<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
SECURITIES EXCHANGE ACT OF 1934
For quarter ended June 30, 1997
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.)
602 FOUNTAIN PARKWAY, GRAND PRAIRIE, TEXAS 75050
(Address of principal executive offices)
(Zip Code)
(972) 343-1000
(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, 1997, 4,000,210 shares of the registrant's common stock,
$0.01 par value per share, were outstanding.
1
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BOLLINGER INDUSTRIES, INC.
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets -
June 30, 1997, and March 31, 1997 3
Consolidated Statements of Earnings -
Three Months Ended June 30, 1997 and 1996
4
Consolidated Statements of Cash Flows -
Three Months Ended June 30, 1997 and 1996
5
Notes to Consolidated Financial Statements 6 - 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8 - 10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 12
INDEX TO EXHIBITS AND EXHIBITS 13
</TABLE>
2
<PAGE> 3
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, 1997 March 31, 1997
-------------- --------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash .................................................................. $ 10,877 $ 3,481
Accounts receivable
Trade, net of allowance for doubtful accounts ..................... 19,765,507 16,804,959
Other ............................................................. 129,372 177,208
Inventories (Note C) .................................................. 16,004,131 16,201,780
Prepaid expenses ...................................................... 741,995 533,215
-------------- --------------
Total current assets .............................................. 36,651,882 33,720,643
PROPERTY PLANT AND EQUIPMENT - NET ....................................... 1,955,131 2,083,402
OTHER ASSETS
Goodwill and other intangibles - net .................................. 1,121,754 1,138,654
Notes receivable and other assets ..................................... 677,822 951,085
Deferred financing fees - net ......................................... 442,472 495,568
-------------- --------------
TOTAL ASSETS ............................................................. $ 40,849,061 $ 38,389,352
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long term debt and other debt (Note D) ........... $ 2,239,122 $ 2,907,954
Accounts payable - trade ............................................ 13,707,342 11,620,367
Other current liabilities ........................................... 949,376 1,104,318
Provision for restructuring of operations (Note F) .................. 2,052,587 2,160,169
-------------- --------------
Total current liabilities .................................... 18,948,427 17,792,808
LONG-TERM LIABILITIES
Long term debt, net of current portion .............................. 17,517,932 15,575,411
-------------- --------------
Total liabilities .......................................... 36,466,359 33,368,219
-------------- --------------
COMMITMENTS AND CONTINGENCIES ............................................ -- --
STOCKHOLDERS' EQUITY
Preferred stock -- $.01 par value; 1,000,000 shares authorized;
none issued
Common stock -- $.01 par value; 8,000,000 shares authorized; issued
and outstanding 4,000,210 at June 30,1997, and March 31, 1997 ..
40,002 40,002
Capital in excess of par ............................................ 15,323,058 15,323,058
Retained earnings (accumulated deficit) ............................. (10,980,358) (10,341,927)
-------------- --------------
Total stockholders' equity .................................... 4,382,702 5,021,133
-------------- --------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ............................... $ 40,849,061 $ 38,389,352
============== ==============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
<PAGE> 4
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended
June 30, June 30,
1997 1996
------------ ------------
<S> <C> <C>
Net sales .................................. $ 20,516,641 $ 22,433,893
Cost of goods sold ......................... 16,502,186 17,654,045
------------ ------------
Gross profit .......................... 4,014,455 4,779,848
Selling expenses ........................... 1,572,355 2,080,381
Distribution, general and
administrative expenses ................ 2,462,809 2,823,934
------------ ------------
4,035,164 4,904,315
------------ ------------
Operating profit (loss) ............... (20,709) (124,467)
Other expense (income)
Interest expense ...................... 624,305 649,766
Interest income ....................... (6,828) (9,513)
Miscellaneous ......................... (815) --
------------ ------------
616,662 640,253
------------ ------------
Earnings (loss) before income
taxes ........................... (637,371) (764,720)
Income tax (expense) benefit (Note E) ...... 1,060 --
------------ ------------
Net earnings (loss) ....................... $ (638,431) $ (764,720)
============ ============
Per share data:
Net earnings (loss) per common share ....... $ (.16) $ (.19)
============ ============
Weighted average common and
common equivalent shares
outstanding ............................ 4,000,210 4,000,210
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
<PAGE> 5
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
----------- -----------
<S> <C> <C>
Cash flow from operating activities
Net earnings (loss) ......................................... $ (638,431) $ (764,720)
Adjustments to reconcile net earnings (loss) to net cash
provided by (used in) operating activities
(Gain) loss on disposal of assets ............................ (815) --
Depreciation and amortization ................................ 264,088 210,933
Provision for restructuring of operations .................... (107,582) (398,895)
Provision for Doubtful Accounts .............................. (169,312) --
Provision for Obsolete Inventory ............................. (22,605) --
Changes in operating assets and liabilities
Trade accounts receivable ............................... (2,791,236) (1,195,668)
Other receivables ....................................... 47,836 (1,114)
Inventories ............................................. 220,254 3,064,689
Prepaid expenses ........................................ (208,780) (279,903)
Notes receivable and other assets ....................... 5,881 (19,430)
Accounts payable - Trade ................................ 2,086,975 (1,215,091)
Federal income tax payable .............................. -- (43,847)
Other current liabilities ............................... (154,942) 383,386
Current assets of discontinued operations ............... -- (97,185)
----------- -----------
Net cash provided by (used in) operating activities .. (1,468,669) (356,845)
Cash flow from investing activities
Purchases of property and equipment .......................... (39,939) (8,958)
Payments (advances made) on note receivable .................. 239,315 35,487
Proceeds from sale of assets ................................. 3,000 --
Non-current assets from discontinued operations .............. -- 17,982
----------- -----------
Net cash provided by (used in) investing activities ... 202,376 44,511
Cash flow from financing activities
Net proceeds from (payments on) long term debt .............. 1,273,689 960,125
----------- -----------
Net cash provided by (used in) financing activities ... 1,273,689 960,125
Net increase (decrease) in cash ....................... 7,396 647,791
Cash at beginning of period ...................................... 3,481 408,871
=========== ===========
Cash at end of period ............................................ $ 10,877 $ 1,056,662
=========== ===========
</TABLE>
The accompany notes are an integral part of these
consolidated financial 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 (the "SEC"). Certain information and
footnote disclosure normally included in financial statements prepared in
accordance with generally accepted accounting principals ("GAAP") 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 Company's form 10-K consolidated financial
statements and notes for the year ended March 31, 1997.
In the opinion of management, the unaudited interim consolidated
financial statements 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.
The preparation of financial statements in accordance with GAAP
requires management to make estimates and assumptions. Such estimates and
assumptions affect the reported amounts of assets and liabilities, as well as
the disclosure of contingent assets and liabilities at the date of the
financial statements, and the reported amounts of revenue and expense during
the reporting period. Actual results could differ from these estimates.
NOTE B - CONSOLIDATED STATEMENTS OF CASH FLOW
Supplemental disclosures:
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
June 30, June 30,
-------------------- ------------------
1997 1996
-------------------- ------------------
<S> <C> <C>
Interest paid $ 642,370 $ 844,126
</TABLE>
6
<PAGE> 7
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(continued)
NOTE C - INVENTORIES
<TABLE>
<CAPTION>
June 30, March 31,
1997 1997
------------ ------------
<S> <C> <C>
Raw materials $ 3,659,410 $ 9,013,914
Work-in-process 200,441 328,436
Finished goods 13,681,445 8,419,200
Reserve for obsolescence (1,537,165) (1,559,770)
------------ ------------
$ 16,004,131 $ 16,201,780
============ ============
</TABLE>
NOTE D - NOTES PAYABLE
The Company obtained a credit facility with a financial institution on August
16, 1996 with a maximum line of $25 million and a three-year term. This credit
line was subsequently extended to four years with modification to several of
the financial covenants. Availability, pursuant to the credit line, is based on
the levels of specific current assets namely accounts receivable and inventory.
The outstanding obligation at June 30, 1997, was $16.7 million with undrawn
availability of $35,000 pursuant to the asset based formula.
NOTE E - INCOME TAXES
The Company's effective federal income tax rates for the three months
ended June 30, 1996 and 1997 respectively were 0% and 0%, based on providing a
100% valuation against the deferred tax benefit.
NOTE F - RESTRUCTURED INVENTORY
In connection with the Company plan for restructuring of inventory, as
disclosed in the Company's annual report and Form 10-K for year ended March 31,
1996, the Company has implemented measures to reduce inventory levels of
targeted products. Of the approximately $12 million in inventory originally
designated for liquidation, approximately $8.2 million of inventory was sold for
$6.3 million with a resultant charge to the reserve of $1.9 million.
<TABLE>
<CAPTION>
MARCH 31, 1996 MARCH 31, 1997 JUNE 30, 1997
------------------------- ----------------------- -------------------------
INVENTORY RESERVE INVENTORY RESERVE INVENTORY RESERVE
VALUE AMOUNT VALUE AMOUNT VALUE AMOUNT
<S> <C> <C> <C> <C> <C> <C>
Celebrity Endorsed product $ 5,175,000 $ 1,730,000 $ 843,000 $ 250,000 $ 726,000 $ 216,000
Other Product 6,625,000 2,028,000 3,188,000 1,910,000 2,888,000 1,837,000
Other Costs -- 202,000 -- -- -- --
----------- ----------- ---------- ---------- ----------- -----------
Total $11,800,000 $ 3,960,000 $4,031,000 $2,160,000 $ 3,614,000 $ 2,053,000
=========== =========== ========== ========== =========== ===========
</TABLE>
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,
1997 and March 31, 1996; the Company's Form 10-Q for the quarter ending June 30,
1996; and the consolidated financial statements and related notes, for the
quarter ended June 30, 1997, found elsewhere in this report.
THREE MONTHS ENDED JUNE 30, 1997, COMPARED WITH JUNE 30, 1996
As fully disclosed in the Company's annual report and Form 10-K for the year
ended March 31, 1996, and updated at March 31, 1997, the Company has embarked
on a restructuring plan whereby it is focusing on its name brand products,
including trampolines, and greatly reducing its use of celebrity endorsed
products.
Consolidated net sales for the quarter ended June 30, 1997, decreased by $1.9
million as compared to the quarter ended June 30, 1996, a decrease of 9%.
Decreases in the sales of fitness accessory products of $4.9 million were
partially offset by gains in the sales of trampolines of $3.0 million. In the
first three months of the current year, the Company successfully sold
approximately $0.4 million of targeted inventory as part of the restructuring
plan.
Gross profit for the quarter ended June 30, 1997, decreased $.8 million as
compared to the quarter ended June 30, 1996, and decreased as a percentage of
net sales from 21.3% in 1996 to 19.6% in 1997 for the same period. The
reduction in gross profit was primarily due to a shift in sales from fitness
accessory products to trampolines. Gross profits on trampoline sales have
increased significantly compared to last year, however, margins on trampolines
continue to be lower than margins on fitness accessory products.
The major thrust of the restructuring plan comprised the liquidation of certain
inventories. The Company's initiative on vendor pricing, which was designed to
significantly reduce purchase prices, will not have a significant effect on
gross profit until the targeted inventory is liquidated.
Selling expenses for the quarter ended June 30, 1997, decreased by $508,000 as
compared to the quarter ended June 30, 1996, and decreased as a percentage of
net sales from 9.3% to 7.7%. The dollar decrease in selling expense, as well as
the percentage decrease was directly related to the lower sales volume and the
reduction in celebrity royalty expenses.
Distribution, general and administrative expenses for the quarter ended June
30, 1997, decreased by $361,000 as compared to the quarter ended June 30, 1996,
and decreased as a percentage of net sales from 12.6% in 1996 to 12.0% in 1997.
Reductions in rent, contract labor, consulting fees, and bad debt expense,
partially offset by increased legal fees, led to the overall reduction.
8
<PAGE> 9
The Company sustained an operating loss of $21,000 for the quarter ended June
30, 1997, as compared to an operating loss of $124,000 in the same quarter last
year. The gross profit decline of $765,000 is partially offset by lower selling
and distribution, general, and administrative expenses for a net improvement of
$104,000 in operating income.
Interest expense for the quarter ended June 30, 1997, was $624,000 compared to
$650,000 the previous year.
LIQUIDITY AND CAPITAL RESOURCES
To date, the Company's principal source of financing has been borrowings from
various financial institutions and its initial public offering. Net cash used
by operating activities for the three months ended June 30, 1997, was
$1,469,000 compared to cash used by operating activities for the same period in
the prior year of $357,000. Cash generated from the collection of notes
receivable and the proceeds from a revolving credit facility were used to fund
higher trade accounts receivable and operating losses in the first quarter
1998.
In fiscal 1997, the Company secured a revolving credit facility with a
financial institution providing a maximum line of credit of 25.0 million,
subject to certain borrowing base requirements and covenants. As of June 30,
1997, outstanding balance was $16.7 million. This facility matures August 16,
2000. The Company is currently in compliance with all terms and covenants of
the agreement.
Outstanding balances in the first quarter bore interest at an approximate rate
of 10.25% compared to a rate of 11.25% for the first quarter last year. The
Company also has a long term note payable, secured by the Irving facility,
which bears interest at 11.50% per annum.
9
<PAGE> 10
FACTORS THAT COULD AFFECT FUTURE PERFORMANCE
Certain statements contained in this Quarterly Report on Form 10-Q, including
without limitation, statements containing the words "believes", "anticipates",
"intends", "expects", and words of similar import, constitute "forward-looking
statements". Such forward-looking statements involve numerous assumptions about
known and unknown risks, uncertainties and other factors which may ultimately
prove to be inaccurate. Certain of these factors are discussed in more detail
elsewhere in this Quarterly Report, including without limitation under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and include the Company's ability to maintain sufficient gross
margins, to reduce general, administrative and warehouse expenses, to increase
sales of fitness accessory products, and to achieve profitability. Actual
results may differ materially from any future results expressed or implied by
such forward-looking statements. The company disclaims any obligation to update
any forward-looking statements or publicly revise any of the forward-looking
statements contained herein to reflect future events or developments.
10
<PAGE> 11
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There have been no material changes in legal proceedings. Please refer
to the Company's March 31, 1997 10-K filing.
ITEM 5. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10.58 Third Amendment to Loan and Security Agreement dated
June 11, 1997, between Bollinger Industries, Inc.,
Bollinger Industries, L.P. and NBF, Inc. and Foothill
Capital Corporation.
10.59 Twelfth Amendment to Loan and Security Agreement dated
March 15, 1997, 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 three month
period ended June 30, 1997.
11
<PAGE> 12
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 8, 1997 /s/ GLENN D. BOLLINGER
----------------------------- ----------------------------------
Glenn D. Bollinger
Chairman of the Board and
Chief Executive Officer
Date: August 8, 1997 /s/ ROSE TURNER
----------------------------- ----------------------------------
Rose Turner
Senior Vice President - Finance,
Chief Financial Officer,
Treasurer and Secretary
12
<PAGE> 13
BOLLINGER INDUSTRIES, INC. AND SUBSIDIARIES
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibits Description
-------- -----------
<S> <C>
10.58 Third Amendment to Loan and Security Agreement dated
June 11, 1997, between Bollinger Industries, Inc.,
Bollinger Industries, L.P. and NBF, Inc. and Foothill
Capital Corporation.
10.59 Twelfth Amendment to Loan and Security Agreement dated
March 15, 1997, between Bollinger Industries, L.P. and
NationsBank of Texas, N.A.
11.1 Computation of Earnings Per Share
27.1 Financial Data Schedule
</TABLE>
13
<PAGE> 1
EXHIBIT 10.58
AMENDMENT NO. THREE TO THE LOAN
AND SECURITY AGREEMENT
BOLLINGER INDUSTRIES, INC., BOLLINGER INDUSTRIES, L.P. AND
NBF, INC.
This Amendment No. Three To The Loan And Security Agreement (the
"Amendment") is entered into as of the 11th day of June, 1997, by and between
BOLLINGER INDUSTRIES, INC., a Delaware corporation ("Inc."), BOLLINGER
INDUSTRIES, L.P., a Texas limited partnership ("L.P.") and NBF, INC., a Georgia
corporation ("NBF"), jointly and severally, (collectively "Borrower"), with
their chief executive office located at 602 Fountain Parkway, Grand Prairie,
Texas 75050 and FOOTHILL CAPITAL CORPORATION, a California corporation
("Foothill"), with a place of business located at 11111 Santa Monica Boulevard,
Suite 1500, Los Angeles, California 90025-3333, in light of the following facts:
FACTS
FACT ONE: Foothill and Borrower have previously entered into
that certain Loan And Security Agreement, dated August 16, 1996 (as amended and
supplemented, the "Agreement").
FACT TWO: Foothill and Borrower desire to further amend the
Agreement as provided herein. Terms defined in the Agreement which are used
herein shall have the same meanings as set forth in the Agreement, unless
otherwise specified.
NOW, THEREFORE, Foothill and Borrower hereby modify and amend the
Agreement as follows:
1. The definition of Eligible Accounts under Subsection 1.1(g)
of the Agreement is hereby amended in its entirety to read as follows:
"(g) Accounts with respect to an Account Debtor whose total
obligations owing to Borrower exceed ten percent (10%) of all Eligible Accounts
(or, in the case of Service Merchandise and Dayton-Hudson, fifteen percent
(15%)), to the extent of the obligations owing by such Account Debtor in excess
of such percentage; provided, however, in the case of Wal-Mart or K-Mart, such
percentage shall be (75%) as to both combined, effective June 1, 1997."
2. Subsection 2.1(d) of the Agreement is hereby amended in its
entirety to read as follows:
"(d) Foothill is authorized to make Revolving Advances under this
Agreement based upon telephonic or other instructions received from anyone
purporting to be an Authorized Officer of Borrower, or without instructions if
1
<PAGE> 2
pursuant to Section 2.4(d). Borrower agrees to establish and maintain a
single designated deposit account for the purpose of receiving the proceeds
of the Revolving Advances requested by Borrower and made by Foothill
hereunder. Unless otherwise agreed by Foothill and Borrower, any
Revolving Advances requested by Borrower and made by Foothill hereunder
shall be made to such designated deposit account. Amounts borrowed
pursuant to this Section 2.1 may be repaid and, subject to the terms and
conditions of this Agreement, reborrowed at any time during the term of
this Agreement.
3. Notwithstanding anything to the contrary contained in Section 2.3
of the Agreement, Foothill agrees to provide Borrower a temporary Overadvance
facility in the amount of One Million Dollars ($1,000,000) commencing as of
June 1, 1997 through September 15, 1997. Said Overadvance facility shall be
reduced in equal monthly installments of Two Hundred Fifty Thousand Dollars
($250,000) beginning June 15, 1997 and continuing through September 15,
1997, and shall be back in formula.
4. Subsection 2.7(h) of the Agreement is hereby amended in its
entirety to read as follows:
"(h) Overadvance Fee. Borrower's account shall be charged
Overadvance fees in amounts equal to: (i) $10,000.00 on the One Million
Dollar ($1,000,000) Overadvance due on June 1, 1997; (ii) $13,125.00 on
the Seven Hundred Fifty Thousand Dollar ($750,000) Overadvance due June
15, 1997; (iii) $7,500.00 on the Five Hundred Thousand Dollar ($500,000)
Overadvance due July 15, 1997; and (iv) $3,125.00 on the Two Hundred
and Fifty Thousand Dollar ($250,000) Overadvance due August 15, 1997.
Overadvance fees shall be fully earned, non-refundable, and due and
payable on the date as specified in this Subsection 2.7(h)."
5. Subsection 6.13(b) of the Agreement is hereby amended in its
entirety to read as follows:
"(b) Total Liabilities to Tangible Net Worth Ratio. A ratio
of Borrower's total liabilities divided by Tangible Net Worth measured on a
fiscal quarter-end basis of not more than:
<TABLE>
<CAPTION>
Date of Fiscal quarter-End Ratio
-------------------------- -----
<S> <C>
90/30/96 4.75:1.0
12/31/96 4.50:1.0
03/31/97 4.00:1.0
06/30/97 13.50:1.0
09/30/97 15.00:1.0
12/31/97 10.50:1.0
03/31/98 10.50:1.0
</TABLE>
2
<PAGE> 3
<TABLE>
<S> <C>
06/30/98 9.50:1.0
09/30/98 9.50:1.0
12/31/98 and thereafter 9.00:1.0"
</TABLE>
6. "Foothill hereby waives the existing violations of the covenants
contained in Sections 6.13(b) and 6.13(c) for the third and fourth fiscal
quarters of 1997. This waiver is limited to its particular circumstances
and shall not constitute a waiver of any other provision of the Loan
Agreement or a future waiver of Section 67.13(b) and Section 6.13(c)
or any other provision of the Loan Agreement."
7. Foothill shall charge Borrower's loan account a documentation
fee in the amount of Two Hundred Fifty Dollars ($250.00). Said fee shall
be fully-earned, non-refundable, and due and payable on the date Borrower's
loan account is charged.
8. In the event of a conflict between the terms and provisions of
this Amendment and the terms and provisions of the Agreement, the terms and
provisions of this Amendment shall govern. In all other respects, the
Agreement, as supplemented, amended and modified, shall remain in full
force and effect.
IN WITNESS WHEREOF, Borrower and Foothill have executed this
Amendment as of the day and year first written above.
FOOTHILL CAPITAL CORPORATION BOLLINGER INDUSTRIES, L.P.
By: Bollinger Operating Corp., its
General Partner
By /s/ LISA M. GONZALES By /s/ GLENN D. BOLLINGER
---------------------------- ---------------------------
Lisa M. Gonzales Glenn D. Bollinger
Its Assistant Vice President Its CEO
---------------------------- ---------------------------
BOLLINGER INDUSTRIES, INC.
By /s/ GLENN D. BOLLINGER
---------------------------
Glenn D. Bollinger
Its CMEO/CEO
---------------------------
NBF, INC.
By /s/ GLENN D. BOLLINGER
---------------------------
Glenn D. Bollinger
Its V.P.
---------------------------
3
<PAGE> 4
REAFFIRMATION OF GUARANTORS
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
BOLLINGER OPERATING CORP.,
a Nevada corporation
By /s/ BOBBY D. BOLLINGER
--------------------------------
Bobby D. Bollinger
Its
--------------------------------
By its acceptance below this ___ day of June, 1997, the undersigned guarantor
hereby reaffirms its Continuing Guaranty dated August 16, 1996 and consents to
the above-stated terms.
BOLLINGER HOLDING CORP.,
a Delaware corporation
By /s/ BOBBY D. BOLLINGER
--------------------------------
Bobby D. Bollinger
Its
--------------------------------
By its acceptance below this ___ day of June, 1997, the undersigned guarantor
hereby reaffirms its Continuing Guaranty dated August 16, 1996 and consents to
the above-stated terms.
BOLLINGER SPORT, INC.,
a Texas corporation
By /s/ BOBBY D. BOLLINGER
--------------------------------
Its
-------------------------------
<PAGE> 5
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
C.G. PRODUCTS, INC.,
a California corporation
By /s/ GLENN D. BOLLINGER
--------------------------------
Its Vice President
------------------------------
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
TARBOX, INC.,
a Texas corporation
By /s/ GLENN D. BOLLINGER
---------------------------------
Its President
--------------------------------
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
/s/ GLENN D. BOLLINGER
-----------------------------------
Glenn D. Bollinger,
an individual
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
/s/ GLENN D. BOLLINGER
-----------------------------------
Glenn D. Bollinger
an individual
By its acceptance below this ___ day of June, 1997, the undersigned
guarantor hereby reaffirms its Continuing Guaranty dated August 16, 1996 and
consents to the above-stated terms.
/s/ BOBBY D. BOLLINGER
-----------------------------------
Bobby D. Bollinger,
an individual
<PAGE> 1
EXHIBIT 10.59
NATIONSBANK
NATIONSBANK OF TEXAS, N.A.
- -------------------------------------------------------------------------------
TWELFTH AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
THIS TWELFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (the "AMENDMENT")
is dated effective as of March 15, 1997, 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 75202, 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");
WHEREAS, Lender and Borrower, effective on May 17, 1996, have entered
into a Ninth Amendment to Loan and Security Agreement (the "NINTH AMENDMENT");
and
<PAGE> 2
WHEREAS, Lender and Borrower, effective on July 8, 1996, have entered
into a Tenth Amendment to Loan and Security Agreement ( the "TENTH
AMENDMENT"); and
WHEREAS, Lender and Borrower, effective on August 20, 1996, have
entered into an Eleventh Amendment to Loan and Security Agreement (the
"ELEVENTH 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,
the Ninth Amendment, the Tenth Amendment and the Eleventh Amendment shall
hereinafter be referred to as the "AGREEMENT");
WHEREAS, in connection with the Agreement, Borrower previously executed
and delivered to Lender its promissory note dated September 9, 1994 payable to
the order of Lender in the face amount of $25,000,000.00, as renewed, amended
and restated by the certain promissory note dated December 29, 1995 executed by
Borrower payable to the order of Lender, with a final maturity date (as modified
and amended) of September 15, 1998 (the "NOTE"), which is secured by, in
addition to the Collateral, certain real property owned by Borrower and located
in Dallas County, Texas, as more particularly provided pursuant to the certain
Deed of Trust, Assignment, Security Agreement and Financing Statement dated as
of May 8, 1996 executed by Borrower, as grantor, for the benefit of Lender,
recorded at Volume 96107, Page 07017 of the Deed Records of Dallas County,
Texas, as the same may have been renewed, extended, modified or amended,
including without limitation pursuant to the certain Modification and Extension
Agreement dated effective August 15, 1996 between Lender and Borrower which was
recorded at Volume 96185, Page 03075 of the Deed Records of Dallas County,
Texas (collectively the "DEED OF TRUST");
WHEREAS, Lender and Borrower desire to further amend the Agreement and
the Note as hereinafter set forth;
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 SECTION 2.3 OF THE AGREEMENT. Effective
as of the date hereof, Section 2.3 of the Agreement hereby is amended and
restated to read in its entirety as follows:
2.3 REPAYMENT AND LINE TERMINATION. The remaining balance of the
Obligations shall be payable as follows: Twenty-five (25) consecutive
monthly installment payments, each payable on the fifteenth (15th) day
of each calendar month, as follows: (i) three (3) payments of $25,000.00
plus accrued interest, payable on September 15, 1996 and
2
<PAGE> 3
continuing through November 15, 1996, (ii) three (3) payments of
$50,000.00 plus accrued interest, payable on December 15, 1996 and
continuing through February 15, 1997, (iii) one (1) payment of
$75,000.00 plus accrued interest, payable on March 15, 1997, (iv)
seventeen (17) payments of $25,000.00 plus accrued interest, payable on
April 15, 1997 and continuing through August 15, 1998, and (v) one final
payment in the amount of all remaining unpaid principal plus interest
which shall be due and payable on September 15, 1998. Borrower
acknowledges and agrees that Lender shall have no obligation to renew
the Obligations.
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 the date of execution hereof, and Borrower hereby represents and warrants
that no such claims, offset 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
Borrowers, 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 the
effective date of the last financial statements delivered to Lender, except as
may have been previously disclosed to Lender or publicly disclosed, and there
has been no change in the officers of Borrower or any Guarantor since the last
certification thereof to Lender by Borrower or any such Guarantor. 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 the last certification thereof to Lender.
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 conducted 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.
3
<PAGE> 4
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 effective date of
this Amendment, from the General Partner of Borrower and each
Guarantor certifying as a corporate resolutions authorizing the
execution and delivery of this Amendment.
(ii) Amendment. This Amendment, duly executed.
(vi) Other Documents. Borrower shall have executed
and delivered such other documents and instruments as Lender may
reasonably require.
(vii) Legal and Professional Fees. Borrower shall
have paid all fees and expenses of Lender's accountants and
legal counsel incurred in connection with the Obligations 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.
ARTICLE V
MISCELLANEOUS
Section 5.1 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 and remedies available to Lender under the Loan
Documents, at law or in equity, with resect to
4
<PAGE> 5
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 5.2 NOTE. The note hereby is deemed modified and amended
consistent with this Amendment. Borrower hereby acknowledges, ratifies and
confirms the Note as being and continuing in full force and effect, as amended
hereby.
Section 5.3 DEED OF TRUST. Borrower hereby acknowledges, ratifies
and confirms the Deed of Trust as being and continuing in full force and
effect, as amended hereby as continuing security for all "secured indebtedness"
defined therein, including without limitation the Note, as amended hereby.
Section 5.4 NO EXTENSION OF MATURITY. 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 and
that the remaining balance of the Obligations shall be due and payable as
specified in Section 2.3 of the Agreement, as amended hereby.
Section 5.5 COLLATERAL; CONTINUING SECURITY. Borrower acknowledges
that Lender's continuing security interest in the Collateral continues as
security for the Obligations, subject to the Intercreditor Agreement, provided,
that in any event Lender shall keep and maintain first, prior and exclusive its
existing deed of trust lien and interest as evidenced by the Deed of Trust.
Section 5.6 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 5.7 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 5.8 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 5.9 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
5
<PAGE> 6
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, UPON A 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 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 REPORT 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 5.10 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
6
<PAGE> 7
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 5.11 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 5.12 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 5.13 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 compromised 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.
Section 5.14 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 5.15 SURVIVAL. All covenants, agreements, representatives,
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.
7
<PAGE> 8
IN WITNESS WHEREOF, the parties have executed this Amendment on
July 3, 1997 to be effective as of the effective date stated in the
preamble.
"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
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 3rd day of July
1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or Notary)
8
<PAGE> 9
AGREED AND ACCEPTED on 8th day of July, 1997 to be effective as of the
effective date stated in the preamble.
"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 8th day of July, 1997.
/s/ DONNA M. MALIZIA
--------------------------------------
NOTARY PUBLIC, STATE OF TEXAS
My Commission Expires
11-9-98 DONNA M. MALIZIA
--------------------------------------
(Printed Name of Notary)
9
<PAGE> 10
CONSENTS AND REAFFIRMATIONS
BOLLINGER INDUSTRIES, INC. ("BII"), BOLLINGER OPERATING CORP. AND NBF,
INC. ("NBF"), each jointly and severally hereby acknowledges the execution of,
and consent to, the terms and conditions of the above Twelfth Amendment to Loan
and Security Agreement (the "TWELFTH AMENDMENT") dated effective as of June __,
1997, between Bollinger Industries, L.P. and NationsBank of Texas, N.A.
("LENDER") and (i) reaffirms their respective obligations under its certain
Guaranty By Corporation (collectively the "GUARANTIES") dated as of September
9, 1994, made by the undersigned, respectively, in favor of the Lender, and
acknowledges and agrees that the Guaranties remain in full force and effect 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 3, 1997 to be effective as of
the stated effective date of such Twelfth Amendment.
BOLLINGER INDUSTRIES, INC.
By: /s/ GLENN D. BOLLINGER
---------------------------------------
Name: Glenn D. Bollinger
Title: Chairman and Chief Executive Officer
BOLLINGER OPERATING CORP.
By: /s/ GLENN D. BOLLINGER
----------------------------------------
Name: Glenn D. Bollinger
Title: Chairman and Chief Executive Officer
NBF, INC.
By: /s/ GLENN D. BOLLINGER
----------------------------------------
Name: Glenn D. Bollinger
Title: Vice Chairman
10
<PAGE> 11
GLEN D. BOLLINGER hereby acknowledges the execution of, and consent to, the
terms and conditions of the above Twelfth Amendment to Loan and Security
Agreement and reaffirms all of the obligations under his certain (ii) Continuing
and Unconditional Guaranty dated August 15, 1996 and (ii) Guaranty dated
effective July 8, 1996 (collectively the "Guaranties"), made in favor of the
Lender, and acknowledges and agrees that the Guaranties remain in full force and
effect and the Guaranties are hereby ratified and confirmed. EXECUTED on July 3,
1997 to be effective as of the stated effective date of such Twelfth Amendment.
/s/ GLENN D. BOLLINGER, INDIVIDUALLY
----------------------------------------
GLENN D. BOLLINGER, Individually
BOBBY BOLLINGER hereby acknowledges the execution of, and consent to, the
terms and conditions of the above Twelfth Amendment to Loan and Security
Agreement and reaffirms all of his obligations under his certain (ii) Continuing
and Unconditional Guaranty dated August 15, 1996 and (ii) Guaranty dated
effective July 8, 1996 (collectively the "Guaranties"), made in favor of the
Lender, and acknowledges and agrees that the Guaranties remain in full force and
effect and the Guaranties are hereby ratified and confirmed. EXECUTED on
July 3, 1997 to be effective as of the stated effective date of such Twelfth
Amendment.
/s/ BOBBY BOLLINGER
---------------------------------------
Bobby Bollinger, Individually
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 3rd day of July, 1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or Notary)
11
<PAGE> 12
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 3rd day of July, 1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or 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 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 3rd day of July, 1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or 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 whose name is subscribed to
the foregoing instrument, and acknowledged to me that he executed the same for
the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 3rd day of July, 1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or Notary)
12
<PAGE> 13
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, the undersigned authority, on this day personally appeared
Bobby Bollinger, known to me to be the person whose name is subscribed to the
foregoing instrument, and acknowledged to me that he executed the same for the
purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 3rd day of July, 1997.
/s/ ROSE TURNER PAYNE
-------------------------------
NOTARY PUBLIC, STATE OF TEXAS
[NOTARY SEAL]
ROSE TURNER PAYNE
MY COMMISSION EXPIRES
My Commission Expires: MARCH 11, 2001
- ---------------------------- -------------------------------
(Printed Name or Notary)
13
<PAGE> 1
Exhibit 11.1
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
Three Month Three Month
Period Period
Ended Ended
June 30, 1997 June 30, 1996
----------- -----------
<S> <C> <C>
Net earnings (loss) ......................... $ (638,431) $ (764,720)
=========== ===========
Weighted average number of common shares
outstanding during the period ......... 4,000,210 4,000,210
Net effect of dilutive stock options
based on the treasury stock method
at market prices ...................... 0 0
----------- -----------
Shares used for computation ................. 4,000,210 4,000,210
=========== ===========
Net earnings (loss) per share ............... $ (.16) $ (.19)
=========== ===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> JUN-30-1997
<CASH> 10,877
<SECURITIES> 0
<RECEIVABLES> 19,765,507
<ALLOWANCES> 675,000
<INVENTORY> 16,004,131
<CURRENT-ASSETS> 36,651,882
<PP&E> 4,989,184
<DEPRECIATION> 3,034,053
<TOTAL-ASSETS> 40,849,061
<CURRENT-LIABILITIES> 18,948,427
<BONDS> 0
0
0
<COMMON> 40,002
<OTHER-SE> 4,342,700
<TOTAL-LIABILITY-AND-EQUITY> 40,849,061
<SALES> 20,516,641
<TOTAL-REVENUES> 20,516,641
<CGS> 16,502,186
<TOTAL-COSTS> 1,572,355
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (169,312)
<INTEREST-EXPENSE> 624,305
<INCOME-PRETAX> (637,371)
<INCOME-TAX> 1,060
<INCOME-CONTINUING> (638,431)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (638,431)
<EPS-PRIMARY> (.16)
<EPS-DILUTED> (.16)
</TABLE>
