
agreements set forth in the Agreement and this Amendment, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Capitalized terms used in this
Amendment, to the extent not otherwise defined herein, shall have the same
meanings as in the Agreement, as amended hereby.
ARTICLE II
AMENDMENTS
Section 2.1 AMENDMENT TO DEFINITION OF CONTRACT TERM. Effective
as of the date hereof, the definition of "Contract Term" contained in Article I
of the Agreement is hereby amended and restated to read in its entirety as
follows:
"CONTRACT TERM" means the period beginning on the effective
date specified in the preamble of this Agreement and
continuing through November 8, 1996.
Section 2.2 AMENDMENT TO DEFINITION OF CREDIT LIMIT. Effective as
of the date hereof, the definition of "Credit Limit" contained in Article I of
the Agreement is hereby amended and restated to read in its entirety as
follows:
"CREDIT LIMIT" means (a) from July 8, 1996, to but excluding
July 31, 1996, Twenty-Three Million Three Hundred Thousand and
No/100 Dollars ($23,300,000), (b) from July 31, 1996, to but
excluding September 30, 1996, Twenty-Two Million Five Hundred
Thousand and No/100 Dollars ($22,500,000), and (c) from and
after September 30, 1996, Twenty-One Million Five Thousand and
No/100 Dollars ($21,500,000).
Section 2.3 AMENDMENT TO DEFINITION OF LOAN DOCUMENTS. The
definition of "Loan Documents" contained in Article I of the Agreement is
hereby amended and restated to read in its entirety as follows:
"LOAN DOCUMENTS" means this Agreement, the Revolving Note, the
First Amended and Restated Revolving Note - Overline, the
Demand Note, the First Amendment to Loan and Security
Agreement dated effective as of September 9, 1994, the Second
Amendment to Loan and Security Agreement dated as of December
8, 1994, the Third Amendment to Loan and Security Agreement
dated effective as of December 31, 1994, the Fourth Amendment
to Loan and Security Agreement dated effective as of January
31, 1995, the Fifth Amendment to Loan and Security Agreement
dated as of September 9, 1995, the Sixth Amendment to Loan and
Security Agreement dated as of December 29, 1995, the Seventh
Amendment to Loan and Security Agreement dated as of March 8,
1996, the Eighth Amendment to Loan and Security Agreement
dated as of May 8, 1996, the Ninth Amendment to Loan and
Security Agreement dated as of May 17, 1996, the Tenth
Amendment to Loan and Security Agreement dated as of July 8,
1996, each Guaranty, the Guaranty, if any, executed by Glenn
D. Bollinger in
2
<PAGE> 3
favor of Lender, the Guaranty, if any, executed by Bobby
Bollinger in favor of Lender, the NBF Security Agreement, the
Security Agreement dated as of March 8, 1996, executed by BII
to the Lender, the Deed of Trust, Security Agreement,
Assignment and Financing Statement dated as of May 8, 1996,
relating to the Borrower's corporate headquarters, and all
other documents or agreements executed in connection
therewith, and also includes any and all renewals, extensions,
modifications or amendments of any of any of the foregoing.
Section 2.4 AMENDMENT TO SECTION 6.6 OF THE AGREEMENT. A new
sentence shall be added at the end of Section 6.22 of the Agreement to read in
its entirety as follows:
Concurrently with the delivery of the monthly
financial statements required by this Section 6.6, Borrower
shall deliver to Lender (a) an accounts receivable aging with
a summary report, (b) an accounts payable aging with a summary
report, (c) a comparison of actual results for the month and
the fiscal year to date with the forecasted results for the
same periods, (d) a report of the status of Borrower's
inventory reduction plan and the results to date of the
inventory reduction plan, and (d) a certificate demonstrating
compliance with the Tangible Net Worth covenant contained in
Section 6.33.
Section 2.5 AMENDMENT TO SECTION 6.22 OF THE AGREEMENT. Section
6.22 of the Agreement is hereby amended and restated to read in its entirety as
follows:
SECTION 6.22 SALE OF ASSETS. Borrower will not sell
or dispose of any assets other than the sale of Inventory in
the ordinary course of business without the prior written
consent of Lender. Upon any disposition of assets consented to
by Lender, all proceeds of such disposition shall be delivered
to Lender for application to the Obligations.
Section 2.6 AMENDMENT TO SECTION 6.25 OF THE AGREEMENT. Section
6.22 of the Agreement is hereby amended and restated to read in its entirety as
follows:
SECTION 6.25 LIMITATION ON INDEBTEDNESS. Borrower
will not be obligated, directly or indirectly, for borrowed
money or otherwise under any promissory note, bond, indenture
or similar instrument, other than (i) in favor of Lender, and
(ii) the indebtedness listed on Exhibit 6.25 attached hereto.
Section 2.7 AMENDMENT TO SECTION 6.30 OF THE AGREEMENT. Section
6.30 of the Agreement is hereby amended and restated to read in its entirety as
follows:
SECTION 6.30 LIMITATION ON INVESTMENTS. Borrower
shall not invest in or otherwise purchase or acquire the
securities of any Person, except for certificates of deposit
issued by commercial banks organized in the United States
which have assets in excess of $1,000,000,000. Borrower will
not, and will not permit any Guarantor to, purchase or acquire
all or a substantial part of the business or properties of any
Person.
Section 2.8 ADDITION OF SECTION 6.33 TO THE AGREEMENT. A new
Section 6.33 is hereby added to the Agreement to read in its entirety as
follows:
SECTION 6.33 TANGIBLE NET WORTH. Borrower shall at
all times maintain a Tangible Net Worth of not less than
$12,250,000.
3
<PAGE> 4
ARTICLE III
RATIFICATIONS, REPRESENTATIONS AND WARRANTIES
Section 3.1 RATIFICATIONS. The terms and provisions set forth in
this Amendment shall modify and supersede all inconsistent terms and provisions
set forth in the Agreement and, except as expressly modified and superseded by
this Amendment, the terms and provisions of the Agreement, including, without
limitation, all financial covenants contained therein, are ratified and
confirmed and shall continue in full force and effect. Lender and Borrower
agree that the Agreement as amended hereby shall continue to be legal, valid,
binding and enforceable in accordance with its terms. In furtherance and not in
limitation of the provisions of this Section 3.1, Borrower hereby waives and
releases any and all claims or offsets against, or defenses to, the payment and
performance of the Obligations that Borrower may have at law, in equity or
otherwise, based on any and all actions or alleged actions, omissions or
related omissions of Lender or any of Lender's affiliates, directors, officers,
employees, attorneys, representatives or agents which have occurred on or prior
to July 8, 1996, and Borrower hereby represents and warrants that no such
claims, offsets or defenses exist as of such date.
Section 3.2 REPRESENTATIONS AND WARRANTIES. Borrower, BII, BOC
and NBF each hereby represent and warrant to Lender that the execution,
delivery and performance of this Amendment and all other Loan Documents to
which Borrower, BII, BOC or NBF is or is to be a party hereunder (hereinafter
referred to collectively as the "LOAN DOCUMENTS") executed and/or delivered in
connection herewith, have been authorized by all requisite corporate or
partnership action, as applicable, on the part of Borrower, BII, BOC and NBF
and will not violate the Articles of Incorporation, Bylaws or Partnership
Agreement of Borrower, BII, BOC or NBF, as applicable. There has been no
material adverse change in the business, operations, financial condition,
profits or prospects, or in the Collateral, of Borrower or NBF, since November
16, 1995, except as previously disclosed to Lender or publicly disclosed, and
there has been no change in the officers of Borrower or any Guarantor since
November 16, 1995. The Articles of Incorporation, Bylaws or Partnership
Agreement, as applicable, of the General Partner of Borrower and each Guarantor
have not been altered, amended, rescinded or revised since November 16, 1995.
Borrower, BII, BOC and NBF hereby jointly and severally represent and warrant
to Lender that (i) Borrower and NBF own all of the Eligible Accounts and
Eligible Inventory described on each Borrowing Base Report previously or
hereafter delivered to Lender, (ii) BII conducts no operations and owns no
material assets other than the stock of BOC and BHC, (iii) BOC and BHC conduct
no operations other than the ownership of partnership interests in Borrower, of
which BOC is the sole general partner and BHC is the sole limited partner, and
(iv) BOC and BHC own no material assets other than their respective partnership
interests in Borrower.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1 CONDITIONS. The effectiveness of this Amendment is
subject to the satisfaction of the following conditions precedent (unless
specifically waived in writing by the Lender):
(a) Lender shall have received all of the following, each
dated (unless otherwise indicated) as of the date of this Amendment,
in form and substance satisfactory to Lender in its sole discretion:
(i) Secretary's Certificate. A Secretary's
Certificate dated as of even date with the date this Amendment
is executed from the General Partner of Borrower and each
4
<PAGE> 5
Guarantor certifying as to corporate resolutions authorizing
the execution and delivery of this Amendment.
(ii) Amendment. This Amendment, duly executed.
(iii) Opinions of Counsel to Borrower and
Guarantors. An opinion of counsel for Borrower and each
Guarantor, respectively, in form and substance reasonably
satisfactory to Lender dated as of even date with the date
this Amendment is executed, as well as executed original
opinions which were required to have been delivered in
connection with the Seventh Amendment, the Eight Amendment and
the Ninth Amendment but which have not yet been delivered to
the Lender.
(iv) Other Documents. Borrower shall have executed
and delivered such other documents and instruments as Lender
may reasonably require.
(v) Legal and Professional Fees. Borrower shall
have paid all fees and expenses of Lender's accountants and
legal counsel incurred in connection with the Revolving
Facility and the Loan Documents, including this Amendment, and
the interpretation and enforcement thereof.
(b) All partnership or corporate proceedings, as
applicable, taken in connection with the transactions contemplated by
this Amendment and all documents, instruments and other legal matters
incident thereto shall be reasonably satisfactory to Lender.
(c) An amendment fee of $25,000.00.
ARTICLE V
MISCELLANEOUS
Section 5.1 POST-CLOSING COVENANTS. The Borrower agrees to comply
with the following covenants, and any failure by the Borrower to comply with
any of the following covenants shall constitute an Event of Default under the
Agreement:
(a) Collateral Compliance Review and Audit. If the
Obligations have not been refinanced by August 20, 1996, the Borrower
shall assist the Lender in carrying out a review and audit of the
Collateral, which review and audit Lender intends to complete by
September 15, 1996.
(b) Appraisal and Environmental Report. If the
Obligations have not been refinanced by August 20, 1996, the Lender
shall obtain, at the Borrower's expense, no later than
September 30, 1996, an appraisal and a Phase I environmental
assessment of the Borrower's corporate headquarters located at
222 West Airport Freeway, Irving, Texas, such appraisal and such
environmental report to be addressed to Lender, to be satisfactory to
Lender in form and substance, and to be prepared in accordance with
all applicable regulatory requirements. The Lender shall order the
appraisal, but the Borrower may order the environmental report,
subject to approval by the Lender.
(c) Guaranties. The Borrower shall deliver to the Lender
continuing guaranties of the Obligations, executed by each of
Glenn D. Bollinger and Bobby Bollinger, in form and
5
<PAGE> 6
substance satisfactory to the Lender, providing that each guarantor's
payment obligations thereunder are limited to $2,300,000. The
guaranties shall be delivered by August 1, 1996, unless on or before
that date the Borrower has delivered to the Lender written evidence of
approval for a loan to refinance the Obligations, subject only to
completion of documentation, and if such written evidence is provided
and the Obligations are not refinanced by August 20, 1996, the
guaranties will be provided on August 20, 1996.
(d) Additional Amendment Fee. The Borrower shall pay the
Lender an additional amendment fee of $25,000.00 on August 1, 1996
unless on or before that date the Borrower has delivered to the Lender
written evidence of approval for a loan to refinance the Obligations,
subject only to completion of documentation, and if such written
evidence is provided and the Obligations are not refinanced by August
20, 1996, the additional amendment fee will be provided on August 20,
1996.
(e) Financial Reports. Borrower shall deliver to Lender,
no later than August 8, 1996, personal financial statements for each
of Glenn D. Bollinger and Bobby Bollinger, prepared on Lender's
standard form.
Section 5.2 NO WAIVER, RESERVATION OF RIGHTS. No failure on the
part of Lender to exercise and no delay in exercising, and no course of dealing
with respect to, any right, power or privilege under the Agreement or any other
Loan Document shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, power or privilege under the Agreement or any
other Loan Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. Notwithstanding any failure by
Lender to insist on strict compliance by Borrower with the terms of the
Agreement or any other Loan Document in the past, or any forbearance by Lender
in exercising its rights and remedies under the Agreement and the other Loan
Documents, including any past waivers by Lender of Events of Default under the
Agreement or any other Loan Document, Lender will insist on strict compliance
with the terms of the Agreement and the other Loan Documents in the future. Any
future failure by Borrower to comply strictly with the terms of the Agreement
and the other Loan Documents may result in the Lender's pursuit of its rights
and remedies existing by virtue of the Agreement and the other Loan Documents
or existing at law or in equity. Lender expressly reserves the right to
exercise any and all rights or remedies available to Lender under the Loan
Documents, at law or in equity, with respect to any present or future Events of
Default unless the same are waived in writing by Lender. No failure on the part
of Lender to exercise, or delay by Lender in exercising, its rights and
remedies under the Loan Documents shall constitute a waiver of any existing or
future Event of Default.
Section 5.3 NO EXTENSION OF MATURITY. Notwithstanding that Lender
has continued to make credit available to Borrower in the past and has renewed
and extended the credit facility evidenced by the Loan Documents in the past,
Borrower acknowledges that Lender has no obligation to continue to make credit
available to Borrower under the Revolving Facility after November 8, 1996.
Lender hereby notifies Borrower that, notwithstanding any previous renewals or
extensions of credit to Borrower, Lender will not continue to make credit
available to Borrower after November 8, 1996, and that the Obligations shall be
due and payable in full on November 8, 1996.
Section 5.4 FORBEARANCE. Borrower has notified Lender that
Borrower is in violation of the covenants contained in Section 6.21 of the
Agreement. Lender hereby agrees not to exercise its rights and remedies under
the Loan Documents based on the Events of Default resulting from the
noncompliance by Borrower with the provisions of Section 6.21 of the Agreement
through and including November 8, 1996, and not thereafter. The foregoing
agreement to forebear does not permit Borrower to fail to comply with any other
6
<PAGE> 7
provision of the Agreement or any other Loan Document, and does not require the
Lender to forebear from exercising its rights and remedies following the
occurrence of any other Default or Event of Default.
Section 5.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in the Agreement or any other document or
documents relating thereto, including, without limitation, any Loan Document
furnished in connection with this Amendment, shall survive the execution and
delivery of this Amendment and the other Loan Documents, and no investigation
by Lender or any closing shall affect the representations and warranties or the
right of Lender to rely thereon.
Section 5.6 REFERENCE TO AGREEMENT. The Agreement, each of the
Loan Documents, and any and all other agreements, documents or instruments now
or hereafter executed and delivered pursuant to the terms hereof or pursuant to
the terms of the Agreement as amended hereby, are hereby amended so that any
reference therein to the Agreement shall mean a reference to the Agreement as
amended hereby.
Section 5.7 WAIVER OF JURY TRIAL. THE PARTIES HERETO AGREE THAT
NEITHER PARTY SHALL REQUEST A TRIAL BY JURY IN THE EVENT OF LITIGATION BETWEEN
THEM CONCERNING THE LOAN DOCUMENTS OR ANY CLAIMS OR TRANSACTIONS IN CONNECTION
THEREWITH, IN EITHER A STATE OR FEDERAL COURT, THE RIGHT TO TRIAL BY JURY BEING
EXPRESSLY WAIVED BY BOTH LENDER AND BORROWER. LENDER AND BORROWER EACH
ACKNOWLEDGES THAT SUCH WAIVER IS MADE WITH FULL KNOWLEDGE AND UNDERSTANDING OF
THE NATURE OF THE RIGHTS AND BENEFITS WAIVED HEREBY, AND WITH THE BENEFIT OF
ADVICE OF COUNSEL OF ITS CHOOSING.
Section 5.8 ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR
AMONG THE PARTIES HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR
RELATING TO THIS AMENDMENT OR ANY RELATED AGREEMENTS OR INSTRUMENTS, INCLUDING
ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY
BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION ACT (OR IF NOT
APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR
THE ARBITRATION OF COMMERCIAL DISPUTES OF ENDISPUTE, INC. (A/K/A
J.A.M.S./ENDISPUTE) ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY
PARTY TO THIS AMENDMENT MAY BRING AN ACTION, INCLUDING A SUMMARY OR EXPEDITED
PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS
AMENDMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH ACTION.
(a) Special Rules. THE ARBITRATION SHALL BE CONDUCTED IN
THE CITY OF THE BORROWER'S DOMICILE AT THE TIME OF THIS AMENDMENT'S
EXECUTION AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR;
IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE
ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL
ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND
FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPONA SHOWING OF
CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP
TO AN ADDITIONAL 60 DAYS.
(b) Reservation of Rights. NOTHING IN THIS AMENDMENT
SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE
APPLICABLE STATUTES OF
7
<PAGE> 8
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS AMENDMENT; OR
(II) BE A WAIVER BY THE LENDER OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III)
LIMIT THE RIGHT OF THE LENDER HERETO (A) TO EXERCISE SELF HELP
REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B) TO FORECLOSE
AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO OBTAIN
FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS (BUT NOT
LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. THE LENDER MAY EXERCISE SUCH SELF HELP RIGHTS,
FORECLOSE UPON SUCH PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY
REMEDIES BEFORE, DURING OR AFTER THE PENDENCY OF ANY ARBITRATION
PROCEEDING BROUGHT PURSUANT TO THIS AMENDMENT. NEITHER THIS EXERCISE
OF SELF HELP REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION
FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE
A WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN ANY SUCH
ACTION, TO ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM
OCCASIONING RESORT TO SUCH REMEDIES.
No provision in the Loan Documents regarding waiver of trial by jury
or submission to jurisdiction and/or venue in any court is intended or shall be
construed to be in derogation of the provisions in any Loan Document for
arbitration of any controversy or claim.
Section 5.9 GOVERNING LAW. THIS AMENDMENT, AND ALL DOCUMENTS AND
INSTRUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE GOVERNED BY AND CONSTRUED
ACCORDING TO THE LAWS OF THE STATE OF TEXAS, PROVIDED, THAT TO THE EXTENT
FEDERAL LAW WOULD ALLOW A HIGHER RATE OF INTEREST THAN WOULD BE ALLOWED BY THE
LAWS OF THE STATE OF TEXAS, THEN WITH RESPECT TO THE PROVISIONS OF ANY LAW
WHICH PURPORT TO LIMIT THE AMOUNT OF INTEREST THAT MAY BE CONTRACTED FOR,
CHARGED OR RECEIVED IN CONNECTION WITH ANY OF THE OBLIGATIONS, SUCH FEDERAL LAW
SHALL APPLY.
Section 5.10 PARTIES BOUND. This Amendment shall be binding upon
and inure to the benefit of Borrower and Lender, and their respective
successors in interest and assigns. Borrower may not assign any right, power,
duty, or obligation under this Amendment. or any document or instrument
executed in connection herewith, without the prior written consent of Lender.
Subject to any applicable rules, regulations or laws of governmental
authorities relating to the non-assignability of loans or other assets of
Lender, Lender may not assign any of its rights, powers, duties or obligations
under this Amendment, or any document or instrument executed in connection
herewith, without the prior written consent of Borrower. This Amendment is
intended for the benefit of Borrower and Lender, and their respective
successors in interest and assigns only, and may not be relied upon by any
other Person.
Section 5.11 CUMULATIVE RIGHTS. All rights and remedies of Lender
under the Loan Documents are cumulative, and are in addition to rights and
remedies available to Lender by law. Such rights and remedies may be exercised
concurrently or successively, at such times as Lender may determine in its
discretion. Borrower waives any right to require marshaling.
Section 5.12 SEVERABILITY. If any provision of this Amendment is
held to be illegal, invalid, or unenforceable under any present or future laws
effective during the Contract Term, such provisions shall be fully severable,
and this Amendment shall be construed and enforced as if such illegal, invalid,
or unenforceable provision had never comprised a part of this Amendment. In
such case, the remaining provisions of the Amendment shall remain in full force
and effect and shall not be affected thereby.
8
<PAGE> 9
Section 5.13 MULTIPLE COUNTERPARTS. This Amendment may be executed
simultaneously in one or more multiple originals, each of which shall be deemed
an original, but all of which together shall constitute one and the same
Amendment.
Section 5.14 SURVIVAL. All covenants, agreements, representations,
and warranties made by Borrower herein shall survive the execution, delivery,
and closing of this Amendment, and all documents executed in connection
herewith, and shall not be affected by any investigation made by any party.
THIS WRITTEN AMENDMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties have executed this Amendment under
seal on July 9, 1996 to be effective as of July 8, 1996.
"BORROWER"
BOLLINGER INDUSTRIES, L.P.,
A TEXAS LIMITED PARTNERSHIP
By: Bollinger Operating Corp.,
A Nevada corporation,
General Partner
By: /s/ GLENN D. BOLLINGER
-----------------------------------
Name: Glenn D. Bollinger
Title: Chairman and Chief Executive Officer
9
<PAGE> 10
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally
appeared Glenn D. Bollinger, Chairman and Chief Executive Officer of Bollinger
Operating Corp., the general partner of Bollinger Industries, L.P., known to me
to be the person and officer whose name is subscribed to the foregoing
instrument, and acknowledged to me that the same was the act of the said
BOLLINGER INDUSTRIES, L.P., a Texas limited partnership, and that he executed
the same on behalf of Bollinger Operating Corp. as the general partner of
Bollinger Industries, L.P., as the act of such limited partnership for the
purposes and consideration therein expressed and in the capacity therein
stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 9th day of July, 1996.
VALERIE A. ROMBERG
NOTARY PUBLIC
State of Texas
Comm. Exp 02-26-99
/s/ VALERIE A. ROMBERG
-----------------------------------
NOTARY PUBLIC, STATE OF TEXAS
My Commission Expires:
- --------------------------------
02/26/99 Valerie A. Romberg
-----------------------------------
(Printed Name of Notary)
10
<PAGE> 11
AGREED AND ACCEPTED on July 9, 1996 to be effective as of July 8, 1996.
"LENDER"
NATIONSBANK OF TEXAS, N.A.
By: /s/ GREG NICHOLAS
Name: Greg Nicholas
Title: Vice President
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally
appeared Greg Nicholas, Vice President, known to me to be the person and
officer whose name is subscribed to the foregoing instrument, and acknowledged
to me that the same was the act of the said NATIONSBANK OF TEXAS, N.A., a
national banking association, and that he executed the same as the act of such
banking association for the purposes and consideration therein expressed and in
the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 9th day of July, 1996.
/s/ DONNA M. MALIZIA
--------------------------------------
NOTARY PUBLIC, STATE 0F TEXAS
My Commission Expires:
- ---------------------------------
11-09-98 Donna M. Malizia
---------------------------------------
(Printed Name of Notary)
DONNA M. MALIZIA
NOTARY PUBLIC
STATE OF TEXAS
My Comm. Exp. 11-09-98
11
<PAGE> 12
CONSENTS AND REAFFIRMATIONS
BOLLINGER INDUSTRIES, INC. ("BII"), BOLLINGER OPERATING CORP.
AND NBF, INC. ("NBF"), each jointly and severally hereby acknowledge the
execution of, and consent to, the terms and conditions of that certain Tenth
Amendment to Loan and Security Agreement dated effective as of July 8, 1996,
between Bollinger Industries, L.P. and NationsBank of Texas, N.A. ("LENDER")
and (i) reaffirms their respective obligations under those certain Guaranty By
Corporation (the "GUARANTIES") each dated as of September 9, 1994, made by the
undersigned in favor of the Lender, and acknowledge and agree that the
Guaranties remain in full force and effect and the Guaranties are hereby
ratified and confirmed; and (ii) NBF reaffirms its obligations under that
certain Security Agreement (the "NBF SECURITY AGREEMENT") dated as of September
9, 1994, made by NBF in favor of the Lender and acknowledges and agrees that
the NBF Security Agreement remains in full force and effect and the NBF
Security Agreement is hereby ratified and confirmed; and (iii) BII reaffirms
its obligations under that certain Security Agreement (the "BII SECURITY
AGREEMENT") dated as of March 8, 1996, made by BII in favor of the Lender and
acknowledges and agrees that the BII Security Agreement remains in full force
and effect and the BII Security Agreement is hereby ratified and confirmed.
EXECUTED on July 9, 1996 to be effective as of July 8, 1996.
GUARANTOR:
BOLLINGER INDUSTRIES, INC.
By: /s/ GLENN D. BOLLINGER
-------------------------------------
Name: Glenn D. Bollinger
Title: Chairman and Chief Executive Officer
GUARANTOR:
BOLLINGER OPERATING CORP.
By: /s/ GLENN D. BOLLINGER
-------------------------------------
Name: Glenn D. Bollinger
Title: Chairman and Chief Executive Officer
GUARANTOR:
NBF, INC.
By: /s/ GLENN D. BOLLINGER
-------------------------------------
Name: Glenn D. Bollinger
Title: Vice Chairman
12
<PAGE> 13
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally
appeared Glenn D. Bollinger, known to me to be the person and officer whose
name is subscribed to the foregoing instrument, and acknowledged to me that the
same was the act of said Bollinger Industries, Inc., and that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 9th day of July, 1996.
VALERIE A. ROMBERG
NOTARY PUBLIC
State of Texas
Commission Exp. 02/26/99
My Commission Expires:
2/29/99
-------
/s/ VALERIE A. ROMBERG
---------------------------------------
NOTARY PUBLIC, STATE OF TEXAS
Valerie A. Romberg
---------------------------------------
(Printed Name of Notary)
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally
appeared Glenn D. Bollinger, known to me to be the person and officer whose
name is subscribed to the foregoing instrument, and acknowledged to me that the
same was the act of said Bollinger Operating Corp., and that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 9th day of July, 1996.
VALERIE A. ROMBERG
NOTARY PUBLIC
State of Texas
Commission Exp. 02/26/99
My Commission Expires:
2/29/99
-------
/s/ VALERIE A. ROMBERG
---------------------------------------
NOTARY PUBLIC, STATE OF TEXAS
Valerie A. Romberg
---------------------------------------
(Printed Name of Notary)
13
<PAGE> 14
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally
appeared Glenn D. Bollinger, known to me to be the person and officer whose
name is subscribed to the foregoing instrument, and acknowledged to me that the
same was the act of said NBF, Inc., and that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 9th day of July, 1996.
VALERIE A. ROMBERG
NOTARY PUBLIC /s/ VALERIE A. ROMBERG
State of Texas ------------------------------------
Comm. Exp. 02-26-99 NOTARY PUBLIC, STATE OF TEXAS
Valerie A. Romberg
------------------------------------
My Commission Expires: (Printed Name of Notary)
02/26/99
--------
14
<PAGE> 1
Exhibit 11.1
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
Thirteen Week Three Months
Period Ended Ended
June 30, June 30,
----------------- -----------------
1996 1995
----------------- -----------------
<S> <C> <C>
Earnings (loss) from continuing operations $ (764,720) $ (702,632)
Net earnings (loss) $ (764,720) $ (994,831)
============ ============
Weighted average number of common shares outstanding during the
period 4,000,210 3,708,090
Net effect of dilutive stock options based on the treasury stock
method at market prices -0- 262,982
------------ ------------
Shares used for computation 4,000,210 3,971,072
=========== ============
Earnings (loss) from continuing operations $(.19) $(.18)
===== =====
Net earnings (loss) per share $(.19) $(.25)
===== =====
</TABLE>
13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> JUN-30-1996
<CASH> 1,056,662
<SECURITIES> 0
<RECEIVABLES> 19,540,495
<ALLOWANCES> 0
<INVENTORY> 27,048,245
<CURRENT-ASSETS> 52,901,726
<PP&E> 4,722,377
<DEPRECIATION> 2,693,553
<TOTAL-ASSETS> 57,515,787
<CURRENT-LIABILITIES> 45,250,529
<BONDS> 0
<COMMON> 40,001
0
0
<OTHER-SE> 11,657,807
<TOTAL-LIABILITY-AND-EQUITY> 57,515,787
<SALES> 22,433,893
<TOTAL-REVENUES> 22,433,893
<CGS> 17,654,045
<TOTAL-COSTS> 4,904,315
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 131,500
<INTEREST-EXPENSE> 649,766
<INCOME-PRETAX> (764,720)
<INCOME-TAX> 0
<INCOME-CONTINUING> (764,720)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (764,720)
<EPS-PRIMARY> (.19)
<EPS-DILUTED> (.19)
</TABLE>
