UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 0 - 23426
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REPTRON ELECTRONICS, INC.
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(Exact name of registrant as specified in its charter)
Florida 38-2081116
- -------------------------------- ----------------------------------
State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization
14401 McCormick Drive
Tampa, Florida 33626
- --------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (813)854-2351
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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
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6,082,119 shares of common stock issued and outstanding as of
November 10, 1997.
- -----------------
REPTRON ELECTRONICS, INC.
INDEX
Page
PART I. FINANCIAL INFORMATION Number
Item 1. Financial Statements
Consolidated Statements of Earnings --
Three months ended September 30, 1997 and
September 30, 1996 and Nine months ended
September 30, 1997 and September 30, 1996 3
Consolidated Balance Sheets --
September 30, 1997 and December 31, 1996 4
Consolidated Statement of
Shareholders' Equity -- Year ended December
31, 1996 and Nine months ended September
30, 1997 5
Consolidated Statements of Cash Flows --
Nine months ended September 30, 1997 and September
30, 1996 6
Notes to Consolidated Financial
Statements -- September 30, 1997 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except share and per share data)
Three months ended Nine months ended
September 30, September 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $74,278 $65,953 $229,631 $198,595
Cost of goods sold 61,276 53,359 187,956 160,821
------ ------ ------- -------
Gross profit 13,002 12,594 41,675 37,774
Selling, general and administrative expenses 9,158 8,394 27,793 25,748
------ ------ ------- -------
Operating income 3,844 4,200 13,882 12,026
Interest expense, net 1,595 837 4,069 2,955
------ ------ ------- -------
Earnings from operations before income taxes 2,249 3,363 9,813 9,071
Income taxes 810 1,346 3,835 3,629
------ ------ ------- -------
Net earnings $ 1,439 $ 2,017 $ 5,978 $ 5,442
====== ====== ======= =======
Net earnings per share $ 0.23 $ 0.33 $ 0.95 $ 0.88
====== ====== ======= =======
Weighted average Common Stock and Common
Stock equivalent shares outstanding 6,325,571 6,181,105 6,265,153 6,176,039
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements
3
<TABLE>
<CAPTION>
REPTRON ELECTRONICS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
ASSETS
September 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 49,345 $ 479
Accounts receivable - trade, less allowances
for doubtful accounts of $350 45,669 39,807
Inventories 68,629 58,694
Prepaid expenses and other assets 4,933 2,764
Deferred tax benefit 133 138
------- -------
Total current assets 168,709 101,882
PROPERTY, PLANT & EQUIPMENT - AT COST, NET 35,894 30,869
EXCESS OF COST OVER NET ASSETS ACQUIRED, NET 4,316 4,504
OTHER ASSETS 8,906 1,377
------- -------
$217,825 $138,632
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable - trade $ 24,209 $ 18,339
Current portion of long-term obligations 3,604 3,560
Accrued expenses 2,911 2,506
Income taxes payable - 246
------- -------
Total current liabilities 30,724 24,651
NOTES PAYABLE TO BANKS - 48,550
LONG-TERM OBLIGATIONS, less current portion 130,478 15,235
DEFERRED INCOME TAXES 1,852 1,506
SHAREHOLDERS' EQUITY
Preferred Stock - authorized 15,000,000 shares
of $.10 par value; no shares issued - -
Common Stock - authorized 50,000,000 shares
of $.01 par value; issued and outstanding,
6,082,019 and 6,065,519 shares, respectively 61 61
Additional paid-in capital 21,336 21,233
Retained earnings 33,374 27,396
------- -------
54,771 48,690
------- -------
$217,825 $138,632
======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements
4
<TABLE>
<CAPTION>
REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(In thousands, except share data)
Total
Common Stock Capital Share-
Shares Par In excess of Retained holders'
Outstanding Value Par Value Earnings Equity
----------- ----- ------------ -------- --------
<S> <C> <C> <C> <C> <C>
Balance at
December 31, 1996 6,048,519 $60 $21,145 $19,743 $40,948
Exercise of stock
options 17,000 1 88 - 89
Net Earnings - - - 7,653 7,653
--------- --- ------ ------ ------
Balance at
December 31, 1997 6,065,519 61 21,233 27,396 48,690
Exercise of stock
options (Unaudited) 16,500 - 103 - 103
Net Earnings (Unaudited) - - - 5,978 5,978
--------- -- ------ ------ ------
Balance at September
30, 1997 (Unaudited) 6,082,019 $61 $21,336 $33,374 $54,771
========= == ====== ====== ======
</TABLE>
The accompanying notes are an integral part of these financial
statements
5
<TABLE>
<CAPTION>
REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Nine months ended
September 30,
1997 1996
------- -------
Increase (decrease) in cash and cash equivalents:
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 5,978 $ 5,442
Adjustments to reconcile net earnings to net cash
provided by (used in) operating activities:
Depreciation and amortization 3,509 2,616
Deferred income taxes 351 217
Gain on sale of assets (23) -
Change in assets and liabilities:
Accounts receivable - trade (5,862) 3,613
Inventories (9,935) 9,142
Prepaid expenses and other assets (2,169) (248)
Other assets (7,813) (592)
Accounts payable - trade 5,870 (7,399)
Accrued expenses 405 (84)
Income taxes Payable (246) 226
------- -------
Net cash provided by (used in) operating
activities (9,935) 12,933
------- -------
Cash flows from investing activities:
Net cash paid for acquisitions - (102)
Disposal of property, plant and equipment 23 -
Purchases of property, plant and equipment (5,489) (8,388)
------- ------
Net cash used in investing activities (5,466) (8,490)
------- -------
Cash flows from financing activities:
Proceeds from exercise of stock options 103 73
Net proceeds from (payments on) note payable to bank (48,550) (5,383)
Proceeds from long-term obligations 123,800 4,000
Payments on long-term obligations (11,086) (1,894)
------- -------
Net cash provided by (used in) financing
activities 64,267 (3,204)
------- -------
Net increase in cash and cash equivalents 48,866 1,239
Cash and cash equivalents at beginning of period 479 224
------ -------
Cash and cash equivalents at end of period $49,345 $ 1,463
====== ======
Supplemental cash flow information:
Interest paid $ 3,311 $ 2,776
====== ======
Income taxes paid $ 4,216 $ 3,185
====== ======
</TABLE>
Non-cash investing and financing activities:
During the nine month periods ended September 30, 1997 and 1996, the
Company incurred approximately $2,573 and $372, respectively, of obligations
under capital leases for the acquisition of equipment.
The accompanying notes are an integral part of these financial statements
6
REPTRON ELECTRONICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
NOTE A -- BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared in
accordance with the instructions to Form 10-Q and do not include all the
information and footnote disclosure required by generally accepted
accounting principles for complete financial statements. The consolidated
financial statements as of September 30, 1997 and for the three and nine
months ended September 30, 1997 and September 30, 1996 are unaudited and
reflect all adjustments (consisting only of normal recurring adjustments)
which are, in the opinion of management, necessary for a fair presentation
of the financial position and operating results for the interim periods.
The results of operations for the three and nine months ended September 30,
1997 are not necessarily indicative of results that may be expected for the
year ending December 31, 1997. The consolidated financial statements
should be read in conjunction with the financial statements and notes
thereto, together with management's discussion and analysis of financial
condition and results of operations, included in the 1996 Form 10-K.
<TABLE>
<CAPTION>
NOTE B -- INVENTORIES
Inventories consist of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
Reptron Distribution:
Inventories $40,512 $31,085
K-Byte Manufacturing:
Work in process 9,883 8,833
Raw Materials 18,234 18,776
------ ------
$68,629 $58,694
====== ======
</TABLE>
NOTE C -- NOTES PAYABLE
On August 11, 1997, the Company issued $115,000,000 of 6 3/4% Convertible
Subordinated Notes, due 2004. The Notes are convertible at any time prior
to maturity, unless repurchased, into shares of common stock at a
conversion rate of approximately 35.09 shares per $1,000 principal amount
of the Notes. Interest on the Notes is payable semi-annually on February 1
and August 1, commencing February 1, 1998. The Notes are redeemable in
whole or in part, at the Company's option, at any time on or after August
1, 2000. The Notes are unsecured obligations subordinated to all existing
and future Senior Indebtedness (as defined under the indenture) of the
Company (but not other unsecured obligations of the Company unless such
obligations constitute senior indebtedness) and are effectively
subordinated to all indebtedness and other liabilities of the Company's
subsidiaries.
7
REPTRON ELECTRONICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
SEPTEMBER 30, 1997
NOTE D -- FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS
The Company has two industry segments: Distribution and Contract
Manufacturing. Distribution purchases a wide variety of electronic
components, including semiconductors, passive products and
electromechanical components, for distribution to manufacturers and
wholesalers throughout the United States. Contract Manufacturing
manufactures electronic products according to customer design, for
customers in various industries, including telecommunications, banking, and
healthcare services.
The following table shows net sales and gross profit by industry segments:
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
(in thousands) (in thousands)
------------------ -----------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Sales
Distribution $45,801 $40,856 $142,420 $124,687
Contract Manufacturing 28,477 25,097 87,211 73,908
------ ------ ------- -------
$74,278 $65,953 $229,631 $198,595
====== ====== ======= =======
Gross Profit
Distribution $ 8,756 $ 8,235 $ 26,934 $ 25,290
Contract Manufacturing 4,246 4,359 14,741 12,484
------ ------ ------- -------
$13,002 $12,594 $ 41,675 $ 37,774
====== ====== ======= =======
</TABLE>
NOTE E -- NEW ACCOUNTING PRONOUNCEMENT
The Financial Accounting Standards Board has issued Statement of Financial
Accounting Standards (FAS) No. 128 "Earnings Per Share", which supersedes
Accounting Principles Board Opinion 15. FAS No. 128 is effective for
financial statements issued for periods ending after December 15, 1997.
The potential effect of applying FAS No. 128 would have increased basic
earnings per share from $ .23 to $ .24 during the three month period ended
September 30, 1997 and basic earnings per share for the nine month period
ended September 30, 1997 would have increased from $ .95 to $ .98.
8
REPTRON ELECTRONICS, INC
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This document contains certain forward-looking statements that involve
a number of risks and uncertainties. Such forward-looking statements are
within the meaning of that term in Section 27A of the Securities Act of
1933, as amended and Section 21E of the Securities Act of 1934, as amended.
Factors that could cause actual results to differ materially include the
following: business conditions and growth in the Company's industry and in
the general economy; competitive factors; risks due to shifts in market
demand; the ability of the Company to complete acquisitions; and the risk
factors listed from time to time in the Company's reports filed with the
Securities and Exchange Commission as well as assumptions regarding the
foregoing. The words "believe", "estimate", "expect", "intend",
"anticipate", and similar expressions and variations thereof identify
certain of such forward-looking statements, which speak only as of the
dates on which they were made. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise. Readers are
cautioned that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that actual
results may differ materially from those indicated in the forward-looking
statements as a result of various factors. Readers are cautioned not to
place undue reliance on these forward-looking statements.
RESULTS OF OPERATIONS
- ---------------------
Net Sales. Total third quarter net sales increased $8.3 million, or
12.6%, from $66.0 million in the third quarter of 1996 to $74.3 million in
the third quarter of 1997. Total net sales for the first three quarters of
1997 increased $31.0 million, or 15.6% from $198.6 million in the first
three quarters of 1996 to $229.6 million in the first three quarters of
1997.
Reptron Distribution third quarter net sales increased $4.9 million,
or 12.1%, from $40.9 million in the third quarter of 1996 to $45.8 million
in the third quarter of 1997. Passive components and electromechanical
products accounted for approximately $4.7 million and $2.4 million of the
increase in net sales, respectively. These increases were off-set by a
decrease in semiconductor net sales of approximately $2.3 million. The
largest customer, which is also a K-Byte Manufacturing customer,
represented approximately 11.8% of Reptron Distribution third quarter, 1997
net sales (8.0% of total Company net sales), no other customer represented
more than 5.7% of Reptron Distribution third quarter 1997 sales. The
largest sales office accounted for approximately 18.6% of Reptron
Distribution net sales. Sales of semiconductors accounted for 63.2% of
third quarter Reptron Distribution net sales, with the remaining sales
generated from passive components (26.7%) and electromechanical products
(10.0%).
Reptron Distribution net sales increased $17.7 million, or 14.2%, from
$124.7 million in the first three quarters of 1996 to $142.4 million in the
first three quarters of 1997. Passive components, semiconductors and
electromechanical products accounted for approximately $8.1 million, $4.7
million and $4.9 million of the increase in net sales, respectively.
During the first three quarters of 1997, the largest Reptron Distribution
customer, which is also a K-Byte Manufacturing customer, represented
approximately 15.8% of total Reptron Distribution net sales (10.6% of total
Company net sales) and the largest sales office accounted for approximately
22.9% of total Reptron Distribution net sales.
K-Byte Manufacturing net sales increased $3.4 million, or 13.5%, from
$25.1 million in the third quarter of 1996 to $28.5 million in the third
quarter of 1997. Net sales to new customers aggregated approximately $6.5
million, which was off-set by a net decrease in net sales to previously
established customers of approximately $3.1 million. The three largest K-
Byte Manufacturing customers accounted for approximately 15.5%, 10.8% and
9.6%, respectively, of third quarter division net sales (5.9%, 4.1% and
3.7%, respectively, of total Company third quarter net sales), no other
customers accounted for more than 7.8% of third quarter division net sales.
Sales from the Tampa, Florida manufacturing facility accounted for
approximately 54.7% of K-Byte Manufacturing third quarter net sales. The
Gaylord, Michigan manufacturing facility generated approximately 41.2% of
K-Byte Manufacturing third quarter net sales with the remaining sales
originating from the Saline, Michigan location.
9
K-Byte Manufacturing net sales increased $13.3 million, or 18.0%, from
$73.9 million in the first three quarters of 1996 to $87.2 million in the
first three quarters of 1997. Net sales to new customers accounted for
approximately $15.5 million of the increase, off-set by a net decrease in
net sales to the previously established customer base of $2.2 million. The
largest three K-Byte customers accounted for approximately 15.1%, 10.7% and
7.0%, respectively, of total division net sales (5.7%, 4.0% and 2.6%,
respectively, of total Company net sales). Sales from the Tampa, Florida,
Gaylord, Michigan and Saline, Michigan manufacturing facilities accounted
for approximately 56.0%, 40.0% and 4.0%, respectively, of total K-Byte
Manufacturing sales in the first three quarters of 1997.
Gross Profit. Total third quarter gross profit increased $408,000, or
3.2%, from $12.6 million in the third quarter of 1996 to $13.0 million in
the third quarter of 1997. The gross profit percentage of the Company
decreased from 19.1% in the third quarter of 1996 to 17.5% in the third
quarter of 1997. Total gross profit increased $3.9 million, or 10.3%, from
$37.8 million in the first three quarters of 1996 to $41.7 million in the
first three quarters of 1997. The gross profit percentage decreased from
19.0% in the first three quarters of 1996 to 18.1% in the first three
quarters of 1997.
Reptron Distribution third quarter gross profit increased $520,000, or
6.3%, from $8.2 million in the third quarter of 1996 to $8.8 million in the
third quarter of 1997. The gross profit percentage decreased from 20.2% in
the third quarter of 1996 to 19.1% in the third quarter of 1997. The
decrease in gross profit percentage was primarily due to product mix and
industry pricing pressures. Reptron Distribution's gross profit percentage
decreased from 20.3% in the first three quarters of 1996 to 18.9% in the
first three quarters of 1997 for similar reasons.
K-Byte Manufacturing gross profit decreased $113,000, or 2.6%, from
$4.4 million in the third quarter of 1996 to $4.2 million in the third
quarter of 1997 and its gross profit percentage decreased from 17.4% in the
third quarter of 1996 to 14.9% in the third quarter of 1997. This decrease
is primarily due to customer mix and industry pricing pressures. K-Byte
Manufacturing gross profit percentage remained unchanged at 16.9% in both
the first three quarters of 1996 and the first three quarters of 1997.
Selling, General, and Administrative Expenses. Selling, general, and
administrative expenses increased $760,000, or 9.1%, from $8.4 million in
the third quarter of 1996 to $9.2 million in the third quarter of 1997.
This increase is primarily driven by an increase in variable costs
associated with the increase in net sales. These expenses, as a percentage
of net sales, decreased from 12.7% in the third quarter of 1996 to 12.3% in
the third quarter of 1997. Selling, general and administrative expenses as
a percentage of net sales decreased from 13.0% in the first three quarters
of 1996 to 12.1% in the first three quarters of 1997.
Interest Expense. Interest expense increased $760,000, or 90.6% from
$840,000 in the third quarter of 1996 to $1.6 million in the third quarter
of 1997. This increase is primarily attributable to the increase in long
term debt as a result of the issuance of $115.0 million of subordinated,
convertible notes, offset by interest income of $212,000 on municipal
investments during the third quarter of 1997. First three quarters
interest expense increased $1.1 million, or 37.7%, from $3.0 million in the
first three quarters of 1996 to $4.1 million in the first three quarters of
1997. This increase resulted primarily from an increase in the average
outstanding working capital debt of $5.6 million or 11.3%, from $49.4
million during the first three quarters of 1996 to $55.0 million during the
first three quarters of 1997, as well as the net increase in long term debt
associated with the issuance of the subordinated convertible debt.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Company primarily finances its operations through bank credit
lines, capital equipment leases, and short-term financing through supplier
credit lines. The Company has liquid cash reserves available for working capital
needs as a result of the Company's Convertible Debt offering in August, 1997.
Accordingly, the Company's Revolving Credit Facility was amended in August, 1997
to reduce the available credit limit to $15.0 million. As of September 30, 1997
no amounts were outstanding under the Revolving Credit Facility.
10
Operating activities for the third quarter of 1997 used cash of
approximately $6.9 million. This use of cash resulted primarily from a
decrease in accounts payable of $3.2 million, an increase in inventories of
$3.2 million, an increase in other assets of $5.4 million, and an increase
in prepaid expenses of $1.2 million. These items were partially offset by
net earnings of $1.4 million, and a decrease in accounts receivable of $3.3
million. The increase in other assets is primarily as a result of
capitalized debt offering costs of approximately $4.9 million. Annualized
Reptron Distribution inventory turns for the third quarter of 1997 averaged
4.24 times and K-Byte Manufacturing annualized inventory turns for the
third quarter of 1997 was 3.50 times.
Operating activities for the first three quarters of 1997 used cash of
approximately $9.9 million. This use of cash resulted primarily from an
increase in inventories of $9.9 million, an increase in other assets of
$7.8 million, an increase in accounts receivable of $5.9 million and an
increase in prepaid expenses of $2.2 million. These items were partially
off-set by net earnings of $6.0 million and an increase in accounts payable
of $5.9 million. Reptron Distribution and K-Byte Manufacturing annualized
inventory turns for the first three quarters of 1997 were 4.98 times and
3.7 times, respectively. The increase in other assets is primarily
attributable to capitalized debt offering costs of approximately $4.9
million and K-Byte Manufacturing new customer capitalized contract set-up
costs of approximately $2.3 million. The Company's accounts receivable
collections averaged approximately 53 days as of September 30, 1997
compared to 51 days as of December 31, 1996.
Capital expenditures totaled approximately $7.2 million in the first
three quarters of 1997. These capital expenditures were primarily for the
acquisition of manufacturing equipment. The Company financed approximately
$2.6 million of the capital expenditures through capital leases.
The Company believes that cash generated from operations and available
credit facilities will be sufficient for the Company to meet its capital
expenditures and working capital needs for its operations as presently
conducted. Additionally, the Company's future liquidity and cash
requirements will depend on a wide range of factors, including the level of
business in existing operations, expansion of facilities, and possible
acquisitions. While there can be no assurance that such financing will be
available in amounts and on terms acceptable to the Company, the Company
believes that such financing will be available on acceptable terms.
11
REPTRON ELECTRONICS, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
10.1 Amendment Agreement No. 4, dated January 31, 1997,
to the Amended and Restated Revolving Credit and
Reimbursement Agreement, dated June 29, 1995.
10.2 Amendment Agreement No. 5, dated April 28, 1997,
to the Amended and Restated Revolving Credit and
Reimbursement Agreement, dated June 29, 1995.
10.3 Amendment Agreement No. 6, dated April 30, 1997,
to the Amended and Restated Revolving Credit and
Reimbursement Agreement, dated June 29, 1995.
10.4 Amendment Agreement No. 7, dated June 30, 1997,
to the Amended and Restated Revolving Credit and
Reimbursement Agreement, dated June 29, 1995 and
Subsidiary Guarantee dated August 4, 1997.
10.5 Amendment Agreement No. 8, dated August 12, 1997,
to the Amended and Restated Revolving Credit and
Reimbursement Agreement, dated June 29, 1995.
10.6 Loan Agreement, dated April 28, 1997, between
Reptron Electronics, Inc. and Barnett Bank, N.A.
27.1 Financial Data Schedule
b. Reports on Form 8-K
No reports on Form 8-K were filed during the three months
ended September 30, 1997.
12
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Dated:_______________________________
REPTRON ELECTRONICS, INC.
_________________________
(Registrant)
By:______________________
Michael Branca Chief
Financial Officer (Principal
Financial and Accounting Officer)
13
EXHIBIT 10.1
AMENDMENT AGREEMENT NO. 4
TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT NO. 4 TO THE AMENDED AND RESTATED REVOLVING
CREDIT AND REIMBURSEMENT AGREEMENT (the "Amendment Agreement") is made and
entered into as of this 31 day of January, 1997 among REPTRON ELECTRONICS,
INC., a Florida corporation having its principal place of business in
Tampa, Florida (the "Borrower"), NATIONSBANK, NATIONAL ASSOCIATION (SOUTH),
a national banking association ("NationsBank") in its capacity as agent
(the "Agent") for each of the lenders (the "Lenders") now or hereafter
party to the Credit Agreement (defined below), and each of the undersigned
Lenders. Unless the context otherwise requires, all terms used herein
without definition shall have the respective definitions provided therefor
in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into that
certain Amended and Restated Revolving Credit and Reimbursement Agreement
dated June 29, 1995 whereby the Lenders have made available to the Borrower
(i) a $55,000,000 revolving credit facility, which shall include a letter
of credit facility of up to $500,000 and (ii) a $9,942,917 (as reduced from
time to time in accordance with the terms thereof) direct pay letter of
credit facility (together with the exhibits and schedules attached thereto,
as the same has been amended by Amendment Agreement No. 1 dated as of
December 15, 1995, Amendment Agreement No. 2 dated as of March 15, 1996 and
Amendment Agreement No. 3 dated as of September 24, 1996 and as the same
may be further amended, restated or supplemented from time to time, the
"Credit Agreement"); and
WHEREAS, the Borrower has requested that the Lenders amend the Credit
Agreement to temporarily increase the Total Revolving Credit Commitment
from $55,000,000 to $60,000,000; and
WHEREAS, upon the terms and conditions contained herein, the Agent and
the Lenders are willing to amend the Credit Agreement to so increase the
Total Revolving Credit Commitment through April 30, 1997;
NOW, THEREFORE, in consideration of the premises and conditions herein
set forth, it is hereby agreed as follows:
1. Credit Agreement Amendment. Subject to the conditions hereof,
the Credit Agreement is hereby amended, effective as of the date hereof, as
follows:
(a) Section 1.1 thereof is hereby amended by amending and
restating the following definitions in their entirety as follows:
(i) "'Overline Notes' means the promissory notes of the Borrower
dated as of January 31, 1997 and payable to the order of the Lenders in the
aggregate original principal amount of $5,000,000, each substantially in
the form attached hereto as Exhibit O."
(ii) "'Overline Termination Date' means (i)April 30, 1997 or (ii)
such earlier date of termination of Lenders' obligations pursuant to
Article XII upon the occurrence of an Event of Default or (iii) such date
as the Borrower may voluntarily permanently terminate the Revolving Credit
Facility by payment in full of all obligations (including the discharge of
all obligations with respect to Letters of Credit) or (iv) such later date
as the Borrower and the Lenders shall agree in writing pursuant to Section
2.13 hereof."
(iii) "'Total Revolving Credit Commitment' means an amount equal
to $55,000,000, as reduced from time to time in accordance with Section 2.7
hereof; provided, however, that during the period beginning January 31,
1997 through but not including April 30, 1997, the Total Revolving Credit
Commitment shall be equal to $60,000,000, as reduced from time to time in
accordance with Section
2.7."
(b) Section 2.7(b) thereof is hereby amended and restated in its
entirety as follows:
"(b) On the Overline Termination Date, the Borrower shall
permanently reduce the Total Revolving Credit Commitment to an amount not
to exceed $55, 000, 000 by payment in full of the Overline Note to the
extent that (i) the sum of the Revolving Credit Debit Balance (excluding
Construction Advances) and the Outstanding Commercial Letters of Credit
exceeds the Unrestricted Total Revolving Credit Commitment or (ii) the sum
of the Revolving Credit Debit Balance (including Construction Advances) and
the Outstanding Commercial Letters of Credit exceeds the lesser of the
Total Revolving Credit Commitment or the Borrowing Base, after giving
effect to such reduction, together with accrued and unpaid interest on the
amounts prepaid. No such reduction and accompanying prepayment shall
result in the payment of any Eurodollar Loan other than on the last day of
the Interest Period of such Loan unless such prepayment is accompanied by
amounts due, if any, under Section 5.4. Upon such reduction and
accompanying prepayment, the Overline Notes shall be canceled and returned
to the Borrower."
(c) Exhibit O shall be added to the Credit Agreement as attached
hereto.
2
1. Applicable Commitment Percentages. The parties hereto agree
that the Applicable Commitment Percentages of the Lenders set forth on
Exhibit B to the Credit Agreement shall remain unchanged with respect to
the Revolving Credit Facility.
2. Representations and Warranties. In order to induce the Agent
and the Lenders to enter into this Amendment Agreement, the Borrower hereby
represents and warrants that the Credit Agreement has been re-examined by
the Borrower and that except as disclosed by the Borrower in writing to the
Lenders as of the date hereof:
(a) The representations and warranties made by the Borrower in
Article VIII thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the date
of the most recent financial reports of the Borrower delivered to the Agent
under Section 10.2 thereof, other than changes in the ordinary course of
business;
(c) The business and properties of the Borrower and its
Subsidiaries are not, and since the date of the most recent financial
reports of the Borrower delivered to the Agent under Section 10.2 thereof,
have not been, adversely affected in any substantial way as the result of
any fire, explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts of
God or the public enemy, or cancellation or loss of any ma3or contracts;
and
(d) After giving effect to this Amendment Agreement, no
condition exists which, upon the effectiveness of the amendment
contemplated hereby, would constitute a Default or an Event of Default on
the part of the Borrower under the Credit Agreement or the Notes, either
immediately or with the lapse of time or the giving of notice, or both.
3. Conditions Precedent. The effectiveness of this Amendment
Agreement is subject to the receipt by the Agent of the following:
(i) six counterparts of this Amendment Agreement duly executed by
all signatories hereto;
(ii) the Notes, in the form attached hereto as Exhibit 0,
executed by the Borrower;
(iii) resolutions of the Board of Directors or other governing
body of the Borrower approving this Amendment Agreement certified by the
Secretary of the Borrower; and
3
(iv) copies of all additional agreements, instruments and
documents which the Agent may reasonably request, such documents, when
appropriate, to be certified by appropriate governmental authorities.
All proceedings of the Borrowers relating to the matters provided for
herein shall be satisfactory to the Lenders, the Agent and their counsel.
4. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party hereto, and no one of them has relied on any such promise,
condition, representation or warranty. Each of the parties hereto
acknowledges that, except as in this Amendment Agreement otherwise
expressly stated, no representations, warranties or commitments, express or
implied, have been made by any party to the other. None of the terms or
conditions of this Amendment Agreement may be changed, modified, waived or
canceled orally or otherwise, except by writing, signed by all the parties
hereto, specifying such change, modification, waiver or cancellation of
such terms or conditions, or of any proceeding or succeeding breach
thereof.
5. Full Force and Effect of Agreement. Except as hereby
specifically amended, modified or supplemented, the Credit Agreement and
all other Loan Documents are hereby confirmed and ratified in all respects
and shall remain in full force and effect according to their respective
terms.
6. Counterparts. This Amendment Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.
7. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF FLORIDA, WITHOUT REGARD TO ANY
OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY
(i) SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS
OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF
COLLECTION AND
(ii) WAIVES TRIAL BY JURY IN CONNECTION WITH ANY SUCH LITIGATION.
8. Enforceability. Should any one or-more of the provisions of
this Amendment Agreement be determined to be illegal or unenforceable as to
one or more of the parties hereto, all other provisions nevertheless shall
remain effective and binding on the parties hereto.
4
9. Credit Agreement. All references in any of the Loan
Documents to the Credit Agreement shall mean and include the Credit
Agreement as amended hereby.
10. Successors and Assigns. This Amendment Agreement shall
be binding upon and inure to the benefit of each of the Borrower, the
Lenders, the Agent and their respective successors, assigns and legal
representatives; provided, however, that the Borrower, without the prior
consent of the Lenders, may not assign any rights, powers, duties or
obligations hereunder.
[remainder of this page left blank intentionally]
5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment Agreement
to be duly executed by their duly authorized officers, all as of the day
and year first above written.
BORROWER:
REPTRON ELECTRONICS, INC.
By: /s/ Paul J. Plante
Name: Paul J. Plante
Title: CFO
NATIONSBANK, NATIONAL ASSOCIATION
(SOUTH), as Agent and a Lender
By: /s/ Lori Stone
Name: Lori Stone
Title: Vice President
PNC BANK, KENTUCKY, INC.
By: /s/ Jim Neil
Name: James D. Neil
Title: Vice President
THE SUMITOMO BANK, LIMITED
By: /s/ Allen L. Harvell Jr.
Name: Allen L. Harvell Jr.
Title: Vice President and Manager
By: /s/ M. Phillip Freeman
Name: M. Phillip Freeman
Title: Vice President
BARNETT BANK OF TAMPA
By: /s/ David Austin
Name: David Austin
Title: SVP
EXHIBIT 10.2
AMENDMENT AGREEMENT NO. 5 AND WAIVER
TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT NO. 5 AND WAIVER TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT (the "Amendment Agreement") is
made and entered into as of this 28th day of April, 1997 among REPTRON
ELECTRONICS, INC., a Florida corporation having its principal place of
business in Tampa, Florida (the "Borrower"), NATIONSBANK, NATIONAL
ASSOCIATION (SOUTH) , a national banking association ("NationsBank") in its
capacity as agent (the "Agent") for each of the lenders (the "Lenders") now
or hereafter party to the Credit Agreement (defined below) , and each of
the undersigned Lenders. Unless the context otherwise requires, all terms
used herein without definition shall have the respective definitions
provided therefor in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into that
certain Amended and Restated Revolving Credit and Reimbursement Agreement
dated June 29, 1995 whereby the Lenders have made available to the Borrower
(i) a $60,000,000 revolving credit facility, which includes a letter of
credit facility of up to $500,000 and (ii) a $9,942,917 (as reduced from
time to time in accordance with the terms thereof) direct pay letter of
credit facility (together with the exhibits and schedules attached thereto,
as the same has been amended by Amendment Agreement No. 1 dated as of
December 15, 1995, Amendment Agreement No. 2 dated as of March 15, 1996,
Amendment Agreement No. 3 dated as of September 24, 1996 and Amendment
Agreement No. 4 dated as of January 31, 1997 and as the same may be further
amended, restated or supplemented from time to time, the "Credit
Agreement"); and
WHEREAS, the Borrower has requested that the Lenders amend and/or waive
the provisions of the Credit Agreement in order to, among other things, (i)
provide for payment of certain Reimbursement Obligations upon the terms and
conditions of a note attached hereto, (ii) allow for the Flexible Term
Notes to be optionally redeemed with a draw on the Direct Pay Letter of
Credit, (iii) provide for the cancellation of such Direct Pay Letter of
Credit (iv) allow the Fronting Bank to sell the note to Barnett Bank, N.A.
and the proceeds of such sale to be paid to the Fronting Bank and the
Lenders in satisfaction of certain Reimbursement obligations; and
WHEREAS, upon the terms and conditions contained herein, the Agent and
the Lenders are willing to amend the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and conditions herein
set forth, it is hereby agreed as follows:
1. Credit Agreement Amendments and Waivers. Subject to the conditions
hereof, the Credit Agreement is hereby amended, effective as of the date
hereof, as follows:
(a) Section 1.01 is hereby amended by adding the following
definitions in the appropriate alphabetical order:
"'Amendment No. 5' means that certain Amendment Agreement No. 5 and
Waiver to the Amended and Restated Revolving Credit and Reimbursement
Agreement dated as of April 28, 1997.
`Draw Note' means the Note, in the form of Exhibit A to Amendment
No. 5 hereto, from Borrower to the Fronting Bank.
'Purchasing Bank' means Barnett Bank, N.A. in its capacity as
purchaser of the Draw Note."
(b) The provisions of the Credit Agreement are hereby waived to the
extent, and only to the extent, of permitting $8,800,000 of the
Reimbursement obligation resulting from the draw under the Direct Pay
Letter of Credit to not be paid by an Advance or as otherwise provided in
the Credit Agreement, but replaced by the Draw Note attached to this
Amendment Agreement as Exhibit A. Each Lender (other than NationsBank)
shall acquire a pro rata participation in the right to payment under the
Draw Note.
(c) Section 3.2(a) is hereby amended by adding after the phrase
"and (ii) to the extent expressly permitted under Article IV, the Borrower
shall not be required to make immediate reimbursement of Tender Advances",
the phrase "or other Reimbursement Obligations as set forth therein or in
Amendment No. 5".
(d) The last paragraph of Section 4.13 is hereby amended and
restated as follows:
"In the event that the Borrower has net proceeds from any public
offering of its stock, the Borrower agrees to apply one hundred percent
(100%) of such net proceeds to repay amounts outstanding under the
Revolving Credit Facility."
(e) The provisions of Sections 11.2 and 11.4 are hereby waived to
the extent, and only to the extent, to permit the Borrower to enter into
the loan agreement related to the Draw Note with the Purchasing Bank and to
permit the Draw Note to be secured by the Mortgage, which will be assigned
to the Purchasing Bank.
(f) The provisions of Section 11.15 are hereby waived to the
extent, and only to the extent, to permit the Borrower to enter into an
Interest Rate Hedging Agreement with the
2
Purchasing Bank pursuant to the terms of the Loan Agreement related to the
Draw Note.
(g) Section 11.17 is hereby deleted in its entirety and replaced
with the phrase "Intentionally Deleted".
2. Termination of Commitment. From and after the effectiveness of
this Amendment Agreement, the Direct Pay Letter of Credit Commitment shall
be terminated in its entirety and all Reimbursement Obligations related
thereto shall be terminated.
3. Representations and Warranties. In order to induce the Agent and
the Lenders to enter into this Amendment Agreement, the Borrower hereby
represents and warrants that the Credit Agreement has been re-examined by
the Borrower and that except as disclosed by the Borrower in writing to the
Lenders as of the date hereof:
(a) The representations and warranties made by the Borrower in
Article VIII thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the date
of the most recent financial reports of the Borrower delivered to the Agent
under Section 10.2 thereof, other than changes in the ordinary course of
business;
(c) The business and properties of the Borrower and its
Subsidiaries are not, and since the date of the most recent financial
reports of the Borrower delivered to the Agent under Section 10.2 thereof,
have not been, adversely affected in any substantial way as the result of
any fire, explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts of
God or the public enemy, or cancellation or loss of any major contracts;
and
(d) After giving effect to this Amendment Agreement, no condition
exists which, upon the effectiveness of the amendment contemplated hereby,
would constitute a Default or an Event of Default on the part of the
Borrower under the Credit Agreement or the Notes, either immediately or
with the lapse of time or the giving of notice, or both.
4. Conditions. The effectiveness of this Amendment Agreement is
subject to the following conditions occurring in the following order
provided, however, that Section 1(d) shall become effective upon the
fulfillment of only the condition set forth in paragraph (ii) hereof:
3
(i) Notices of Redemption have been delivered by Borrower to the
trustee of the Flexible Term Notes and by such trustee to the Flexible Term
Note holders;
(ii) the Agent has received six counterparts of this Amendment
Agreement duly executed by all signatories hereto;
(iii) duly completed Draw Certificate for Principal Drawing and
Draw Certificate for Interest Drawing in the forms of Annex A and Annex B
to the Direct Pay Letter of Credit have been delivered to the Fronting
Bank;
(iv) duly completed Discharge of Note Agreement and Letter of
Credit Cancellation in the form of Annex E to the Direct Pay Letter of
Credit, together with the original Direct Pay Letter of Credit have been
delivered to the Fronting Bank;
(v) the Draw Note, in the form attached hereto as Exhibit A,
executed by the Borrower has been delivered to NationsBank;
(vi) the Agent has received the canceled Flexible Term Notes;
(vii) the Agent has received $8,800,000 representing payment in full
from the Purchasing Bank to the NationsBank and the other Lenders of all
amounts due under the Draw Note for the Reimbursement Obligations incurred
by the draw on the Direct Pay Letter of Credit and payment in full from the
Borrower to NationsBank and the other Lenders of all other amounts due for
the Reimbursement obligations incurred by the draw on the Direct Pay Letter
of Credit.
(viii) the Agent has received counterparts of the Assignment and
Assumption Agreement, in the form attached hereto as Exhibit B, executed by
the Purchasing Bank, the Agent and the Borrower;
(ix) the Agent has received counterparts of the Mortgage
Modification Agreement, in the form attached hereto as Exhibit C, executed
by the Borrower, the Purchasing Bank and the Agent;
(x) the Agent has received UCC-3 Financing Statements executed by
the Agent and the Purchasing Bank;
(xi) the Agent has received an opinion of counsel to the Borrower
in form and substance satisfactory to the Agent and its counsel;
4
(xii) the Agent has received resolutions of the Board of Directors
or other governing body of the Borrower approving this Amendment Agreement
certified by the Secretary of the Borrower; and
(xiii) the Agent has received copies of all additional agreements,
instruments and documents which the Agent may reasonably request, such
documents, when appropriate, to be certified by appropriate governmental
authorities.
All proceedings of the Borrower relating to the matters provided for herein
shall be satisfactory to the Lenders, the Agent and their counsel.
5. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party hereto, and no one of them has relied on any such promise,
condition, representation or warranty. Each of the parties hereto
acknowledges that, except as in this Amendment Agreement otherwise
expressly stated, no representations, warranties or commitments, express or
implied, have been made by any party to the other. None of the terms or
conditions of this Amendment Agreement may be changed, modified, waived or
canceled orally or otherwise, except by writing, signed by all the parties
hereto, specifying such change, modification, waiver or cancellation of
such terms or conditions, or of any proceeding or succeeding breach
thereof.
6. Full Force and Effect of Agreement:. Except as hereby
specifically amended, modified or supplemented,' the Credit Agreement and
all other Loan Documents are hereby confirmed and ratified in all respects
and shall remain in full force and effect according to their respective
terms.
7. Counterparts. This Amendment Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.
8. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF FLORIDA, WITHOUT REGARD TO ANY
OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY
(i) SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS
OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF
COLLECTION AND
(ii) WAIVES TRIAL BY JURY IN CONNECTION WITH ANY SUCH LITIGATION.
9. Enforceability. Should any one or more of the provisions of
thisAmendment Agreement be determined to be illegal or
5
unenforceable as to one or more of the parties hereto, all other provisions
nevertheless shall remain effective and binding on the parties hereto.
10. Credit Agreement. All references in any of the Loan Documents to
the Credit Agreement shall mean and include the Credit Agreement as amended
hereby.
11. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders, the
Agent and their respective successors, assigns and legal representatives;
provided, however, that the Borrower, without the prior consent of the
Lenders, may not assign any rights, powers, duties or obligations
hereunder.
[remainder of this page left blank intentionally]
6
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of
the day and year first above written.
BORROWER:
REPTRON ELECTRONICS, INC.
BY:/s/ Paul J. Plante
Name: Paul J. Plante
Title: COO
NATIONSBANK, NATIONAL ASSOCIATION
(SOUTH), as Agent and a Lender
By: /s/ Timothy M. O'Connor
Name: TIMOTHY M. O'CONNOR
Title: VICE PRESIDENT
PNC BANK, KENTUCKY, INC.
By: /s/ J. Neil
Name: James D. Neil
Title: Vice President
THE SUMITOMO BANK, LIMITED
By: /s/ Allen L. Harvell Jr.
Name: Allen L. Harvell Jr.
Title: Vice President and Manager
By: /s/ M. Phillip Freeman
Name: M. Phillip Freeman
Title: Vice President
BARNETT BANK, N.A.
By: /s/ David Austin
Name: David Austin
Title: Senior Vice President
Exhibit A
(see attached)
DIRECT PAY OBLIGATIONS RENEWAL
AND REPLACEMENT PROMISSORY NOTE
$8,800,000.00 April 25, 1997
(the "Principal Amount") As of April 28, l997
FOR VALUE RECEIVED, the undersigned, REPTRON ELECTRONICS, INC., a Florida
corporation (the "Borrower"), promises to pay to the order of NATIONSBANK,
NATIONAL ASSOCIATION (SOUTH), a national banking association, as Agent (the
"Agent"), at its office at 901 Main Street, 67h Floor, Dallas, Texas 75202,
or at such other place as the holder of this Note from time to time may
designate to the Borrower in writing, the principal sum of EIGHT MILLION
EIGHT HUNDRED THOUSAND AND N0/100 DOLLARS ($8,800,000.00), or so much
thereof as may be outstanding, together with interest on the principal
balance of this obligation from time to time remaining unpaid, at the rates
and at the times provided in this Note. All payments required by this Note
must be by legal tender of the United States of America.
Pursuant to the terms of a certain Amended and Restated Credit and
Reimbursement Agreement dated June 29, 1995, executed by and among the
Borrower, various banks from time to time parties thereto and the Agent, as
amended to date (the "Credit Agreement"), this Note is given in
satisfaction of and to replace certain reimbursement obligations of the
Borrower to the Agent (the "Direct Pay Obligations") for a draw on the
Direct Pay Letter of Credit (as such term is defined in the Credit
Agreement) and the principal amount of this Note is equal to portion of the
Direct Pay Obligations which represented the principal amount of the draw
on the Direct Pay Letter of Credit. It is contemplated in the Credit
Agreement that this Note and the mortgage and other loan documents securing
this Note will be purchased by Barnett Bank, N.A., a national banking,
association ("Purchasing Bank") and the Borrower and the Purchasing Bank
have entered into a certain Loan Agreement of even date herewith relating
to the purchase of this Note (the "Loan Agreement"). All capitalized terms
used herein but not otherwise defined herein shall have the meanings
ascribed to such terms in the Loan Agreement. From and after the date upon
which this Note is purchased by the Purchasing Bank, all references herein
to the "Agent" shall be deemed to refer to the Purchasing Bank.
As used in this Note, the following terms shall have the following
meanings:
1. Adjusted LIBO Rate. For each LIBO Interest Period, a daily rate equal
to the applicable LIBO Rate, plus the Applicable Margin.
Applicable Margin. A percentage rate per annum to be used in calculating
the LIBO Rate, which percentage rate shall be: (a) 1.375% for the period
from the date of this Note until the earlier to occur of (i) the date upon
which the Borrower enters into the Swap Agreement or (ii) May 31, 1997; (b)
1.125% from and after the date upon which the Borrower enters into the Swap
Agreement; or (c) the margin applicable to Eurodollar Loans (as defined in
the Credit Agreement) during, the applicable time period as provided in the
Credit Agreement, in the event that the Borrower fails to enter into the
Swap Agreement prior to May 31, 1997.
3. Business Banking Day Any day other than a Saturday, Sunday or other day
on which commercial banks in Jacksonville, Florida are closed for business.
4. LIBO Interest Period. Initially, the period commencing on April
28, 1997 and ending on June 5, 1997 and thereafter the period commencing on
the fifth (5th) day of July and on the fifth (5th) day of each month
thereafter and ending on the day immediately preceding the date upon which
the next LIBO Interest Period commences; provided that the last LIBO
Interest Period during the term of the Note shall end on the Maturity Date.
If any LIBO Interest Period would end on a date which is not a Business
Banking Day, such LIBO Interest Period shall be extended to the next
succeeding Business Banking Day.
5. LIBO Rate. An interest rate per annum equal to the rate per
annum obtained by dividing (a) the rate of interest per annum (rounded
upward to the nearest one-sixteenth (1/1 6th) of one percent) at which
deposits in United States dollars in the approximate amount of the
outstanding principal balance of this Note for a term of one (1) month are
offered in the London Interbank Market as appears on the LIBO Rate
Reference Page as of 11:00 a.m. (London time) on the day that is two London
Banking Days (as defined herein) preceding the first Banking Business Day
of the LIBO Interest Period, by (b) an amount equal to 1 minus the LIBO
Reserve Percentage for such LIBO Interest Period. If at least two such
offered rates appear on the LIBO Rate Reference Page, the rate will be the
arithmetic mean of such offered rates. The Agent may, in its discretion,
use any other publicly available index or reference rate showing, rates
offered for United States dollar deposits in the London Interbank market as
of the applicable date. In addition, the Agent may, in its discretion, use
rate quotations for daily or annual periods in lieu of quotations for
substantially equivalent monthly periods.
6. LIBO Rate Reference Page. Any of (a) the Reuters Screen LIBO Page, (b)
the Dow Jones Telerate Page 3750 or (c) such other nationally recognized
source, as may from time to time by used by the Agent in its sole
discretion as a reference for determining any applicable LIBO Rate.
7. LIBO Reserve Percentage. The rate at which reserves (including,
without limitation, any marginal supplemental or emergency reserves) are
required to be maintained by the Agent two (2) Business Days prior to the
commencement of a LIBO Interest Period against Eurocurrency liabilities
having a term substantially equal to such LIBO Interest Period, expressed
as a decimal.
8. LIBO Roll-Over Date. The last day of any LIBO Interest Period.
9. London Banking Day. Each day other than a Saturday, a Sunday or any
holiday on which commercial banks 'in London, England are closed for
business.
2.
10. Maturity Date. April 28, 2004.
11. Prime Rate. The lending rate from time to time announced by Barnett
Banks, Inc., the Purchasing Bank's holding company ("BBI"), as its prime
rate.
From and after the date of this Note, interest shall accrue at the Adjusted
LIBO Rate applicable to each such LIBO Interest Period. Interest shall be
calculated on the daily outstanding principal balance of this Note.
Interest shall be computed on the basis of a year of 360 days for the
actual number of days elapsed through the actual payment due date. Changes
in the Prime Rate shall be effective as of the date of change in the
applicable rate. Changes in the Adjusted LIBO Rate shall be effective on
the first day of each LIBO Interest Period. Equal principal payments in
the amount of $37,510.00, plus interest then accrued on the outstanding
principal balance of this Note shall be paid monthly in arrears commencing
on June 5, 1997 and continuing on the fifth (5th) day of each month
thereafter prior to the Maturity Date. Notwithstanding anything contained
in this Note or the Loan Agreement to the contrary, the outstanding
principal balance of this Note, plus unpaid accrued interest, shall be due
and payable on the Maturity Date.
In the event, and on each occasion, that on the day two (2) Business Days
prior to the commencement of any LIBO Interest Period, the Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrower) that (i) the LIBO Rate is not available for dollar deposits in an
amount approximately equal to the outstanding principal balance of this
Note for the applicable LIBO Interest Period, or (ii) the rate at which
such dollar deposits are being offered will not adequately and fairly
reflect the cost to the Agent or its holding company, if any, of making or
maintaining the Adjusted LIBO Rate with respect to the outstanding
principal balance of this Note during, such LIBO Interest Period, or (iii)
reasonable means do not exist for ascertaining, a LIBO Rate, or (iv) a LIBO
Rate with respect thereto would be in excess of the maximum interest rate
which the Borrower may by law pay, then the outstanding principal balance
of this Note shall bear interest at the Prime Rate until such time as the
Agent determines that none of the circumstances described in clauses (i)
through (iv) continues to exist.
If any change in any law or regulation or in the interpretation thereof by
any Governmental authority charged with the administration or
interpretation thereof shall make it unlawful for the Agent, or its holding
company, if any, to make or maintain LIBO Rates or to give effect to its
obligations as contemplated hereby, then, the LIBO Rate shall immediately
terminate and cease to be applicable and, upon notice by the Agent to the
Borrower the interest rate applicable to this Note shall be automatically
converted to another Eurodollar market rate selected by the Agent, provided
such conversion does not increase the Agent's cost or if no other
Eurodollar market rate is acceptable to the Agent, the interest rate
applicable to this Note shall be automatically converted to the Prime Rate
and the Borrower shall pay to the Agent an amount equal to the prepayment
premium which would be due with respect to the prepayment of the amount
bearing at the Adjusted LIBO Rate pursuant to the provisions of this Note
hereinafter set forth. Any notice given by the Agent to the
3.
Borrower Pursuant to this paragraph shall, if lawful, be effective on the
last day of the then, applicable LIBO Interest Period.
The Borrower recognizes that the cost to the Agent of making or maintaining
an Adjusted LIBO Rate with respect to the outstanding principal amount of
this Note may be, from time to time affected by the matters set forth in
Paragraphs 1 and 2, below, and the Borrower, agrees that the Agent, in
quoting or establishing a LIBO Rate at the commencement of a LIBO Interest
Period, may take into consideration such additional amount or amounts
resulting from the following as the Agent shall determine, will compensate
the Agent for such additional costs:
1. The imposition of, or changes in, the reserve requirements promulgated
by the Board of Governors of the Federal Reserve System of the United
States, including, but not limited to, any reserve on Eurocurrency
Liabilities, as defined in Regulation D, at the ratios provided in such
Regulation from time to time, it being agreed that outstanding principal
amount of this Note shall be deemed to constitute a Eurocurrency Liability
if it bears interest at the Adjusted LIBO Rate, and it being further agreed
that such Eurocurrency Liabilities shall be deemed to be subject to such
reserve requirements without benefit of or credit for prorations,
exceptions, or offsets that may be available to the Agent or its holding
company, if any, from time to time under such Regulation; or
2. Any change, after the date of this Note, in applicable law or
regulation or in the interpretation or administration thereof by any
governmental authority charged with the interpretation or administration
thereof (whether or not having the force of law) or by any court changing
the basis of taxation of payments to the Agent or its holding, company, if
any, of the principal of or interest on the outstanding principal amount of
this Note or any other fees or amounts payable under this Note or the Loan
Agreement (other than taxes imposed on the overall net income of the Agent
or its holding company, if any, by any state, or by any political
subdivision or taxing authority therein), or imposing, modifying, or
applying any reserve, special deposit or similar requirement Against assets
of, deposits with or for the account of credit extended by, or any other
acquisition of funds for loans by the Agent or its holding company, if any,
or imposing on the Agent or its holding company, if any, or the London
Interbank Market any other condition affecting this Note or the Loan
Agreement or the outstanding principal amount of this Note so as to
increase the cost to the Agent or its holding company, if any, of making or
maintaining an Adjusted LIBO Rate or to reduce the amount of any sum
received or receivable by the Agent under this note or the Loan Agreement
(whether of principal, interest or otherwise), by an amount deemed by the
Agent to be material, but without duplication for payments required under
clause (1) above.
The Borrower shall indemnify the Agent against any loss or expense that the
Agent may sustain or incur as a consequence of any default by the Borrower
in the payment of any portion of the principal balance of this Note
bearing, interest at the Adjusted LIBO Rate, as and when, due and payable,
or the occurrence of any event specified in the provisions of this Note or
the Loan Agreement, including, but not limited to, any loss or reasonable
expense sustained or incurred in
4.
liquidating or reemploying deposits from third parties acquired to effect
or maintain the Adjusted LIBO Rate. The Agent shall provide to the
Borrower a statement explaining the amount of any such loss or expense,
which statement shall be conclusive absent manifest error.
The Borrower shall have the right, provided that it is not in default under
this Note or the Loan Agreement, to prepay the principal balance of this
Note, in whole or in part, at any time, upon payment of all interest and
other sums then due and payable pursuant to the provisions of this Note or
the Loan Agreement. No prepayment premium shall be payable with respect to
any portions of the principal balance of this Note which bears interest at
the Prime Rate. If any portion of the principal balance of this Note being
prepaid bears interest at the Adjusted LIBO Rate, either, with respect to
the amount being prepaid, the Borrower shall pay to the Agent
contemporaneously with any such prepayment of this Note, an amount equal to
the amount of the prepayment multiplied by a per annum interest rate equal
to the difference between the Adjusted LIBO Rate applicable thereto, and
the 360 day equivalent interest yield (hereinafter called the "Reinvestment
Rate") on any United States Treasury obligations selected by the Agent in
an aggregate amount approximately equal to such portion of the principal
balance of this Note, and with maturities comparable to the LIBO Roll-Over
Date applicable thereto, calculated over a period of time from the date of
prepayment to and including such LIBO Roll-Over Date. If the Adjusted LIBO
Rate on the amount being prepaid is equal to or less than the Reinvestment
Rate, no prepayment premium shall be due. Any payment of the principal
balance of this Note after acceleration of the applicable maturity date of
this Note, or the commencement of any proceedings to enforce this Note or
the Loan Agreement, as a result of the occurrence of an Event of Default
under the Loan Agreement, shall be deemed a voluntary prepayment for the
purposes of this paragraph and a prepayment premium calculated pursuant to
the provisions of this paragraph shall be payable with respect thereto
based upon the Adjusted LIBO Rate applicable immediately prior to such
default and acceleration. The Agent shall certify to the Borrower the
amount and basis of determination of such prepayment premium it being
agreed that (a) the calculation of such prepayment premium may be based on
any United States Treasury obligations selected by the Agent in its sole
discretion and (b) the Agent shall not be obligated or required to have
actually reinvested the prepaid principal balance of this Note in any such
United States Treasury obligations as a condition precedent to receiving a
prepayment premium calculated as aforesaid. The Borrower shall upon
receipt of such certification and contemporaneously with any such
prepayment of the principal balance of this Note, remit to the Agent the
prepayment premium, if any, due in connection therewith as calculated
pursuant to the provisions of this paragraph. The Agent shall not be
obligated to accept any prepayment of the principal balance of this Note
unless it is accompanied by the prepayment premium, if any, due in
connection therewith as calculated pursuant to the provisions of this
paragraph.
If any payment required by this Note is not paid within ten (10) days after
the date such payment is due, then the holder of this Note, at such
holder's option, may elect to declare the entire principal balance of this
note, plus accrued interest, immediately due and payable. The Borrower
shall pay a late charge equal to the greater of (a) $100.00 or (b) five
percent (5%) of the
5.
amount of any payment which is not received by the Agent on or before the
tenth (10th) day following the date such payment is due, to compensate for
the Agent's loss of use of funds and for the expense of handling the
delinquency, which late charge must be received by the Agent with the
payment then due.
If, following any default by the Borrower under this Note, the holder of
this Note employs attorneys, to enforce collection of this obligation, in
whole or in part, then the Borrower will pay, a reasonable fee for such
attorneys' and any legal assistants' services, regardless of whether suit
is instituted and, if a suit or other action or proceeding is instituted to
enforce payment of all or any portion of this obligation, for all trial and
appellate proceedings, if any. The Borrower also will pay (i) all other
costs of collection incurred, and (ii), all costs and reasonable attorneys'
and legal assistants' fees incurred by the holder for all administrative,
trial, and appellate proceedings involving this obligation.
The remedies of the Agent as provided herein and in the Loan Agreement
shall be cumulative and concurrent, and may be pursued singly, successively
or together, at the sole discretion of the Agent, and may be exercised as
often as occasion therefor shall arise. No act of omission or commission
of the Agent, including specifically any failure to exercise any right,
remedy or recourse, shall be effective as a waiver thereof unless it is set
forth in a written document executed by the Agent and then only to the
extent specifically recited therein. A waiver or release with reference to
one event shall not be construed as continuing, as a bar to, or as a waiver
or release of, any subsequent right, remedy or recourse as to any
subsequent event.
Notwithstanding any provision of this Note or the Loan Agreement to the
contrary, the parties intend that no provision of this Note or the Loan
Documents be interpreted, construed, applied, or enforced so as to permit
or require the payment or collection of interest, in excess of the maximum
rate as hereafter may be permitted by the law applicable to this
transaction (the "Maximum Permitted Rate"). If, however, any such
provision is so interpreted, construed, applied, or enforced, then the
parties intend: (i) that such provision automatically shall be reformed
nunc pro tunc so as to require payment only of interest at the Maximum
Permitted Rate; and (ii) if the holder of this Note has received interest
payments in excess of such Maximum Permitted Rate, that the amount of such
excess be credited nunc pro tunc in reduction of the principal amount of
this obligation, together with interest at such Maximum Permitted Rate.
In connection with all calculations to determine the Maximum Permitted
Rate, the parties intend: first, that all charges be excluded to the extent
that they are property excludable under the usury laws of the State of
Florida or the United States of America, as they from time to time are
determined to apply to this obligation and, second, that all charges that
may be "spread" in the manner provided by Section 687.03(3), Florida
Statutes (1995), or any similar successor law, be spread in the manner
provided by such statute.
6.
This Note will be interpreted, construed, applied, and enforced according
to the laws of the State of Florida, regardless of where executed or
delivered, where payment is made, where any action or other proceeding
involving this Note is instituted, or whether the laws of the State of
Florida otherwise would apply the laws of another jurisdiction. The
provisions of this Note bind, and are for the benefit of, the respective
heirs, successors, and assigns of the Agent and all persons and entities
executing this Note as the Borrower, jointly and severally.
Presentment, protest, notice of protest, notice of dishonor, and all
suretyship defenses, unless expressly reserved by any subsequent endorser,
are hereby waived by all parties now or hereafter liable for payment of all
or any portion of this obligation, whether as makers, endorsers,
guarantors, or otherwise, and regardless of accommodation status.
IN WITNESS WHEREOF, the Borrower has executed and delivered this Note the
date stated above.
REPTRON ELECTRONICS, INC., a
Florida corporation
By: /s/ Paul J. Plante
--------------------
Paul J. Plante, Vice
President and Chief Operating Officer
7.
STATE OF ILLINOIS )
COUNTY OF DuPAGE )
THE FOREGOING INSTRUMENT was acknowledged before me this 25th day of
April, 1997, by PAUL J. PLANTE, as Vice President and Chief Operating
Officer of REPTRON ELECTRONICS, INC., a Florida corporation, on behalf of
the corporation. He/She is either personally known to me or X has
produced his/her FL Drivers License as identification.
(Affix Seal) /s/ Pamela Middleton
--------------------
Print Name: Pamela Middleton
Notary Public - State of Illinois
My Commission Expires: 11/6/98
My Commission No.:
-------------
INDORSEMENT:
- -----------
WITHOUT RECOURSE, PAY TO THE
ORDER OF BARNETT BANK, N.A.
NATIONSBANK, NATIONAL ASSOCIATION
(SOUTH), AS AGENT
By: /s/ Timothy M. O'Connor
-------------------------
Name: Timothy M. O'Connor
Title: Vice President
Date: 4/28
EXHIBIT B
(see attached)
PREPARED BY AND AFTER RECORDING
RETURN TO:
Richard H. Sollner, Esq.
Trenam, Kemker, Scharf, Barkin,
Frye, O'Neill & Mullis, P.A.
101 E. Kennedy Blvd., Suite 2700
Tampa, FL 33602
[Space Above This Line for Recording Data]
ASSIGNMENT OF MORTGAGE
KNOW ALL MEN BY THESE PRESENTS: That NATIONSBANK, NATIONAL ASSOCIATION
(SOUTH), a national banking association, as Agent for the Lenders under the
Credit Agreement (as such term is defined in the Mortgage described below)
(hereinafter called "Assignor"), for and in consideration of the sum of Ten
and No/100 Dollars ($10.00) to it in hand paid by, a BARNETT BANK, N.A., a
national banking association (hereinafter called "Assignee"), the receipt
of which is hereby acknowledged, does grant, bargain, sell, convey, and
assign to Assignee, its successors and assigns, all of Assignor's right,
title, and interest in, to and under that certain Mortgage and Security
Agreement executed by REPIRON ELECTRONICS, INC., a Florida corporation
("Borrower"), dated as of March 1, 1995, and recorded in Official Records
Book 7687, Page 1857, of the Public Records of Hillsborough County,
Florida, as amended (i) by Amendment to Mortgage and Security Agreement
dated as of April 28, 1995, and recorded in Official Records Book 7787,
Page 1120, and re-recorded in Official Records Book 7803, Page 1996, Public
Records of Hillsborough County, Florida, (d) Second Amendment to Mortgage
and Security Agreement dated as of August 24, 1995, and recorded in
Official Records Book 7884, Page 1109, Public Records of Hillsborough
County, Florida, and (iii) Third Amendment to Mortgage and Security dated
of even date herewith and recorded or to be recorded in the Public Records
of Hillsborough County, Florida (as modified, the "Mortgage"), together
with the indebtedness secured thereby and the monies due or to become due
thereon with interest thereon from April 28, 1997, and all right, title and
interest of Assignor in and to the encumbered property therein described
located in Hillsborough County, Florida.
WITHOUT RECOURSE against Assignor.
ASSIGNOR further warrants that it is the holder of the Mortgage and the
promissory note secured thereby as the Agent for the Lenders with full
power and authority to assign the Mortgage, that it has executed no
assignment, release, discharge, satisfaction or cancellation of the
Mortgage or the promissory note secured thereby; and that except as set
forth herein, it has executed no instruments in any way affecting the
Mortgage or the promissory note secured thereby,
IN WITNESS WHEREOF, Assignor has caused these presents to be signed in
its name and on its behalf by officers authorized to do so as of the 28th
day of April, 1997.
Signed, sealed and delivered in the ASSIGNOR:
the presence of:
NATIONSBANK, NATIONAL
ASSOCIATION (SOUTH), a national
banking association
/s/ Amy Krovocheck By: /s/ Timothy M. O'Connor
Print Name: Amy Krovocheck Name: Timothy M. O'Connor
Title: Vice President
/s/ Nancy J. Pearson
Print Name: Nancy J. Pearson
STATE OF TEXAS
COUNTY OF
THE FOREGOING INSTRUMENT was acknowledged before me this 28th day of April,
1997, by Tim O'Connor, as Vice President of NATIONSBANK NATIONAL
ASSOCIATION(SOUTH), a national banking association, On behalf of the
association.
He/she is either X personally known to me or produced
as
---- ---- -----------
identification.
LINDA F. WEBSTER
NOTARY PUBLIC /s/ Linda F. Webster
STATE OF TEXAS ----------------------------
Print Name: Linda F. Webster
MY COMM. EXP. 09-23-00 NotaryPublic, State of Texas
(NOTARIAL SEAL) My CommissionExpires: 9/00
My Commission Number: N/A
2.
EXHIBIT C
(see attached)
PREPARED BY AND AFTER RECORDING
RETURN TO:
Richard H. Sollner, Esq.
Trenam, Kemker, Scharf, Barkin,
Frye, O'Neill & Mullis, P.A.
101 E. Kennedy Blvd., Suite 2700
Tampa, FL 3 3602
[ Space Above This Lure for Recording Data l
THIRD AMENDMENT TO MORTGAGE AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO MORTGAGE AND SECURITY AGREEMENT AMENDMENT (this
"Third Amendment"), made and entered into as of the 28th day of April,
1997, is between REPTRON ELECTRONICS, INC., a Florida corporation (the
"Mortgagor"), and NATIONSBANK, NATIONAL ASSOCIATION (SOUTH), a national
banking association, as Agent for the Lenders under the Credit Agreement
described below (in such capacity, the "Mortgagee") whose address is 400
North Ashley Drive, Tampa, Florida 33602;
RECITALS
1. In order to secure certain Direct Pay Obligations relating to the
Direct Pay Letter of Credit (as such terms are defined in that certain
Amended and Restated Revolving Credit and Reimbursement Agreement dated as
of March 1, 1995 among the Mortgagor, the Mortgagee and the Lenders
thereunder, as the same may be amended, modified or restated from time to
time, the "Credit Agreement"), Mortgagor executed and delivered to
Mortgagee that certain Mortgage and Security Agreement dated as of March 1,
1995, and recorded in Official Records Book 7687, Page 1857, of the Public
Records of Hillsborough County, Florida (the "Mortgage"); and
2. The Mortgage has heretofore been amended (i) by Amendment to
Mortgage and Security Agreement dated as of April 28, 1995, and recorded in
Official Records Book 7787, Page 1120, and re-recorded in Official Records
Book 7803, Page 1996, Public Records of Hillsborough County, Florida, (ii)
Second Amendment to Mortgage and Security Agreement dated as of August 24,
1995, and recorded in Official Records Book 7884, Page 1109, Public Records
of Hillsborough County, Florida; and
THE MORTGAGE, AS HERETOFORE AND HEREBY AMENDED SECURES A PRESENT
INDEBTEDNESS IN A PRINCIPAL AMOUNT OF UP TO $7,750,000.00, PLUS INTEREST
THEREON. DOCUMENTARY STAMP TAXES IN THE AMOUNT OF $27,125.00 HAVE BEEN
HERETOFORE PAID AND AFFIXED TO THE MORTGAGE AND ONE OR MORE OF THE PRIOR
AMENDMENTS, ACCORDINGLY, ALL DOCUMENTARY STAMP TAXES REQUIRED TO BE PAID,
HAVE BEEN PAID. INTANGIBLE PERSONAL PROPERTY TAX IN THE AMOUNT OF
$15,500.00 IS BEING PAID AT THE TIME OF RECORDING OF THIS THIRD AMENDMENT.
3. There has been a draw under the Direct Pay Letter of Credit and,
pursuant to the terms of the Credit Agreement, the Direct Pay Obligations
under the Credit Agreement have been removed from the Credit Agreement and
replaced, renewed and incorporated into a certain Direct Pay Obligation
Renewal and Replacement Promissory Note dated of even date herewith in the
original principal amount of $8,800,000.00 executed by Mortgagor and
delivered to Mortgagee (the "Note"); and
4. It is the intent of Mortgagor and Mortgagee that the Mortgage, as
heretofore modified and as modified hereby, cease to secure the Contingent
Liabilities (as such term is defined in the Mortgage) and hereafter secure
up to $7,750,000.00 of the principal amount of the Note, together with
interest thereon at the rate set forth in the Note (the "Secured Amount")
and Mortgagor and Mortgagee desire to amend the Mortgage to reflect such
intent.
5. Contemporaneously with the execution of this Third Amendment,
Mortgagee is endorsing the Note, without recourse, and assigning the
Mortgage, as modified heretofore and hereby, and certain other documents
securing the Note to BARRETT BANK, N.A., a national banking association
("Purchasing Lender").
NOW, THEREFORE, in consideration of the premises and the mutual
covenants, promises and conditions herein set forth, it is hereby agreed
that the Mortgage, as heretofore amended, is hereby further amended as
follows:
1. All references in the Mortgage to the "Contingent Liabilities"
shall be deemed to refer to the Secured Amount.
2. All references in the Mortgage to the "Credit Agreement" shall be
deemed to refer to the Note and/or that certain Loan Agreement dated of
even date herewith executed by and between Mortgagor and Purchasing Lender
(the "Loan Agreement"), as appropriate.
3. Sections 2.01 and 2.02 are hereby deleted in their entirety and the
following substituted therefor:
2.01 Event of Default. The term Event of Default, when used in
this Mortgage, shall have the definition given it in Section 7.1 of the
Loan Agreement.
2.02 Remedies upon Event of Default. In an Event of Default shall
have occurred, Mortgagee may take any actions authorized pursuant to
Article 7 of the Loan Agreement and may take such other actions as may be
permitted by law.
4. All references in the Mortgage to the "Note Agreement" are hereby
deleted.
-2-
IN WITNESS WHEREOF, the Mortgagor and the Mortgagee have caused this Third
Mortgage Amendment to be duly executed, all as of the day and year first
above written.
WITNESS: REPTRON ELECTRONICS, INC., a
Florida corporation
/s/ Michael R. Nichols By: /s/ Paul J. Plante
- --------------------------- --------------------------
(Print Name) Michael R. Nichols Name: Paul J. Plante
Title: Vice President and
Chief Operating Officer
/s/ Joseph J. Fijak
(Print Name) Joseph J. Fijak
WITNESS: NATIONSBANK, NATIONAL
ASSOCIATION (SOUTH), a
National Banking association
/s/ Amy Krovocheck By: /s/ Timothy M. O'Connor
- --------------------------- -------------------------
(Print Name) Amy Krovocheck Name: Timothy M. O'Connor
Title: Vice President
/s/ Nancy J. Pearson
- -----------------------------
(Print Name) Nancy J. Pearson
STATE OF ILLINOIS
COUNTY OF DU PAGE
THE FOREGOING INSTRUMENT was acknowledged before me this
25 day of April, 1997, by PAUL J. PLANTE, as Vice President and Chief
Operating Officer of REPTRON ELECTRONICS, INC., a Florida corporation, on
behalf of the corporation. He is either Personally known to me or X
produced FL Drivers License as identification.
---- ------------------
/s/ Pamela Middleton
"OFFICAL SEAL" Print Name: Pamela Middleton
Pamela Middleton Notary Public, State of Illinois
Notary Public State of Illinois My Commission Expires: 11-6-98
My Commission Expires 11/06/98
STATE OF TEXAS
COUNTY OF DALLAS
THE FOREGOING INSTRUMENT was acknowledged before me
this 28th day of April, 1997, by Tim O'Connor, as Vice President of
NATIONSBANK, NATIONAL ASSOCIATION (SOUTH), a national banking association,
on behalf of the association. He/she is either X personally known to me
or produced as identification.
LINDA F. WEBSTER
NOTARY PUBLIC /s/ Linda F. Webster
STATE OF TEXAS -----------------------
Print Name: Linda F. Webster
MY COMM. EXP. 09-23-00 NotaryPublic, State of Texas
(NOTARIAL SEAL) My CommissionExpires: 9/00
My Commission Number: N/A
EXHIBIT 10.3
AMENDMENT AGREEMENT NO. 6
TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT NO. 6 TO THE AMENDED AND RESTATED REVOLVING
CREDIT AND REIMBURSEMENT AGREEMENT (the "Amendment Agreement") is made and
entered into as of this 3Oth day of April, 1997 among REPTRON ELECTRONICS,
INC., a Florida corporation having its principal place of business in
Tampa, Florida (the "Borrower"), NATIONSBANK, NATIONAL ASSOCIATION (SOUTH),
a national banking association in its capacity as agent (the "Agent") for
each of the lenders (the "Lenders") now or hereafter party to the Credit
Agreement (defined below), and each of the undersigned Lenders. Unless the
context otherwise requires, all terms used herein without definition shall
have the respective definitions provided therefor in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into
that certain Amended and Restated Revolving Credit and Reimbursement
Agreement dated June 29, 1995 whereby the Lenders have made available to
the Borrower (i) a $55,000,000 revolving credit facility, which shall
include a letter of credit facility of up to $500,000 and (ii) a $9,942,917
(as reduced from time to time in accordance with the terms thereof) direct
pay letter of credit facility (together with the exhibits and schedules
attached thereto, as the same has been amended by Amendment Agreement No. 1
dated as of December 15, 1995, Amendment Agreement No. 2 dated as of March
15, 1996, Amendment Agreement No. 3 dated as of September 24, 1996,
Amendment Agreement No. 4 dated as of January 31, 1997 and Amendment
Agreement No. 5 and Waiver dated as of April 28, 1997, hereinafter referred
to as the "Credit Agreement"); and
WHEREAS, pursuant to Amendment Agreement No.5 and Waiver to the
Amended and Restated Revolving Credit and Reimbursement Agreement dated as
of April 28, 1997, the Direct Pay Letter of Credit Commitment of Lenders
has been terminated and the Direct Pay Letter of Credit issued thereunder
has been canceled; and
WHEREAS, the Overline Notes issued by the Borrower in favor of the
Lenders pursuant to Amendment Agreement No.4 to the Amended and Restated
Revolving Credit and Reimbursement Agreement dated as of January 31, 1997
mature as of even date herewith and will be repaid by the Borrower; and
WHEREAS, to provide Borrower with additional funds under the revolving
credit facility, the Borrower has requested that the Lenders amend the
Credit Agreement to permanently increase the Total Revolving Credit
Commitment from $55,000,000 to $63,800,000; and
Name: NB REPTRON AMENDMENT NO 6 Doc No: 125050
WHEREAS, upon the terms and conditions contained herein, the Agent and
the Lenders are willing to amend the Credit Agreement to so increase the
Total Revolving Credit Commitment;
NOW, THEREFORE, in consideration of the premises and conditions herein
set forth, it is hereby agreed as follows:
1. Credit Agreement Amendment. Subject to the conditions hereof, the
Credit Agreement is hereby amended, effective as of the date hereof, as
follows:
(a) Section 1.1 thereof is hereby amended by inserting therein in
the appropriate alphabetical order the following definition:
(i) "'Additional Notes' means the promissory notes of the
Borrower dated as of April 30, 1997 and payable to the order of
the Lenders in the aggregate original principal amount of
$8,800,000, each substantially in the form attached hereto as
Exhibit O."
(ii) "'Amendment No. 6' means that certain Amendment Agreement
No. 6 to the Amended and Restated Revolving Credit and
Reimbursement Agreement dated as of April 30, 1997."
(b) Section 1.1 thereof is hereby amended by amending and restating
the following definitions in their entirety as follows:
(i) "'Applicable Commitment Percentage' means, at any time for
each Lender with respect to the Revolving Credit Facility
(including its Participations and its obligations hereunder to the
Fronting Bank to acquire Participations), a fraction (expressed as
a percentage), (A) the numerator of which shall be the amount of
such Lender's Revolving Credit Commitment (which Revolving Credit
Commitment for each Lender is set forth on Exhibit B attached
hereto and incorporated herein by reference), and (B) the
denominator of which shall be the Total Revolving Credit Commitment
at such date of determination; provided that the Applicable
Commitment Percentage of each Lender shall be increased or
decreased to reflect any assignments to or by such Lender effected
in accordance with Section 14.1 hereof."
(ii) "'Notes' means, collectively, (i) the Notes of the Borrower
evidencing Loans and Participations executed and delivered to the
Lenders as provided in Section 2.5 hereof substantially in the form
attached hereto as Exhibit J. with appropriate insertions as to
amounts and dates, and (ii) the Additional Notes of the Borrower
evidencing Loans and Participations executed and
Name: NB REPTRON AMENDMENT NO 6
Doc No: 125050 2
delivered to the Lenders as provided under Amendment No. 6
substantially in the form attached hereto as Exhibit 0, with
appropriate insertions as to amounts and dates."
(iii) "'Total Facilities Commitment' means, the Total Revolving
Credit Commitment."
(iv) "'Total Revolving Credit Commitment' means an amount equal
to $63,800,000, as reduced from time to time in accordance with
Section 2.7 hereof."
(c) Exhibit B to the Credit Agreement shall be deleted in its
entirety and replaced by Exhibit B attached hereto.
(d) Exhibit O to the Credit Agreement shall be deleted in its
entirety and replaced by Exhibit O attached hereto.
2. Representations and Warranties. In order to induce the Agent and
the Lenders to enter into this Amendment Agreement, the Borrower hereby
represents and warrants that the Credit Agreement has been re-examined by
the Borrower and that except as disclosed by the Borrower in writing to the
Lenders as of the date hereof:
(a) The representations and warranties made by the Borrower in
Article VIII thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the date
of the most recent financial reports of the Borrower delivered to the Agent
under Section 10.2 thereof, other than changes in the ordinary course of
business;
(c) The business and properties of the Borrower and its
Subsidiaries are not, and since the date of the most recent financial
reports of the Borrower delivered to the Agent under Section 10.2 thereof,
have not been, adversely affected in any substantial way as the result of
any fire, explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts of
God or the public enemy, or cancellation or loss of any major contracts;
and
(d) After giving effect to this Amendment Agreement, no condition
exists which, upon the effectiveness of the amendment contemplated hereby,
would constitute a Default or an Event of Default on the part of the
Borrower under the Credit Agreement or the Notes, either immediately or
with the lapse of time or the giving of notice, or both.
Name: NB REPTRON AMENDMENT NO 6
Doc No: 125050 3
3. Conditions Precedent. The effectiveness of this Amendment
Agreement is subject to the following conditions:
(i) fulfillment of the conditions set forth in Section 4 of
Amendment No. 5;
(ii) receipt by the Agent of six counterparts of this Amendment
Agreement duly executed by all signatories hereto;
(iii) receipt by the Agent of the Additional Notes, in the form
attached hereto as Exhibit 0, executed by the Borrower;
(iv) receipt by the Agent of resolutions of the Board of
Directors or other governing body of the Borrower approving this
Amendment Agreement certified by the Secretary of the Borrower; and
(v) receipt by the Agent of copies of all additional agreements,
instruments and documents which the Agent may reasonably request,
such documents, when appropriate, to be certified by appropriate
governmental authorities.
All proceedings of the Borrower relating to the matters provided for herein
shall be satisfactory to the Lenders, the Agent and their counsel.
4. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party hereto, and no one of them has relied on any such promise,
condition, representation or warranty. Each of the parties hereto
acknowledges that, except as in this Amendment Agreement otherwise
expressly stated, no representations, warranties or commitments, express or
implied, have been made by any party to the other. None of the terms or
conditions of this Amendment Agreement may be changed, modified, waived or
canceled orally or otherwise, except by writing, signed by all the parties
hereto, specifying such change, modification, waiver or cancellation of
such terms or conditions, or of any proceeding or succeeding breach
thereof.
5. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all other Loan
Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.
Name: NB REPTRON AMENDMENT NO 6
Doc No: 125050 4
6. Counterparts. This Amendment Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.
7. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF FLORIDA, WITHOUT REGARD TO ANY
OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY
(i) SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS
OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF
COLLECTION AND (ii) WAIVES TRIAL BY JURY IN CONNECTION WITH ANY SUCH
LITIGATION.
8. Enforceability. Should any one or more of the provisions of this
Amendment Agreement be determined to be illegal or unenforceable as to one
or more of the parties hereto, all other provisions nevertheless shall
remain effective and binding on the parties hereto.
9. Credit Agreement. All references in any of the Loan Documents to
the Credit Agreement shall mean and include the Credit Agreement as amended
hereby.
10. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders, the
Agent and their respective successors, assigns and legal representatives;
provided, however, that the Borrower, without the prior consent of the
Lenders, may not assign any rights, powers, duties or obligations
hereunder.
[remainder of this page left blank intentionally]
Name: NB REPTRON AMENDMENT NO 6
Doc No: 125050 5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of
the day and year first above written.
BORROWER:
REPTRON ELECTRONICS, INC.
By: /s/ William L. Elson
Name: William L. Elson
Title: Attorney in fact
NATIONSBANK, NATIONSL ASSOCIATION
(SOUTH), as Agent and a Lender
By: /s/ Timothy M. O'Connor
Name: Timothy M. O'Connor
Title: Vice President
PNC BANK, KENTUCKY, INC.
By: /s/ James D. Neil
Name: James D. Neil
Title: Vice President
THE SUMITOMO BANK, LIMITED
By: /s/ Brian M. Smith
Name: Brian Smith
Title: SVP
/s/ William N. Paty
William N. Paty
Vice President & Manager
BARNETT BANK, N.A.
By: /s/ David Austin
Name: David Austin
Title: Senior Vice President
EXHIBIT B
Applicable Commitment Percentages
Revolving Applicable
Credit Commitment
Lender Commitment Percentage
NATIONSBANK, NATIONAL ASSOCIATION $29,415,957.44 46.106516364%
(SOUTH)
PNC BANK, KENTUCKY, INC. $14,736,018.24 23.097207273%
THE SUMITOMO BANK, LIMITED $9,824,012.16 15.398138182%
BARNETT BANK, N.A. $9,824,012.16 15.398138182%
--------------- ------------
TOTAL $63,800,000.00 100.00%
B-1
EXHIBIT O
PROMISSORY NOTE
$[ ] --------------,---------------
April , 1997
FOR VALUE RECEIVED, REPTRON ELECTRONICS, INC., a Florida corporation
having its principal place of business located in Tampa, Florida (the
"Borrower"), hereby promises to pay to the order of [ ] (the
"Lender"), in its individual capacity, at the office of NationsBank,
National Association (South), as agent for the Lenders (the "Agent"),
located at One Independence Center, 101 North Tryon Street, Charlotte,
North Carolina 28255 (or at such other place or places as the Agent may
designate) at the times set forth in the Amended and Restated Revolving
Credit and Reimbursement Agreement dated as of June 29, 1995 among the
Borrower, the financial institutions party thereto (collectively, the
"Lenders") and the Agent(as previously amended and as further amended and
supplemented and in effect from time to time, the "Credit Agreement"; all
capitalized terms not otherwise defined herein shall have the respective
meanings set forth in the Credit Agreement), in lawful money of the United
States of America, in immediately available funds, the principal amount of
[ ] DOLLARS ($[ ]) and to pay interest from the date
hereof on the unpaid principal amount hereof, in like money, at said
office, on the dates and at the rates provided in the Credit Agreement. All
or any portion of the principal amount of such Loans or other obligations
may be prepaid as provided in the Credit Agreement.
This Note is one of the Notes in the aggregate principal amount of
$63,800,000 referred to in the Credit Agreement and is issued pursuant to
and entitled to the benefits and security of the Credit Agreement to which
reference is hereby made for a more complete statement of the terms and
conditions upon which the Loans evidenced hereby were or are made and are
to be repaid. This Note is subject to certain restrictions on transfer or
assignment as provided in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity of
this Note upon the occurrence of certain events and for prepayments of
obligations upon the terms and conditions specified therein.
If payment of all sums due hereunder is accelerated under the terms of
the Credit Agreement or under the terms of the other Loan Documents
executed in connection with the Credit Agreement, the then remaining
principal amount and accrued but unpaid interest shall bear interest which
shall be payable on demand at the rates
0-1
per annum set forth in the Credit Agreement, or the maximum rate
permitted under applicable law, if lower, until such principal and interest
have been paid in full. Further, in the event of such acceleration, this
Note, and all other indebtedness of the Borrower to the Lenders shall
become immediately due and payable, without presentation, demand, protest
or notice of any kind, all of which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the
principal and interest, all costs of collection, including reasonable
attorneys' fees, and interest thereon at the rates set forth above.
Interest hereunder shall be computed on the basis of a 360-day year for
the actual number of days in the interest period.
This Note shall be governed by, and construed in accordance with, the
internal substantive law of the State of Florida without regard to
otherwise applicable choice of laws rules.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby
waive to the full extent permitted by law the benefits of all provisions of
law for stay or delay of execution or sale of property or other
satisfaction of judgment against any of them on account of liability hereon
until judgment be obtained and execution issues against any other of them
and returned satisfied or until it can be shown that the maker or any other
party hereto had no property available for the satisfaction of the debt
evidenced by this instrument, or until any other proceedings can be had
against any of them, and also their right, if any, to require the holder
hereof to hold as security for this Note any collateral deposited by any of
said Persons as security. Protest, notice of protest, notice of dishonor,
dishonor, demand or any other formality are hereby waived by all parties
bound hereon.
Notwithstanding any other provision herein, the aggregate interest rate
charged under this Note, including all charges or fees in connection
therewith deemed in the nature of interest under Florida law, shall not
exceed the Highest Lawful Rate (as such term is defined below). If the rate
of interest (determined without regard to the preceding sentence) under
this Note at any time exceeds the Highest Lawful Rate (as defined below),
the outstanding amount of the Loans made hereunder shall bear interest at
the Highest Lawful Rate until the total amount of interest due hereunder
equals the amount of interest which would have been due hereunder if the
stated rates of interest set forth in this Note had at all times been in
effect. In addition, if when the Loans made hereunder are repaid in full
the total interest due hereunder (taking into account the increase provided
for above) is less than the total amount of interest which would have been
due hereunder if the stated rates of interest set forth in this Note had at
all
0-2
times been in effect, then to the extent permitted by law, the Borrower
shall pay to the Agent an amount equal to the difference between the amount
of interest paid and the amount of interest which would have been paid if
the Highest Lawful Rate had at all times been in effect. Subject to the
adjustments permitted above, at no time will the interest paid be greater
than the stated rate. Notwithstanding the foregoing, it is the intention of
the Lender and the Borrower to conform strictly to any applicable usury
laws. Accordingly, if the Lender contracts for, charges, or receives any
consideration which constitutes interest in excess of the Highest Lawful
Rate, then any such excess shall be canceled automatically and, if
previously paid, shall at the Lender's option be applied to the outstanding
amount of the Loans made hereunder or be refunded to the Borrower. As used
in this paragraph, the term "Highest Lawful Rate" means the maximum lawful
interest rate, if any, that at any time or from time to time may be
contracted for, charged, or received under the laws applicable to the
Lender which are presently in effect or, to the extent allowed by law,
under such applicable laws which may hereafter be in effect and which allow
a higher maximum nonusurious interest rate than applicable laws now allow.
IN WITNESS WHEREOF, the Borrower has caused this Note to be made,
executed and delivered by its duly authorized representative as of the date
and year first above written, all pursuant to authority duly granted.
REPTRON ELECTRONICS, INC.
WITNESS:
By:
Name:
Title:
- ----------------
- ----------------
0-3
ACKNOWLEDGMENT OF EXECUTION ON BEHALF OF
REPTRON ELECTRONICS, INC.
STATE OF MICHIGAN
COUNTY OF
---------------------
Before me, the undersigned, a Notary Public in and for said State and
County on this 30th day of April, 1997 A.D., personally appeared William L.
Elson, known to me to be the attorney-in-fact for Reptron Electronics, Inc.
(the "Company") being by me duly sworn says he works at 3000 Town Center,
Suite 2690, Southfield, Michigan 48075, that by authority duly given to him
by, and as the act of, the Company, the foregoing and annexed Note dated
April 30, 1997, was signed by him as said attorney-in-fact on behalf of the
Company.
Witness my hand and official seal this 30th day of April,1997.
---------------------------------
Notary Public
(SEAL)
My commission expires:
----------------------
0-4
Affidavit of
----------------------------
The undersigned, being first duly sworn, deposes and says that:
1. He/She is an
------------------------------------------------
of and works at
----------------------------------------------------
- ------------------------------------------------------------.
11. The Note of Reptron Electronics, Inc. to [ ] in
the principal amount of [$ ] dated as of April 30, 1997 was
executed before him/her and subsequently the original executed note was
sent for delivery by overnight mail to [ ].
This the 30th day of April 1997.
Name:
----------------------------
Acknowledgement of Execution
STATE OF MICHIGAN )
COUNTY OF ) SS.:
-------------)
Before me, the undersigned, a Notary Public in and for said State and
County on this 30th day of April, 1997 A.D., personally appeared
-----------
being and by me duly sworn affixed his signature to the above Affidavit.
Witness my hand and official seal this 30th day of April, 1997.
---------------------------
Notary Public
(SEAL)
My commission expires:
-------------------
EXHIBIT 10.4
AMENDMENT AGREEMENT NO. 7
TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT NO. 7 TO THE AMENDED AND RESTATED REVOLVING
CREDIT AND REIMBURSEMENT AGREEMENT (the "Amendment Agreement") is made and
entered into as of this 3Oth day of June, 1997 among REPTRON ELECTRONICS,
INC., a Florida corporation having its principal place of business in
Tampa, Florida (the "Borrower"), NATIONSBANK, NATIONAL ASS0CIATION
(successor by merger of NationsBank, National Association (South)), a
national banking association in its capacity as agent (the "Agent") for
each of the lenders (the "Lenders") now or hereafter party to the Credit
Agreement (defined below), and each of the undersigned Lenders. Unless the
context otherwise requires, all terms used herein without definition shall
have the respective definitions provided therefor in the Credit Agreement.
W
I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into that
certain Amended and Restated Revolving Credit and Reimbursement Agreement
dated June 29, 1995 whereby the Lenders have made available to the Borrower
(i) a $55,000,000 revolving credit facility, which shall include a letter
of credit facility of up to $500,000 and (ii) a $9,942,917 (as reduced from
time to time in accordance with the terms thereof) direct pay letter of
credit facility (together with the exhibits and schedules attached thereto,
as the same has been amended by Amendment Agreement No. 1 dated as of
December 15, 1995, Amendment Agreement No. 2 dated as of March 15, 1996,
Amendment Agreement No. 3 dated as of September 24, 1996, Amendment
Agreement No. 4 dated as of January 31, 1997, Amendment Agreement No. 5 and
Waiver dated as of April 28, 1997 and Amendment Agreement No. 6 dated April
30, 1997, hereinafter referred to as the "Credit Agreement"); and
WHEREAS, the Borrower, the Agent and Lenders have agreed to further
amend the Credit Agreement in the manner set forth herein;
NOW, THEREFORE, in consideration of the premises and conditions herein
set forth, it is hereby agreed as follows:
1. Credit Agreement Amendment. Subject to the conditions hereof, the
Credit Agreement is hereby amended, effective as of the date hereof, as
follows:
(a) The definition of "Permitted Liens" in Section 1.1 is hereby
amended by (x) deleting the word "and" at the end of clause (f), (y)
deleting the period at the end of clause (g) and inserting in lieu
thereof a comma and the word "and", and (z) adding a new clause (h)
thereto reading as follows:
Reptron Amendment No. 7
Document No. 137296.02
"(h) liens on the ownership interest of Borrower or one or more
wholly-owned Subsidiaries of Borrower in capital stock of a Person
which capital stock has been registered pursuant to the Securities
Exchange Act of 1934, as amended."
(b) Section 11.8 is hereby amended by (x) deleting the word "and" at
the end of clause (iii), (y) deleting the period at the end of clause
(iv) and inserting in lieu thereof a semi-colon and the word "and", and
(z) adding a new clause (v) thereto reading as follows:
"(v) capital stock of two wholly-owned Subsidiaries of the
Borrower organized for the sole purpose of acquiring and holding
Stock of a Person which capital stock has been registered pursuant
to the Securities Exchange Act of 1934, as amended, so long as the
aggregate purchase price of all such stock of all such Persons shall
not exceed $4,500,000."
2. Consent. The Lenders hereby consent to the use of up to $4,500,000 of
proceeds of Loans to acquire capital stock of a Person which capital stock
has been registered pursuant to the Securities Exchange Act of 1934, as
amended.
3. Representations and Warranties. In order to induce the Agent and the
Lenders to enter into this Amendment Agreement, the Borrower hereby
represents and warrants that the Credit Agreement has been re-examined by
the Borrower and that except as disclosed by the Borrower in writing to the
Lenders as of the date hereof:
(a) The representations and warranties made by the Borrower in
Article VIII thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the
date of the most recent financial reports of the Borrower delivered to
the Agent under Section 10.2 thereof, other than changes in the
ordinary course of business;
(c) The business and properties of the Borrower and its Subsidiaries
are not, and since the date of the most recent financial reports of the
Borrower delivered to the Agent under Section 10.2 thereof, have not
been, adversely affected in any substantial way as the result of any
fire, explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts
of God or the public enemy, or cancellation or loss of any major
contracts; and
Reptron Amendment No. 7
Document No. 137296.02
2
(d) After giving effect to this Amendment Agreement, no condition
exists which, upon the effectiveness of the amendment contemplated
hereby, would constitute a Default or an Event of Default on the part of
the Borrower under the Credit Agreement or the Notes, either immediately
or with the lapse of time or the giving of notice, or both.
4. Conditions Precedent. The effectiveness of this Amendment Agreement
is subject to the following conditions:
(i) receipt by the Agent of six counterparts of this Amendment
Agreement duly executed by all signatories hereto;
(ii) receipt by the Agent of resolutions of the Board of Directors
or other governing body of the Borrower approving this Amendment
Agreement certified by the Secretary of the Borrower;
(iii) receipt of (x) the joint and several guaranty of payment of
the Obligations by Lake Michigan Investment, Inc. and Lake Huron
Investment Corp., wholly-owned Subsidiaries of the Borrower
(collectively, the "Subsidiaries) in form acceptable to the Agent,
(y) certificates of the Secretary of each of the Subsidiaries to
which is attached resolutions of the Board of Directors of the
Subsidiaries approving such guaranties, the Articles of Incorporation
and Bylaws of the Subsidiaries and certificates of good standing, and
(z) an opinion of counsel to the Subsidiaries in form and content
acceptable to the Agent; and
(iv) receipt by the Agent of copies of all additional agreements,
instruments and documents which the Agent may reasonably request,
such documents, when appropriate, to be certified by appropriate
governmental authorities.
All proceedings of the Borrower relating to the matters provided for herein
shall be satisfactory to the Lenders, the Agent and their counsel.
5. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party hereto, and no one of them has relied on any such promise,
condition, representation or warranty. Each of the parties hereto
acknowledges that, except as in this Amendment Agreement otherwise
expressly stated, no representations, warranties or commitments, express or
implied, have been made by any party to the other. None
Reptron Amendment No. 7
Document No. 137296.02
3
of the terms or conditions of this Amendment Agreement may be changed,
modified, waived or canceled orally or otherwise, except by writing, signed
by all the parties hereto, specifying such change, modification, waiver or
cancellation of such terms or conditions, or of any preceding or succeeding
breach thereof.
6. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all other Loan
Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.
7. Counterparts. This Amendment Agreement may be executed in any number
of counterparts, each of which shall be deemed an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument.
8. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF FLORIDA, WITHOUT REGARD TO ANY
OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY
(i) SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS
OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF
COLLECTION AND (ii) WAIVES TRIAL BY JURY IN CONNECTION WITH ANY SUCH
LITIGATION.
9. Enforceability. Should any one or more of the provisions of this
Amendment Agreement be determined to be illegal or unenforceable as to one
or more of the parties hereto, all other provisions nevertheless shall
remain effective and binding on the parties hereto.
10. Credit Agreement. All references in any of the Loan Documents to the
Credit Agreement shall mean and include the Credit Agreement as amended
hereby.
11. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders, the
Agent and their respective successors, assigns and legal representatives;
provided, however, that the Borrower, without the prior consent of the
Lenders, may not assign any rights, powers, duties or obligations
hereunder.
[remainder of this page left blank intentionally]
Reptron Amendment No. 7
Document No. 137296.02
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of
the day and year first above written.
BORROWER:
REPTRON ELECTRONICS, INC.
By: /s Paul Plante
-----------------------
Name: Paul J. Plante
---------------------
Title: Chief Operating Officer
------------------------
NATIONSBANK, NATIONAL ASSOCIATION,
As Agent and a Lender
By: /s/ Timothy M. O'Connor
-------------------------------
Name: Timothy M. O'Connor
-----------------------------
Title: Vice President
---------------------------
PNC BANK, KENTUCKY, INC.
By: /s/ Ralph M. Bowman
-------------------------------
Name: Ralph M. Bowman
-----------------------------
Title: Vice President
---------------------------
THE SUMITOMO BANK, LIMITED
By: /s/ Allen L. Harvell, Jr.
-------------------------------
Name: ALLEN L. HARVELL, JR.
-----------------------------
Title: VICE PRESIDENT & MGR
---------------------------
By: /s/ M. Phillip Freeman
-------------------------------
Name: M. PHILLIP FREEMAN
-----------------------------
Title: VICE PRESIDENT
---------------------------
BARNETT BANK, N.A.
By: /s/ David A. Austin
-------------------------------
Name: DAVID A. AUSTIN
-----------------------------
Title: SENIOR VICE PRESIDENT
---------------------------
SUBSIDIARY GUARANTY
THIS GUARANTY AND SURETYSHIP AGREEMENT, dated as of August 4, 1997 (the
"Guaranty"), is made by LAKE MICHIGAN INVESTMENT, INC., a Nevada
corporation, and LAKE HURON INVESTMENT CORP., a Florida corporation
(collectively, the "Guarantor"), to the parties named in Section 1 hereof.
Except as otherwise defined herein, terms used herein defined in the
Revolving Credit and Reimbursement Agreement referred to below shall be
used herein as so defined.
WITHESSETH:
WHEREAS, arrangements have been made (i) pursuant to an Amended and
Restated Revolving Credit and Reimbursement Agreement dated June 29, 1995
(as the same may be amended, supplemented or modified, the "Credit
Agreement") among Reptron Electronics, Inc. (the "Company") the Lenders
party thereto and NationsBank National Association (successor by merger of
NationsBank of Florida, National Association) as Agent for the Lenders (the
"Agent") to extend and continue to make available to the Company a
revolving credit facility in the aggregate principal amount of up to
$55,000,000, including within such revolving credit facility the issuance
of letters of credit for the account of the Company;
WHEREAS, the Lenders are unwilling to continue to extend the revolving
credit facility pursuant to the Credit Agreement unless the Guarantor
executes and delivers this Guaranty; and
WHEREAS, the Guarantor is a Subsidiary of the Company and has been or
may be provided with advances from the Company or other working capital
made available directly or indirectly by the Lender under the Credit
Agreement, and has thereby materially benefitted or will materially benefit
from the Loans made to the Borrowers pursuant to the Credit Agreement;
NOW, THEREFORE, in consideration of the premises, the Guarantor hereby
agrees as follows:
1. Guaranty and Surety. The Guarantor does hereby absolutely and
unconditionally for the benefit of the Agent and the Lenders under the
Credit Agreement (collectively, the "Beneficiaries") guarantee and become
surety for the full and timely payment when due (whether by acceleration or
otherwise) (including amounts which, but for the operation of the automatic
stay under Section 362 (a) of the Bankruptcy Code (or any successor
statute), would become due) of:
A. All Obligations as defined in the Credit Agreement; and
B. all other indebtedness, obligations and liabilities of the
Borrower under written financing arrangements stated by the Guarantor to be
guaranteed hereby;
in each case whether direct or indirect, joint or several, absolute or
contingent, liquidated or unliquidated, now or hereafter existing,
extended, renewed, replaced, refinanced or restructured,
whether or not from time to time decreased or extinguished and later
increased, created or incurred (all indebtedness, obligations and
liabilities of the Borrower described in this Section 1 are collectively
referred to as the "Guarantied Obligations"); provided, however, that the
liability of the Guarantor with respect to the Guarantied Obligations shall
not exceed at any time the Maximum Amount (as hereinafter defined). The
"Maximum Amount" means 95% of (a) the fair salable value of the assets of
such Guarantor as of the date hereof minus (b) the total liabilities of the
Guarantor (including contingent liabilities, but excluding liabilities of
the Guarantor under this Guaranty and the other Loan Documents executed by
the Guarantor) as of the date hereof; provided further, however, that if
the calculation of the Maximum Amount in the manner provided above as of
the date payment is required of the Guarantor pursuant to this Guaranty
would result in a greater positive number, then the Maximum Amount shall be
deemed to be such greater positive number.
2. Guaranty Of Payment. This is a guaranty of payment and not merely of
collection. In the event of any default by the original obligor in payment
or otherwise on any of the Guarantied Obligations, the Guarantor will pay
all or any portion of the Guarantied Obligations due or thereafter becoming
due, whether by acceleration or otherwise, without offset of any kind
whatsoever, without the Beneficiaries first being required to make demand
upon the original obligor or pursue any of its rights against the original
obligor, or against any other Person, including other guarantors (whether
or not party to this Guaranty); and without being required to liquidate or
to realize on any collateral security. In any right of action accruing to
any Beneficiary, the Beneficiary may elect to proceed against (a) the
Guarantor together with the original obligor or obligors; (b) the Guarantor
and the original obligor or obligors individually; or (c) the Guarantor
only without having first commenced any action against the original obligor
or obligors.
3. Right to Deal with Guarantied Obligations. Subject to the terms and
conditions of the Credit Agreement, any Beneficiary, without notice to
Guarantor, may deal with any Guarantied Obligations and any collateral
security therefor in such manner as it may deem advisable and may renew or
extend the Guarantied Obligations or any part thereof; accept partial
payment, or settle, release, compound, or compromise the same; demand
additional collateral security therefor, and substitute or release the
same; and may compromise or settle with or release and discharge from
liability any other guarantor of any Guarantied Obligation, or any other
Person liable to the Lender for all or any portion of the obligations of
any original obligor; all without impairing the liability of the Guarantor
hereunder.
4. Other Waivers. Guarantor hereby unconditionally waives with respect
to this Guaranty: (a) notice of acceptance of this Guaranty by the
Beneficiaries and any notice of the incurring by either or both of the
Borrower of any Guarantied Obligation; (b) presentment for payment,
protest, notice of protest and notice of dishonor to any party including
either the Borrower or the Guarantor; (c) any disability of the original
obligor or obligors or defense available to the original obligor or
obligors, including absence or cessation of any original obligor's
liability for any reason whatsoever; (d) any defense or circumstances which
might otherwise constitute a legal or equitable discharge of a guarantor or
surety; and (e) all rights under any state or federal statute dealing with
or affecting the rights of creditors.
2
5. Subordination. Until the Guarantied Obligations are paid in full,
the Letters of Credit (as defined the Credit Agreement) are terminated or
expired and the Lenders are under no further obligation to lend or extend
funds or credit which would constitute Guarantied Obligations, Guarantor
hereby unconditionally subordinates all present and future debts,
liabilities or obligations of each original obligor to such Guarantor to
the Guarantied Obligations, and all amounts due under such debts,
liabilities, or obligations shall, upon the occurrence and during the
continuance of an Event of Default, be collected and paid over forthwith to
the Agent on account of the Guarantied Obligations and, pending such
payment, shall be held by the Guarantor as agent and bailee o1/2 :the
Beneficiaries separate and apart from all other funds, property and
accounts of the Guarantor. Guarantor, at the request of the Agent, shall
execute such further documents in favor of the Beneficiaries to further
evidence and support the purpose of this Section 5. Guarantor hereby
irrevocably waives and releases any right or rights of subrogation or
contribution existing at law, by contract or otherwise to recover all or
any portion of any payment made hereunder from either of the Borrowers or
any other guarantor.
6. Representations and Warranties. Guarantor represents and warrants to the
Beneficiaries that:(a) no other agreement, representation or special
condition exists between the Guarantor and any Beneficiary regarding the
liability of the Guarantor under this Guaranty; nor does any understanding
exist between the Guarantor and any Beneficiary that the obligations of the
Guarantor under this Guaranty are or will be other than as set out herein;
and (b) as of the date hereof, the Guarantor has no defense whatsoever to
any action or proceeding that may be brought to enforce this Guaranty.
Furthermore, the Guarantor affirms to the Beneficiaries that each of the
representations and warranties contained in the Credit Agreement and made
by the Borrower with respect to the Guarantor is true and correct.
7. No Waiver by the Lender. No failure or delay on the part of any
Beneficiary in exercising any right, power or privilege hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of
any right, power or privilege hereunder preclude any other or further
exercise thereof, or the exercise of any other right, power or privilege.
Failure by any Beneficiary to insist upon strict performance hereof shall
not constitute a relinquishment of its right to demand strict performance
at another time. Receipt by any Beneficiary of any payment by any person on
any Guarantied Obligation, with knowledge of a default on any Guarantied
Obligation or of a breach of this Guaranty, or both, shall not be construed
as a waiver of the default or breach.
8. CONTINUING GUARANTY; TERMINATION. THIS GUARANTY IS A CONTINUING
GUARANTY AND SHALL CONTINUE IN FULL FORCE AND EFFECT UNTIL SUCH TIME AS ALL
GUARANTIED OBLIGATIONS SHALL HAVE BEEN INDEFEASIBLY PAID IN FULL (OTHER
THAN GUARANTIED OBLIGATIONS IN THE NATURE OF CONTINUING INDEMNITIES OR
EXPENSE REIMBURSEMENT OBLIGATIONS NOT YET DUE AND PAYABLE), ALL LETTERS OF
CREDIT SHALL HAVE EXPIRED OR BEEN TERMINATED AND THE LENDERS SHALL NOT BE
UNDER ANY FURTHER OBLIGATION TO LEND OR TO ADVANCE FUNDS OR ISSUE LETTERS
OF CREDIT FOR THE ACCOUNT OF THE BORROWER CONSTITUTING GUARANTIED
OBLIGATIONS.
3
9. Benefits of Agreement. This Guaranty is freely assignable and
transferable by the Beneficiaries to any permitted assignee and transferee
of any Guarantied Obligation; however, the duties and obligations of the
Guarantor may not be delegated or transferred by the Guarantor without the
written consent of the Beneficiaries. The rights and privileges of the
Beneficiaries shall inure to the benefit of their respective successors and
assigns, and the duties and obligations of the Guarantors shall bind their
respective successors and assigns.
10. Expenses; Indemnity. The Guarantor will upon demand pay to each
Beneficiary the amount of any and all reasonable expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents,
which it may reasonably incur in connection with enforcement of this
Guaranty or the failure by the Guarantor to perform or observe any of the
provisions hereof. The Guarantor agrees to indemnify and hold harmless each
Beneficiary from and against any and all claims, demands, losses, judgments
and liabilities (including liabilities for penalties) of whatsoever kind or
nature, growing out of or resulting from this Guaranty or the exercise by
any Lender of any right or remedy granted to it hereunder or under the
other Loan Documents, other than such items arising out of the bad faith,
gross negligence or willful misconduct on the part of such Beneficiary. If
and to the extent that the obligations of the Guarantor under this Section
10 are unenforceable for any reason, the Guarantor hereby agrees to make
the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
11. Amendments, Waivers and Consents. No amendment or waiver of any
provision of this Guaranty or consent to any departure by the Guarantor
herefrom shall in any event be effective unless the same shall be in
writing and signed as to the Obligations, by the Guarantor and Agent (which
execution by Agent shall be evidence that Agent has received the consent
thereto of the Lenders required to effect such amendment or waiver) and
then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
that no such amendment, waiver or consent shall deprive any beneficiary of
the benefits generally of this Guaranty without the written consent of such
Beneficiary.
12. Addresses for Notices. All notices and other communications
provided for hereunder shall be in writing (including telecopy
communication) and shall be sent and be effective as provided in Article MV
of the Credit Agreement, except that the initial address for notices to the
Guarantor (which address shall be subject to change in the manner as
provided for changes of notice addresses in Article XIV of the Credit
Agreement) shall be as stated on the signature page hereof.
13. Interpretation; Partial Invalidity. Whenever possible each
provision of this Guaranty shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this
Guaranty shall be prohibited by or invalid under such law, such provision
shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining
provisions of this Guaranty.
14. Miscellaneous; Remedies Cumulative. Unless the context of this
Guaranty otherwise clearly requires, references to the plural include the
singular, the singular the plural and the part the whole and "or" has the
inclusive meaning represented by the phrase "and/or." The section headings
used herein are for convenience of reference only and shall not define,
limit or extend
4
the provisions of this Guaranty. All remedies hereunder are cumulative
and are not exclusive of any other rights and remedies of the Beneficiaries
provided by law or under the Credit Agreement, the other Loan Documents, or
other applicable agreements or instruments. The making of the Loans to the
Borrower and the issuance of the Direct Pay Letter of Credit pursuant to
the Credit Agreement shall be presumed conclusively to have been made or
extended, respectively, in reliance upon the obligations of the Guarantor
incurred pursuant to this Guaranty.
15. Governing Law. This Guaranty shall in all respects be governed by
the law of the State of Florida. Guarantor hereby (i) submits to the
jurisdiction and venue of the state and federal courts of Florida for the
purposes of resolving disputes hereunder or under any of the other Loan
Documents to which it is a party or for the purpose of collection and (ii)
waives trial by jury in connection with any such litigation.
16. Repayment or Recovery. If claim is ever made upon any Beneficiary
for repayment or recovery of any amount or amounts received in payment or
on account of any of the Guarantied Obligations and any Beneficiary repays
all or part of said amount by reason of (a) any judgment, decree or order
of any court or administrative body having jurisdiction over such payee or
any of its property, or (b) any settlement or compromise of any such claim
effected by any Beneficiary with any such claimant (including the original
obligor), then and in such event the Guarantor agrees that any such
judgment, decree, order, settlement or compromise shall be binding upon it,
notwithstanding any revocation hereof or the cancellation of any Note or
other instrument evidencing any Guarantied Obligation or any security
therefor, and the Guarantor shall be and remain liable to the Beneficiary
for the amount so repaid or recovered to the same extent as if such amount
had never originally been received by any Beneficiary.
17. Set-Off. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuance of an Event of Default (as defined in
the Credit Agreement), Guarantor agrees that the Beneficiaries shall have a
lien for all the liabilities of the Guarantor upon all deposits or deposit
accounts, of any kind, or any interest in any deposits or deposit accounts
thereof, now or hereafter pledged, mortgaged, transferred or assigned to
any Beneficiary or otherwise in the possession or control of any
Beneficiary (other than for safekeeping) for any purpose for the account or
benefit of the Guarantor and including any balance of any deposit account
or of any credit of the Guarantor with any Beneficiary, whether now
existing or hereafter established, hereby authorizing any Beneficiary at
any time or times with or without prior notice to apply such balances or
any part thereof to such of the liabilities of the Guarantor to any
Beneficiary then past due and in such amounts as they may elect, and
whether or not the collateral or the responsibility of other Persons
primarily, secondarily or otherwise liable may be deemed adequate. For the
purposes of this Section 17, all remittances and property shall be deemed
to be in the possession of a Beneficiary as soon as the same may be put in
transit to it by mail or carrier or by other bailee.
18. References to Credit Agreement Definitions. In the event that the
Credit Agreement shall no longer be in effect at any time while this
Guaranty shall continue in effect or there shall otherwise continue to
remain outstanding Guarantied Obligations, all references to the Credit
Agreement, including terms defined by reference to their respective
definitions contained in
5
the Credit Agreement, shall be deemed to refer to the Credit Agreement as
in effect as of the date hereof, with such amendments thereto to which the
Agent shall have given express consent in accordance with the Loan
Documents.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed and delivered by its officers hereunto duly authorized as of the
date first above written.
WITNESS: LAKE MICHIGAN INVESTMENT, INC.
/s/ Sandra Logan
- -------------------------- By: /s/ Greg J. Gross
/s/ Judith Davidson Name: Greg J. Gross
- -------------------------- Title: President
Address: 14401 McCormick Drive
Tampa, FL 33626
Attention: Greg J. Gross
Telephone No.: (813) 891-4033
Telefacsimile No.: (813) 855-7580
WITNESS: LAKE HURON INVESTMENT CORP.
/s/ Sandra Logan
- -------------------------- By: /s/ Greg J. Gross
/s/ Judith Davidson Name: Greg J. Gross
- -------------------------- Title: President
Address: 14401 McCormick Drive
Tampa, FL 33626
Attention: Greg J. Gross
Telephone No.: (813) 891-4033
Telefacsimile No.: (813) 855-7580
SECRETARY'S CERTIFICATE
of
LAKE HURON INVESTMENT CORP.
Re: Revolving Credit and Reimbursement Agreement by and between Reptron
Electronics, Inc., as Borrower, and NationsBank, NA., as Agent (the "Credit
Agreement")
I, Greg J. Gross, Secretary of Lake Huron Investment Corp., a
corporation duly organized and existing under the laws of the State of
Florida (the "Company"), DO HEREBY CERTIFY THAT:
1. Attached to this Certificate as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Company as presently
in effect.
2. Attached to this Certificate as Exhibit B is a true, complete and
correct copy of the By-laws of the Company, which have been and remain in
full force and effect at all times since July 10, 1997 to and including the
date hereof.
3. Attached to this Certificate as Exhibit C is a true, correct and
complete copy of certain resolutions duly adopted by the Board of Directors
of the Company adopted by unanimous written consent of all directors, which
constitute all the resolutions of the Board of Directors of the Company
relating to the transactions contemplated by the Credit Agreement including
without limitation the execution, delivery and performance of the Guaranty
Agreement. Such resolutions have not been amended, modified or rescinded
and remain in full force and effect as of the date hereof.
4. Set forth below are the names and the respective offices and true
specimens of the signatures of the duly elected, qualified and acting
officers of the Company authorized to execute and deliver on behalf of the
Company all Loan Documents to which the Company is party, and all other
documents necessary or appropriate to consummate the transactions
contemplated therein:
Name Office Signature
----- ------- ----------
Greg J. Gross President /s/ Greg J. Gross
Greg J. Gross Secretary /s/ Greg J. Gross
Greg J. Gross Treasurer /s/ Greg J. Gross
5. The representations and warranties made by the Company in the
Guaranty Agreement are true on and as of the date hereof.
All capitalized terms used herein, unless otherwise defined herein,
shall have the meanings therefor set forth in the Credit Agreement.
1997.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day of August,
1997.
/s/ Greg J. Gross
-----------------
Greg J. Gross, Secretary
SECRETARY'S CERTIFICATE
of
LAKE MICHIGAN INVESTMENT, INC.
Re: Revolving Credit and Reimbursement Agreement by and between Reptron
Electronics, Inc., as Borrower, and NationsBank, NA., as Agent (the "Credit
Agreement")
I, Greg J. Gross, Secretary of Lake Michigan Investment, Inc., a
corporation duly organized and existing under the laws of the State of
Nevada (the "Company"), DO HEREBY CERTIFY THAT:
1. Attached to this Certificate as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Company as presently
in effect.
2. Attached to this Certificate as Exhibit B is a true, complete and
correct copy of the By-laws of the Company, which have been and remain in
full force and effect at all times since July 26, 1997 to and including the
date hereof.
3. Attached to this Certificate as Exhibit C is a true, correct and
complete copy of certain resolutions duly adopted by the Board of Directors
of the Company adopted by unanimous written consent of all directors, which
constitute all the resolutions of the Board of Directors of the Company
relating to the transactions contemplated by the Credit Agreement including
without limitation the execution, delivery and performance of the Guaranty
Agreement. Such resolutions have not been amended, modified or rescinded
and remain in full force and effect as of the date hereof.
4. Set forth below are the names and the respective offices and true
specimens of the signatures of the duly elected, qualified and acting
officers of the Company authorized to execute and deliver on behalf of the
Company all Loan Documents to which the Company is party, and all other
documents necessary or appropriate to consummate the transactions
contemplated therein:
Name Office Signature
----- ------- ----------
Greg J. Gross President /s/ Greg J. Gross
Greg J. Gross Secretary /s/ Greg J. Gross
Greg J. Gross Treasurer /s/ Greg J. Gross
5. The representations and warranties made by the Company in the
Guaranty Agreement are true on and as of the date hereof.
All capitalized terms used herein, unless otherwise defined herein,
shall have the meanings therefor set forth in the Credit Agreement.
1997.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day of August,
1997.
/s/ Greg J. Gross
-----------------
Greg J. Gross, Secretary
EXHIBIT 10.5
AMENDMENT AGREEMENT NO. 8
TO THE AMENDED AND RESTATED
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT NO. ~ TO THE AMENDED AND RESTATED REVOLVING
CREDIT AND REIMBURSEMENT AGREEMENT (the "Amendment Agreement") is made and
entered into as of this 12th day of August, 1997 among REPTRON ELECTRONICS,
INC., a Florida corporation having its principal place of business in
Tampa, Florida (the "Borrower"), NATION8BANR, NATIONAL A880CIATION
(successor by merger of NationsBank, National Association (South)), a
national banking association in its capacity as agent (the "Agent") for
each of the lenders (the "Lenders") now or hereafter party to the Credit
Agreement (defined below), and each of the undersigned Lenders. Unless the
context otherwise requires, all terms used herein without definition shall
have the respective definitions provided therefor in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into that
certain Amended and Restated Revolving Credit and Reimbursement Agreement
dated June 29, 1995 whereby the Lenders have made available to the Borrower
(i) a $55,000,000 revolving credit facility, which includes a letter of
credit facility of up to $500,000 and (ii) a $9,942,917 (as reduced from
time to time in accordance with the terms thereof) direct pay letter of
credit facility (together with the exhibits and schedules attached thereto,
as the same has been amended by Amendment Agreement No. 1 dated as of
December 15, 1995, Amendment Agreement No. 2 dated as of March 15, 1996,
Amendment Agreement No. 3 dated as of September 24, 1996, Amendment
Agreement No. 4 dated as of January 31, 1997, Amendment Agreement No. 5 and
Waiver dated as of April 28, 1997, Amendment Agreement No. 6 dated April
30, 1997 and Amendment Agreement No. 7 dated June 30, 1997 (hereinafter
referred to as the "Credit Agreement"); and
WHEREAS, the Borrower, the Agent and Lenders have agreed to further
amend the Credit Agreement in the manner set forth herein;
NOW, THEREFORE, in consideration of the premises and conditions herein
set forth, it is hereby agreed as follows:
1. Credit Agreement Amendment. Subject to the conditions hereof, the Credit
Agreement is hereby amended, effective as of the date hereof, as follows:
(a) The definition of "Applicable Margin" in Section 1.1 is hereby
amended in its entirety so that as amended it shall read as follows:
"'Applicable Margin' means that percent per annum set forth below in
the case of each Eurodollar Loan, and with respect to the Unused Fee, which
percent shall be the Applicable Margin effective beginning on the first
Business Day next following receipt by the Agent of a Compliance
Certificate pursuant to Section 10.6 hereof setting forth the ratio of
Consolidated Senior Indebtedness to Consolidated Total Capital, such
Applicable Margin to be that set forth opposite the ratios described below;
provided, however, that the Applicable Margin for the period beginning on
the date the Borrower shall receive the net proceeds from the sale of the
Convertible Notes and have paid in full the then outstanding Loans through,
but not including, the first Business Day next following receipt by the
Agent of a Compliance Certificate pursuant to Section 10.6 hereof for the
Fiscal Quarter ending September 30, 1997 shall be equal to:
Ratio of Consolidated Applicable Margin
Senior Indebtedness
to Consolidated Eurodollar Unused
Total Capital Loan Fee
-------------------- ---------- -------
(a) Equal to or less
than .30 to 1.00 3/4% 1/4%
(b) Greater than .30 to
1.00 1% 3/8%"
(b) Section 1.1 is hereby amended in order to add thereto a new
definition "Consolidated Senior Indebtedness" immediately following the
definition "Consolidated Net Income" which shall read as follows:
"'Consolidated Senior Indebtedness' means Consolidated Indebtedness
minus the outstanding principal amount of Convertible Notes."
(c) Section 1.1 is hereby amended in order to add thereto a new
definition "Convertible Notes" immediately following the definition
"Contractors" which shall read as follows:
"'Convertible Notes' means the Convertible Subordinated Notes due
2004 of the Borrower in an aggregate principal amount of $115,000,000."
(d) The definition of "Total Revolving Credit Commitment" in Section
1.1 is hereby amended in its entirety so that as amended it shall read as
follows:
2
"'Total Revolving Credit Commitment' means an amount equal to
$15,000,000, as reduced from time to time in accordance with Section
2.7 hereof."
(e) Section 10.4 is hereby amended in its entirety so that as amended
it shall read as follows:
"10.4 Borrowing Base Certificate. When and if the Revolving Credit
Debit Balance is greater than $1.00, upon request of the Agent, within
15 days after the last day of each accounting month, a Borrowing Base
Certificate to which there shall be attached a Schedule of Receivables
and Schedule of Inventory."
(f) Section ll.l(b) is hereby amended by deleting the figure ".65"
appearing therein and inserting in lieu thereof the figure ".75".
(g) Clause (iv) of Section 11.2 is hereby amended in its entirety so
that as amended it shall read as follows:
"(iv) Indebtedness evidenced by the Convertible Notes; and"
(h) Exhibit B to the Credit Agreement shall be deleted in its
entirety and replaced by Exhibit B attached hereto.
(i) Notwithstanding any provision of Article II or Article III to the
contrary, until the Agent shall have required the Borrower to deliver to
the Agent and Lenders pursuant to Section 10.4 a Borrowing Base
Certificate, the limitations on Loans and Outstanding Commercial Letters of
Credit to an amount not exceeding the Borrowing Base shall not apply.
2. Consent. Each of Reptron Electronics of PA, Inc., Lake Michigan
Investment, Inc. and Lake Huron Investment Corp., guarantors of the
Obligations, hereby consent to the amendments to the Agreement contained in
this Amendment Agreement.
3. Representations and Warranties. In order to induce the Agent and the
Lenders to enter into this Amendment Agreement, the Borrower hereby
represents and warrants that the Credit Agreement has been re-examined by
the Borrower and that except as disclosed by the Borrower in writing to the
Lenders as of the date hereof:
(a) The representations and warranties made by the Borrower in
Article VIII thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the date
of the most recent financial
3
reports of the Borrower delivered to the Agent under Section 10.2 thereof,
other than changes in the ordinary course of business;
(c) The business and properties of the Borrower and its Subsidiaries
are not, and since the date of the most recent financial reports of the
Borrower delivered to the Agent under Section 10.2 thereof, have not been,
adversely affected in any substantial way as the result of any fire,
explosion, earthquake, accident, strike, lockout, combination of workers,
flood, embargo, riot, activities of armed forces, war or acts of God or the
public enemy, or cancellation or loss of any major contracts; and
(d) After giving effect to this Amendment Agreement, no condition
exists which, upon the effectiveness of the amendment contemplated hereby,
would constitute a Default or an Event of Default on the part of the
Borrower under the Credit Agreement or the Notes, either immediately or
with the lapse of time or the giving of notice, or both.
4. Conditions Precedent. The effectiveness of this Amendment Agreement
is subject to the following conditions:
(i) receipt by the Agent of six counterparts of this Amendment
Agreement duly executed by all signatories hereto;
(ii) payment in full of all outstanding Indebtedness evidenced by the
Notes and cancellation of the Additional Notes;
(iii) receipt by the Agent of resolutions of the Board of Directors
or other governing body of the Borrower approving this Amendment
Agreement certified by the Secretary of the Borrower; and
(iv) receipt by the Agent of copies of all additional agreements,
instruments and documents which the Agent may reasonably request, such
documents, when appropriate, to be certified by appropriate
governmental authorities.
All proceedings of the Borrower relating to the matters provided for herein
shall be satisfactory to the Lenders, the Agent and their counsel.
5. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party
4
hereto, and no one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto acknowledges that,
except as in this Amendment Agreement otherwise expressly stated, no
representations, warranties or commitments, express or implied, have been
made by any party to the other. None of the terms or conditions of this
Amendment Agreement may be changed, modified, waived or canceled orally or
otherwise, except by writing, signed by all the parties hereto, specifying
such change, modification, waiver or cancellation of such terms or
conditions, or of any preceding or succeeding breach thereof.
6. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all other Loan
Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.
7. Counterparts. This Amendment Agreement may be executed in any number
of counterparts, each of which shall be deemed an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument.
8. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF FLORIDA, WITHOUT REGARD TO ANY
OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY
(i) SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS
OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF
COLLECTION AND (ii) WAIVES TRIAL BY JURY IN CONNECTION WITH ANY SUCH
LITIGATION.
9. Enforceability. Should any one or more of the provisions of this
Amendment Agreement be determined to be illegal or unenforceable as to one
or more of the parties hereto, all other provisions nevertheless shall
remain effective and binding on the parties hereto.
10. Credit Agreement. All references in any of the Loan Documents to
the Credit Agreement shall mean and include the Credit Agreement as amended
hereby.
11. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders, the
Agent and their respective successors, assigns and legal representatives;
provided, however, that the Borrower, without the prior consent of the
Lenders, may not assign any rights, powers, duties or obligations
hereunder.
[remainder of this page left blank intentionally]
5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of
the day and year first above written.
BORROWER:
REPTRON ELECTRONICS, INC.
By: /s/ Paul J. Plante
-------------------------
Name: Paul J. Plante
Chief Operating Officer
Guarantors:
REPTRON ELECTRONICS OF PA, INC.
By: /s/ Paul J. Plante
-------------------------
Name: Paul J. Plante
Chief Operating Officer
LAKE MICHIGAN INVESTMENT, INC.
By: /s/ Greg J. Gross
-------------------------
Name: Greg J. Gross
President
LAKE HURON INVESTMENT CORP.
By: /s/ Greg J. Gross
-------------------------
Name: Greg J. Gross
President
NATIONSBANK, NATIONAL ASSOCIATION
As Agent and a Lender
By: /s/
-------------------------
Name:
Title:
PNC BANK, KENTUCKY, INC.
By: /s/
-------------------------
Name:
Title:
BARNETT BANK, N.A.
By: /s/
-------------------------
Name:
Title:
THE SUMITOMO BANK, LIMITED
By: /s/
-------------------------
Name:
Title:
EXHIBIT B
Applicable Commitment Percentages
Revolving Applicable
Credit Commitment
Lender Commitment Percentage
-------- ------------ ----------
NATIONSBANK, NATIONAL ASSOCIATION $ 3,750,000.00 25%
PNC BANK, KENTUCKY, INC. $ 3,750,000.00 25%
THE SUMITOMO BANK, LIMITED $ 3,750,000.00 25%
BARNETT BANK, N.A. $ 3,750,000.00 25%
------------- ---
TOTAL $15,000,000.00 100%
EXHIBIT 10.6
LOAN AGREEMENT
dated as of April 28, 1997
between
REPTRON ELECTRONICS, INC.
and
BARNETT BANK, N.A.
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE 1
Definitions
1.1 Background....................................................2
1.2 Definitions...................................................2
1.3 Other Definitional Provisions.................................5
ARTICLE 2
The Loan
2.3 The Loan/Purchase of the Note and the Loan Documents..........5
2.2 Note..........................................................5
2.3 Term..........................................................5
2.4 Manner of Payment.............................................5
2.5 Swap Agreement................................................5
2.6 Incorporation of Covenants....................................5
ARTICLE 3
Representations and Warranties
3.1 Corporate Status..............................................6
3.2 Power and Authority...........................................6
3.3 No Leins......................................................6
3.4 Liabilities...................................................7
3.5 Litigation....................................................7
3.6 Tax Returns...................................................7
3.7 Contract or Restriction Affecting the Borrower................7
3.8 Governmental Approval.........................................7
3.9 Environmental Laws............................................7
3.10 Priority of Lien on Personalty................................7
3.11 Condition of the Mortgaged Property...........................7
3.12 Zoning........................................................8
3.13 Mechanics' Liens..............................................8
3.14 Regulation U..................................................8
3.15 Credit Agreement..............................................8
3.16 No Untrue Statements..........................................8
ARTICLE 4
Affirmative Coventants
4.1 Payment of Obligations........................................9
4.2 Maintenance of Existence......................................9
4.3 Inspection of Property, Books and Records.....................9
4.4 Licenses and Permits, Etc.....................................9
4.5 Advice Regarding Changes......................................9
4.6 Advice Regarding Litigation...................................9
4.7 Further Assurances............................................9
4.8 Observe All Laws..............................................9
4.9 Fire and Extended Coverage Insurance..........................9
4.10 Public Liability Insurance...................................10
4.11 Worker's Compensation Insurance..............................10
4.12 Flood Insurance..............................................11
4.13 Payment of Impositions.......................................11
4.14 Performance of Credit Agreement..............................11
ARTICLE 5
Negative Covenants
ARTICLE 6
Conditions Precedent
6.1 Closing......................................................11
6.2 Conditions Precedent to Closing..............................12
ARTICLE 7
Default
7.1 Events of Default............................................12
7.2 Remedies.....................................................14
ARTICLE 8
Miscellaneous
8.1 Waiver of Default............................................15
8.2 Amendments and Waivers.......................................15
8.3 Notices......................................................16
8.4 No Waiver, Cumulative Remedies...............................16
8.5 Survival of Representations, Warranties and Covenants........16
8.6 Liens, Set Off by Bank.......................................16
8.7 No Third Party Beneficiaries.................................17
8.8 Florida Law..................................................17
8.9 Paragraph Headings...........................................17
8.10 Gender, Etc..................................................17
8.11 Severability.................................................17
8.12 Reimbursement of Expenses....................................17
8.13 Stamp or Other Taxes.........................................17
8.14 Participation Rights.........................................18
8.15 Further Assurances...........................................18
8.16 Execution in Counterparts....................................18
8.17 Jurisdiction and Process.....................................18
8.18 Waiver of Jury Trial.........................................18
EXHIBITS
Exhibit "A" Legal Description of the Land
Exhibit "B" Company General Certificate
LOAN AGREEMENT
This Loan Agreement is made and entered into as of this 28th day of
April, 1997, by and between REPTRON ELECTRONICS, INC., a Florida
corporation (the "Borrower"), and BARRETT N.A., a national banking
association (the "Bank").
BACKGROUND
----------
a. The Borrower, NationsBank, National Association (South), as Agent (the
"Agent") and various lenders from time to time party thereto (the
"Lenders") have entered into a certain Amended and Restated Revolving
Credit and Reimbursement Agreement dated June 29, 1995 (as amended to date,
the "Credit Agreement").
b. The Borrower is or will become obligated to pay certain letter of
credit reimbursement obligations (the "Direct Pay Obligations") to the
Agent, in its capacity as "Fronting Bank" under the Credit Agreement (the
Agent, when acting in such capacity, is hereinafter referred to as the
"Fronting Bank').
c. The Direct Pay Obligations are represented by a certain Direct Pay
Obligations Renewal and Replacement Promissory Note in the original
principal amount of Eight Million Eight Hundred Thousand Dollars
($8,800,000.00) executed by the Borrower in favor of the Fronting Bank (the
"Note") and secured by various security documents.
d. The Borrower has requested that the Bank make a loan (the "Loan") in
the principal amount of Eight Million Eight Hundred Thousand Dollars
($8,800,000.00), the proceeds of which will be used by the Bank to acquire
the Note and the documents securing the Note from the Fronting Bank and
that the Bank shall thereafter hold the Note and the security documents as
evidence of and security for the Loan.
e. The Bank has agreed to make the Loan on the terms and subject to the
conditions set forth herein and in the other Loan Documents (as hereinafter
defined).
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein, and other good and valuable consideration
in hand paid by the parties hereto, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
OPERATIVE PROVISIONS
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ARTICLE 1
Definitions
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1.1 Background. The Borrower and the Bank acknowledge and agree that the
recitals set forth above (the "Background") are true and correct, and the
Background and the instruments referred to therein are incorporated and
made a part of this Agreement.
1.2 Definitions. As used in this Agreement, the following terms shall
have the meanings set forth below:
1.2.1 "Agent" is defined in the Preamble.
1.2.2 "Agreement" shall mean this Loan Agreement, as the same may be
amended, supplemented or modified, in writing, from time to time.
1.2.3 "Amendment Agreement No. 5" shall mean that certain Amendment
Agreement No. 5 and Waiver to the Amended and Restated Revolving Credit and
Reimbursement Agreement executed of even date herewith by and between the
Borrower, the Agent and the Lenders.
1.2.4 "Assignment of Mortgage" shall mean that certain Assignment of
Mortgage and Other Loan Documents executed or to be executed by the Agent,
on behalf of the Lenders, assigning the Mortgage and the other Loan
Documents to the Bank.
1.2.5 "Business Day" shall mean any day other than a Saturday, Sunday
or other day on which commercial banks in Jacksonville, Florida are closed
for business.
1.2.6 "Closing" is defined in Section 6.1.
1.2.7 "Credit Agreement" is defined in the Preamble. In the event
that the Credit Agreement is amended or is amended and restated, the term
Credit Agreement shall be deemed to refer to the Credit Agreement as so
amended or as so amended and restated.
1.2.8 "Default" or "Event of Default" shall mean any of the events
specified in Section 8.1, whether or not any requirement for the giving of
notice, the lapse of time, or both, has been satisfied.
1.2.9 "Direct Pay Obligations" are defined in the Preamble.
1.2.10 "Fuji Insertion Lines" shall mean that certain automatic
insertion line equipment manufactured by Fuji America Corporation,
comprising two (2) such insertion lines, which
2.
is located in the Improvements and with respect to which the Bank has a
security interest as a portion of the security for the Loan.
1.2.11 "GAAP" shall mean generally accepted accounting principles in
effect at the time of any determination thereof, consistently applied.
1.2.12 "Governmental Authority" shall mean any municipal, county,
state or federal governmental authority or other governmental authority
(domestic or foreign) having or claiming jurisdiction over the Land, the
Improvements, the Bank or the Borrower.
1.2.13 "Impositions" shall mean all (i) real estate and personal
property taxes and other taxes and assessments, water and sewer rates and
charges and all other governmental charges and any interest or costs or
penalties with respect thereto, and charges for any easement or agreement
maintained for the benefit of the Mortgaged Property, general and special,
ordinary and extraordinary, foreseen and unforeseen, of any kind and nature
whatsoever which at any time prior to or after the execution of this
Agreement may be assessed, levied or imposed upon the Mortgaged Property or
the rent or income received therefrom, or any use or occupancy thereof, and
(ii) other taxes, assessments, fees and governmental charges levied,
imposed or assessed upon or against the Borrower or any of its properties.
1.2.14 "Improvements" shall mean all improvements and amenities now
existing or hereafter erected upon the Land.
1.2.15 "Land" shall mean the real property more particularly
described in Exhibit "A" attached hereto and made a part hereof.
1.2.16 "LIBO Rate" shall have the meaning ascribed to such term in
the Note.
1.2.17 "LIBO Rate Advances" shall mean Advances of portions of the
Loan which bear interest at the LIBO Rate.
1.2.18 "Loan" is defined in the Preamble.
1.2.19 "Loan Documents" shall mean, collectively, this Agreement, the
Note, the Mortgage, and any other agreements, documents or instruments
relating to the Loan, whether executed prior to, at or after the Closing
hereof, as the same may be amended, supplemented or modified, in writing,
from time to time; and "Loan Document" shall mean any one of the foregoing.
1.2.20 "Maturity Date" shall mean the earlier of (i) April 28, 2004,
or (ii) such date as the Bank may establish in any notice of acceleration
sent pursuant to Section 7.2, below.
1.2.21 "Mortgage" shall mean that certain Mortgage and Security
Agreement dated as of March 1, 1995, executed by the Borrower in favor of
the Agent, and recorded in Official Records Book 7687, Page 1857, Public
Records of Hillsborough County, Florida, as amended (i) by
3.
Amendment to Mortgage and Security Agreement dated as of April 28, 1995,
and recorded in Official Records Book 7787, Page 1120, and re-recorded in
Official Records Book 7803, Page 1996, Public Records of Hillsborough
County, Florida, (ii) Second Amendment to Mortgage and Security Agreement
dated as of August 24, 1995, and recorded in Official Records Book 7884,
Page 1109, Public Records of Hillsborough County, Florida, and (iii) Third
Amendment to Mortgage and Security dated of even date herewith and recorded
or to be recorded in the Public Records of Hillsborough County, Florida.
1.2.22 "Mortgaged Property'' shall mean the Land, the Improvements,
all fixtures related thereto and all other property of any kind or nature,
whether real, personal or mixed, described in the Mortgage as being
encumbered thereby.
1.2.23 "Note" is defined in the Preamble.
1.2.24 "Participant" shall mean a Person to whom the Bank has sold a
participating interest in the Loan, or some portion thereof, as permitted
under Section 8.14.
1.2.25 "Person" shall mean an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated association,
joint venture or any other entity or a government or any agency or
political subdivision thereof.
1.2.26 "Prime Based Rate" shall have the meaning ascribed to such
term in the Note.
1.2.27 "Prime Rate" shall mean the rate of interest announced by
Barnett Banks, Inc. (the parent of the Bank), from time to time as its
prime rate.
1.2.28 "Prime Rate Advances" shall mean Advances of portions of the
Loan which bear interest at the Prime Based Rate.
1.2.29 "Swap Agreement" shall mean that certain ISDA Master
Agreement, and the schedules, confirmations and addenda relating thereto,
to be entered into between the Borrower and the Bank pursuant to the
requirements of Section 2.5, below, pursuant to which the Borrower will
agree to pay to the Bank a fixed rate of interest on a notational principal
amount equal to the outstanding principal balance of the Loan and the Bank
will agree to pay to the Borrower a floating rate of interest, based upon
the 30-day (one month) LIBO Rate on a notational principal amount equal to
the outstanding principal balance of the Loan.
1.2.30 "Third Amendment to Mortgage" shall mean that certain Third
Amendment to Mortgage and Security executed by and between the Borrower and
the Agent, on behalf of the Lenders, dated of even date herewith and
recorded or to be recorded in the Public Records of Hillsborough County,
Florida.
4.
1.3 Other Definitional Provisions. All terms defined in or
incorporated into this Agreement shall have the same defined meanings when
used in the other Loan Documents or any certificate or other instrument
made or delivered pursuant hereto unless the context otherwise requires.
Any accounting term used but not defined herein shall have the meaning
given to it under GAAP.
ARTICLE 2
The Loan
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2.1 The Loan/Purchase of the Note and the Loan Documents. Upon the
terms and subject to the conditions set forth in this Agreement, to advance
the proceeds of the Loan to the Fronting Bank to the extent required, to
(i) acquire the Note by endorsement, without recourse, and (ii) obtain an
assignment of the Mortgage and all other documents securing the payment of
the Note from the Fronting Bank to the Bank. In the event the full amount
required to be paid to the Fronting Bank to purchase the note exceeds the
principal amount of the Loan remaining after the payment of costs related
to the Loan and the purchase of the Note, the Borrower shall pay the amount
of such excess from its own funds at the Closing.
2.2 Note. Upon acquisition of the Note by the Bank, the Loan shall be
evidenced by the Note. The payment and performance by the Borrower of the
Note and this Agreement shall be secured by the Mortgage and the other Loan
Documents.
2.3 Term. The term of the Loan shall be for a period beginning with
the date hereof and ending on the Maturity Date.
2.4 Manner of Payment. All payments due to the Bank hereunder shall
be made to the Bank at the Bank's office at 101 E. Kennedy Boulevard,
Tampa, Florida 33602 not later than 12:00 Noon, local time, on the due date
thereof, in funds immediately available to the Bank without any deduction
whatsoever, including but not limited to any deduction for any set-off,
recoupment, counterclaim or taxes. Whenever any payment to the Bank
hereunder shall be due on a day which is not a Business Day, the date of
payment thereof shall be extended to the next succeeding Business Day and
interest shall be payable at the then applicable rate during such
extension.
2.5 Swap Agreement. On or before May 31, 1997, the Borrower shall
enter into the Swap Agreement with the Bank. From and after the date upon
which the Swap Agreement is entered, the interest rate payable by the
Borrower with respect to the Loan shall be reduced as provided in the Note.
2.6 Incorporation of Covenants. By this reference, the affirmative
covenants set forth in Article IX of the Credit Agreement, the information
covenants set forth in Article X of the Credit Agreement and the negative
covenants set forth in Article XI of the Credit Agreement, as the same
exist as of the date hereof, are hereby incorporated into this Agreement as
if fully set forth herein.
5.
In the event that any provisions of Article IX, Article X and Article XI of
the Credit Agreement are hereafter amended by the parties to the Credit
Agreement, then such provisions, as amended, shall be deemed incorporated
herein unless the Bank gives written notice to the Borrower that the Bank
does not approve such amendment and elects to have such provision, without
the effect of such amendment, remain in force for purposes of this
Agreement. To the maximum extent possible, the terms of this Agreement and
such incorporated terms of the Credit Agreement shall be construed to be
supplementary to and not in conflict with each, but, in the event of any
conflict between the incorporated covenants of the Credit Agreement and the
terms of this Agreement, the incorporated covenants of the Credit Agreement
shall control.
ARTICLE 3
Representations and Warranties
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In order to induce the Bank to enter into this Agreement and to make
the Loan, the Borrower represents and warrants to the Bank (which
representations and warranties shall survive the delivery of the Note and
the funding of the Loan proceeds) that:
3.1 Corporate Status. The Borrower is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Florida, has the corporate power and legal authority to own its property
and carry on its business as now being conducted and is duly qualified to
do business in every jurisdiction where qualification is necessary.
3.2 Power and Authority. The Borrower is duly authorized under all
applicable provisions of law to execute, deliver and perform pursuant to
this Agreement and the other Loan Documents, and all actions on the part of
the Borrower required for the lawful execution, delivery and performance of
this Agreement and the other Loan Documents have been duly taken. Each of
this Agreement and the other Loan Documents, upon the due execution and
delivery thereof, will be the valid and enforceable instrument, obligation
or agreement of the Borrower in accordance with their respective terms,
except as limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally. To the best of the Borrower's
knowledge, neither the execution and delivery of this Agreement or the
other Loan Documents, nor the fulfillment of or compliance with their
provisions and terms, will conflict with, or result in a breach of the
terms, conditions or provisions of, or constitute a violation of or default
under any applicable law, regulation, order, writ, or decree, or any
agreement or instrument to which the Borrower is now a party, or create any
security interest, chattel mortgage, lien or other encumbrance upon any of
the property or assets of the Borrower pursuant to the terms of any
agreement or instrument to which the Borrower is a party or by which it is
bound, except those in favor of the Bank expressly created by the Loan
Documents.
3.3 No Liens. There are no judgment or other liens, encumbrances, or
other security interests outstanding against the Mortgaged Property or the
Fuji Insertion Line.
6.
3.4 Liabilities. The Borrower has not incurred any debts, liabilities,
or obligations other than those disclosed on the financial statements
and/or the notes thereto submitted to the Bank by the Borrower or those
incurred in the ordinary course of business subsequent to the date of the
financial statements.
3.5 Litigation. There are no investigations, actions, suits or
proceedings by any federal, state or local government body, agency or
authority, or any political subdivisions thereof, or by any Person,
pending, or to the knowledge of the Borrower, threatened against the
Borrower or other proceedings to which the Borrower is a party (including
administrative or arbitration proceedings) (a) that are likely to result in
any material adverse change in, or to have any other material adverse
effect on, the business or condition, financial or otherwise, of the
Borrower, or (b) that, whether or not the Borrower is a party thereto, seek
to restrain, enjoin, prohibit or obtain damages or other relief with
respect to the transactions contemplated by this Agreement or the Credit
Agreement.
3 .6 Tax Returns. The Borrower has filed all tax returns required to be
filed by it and hat paid all taxes and assessments payable by it, if any,
that have become due, other than those not yet delinquent.
3.7 Contract or Restriction Affecting the Borrower. The Borrower is not
a party to or bound by any contract or agreement or subject to any charter
or other corporate restriction that materially and adversely affects or
will materially and adversely affect the business, properties or condition,
financial or otherwise, of the Borrower.
3.8 Governmental Approval. The Borrower is in compliance with all
applicable laws and regulations of all governmental authorities, except
where the failure to so be in compliance will not materially and adversely
affect the business, properties or condition, financial or otherwise, of
the Borrower. Except as otherwise specified herein, no written approval of
any federal, state or local governmental authority, or any political
subdivision thereof, is necessary for the Borrower to carry out the terms
of this Agreement or any of the other Loan Documents, and no consents or
approvals are required in the making or performance of this Agreement or
any of the other Loan Documents by Borrower.
3.9 Environmental Laws. All pollution and environmental control laws
and regulations which are applicable to the Mortgaged Property and the use
thereof have been and will be satisfied.
3.10 Priority of Lien on Personality. No chattel mortgage, security
agreement, financing statement or other title retention agreement (except
those executed in favor of the Bank) has been or will be executed with
respect to the Fuji Insertion Line or any fixtures forming a part of the
Mortgaged Property.
3.11 Condition of the Mortgaged Property. The Improvements are not now
damaged or injured as a result of any fire, explosion, accident, flood or
other casualty.
7.
3.12 Zoning To the best of Borrower's knowledge and belief, the
Mortgaged Property is zoned in accordance with all applicable governmental
rules, ordinances, regulations and laws so as to permit the proposed
Improvements and related amenities to be constructed thereon and that such
zoning and all other applicable laws and ordinances do not impose any
setbacks or other requirements which would make the construction or
operation of the said Improvements economically unfeasible.
3.13 Mechanics' Liens. All other bills for labor, materials and
services supplied or furnished to the Mortgaged Property have been paid in
full; and no persons or entities have the right to assert a lawful claim of
lien against the Mortgaged Property or any portion thereof for labor or
services furnished, or for materials supplied pursuant to the provisions of
Chapter 713, Florida Statutes.
3.14 Regulation U. No part of the proceeds of the Loan will be used to
purchase or carry or to reduce or retire any loan incurred to purchase or
carry, any margin stocks (within the meaning of Regulation IJ of the Board
of Governors of the Federal Reserve System) or to extend credit to others
for the purpose of purchasing or carrying any such margin stocks. The
Borrower is not engaged and will not engage as one of its important
activities in extending credit for the purpose of purchasing or carrying
such margin stocks. If requested by the Bank, the Borrower will furnish to
the Bank, in connection with the Loan, a statement in conformity with the
requirements of Federal Reserve Form U-1 referred to in Regulation U. In
addition, no part of the proceeds of the Loan will be used for the purchase
of commodity future contracts (or margins therefor for short sales), or for
any commodity.
3.15 Credit Agreement. The Borrower is not in default with respect to
any of its obligations under the Credit Agreement and the Credit Agreement
and all notes and other debt instruments executed and delivered by Borrower
in connection therewith which have not been redeemed or repaid in full are
in full force and effect.
3.16 No Untrue Statements. Neither this Agreement, nor any of the other
Loan Documents, nor any other agreement, report, schedule, certification or
instrument simultaneously with the execution of this Agreement delivered to
the Bank by the Borrower or by any officer thereof, contains any
misrepresentation or untrue statement of any material fact or omits to
state any material fact necessary to make any of such agreements, reports,
schedules, certificates or instruments not misleading in any material
respect.
ARTICLE 4
Affirmative Covenants
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The Borrower covenants that, so long as any portion of the Loan remains
unpaid and unless the Bank otherwise consents in writing, it will:
8.
4.1 Payment of Obligations. The Borrower will pay and discharge at or
before maturity, all its material obligations and liabilities, including,
without limitation, tax liabilities, except where the same may be contested
in good faith by appropriate proceedings, and will maintain, in accordance
with generally accepted accounting principles, appropriate reserves for the
accrual of any of the same.
4.2 Maintenance of Existence. The Borrower will preserve, renew and
keep in full force and effect its existence as a valid and active
corporation under the laws of the State of Florida and will not voluntarily
dissolve or allow itself to be involuntarily dissolved.
4.3 Inspection of Property. Books and Records. The Borrower will keep
proper books of record and account in which full, true and correct entries
in conformity with generally accepted accounting principles shall be made
of all dealings and transactions in relation to its business and
activities; and will permit representatives of the Bank at the Bank's
expense to visit and inspect any of its properties, to examine and make
abstracts and copies from its books and records and to discuss its affairs,
finances and accounts with its officers, employees and independent public
accountants, all at such reasonable times and as often as may reasonably be
desired.
4.4 Licenses and Permits. Etc. The Borrower will preserve and keep in
force all licenses, permits and franchises necessary for the proper conduct
of Borrower's business.
4.5 Advice Regarding Changes. The Borrower will inform the Bank
immediately of any material adverse changes in the financial condition of
Borrower.
4.6 Advice Regarding Litigation. The Borrower will inform the Bank
promptly of any litigation or threatened litigation which might or could
substantially affect the Borrower's financial condition.
4.7 Further Assurances. At its cost and expense, upon request of the
Bank, duly execute and deliver or cause to be duly executed and delivered
to the Bank such further instruments and do and cause to be done such
further acts that may be necessary or proper in the opinion of the Bank,
reasonably exercised, to carry out more effectively the provisions and
purposes of this Agreement and the other Loan Documents.
4.8 Observe All Laws. Conform to and duly observe in all material
respects all laws, regulations and other valid requirements of any
regulatory authority with respect to its properties and the conduct of its
business.
4.9 Fire and Extended Coverage Insurance. Keep the Improvements and all
fixtures forming a part thereof and the Fuji Insertion Line insured against
loss or damage by fire, vandalism, burglary, theft, mysterious
disappearance, malicious mischief, riot, earthquake and other hazards
insured against by a standard form of extended coverage insurance and such
other insurance (including, but not limited to, flood) as may be specified
by the Bank from time to time, in amounts and with insurance companies
authorized to do business in Florida which are approved by the Bank to the
extent applicable, cause each insurance policy issued in connection
therewith to be in the
9.
so-called "All Risks" form and which policy shall provide (i) losses will
be adjusted with the Bank; (ii) loss payments will be payable to the Bank
alone, such payments to be applied, at the option of the Bank except as
hereinafter provided, to the restoration, repair or replacement of the
Improvements or the payment of the principal and interest on the Note and
all other indebtedness of the Borrower to the Bank; (iii) the interest of
the Bank shall be insured regardless of any breach or violation by the
Borrower of any warranties, declarations or conditions contained in such
policy; and (iv) if such insurance be canceled or materially changed for
any reason whatsoever, such insurer shall promptly notify the Bank and such
cancellation or change shall not be effective as to the Bank for thirty
(30) days after receipt by the Bank of such notice. The Borrower shall
deliver to the Bank copies of each such policy upon the execution hereof,
and copies of each renewal policy not less than thirty (30) days prior to
the expiration of the original policy or preceding renewal policy (as the
case may be); and deliver to the Bank receipts or other evidence that the
premiums thereon have been paid. The form and content of all insurance
policies required under this Agreement shall be satisfactory to the Bank as
to form and content. Notwithstanding anything contained herein to the
contrary, so long as (i) there has occurred or exists no Event of Default
under this Agreement or the other Loan Documents, or no event which with
the passage of time or notice or either would constitute an Event of
Default hereunder or thereunder, (ii) the Borrower has business
interruption insurance coverage in effect for at least$25,000,000.00, (iii)
the Borrower has provided evidence reasonably satisfactory to the Bank that
prior to the time that losses from the business interruption caused by the
casualty will exceed the business interruption coverage carried by the
Borrower, the Improvements will be restored to the condition existing
immediately prior to such casualty; and (iv) if a building permit is
required for the restoration of the Improvements by Hillsborough County,
Florida, evidence that all parking and setback requirements will be met and
that the Improvements will be restored in accordance with all applicable
building codes, the Bank will disburse such proceeds at the Borrower's
option either monthly as restoration progresses, or upon the completion of
such restoration or repair. All such proceeds shall be used exclusively for
repair and/or restoration of the Improvements to the condition existing
prior to such casualty loss or and shall be disbursed in accordance with
the Bank's customary construction lending practices and upon such other
terms and conditions as the Bank reasonably may require to assure
completion of such restoration or repair in a first class, workmanlike
manner, free and clear of all liens and encumbrances.
4.10 Public Liability Insurance. Carry and cause all contractors to
carry comprehensive public liability and property damage insurance in
connection with the Mortgaged Property, and during any period of
construction, contractor's protective liability insurance (including
explosion and collapse coverage), and comprehensive automobile liability
insurance covering all motor vehicles, owned and non-owned, used in
connection with the Mortgaged Property, all in amounts and with insurers
acceptable to the Bank, and deliver to the Bank a certificate indicating
that the policy or policies evidencing such insurance have been issued to
the Borrower.
4.11 Worker's Compensation Insurance. Carry worker's compensation and
employer's liability insurance covering all liability in connection with
the Mortgaged Property under applicable worker's compensation laws, and
deliver to the Bank a certificate indicating that the policy or policies
evidencing such insurance have been issued.
10.
4.12 Flood Insurance. Comply with the requirements of the Flood
Disaster Protection Act as and when required.
4.13 Payment of Impositions. Pay and discharge the Impositions, such
Impositions or installments thereof to be paid not later than the due date
thereof, or on the day any fine, penalty, interest or cost may be added
thereto or imposed by law for the nonpayment thereof (if such day is used
to determine the due date of the respective item); provided, however, that
if by law any Imposition may, at the option of the taxpayer or other person
obligated to pay it, be paid in installments (whether or not interest shall
accrue on the unpaid balance of such Imposition) the Borrower may exercise
the option to pay the same in such installments. Also pay and discharge, or
cause to be paid and discharged, promptly all taxes, assessments and
governmental charges or levies imposed upon the Borrower or upon its
income, receipts or any of its properties before the same shall become in
default, as well as all lawful claims for labor, materials and supplies or
otherwise which, if unpaid, might become a lien or charge upon such
properties or any part thereof.
4.14 Performance of Credit Agreement. Perform and comply with in a
timely manner all terms, affirmative and negative covenants and
requirements imposed on the Borrower by the Credit Agreement in accordance
with the terms thereof as such terms exist on the date of this Agreement
and provide to the Bank copies of any and all notices of default or non-
compliance by the Borrower under the Credit Agreement within two (2)
Business Days after the Borrower's receipt of the same.
ARTICLE 5
Negative Covenants
------------------
The Borrower and the Bank have intentionally omitted negative covenants
from this Agreement, it being understood and agreed that all negative
covenants set in the Credit Agreement which have been incorporated herein
pursuant to Section 2.6 shall apply and be observed by the Borrower in
connection with the Loan; provided, however, the Bank agrees that neither
(i) the borrowing of funds by the Borrower under the Credit Agreement nor
(ii) the granting or creating of any liens or encumbrances contemplated by
the Credit Agreement shall constitute a violation of the negative covenants
incorporated herein
ARTICLE 6
Conditions Precedent
--------------------
6.1 Closing. The closing of the transactions contemplated hereby (the
"closing") shall be held at a time and place mutually agreeable to the Bank
and the Borrower. Notwithstanding the date of the closing' this Agreement,
the Note, the Third Amendment to Mortgage and all other Loan Documents
shall be effective as of April 28, 1997.
11.
6 2 Conditions Precedent to the Closing. The Bank shall have no
obligation to close the transactions contemplated hereby or to fund the
Loan until the Bank has received the items listed below and/or the events
described below have occurred, as the case may be:
6.2.1 Loan Documents. This Agreement has been duly executed by the
Borrower and delivered to the Bank and the Note, the Third Amendment to
Mortgage and all other Loan Documents have been (i) executed by the
Borrower and delivered to the Agent and (ii) the Agent has endorsed the
Note, without recourse, to the order of the Bank and executed and delivered
to the Bank the Assignment of Mortgage.
6.2.2 Amendment Agreement No. 5. All conditions set forth in
Paragraph 4 of Amendment Agreement No. 5 have occurred or will occur
concurrently with the closing.
6.2.3 Borrowing Resolutions and Company General Certificate.
Delivery of copies of (i) the resolutions of the directors of the Borrower
certified by the corporate secretary authorizing execution of this
Agreement, the other Loan Documents and Amendment Agreement No. 5 on behalf
of the Borrower and authorizing specified officers of the Borrower to
execute and deliver this Agreement, the other Loan Documents and Amendment
Agreement No. 5 on behalf of the Borrower, and (ii) a company certificate
of the Borrower, in substantially the form attached hereto as Exhibit "B."
executed by the corporate secretary.
6.2.4 Certificates of Incumbency. A certificate of incumbency
showing the present officers of the Borrower and specimen signatures of
said officers.
6.2.5 No Adverse Change. No conditions occur or arise regarding the
Borrower's financial condition which the Bank deems, in its sole
discretion, to have a materially adverse impact on the Borrower's financial
condition.
6.2.6 Representations and Warranties. All of the representations and
warranties of the Borrower set forth in this Agreement are true and
correct.
ARTICLE 7
Default
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7.1 Events of Default. The occurrence of one or more of the following
events shall constitute an event of default hereunder (an "Event of
Default"):
7.1.1 Payment of Loan. The failure to pay (i) the outstanding
principal amount of the Note, plus unpaid accrued interest, when due, or
(ii) the failure to pay within ten (10) days after the due date interest on
the Note or any other amount payable hereunder or under any of the other
Loan Documents, either by the terms hereof or thereof or otherwise as
herein or therein provided.
12.
7.1.2 Covenants. The Borrower shall fail to observe or perform any
covenant contained in this Agreement for a period of 30 days after written
notice thereof has been given to the Borrower by the Bank.
7.1.3 Representation or Warranty. Any representation or warranty
made by the Borrower herein or in any writing furnished in connection with
or pursuant to this Agreement or any of the other Loan Documents shall be
false or misleading in any material respect on the date upon which made or
deemed reaffirmed.
7.1.4 Other Documents. The occurrence of any default as specified in
any of the other Loan Documents and such default shall not have been
remedied (i) within the grace period, if any, provided in such Loan
Document.
7.1.5 Default Under the Credit Agreement. An Event of Default shall
occur under the Credit Agreement.
7.1.6 Liquidation: Dissolution; Voluntary Bankruptcy. The
liquidation or dissolution of the Borrower, or the filing by the Borrower
of a voluntary petition or an answer seeking reorganization, arrangement,
readjustment of its debts or for any other relief under the Bankruptcy
Code, as amended, or under any other insolvency act or law, state or
federal, now or hereafter existing, or any other action of the Borrower
indicating its consent to, approval of or acquiescence in, any such
petition or proceeding; the application by the Borrower for, or the
appointment by consent or acquiescence of the Borrower of a receiver, a
trustee or a custodian of the Borrower for all or a substantial part of its
property; the making by the Borrower of any assignment for the benefit of
creditors; the inability of the Borrower or the admission by the Borrower
in writing of its inability to pay its debts as they mature; or the
Borrower taking any corporate action to authorize any of the foregoing.
7.1.7 Involuntary Bankruptcy. The filing of an involuntary petition
against the Borrower in bankruptcy or seeking reorganization, arrangement,
readjustment of its debts or for any other relief under the Bankruptcy
Code, as amended, or under any other insolvency act or law, state or
federal, now or hereafter existing; or the involuntary appointment of a
receiver, a trustee or a custodian of the Borrower for all or a substantial
part of its property; or the issuance of a warrant of attachment, execution
or similar process against any substantial part of the property of the
Borrower, and the continuance of any of such events for sixty (60) days
undismissed or undischarged.
7.1.8 Adjudication of Bankruptcy. The adjudication of the Borrower
as bankrupt or insolvent.
7.1.9 Order of Dissolution. The entering of any order in any
proceedings against the Borrower decreeing the dissolution, divestiture or
split-up of the Borrower, and such order remains in effect for more than
sixty (60) days.
13.
7.1.10 Reports and Certificates. Any report, certificate, financial
statement or other instrument delivered to the Bank by or on behalf of the
Borrower pursuant to the terms of this Agreement or the Loan Documents is
false or misleading in any material respect when made or delivered.
7.1.11 Illegality of Agreement or the Note. This Agreement or the
Note shall have been held by any court of competent jurisdiction, or by any
competent regulatory authority, to be illegal, invalid, prohibited or
unenforceable in whole or in material part.
7.1.12 Attachment. Except as expressly provided otherwise hereunder,
an attachment or any other lien (mechanic's or otherwise) against the
Mortgaged Property shall be issued or entered and shall remain undischarged
or unbended for thirty (30) days after the filing thereof.
7.1.13 Levy Upon Property. Levy is made under any process on, or a
receiver be appointed for the Mortgaged Property or any other property, of
the Borrower.
7.2 Remedies.
7.2.1 Acceleration and Set-off. Upon the occurrence of any Event of
Default, and at any time thereafter as long as the Event of Default is
continuing, the Bank may, upon five (5) days written notice, declare the
entire principal and all interest on the Advances and all obligations under
the Loan Documents, and all other indebtedness of the Borrower to the Bank,
whether the Borrower's liability for payment thereof is primary or
secondary, direct or indirect, sole, joint, several or joint and several,
or whether the indebtedness is matured or unmatured, due or to become due,
fixed, absolute or contingent, to be immediately due and payable (without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived) and the Loan and all such other indebtedness thereupon
shall be and become immediately due and payable, and the Bank may proceed
to collect the same by foreclosure of the Mortgage, pursuit of the Bank's
remedies under the Uniform Commercial Code, at law, or as otherwise
provided in the Loan Documents and/or other instruments or agreements
signed by the Borrower. In addition, without limiting any other rights of
the Bank, whenever the Bank has the right to declare any indebtedness to be
immediately due and payable (whether or not it has so declared), each of
the Bank and each Participant may set off against the indebtedness without
notice any amounts then owed to the Borrower by the Bank or such
Participant, as the case may be, in any capacity, whether due or not due,
including without limitation deposits, stocks, bonds and other securities
and other assets held in any custodial accounts, and each of the Bank and
each Participant shall be deemed to have exercised its right to set off
immediately at the time its right to such election accrues.
7.2.2 Cumulative Remedies. All rights, remedies or recourse of the
Bank under this Agreement, the Note, or any other Loan Documents, at law,
in equity or otherwise, are cumulative, and exercisable concurrently, and
may be pursued singularly, successively or together and may be exercised as
often as occasion therefore shall arise. No act of commission or omission
by the Bank, including, but not limited to, any failure to exercise, or any
delay, forbearance or indulgence in the exercise of, any right, remedy or
recourse hereunder or under any other Loan Document shall
14.
be deemed a waiver, release or modification of that or any other right,
remedy or recourse, and no single or partial exercise of any right, remedy
or recourse shall preclude the Bank from any other or future exercise of
the right, remedy or recourse or the exercise of any other right, remedy or
recourse. No waiver or release of any such rights, remedies and recourse
shall be effective against the Bank unless in writing and manually signed
by an authorized officer on the Bank's behalf, and then only to the extent
recited therein. A waiver, release or modification with reference to any
one event shall not be construed as continuing or constituting a course of
dealing, nor shall it be construed as a bar to, or as a waiver, release or
modification of, any subsequent right, remedy or recourse as to a
subsequent event.
7.2.3 No Liability. Whether or not the Bank elects to employ any or
all remedies available to it in the event of an occurrence of a Default or
an Event of Default, the Bank shall not be liable for the payment of any
expenses incurred in connection with the exercise of any remedy available
to the Bank or for the performance or non-performance of any obligation of
the Borrower.
ARTICLE 8
Miscellaneous
-------------
8.1 Waiver of Default. The Bank may, by written notice to the Borrower
at any time and from time to time, waive any default in the performance or
observation of any condition, covenant or other term thereof or any Event
of Default that shall have occurred hereunder and its consequences. Any
such waiver shall be for such period and subject to such conditions as
shall be specified in any such notice. In the case of any such waiver, the
Borrower shall be restored to its former position hereunder and under the
Loan Documents, and any Event of Default so waived shall be deemed to be
cured and not continuing; but no such waiver shall extend to any subsequent
or other Event of Default.
8.2 Amendments and Waivers. The Bank and the Borrower may, subject to
the provisions of this Section 8.2, from time to time, enter into written
agreements for the purpose of adding any provision to this Agreement or the
other Loan Documents or changing in any manner the rights of the Bank or
the Borrower hereunder or under the other Loan Documents. No such
amendment, modification or supplement shall be established by custom,
conduct or course of dealing, but solely by an instrument in writing duly
executed by the party to be charged therewith. The Bank shall indicate its
consent to any written request by the Borrower with respect to any such
proposed amendment, modification or supplement by its delivery to the
Borrower of its affirmative written approval thereof within ten (10) days
of its receipt of written request from the Borrower for such amendment,
modification or supplement; provided, however, that any such request shall
be deemed denied by the Bank if such written approval thereof shall not
have been delivered by the Bank to the Borrower within such period.
15.
8.3 Notices. All notices, requests, demands and other communications
are required or may be given under this Agreement shall be in writing and
shall be deemed to have been duly given when received if personally
delivered; the day it is sent, if sent by telefacsimile transmission, with
receipt confirmation; the day after it is sent, if sent by recognized
expedited over-night delivery service; and upon receipt, if mailed,
certified mail, return receipt requested, postage prepaid. In each case
notice shall be sent to:
If to the Borrower: Reptron Electronics, Inc.
14401 McCormick Drive
Tampa, FL 33626
Attention: Paul J. Plante
Telefacsimile No: (813) 855-1697
with a copy to: William L. Elson, P.C.
3000 Town Center
Suite 2690
Southfield, MI 48075
Telefacsimile No.: (810) 358-4425
If to the Bank: Barnett Bank, N.A.
101 E. Kennedy Blvd.
Tampa, FL 33602
Attention: David A. Austin
Telefacsimile No.: (813) 225-8752
or to such other address as either party may have specified in writing to
the other using the procedures specified above in this Section 8.3.
8.4 No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Bank, any right, power or privilege
hereunder or under any of the other Loan Documents shall operate as a
waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or thereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein and in the other Loan Documents provided are
cumulative and not exclusive of any rights or remedies provided by law.
8.5 Survival of Representations. Warranties and Covenants. All
representations, warranties, covenants and other agreements made herein
shall survive the execution and delivery of this Agreement and the other
Loan Documents.
8.6 Liens, Set Off by Bank. The Borrower hereby grants to the Bank a
continuing lien for the Loan and all other indebtedness of the Borrower to
the Bank upon any and all monies and securities of the Borrower and the
proceeds thereof, now or hereafter held or received by or in transit to,
the Bank from or for the Borrower, and also upon any and all deposits
(general or special) and credits of the Borrower, if any, against the Bank,
at any time existing. Upon the occurrence of any
16.
Event of Default hereunder, the Bank is hereby authorized at any time and
from time to time, without notice to the Borrower, to set off, appropriate
and apply any or all items herein above referred to against all
indebtedness of the Borrower to the Bank, whether under this Agreement, or
otherwise, whether now existing or hereafter arising. The liens, set-off
rights and other rights granted to the Bank under this Section 8.6 are also
hereby given by the Borrower to each Participant.
8.7 No Third Party Beneficiaries. This Agreement is a contract among
the Bank or the Borrower for their mutual benefit and no third person shall
have any right, claim or interest against either the Bank or the Borrower
by virtue or any provision hereof.
8.8 Florida Law. This Agreement and the rights and obligations of the
parties hereunder shall be construed in accordance with and governed by the
laws of the State of Florida without regard to the principles of the
conflict of laws of Florida.
8.9 Paragraph Headings. Paragraph headings are for the purpose of
identification only and are not considered as a substantive part of this
Agreement.
8 10 Gender; Etc. Whenever the context so requires, the neuter gender
includes the feminine and/or masculine, as the case may be, and the
singular number includes the plural, and the plural number include the
singular.
8.11 Severability. Each paragraph, provision, sentence and part thereof
of this Agreement shall be deemed separate from each other paragraph,
provision, sentence or part thereof, and the invalidity or unenforceability
for any reason or to any extent of any such portion of this Agreement shall
not affect. the enforceability of the remaining portions of this Agreement
or any other Loan Document, or the application of such paragraph,
provision, sentence or part thereof to other persons and circumstances.
8.12 Reimbursement of Expenses. The Borrower agrees to reimburse the
Bank and the Participants for all reasonable costs and out-of-pocket
expenses (including reasonable fees of attorneys) incurred in connection
with the preparation, execution, delivery, modification, waiver and
amendment of this Agreement and the other Loan Documents, and also all
reasonable expenses incurred by the Bank and the Participants (including
reasonable fees of attorneys) in the collection of any indebtedness
incurred hereunder in the event of default by Borrower under any of the
Loan Documents. The obligations of the Borrower under this Section 8.12
shall survive the repayment of the Loan and the satisfaction by the
Borrower of its other obligations under this Agreement and the other Loan
Documents.
8.13 Stamp or Other Taxes. The Borrower agrees to pay any and all
stamp, documentary, exercise and intangible taxes now or hereafter payable
in respect of this Agreement, the Note, and the other Loan Documents,
whether in connection with the execution and delivery thereof, the making
of any Advance previously or hereafter made, any modification or renewal
thereof, or otherwise, together with any interest and penalties incident
thereto. The Borrower agrees to and shall indemnify and hold the Bank
harmless from and against all loss, cost, expense and attorneys' fees that
17.
may be incurred by the Bank in connection with any such assessment, tax,
levy or other charge, or any interest or penalty resulting therefrom. The
Bank may, but shall not be obligated to, at any time or from time to time,
debit the deposit account of the Borrower at the Bank for the amount of any
such obligations. The obligations of the Borrower under this Section 8.13
shall survive the repayment of the Loan and the satisfaction by the
Borrower of its other obligations under this Agreement and the other Loan
Documents.
8.14 Participation Rights. Nothing contained in this Agreement shall in
any way prohibit or otherwise restrict the Bank from (a) entering into
agreements with other financial institutions whereby such other
institutions participate in the Loan and (b) issuing participation
certificates to such other institutions in connection therewith; provided,
that the Loan shall be administered by the Bank and all actions permitted
to be taken by "the Bank" hereunder shall be taken solely by the Bank (but
this provision shall not prohibit (i) a participation agreement from
requiring that the Bank first obtain the consent of a Participant with
respect to one or more of such actions or (ii) a Participant from taking
any action expressly permitted it under this Agreement).
8.15 Further Assurances. The Borrower agrees that, at any time and from
time to time after the execution and delivery of this Agreement, they
shall, upon request of the Bank, execute and deliver such further
instruments and documents and do such further acts and things as the Bank
may reasonably request in order to fully effect the purposes of this
Agreement.
8.16 Execution in Counterparts. This Agreement and the other Loan
Documents may be executed in any number of counterparts, each of which
shall be deemed to be an original as against any party whose signature
appears thereon, and all of which shall together constitute one and the
same instrument.
8.17 Jurisdiction and Process. The Borrower and the Bank agree that
jurisdiction and venue shall properly lie in the Thirteenth Judicial
Circuit in the State of Florida in and for Hillsborough County, Tampa,
Florida and in the United States District Court for the Middle District of
Florida (Tampa Division) with respect to any legal proceedings arising from
this Agreement or any of the other Loan Documents. Such jurisdiction and
venue is merely permissive; jurisdiction and venue shall also continue to
lie in any court where jurisdiction and venue are found to be proper. The
parties further agree that mailing of any process by U.S. Certified Mail,
return receipt requested, shall constitute valid and lawful service of
process.
8.18 WAIVER OF JURY TRIAL. THE BORROWER AND ANY PERSON OR PERSONS
CLAIMING UNDER THE BORROWER, HEREBY VOLUNTARILY AND KNOWINGLY WAIVE ANY
RIGHT ANY OF THEM MAY HAVE TO SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF
THIS AGREEMENT, THE LOAN, THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, ANY
RELATED INSTRUMENT OR AGREEMENT, OR THE DEALINGS OR THE RELATIONSHIP
BETWEEN OR AMONG SUCH PERSONS OR ANY OF THEM. NEITHER THE BORROWER NOR ANY
PERSON CLAIMING UNDER THE BORROWER SHALL SEEK TO CONSOLIDATE ANY SUCH
ACTION IN
18.
WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH TRIAL
CANNOT OR HAS NOT BEEN WAIVED. THE BORROWER ACKNOWLEDGES THAT THE
PROVISIONS OF THIS SECTION 8.18 HAVE BEEN FULLY DISCUSSED WITH THE BORROWER
AND THE BANK, THAT THE BORROWER IS ABLY REPRESENTED BY A LICENSED ATTORNEY
AT LAW IN THE NEGOTIATION OF THIS SECTION 8.18, THAT IT BARGAlNED AT ARM'S
LENGTH AND IN GOOD FAITH AND WITHOUT DURESS OF ANY KIND FOR THE TERMS AND
CONDITIONS OF THIS SECTION 8.18 AND THAT THE PROVISIONS HEREOF SHALL BE
SUBJECT TO NO EXCEPTIONS. NO PARTY HAS IN ANY WAY AGREED WITH OR
REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS SECTION 8.18
WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
IN WITNESS WHEREOF, the Borrower and the Bank have cause this Agreement
to be duly executed as of the day and year first above written.
WITNESSES: REPTRON ELECTRONICS, INC., a Florida
corporation
/s/ Wanda Emery By: /s/ Paul J. Plante
- --------------- --------------------------------
Wanda Emery Name: Paul J. Plante
Title: Vice President, Chief Operating
Officer
/s/ Judith Davidson
- -------------------
Judith Davidson
"BORROWER"
BARNETT BANK, N.A., a national banking
association
/s/ Margaret A. Eldridge By: /s/ David A. Austin
- ------------------------ -----------------------------
Name: David A. Austin
Title: Senior Vice President
/s/
- ------------------------
EXHIBIT "A"
-----------
PARCEL I:
- ---------
Lots 6, 7 and 8, TRI-COUNTY BUSINESS PARK-PHASE II, according to the Plat
thereof on file in the Office of the Clerk of the Circuit Court in and for
Hillsborough County, Florida, recorded in Plat Book 55, Page 42, said lands
situate, lying and being in Hillsborough County, Florida.
PARCEL II:
- ----------
That part of Section 7, Township 28 South, Range 17 East, Hillsborough
County, Florida, being further described as follows:
Begin at the most Northerly corner of Tri-County Business Park-Phase 3 as
recorded in Plat Book 61, page 31, of the Public Records of Hillsborough
County, Florida; thence along said boundary the following, S.66 18'24"W.,
577.84 feet; thence S. 23 41'36"E., 100.00 feet; thence S.66 18'24"W.,
450.00 feet to the boundary of Tri-County Business Park-Phase II, as
recorded in Plat Book 55, page 42, of the Public Records of Hillsborough
County, Florida; thence along said boundary the following N.33 51'34"E.,
372.78 feet; thence N.23 41'36"W., 1257.92 feet; thence leaving said
boundary N.52 46'22"E., 912.95 feet; thence S.26 00'00"E., 73.49 feet;
thence S.64 00'00"W.5.68 feet; thence S. 26 00'00"E., 79.04 feet; thence
N.63 35'13"E., 22.67 feet; thence S.26 24'47"E., 71.12 feet to a curve
concave Northeasterly having a radius of 5759.58 feet; thence Southeasterly
along said curve, 239.72 feet through a central angle of 02 23'05" (chord
bearing S.27 36'20"E., 239.70 feet) thence non-tangent from said curve,
S.61 12'08"W., 21.14 feet; thence S.28 59'52"E~, 40.36 feet; thence
N.60 48'08"E., 21.14 feet to a non-tangent curve concave Northeasterly
having a radius of 5759.58 feet; thence Southeasterly along said curve
251.28 feet through a central angle of 02 29'59" (chord bearing
S.30 26'52"E., 251.26 feet); thence S.31 41 '51"E, 217.16 feet to a curve
concave Northeasterly having a radius of 2576.48 feet; thence Southeasterly
along said curve 43.38 feet through a central angle of 00 57'53" (chord
bearing S.32 10'48"E., 43.38 feet); thence non-tangent from said curve
S.33 36'56"E., 126.49 feet to a non-tangent curve concave Northeasterly
having a radius of 2577.48 feet; thence Southeasterly along said curve,
84.01 feet trough a central angle of 01 52'03" (chord bearing
S.36 24'31"E., 84.01 feet); thence non-tangent from said curve,
S.52 39'28"W., 26.70 feet; thence S.25 59'40"E., 41.30 feet; thence
N.64 00'05"E., 35.97 feet to a non-tangent curve concave Northeasterly
having a radius of 2577.48 feet; thence Southeasterly along said curve,
141.70 feet through a central angle of 03 09'00" (chord bearing
S.39 58'29"E., 141.69 feet); thence non-tangent from said curve
S.48 27'01"W., 28.58 feet; thence S.26 00'14"E., 46.56 feet; thence
N.64 00'02"E., 43.18 feet; thence S.42 21'51"E., 14.00 feet; thence
S.38 23'42"E., 245.59 feet; thence S.42 21'51"E., 190.00 feet; thence
S.47 38'09"W., 15.00 feet; thence S.42 21'51"E., 35.98 feet; thence
S.47 27'10"W., 240.55 feet; thence S.45 32'37"W., 140.08 feet; thence
N.42 32'50"W., 504.05 feet to the Point of Beginning.
EXHIBIT "B"
COMPANY GENERAL CERTIFICATE
---------------------------
REPTRON ELECTRONICS, INC. (Company)
BARNETT BANK, N.A. (Bank)
Closing Date: As of , 1997
---------
The undersigned certifies that he is the of the Company
and that, as such, the undersigned is authorized to execute and deliver
this certificate in the name and on behalf of the Company. The undersigned
further certifies, for the undersigned individually and on behalf of the
Company, that
1. This certificate is being delivered in Tampa, Florida, effective as
of the Closing Date in connection with the extension by the Bank of a loan
in the original principal amount of $8,800,000.00 (the "Loan") and the
modification of the Amended and Restated Revolving Credit and Reimbursement
Agreement by and among the Company, various lenders from time to time party
to the agreement and NationsBank of Florida, National Association, as
Agent.
2. The Company is duly formed, validly existing and in good standing
under the laws of the State of Florida.
3. The Direct Pay Obligations Renewal and Replacement Promissory Note
in the principal amount of $8,800,000.00 dated of even date herewith (the
"Note"), the Loan Agreement dated of even date herewith relating to the
Loan (the "Loan Agreement"), the Amendment Agreement No. 5 and Waiver to
the Amended and Restated Revolving Credit and Reimbursement Agreement of
even date herewith (the "Amendment Agreement") and any and all other
agreements and documents required to be executed and delivered by the
Company in order give effect to and consummate the transactions
contemplated by the Loan Agreement and the Amendment Agreement (i) have
been duly authorized, executed and delivered by the Company, (ii) are in
full force and effect and (iii) are the valid and binding obligations of
the Company, enforceable in accordance with their terms.
a. Attached hereto as Exhibit A is a true, correct and complete copy of
the Company's Articles of Incorporation, which articles are in full force
and effect on and as of the Closing Date without modification or amendment
except as indicated in Exhibit A.
b. Attached hereto as Exhibit B is a true, correct and complete copy of
the Company's Bylaws, which bylaws are in full force and effect on and as
of the Closing Date without modification or amendment except as indicated
in Exhibit B.
c. Attached hereto as Exhibit C is a true, correct and complete copy of
resolutions adopted by the Company's Director(s) on , 1997, and
such resolutions are in ffil1 force and effect on and as of the Closing
Date without revocation, modification or amendment in
any respect. No other or further action by or on behalf of the Company or
its director is necessary or appropriate to authorize the execution,
delivery and performance of the Loan Agreement, the Amendment Agreement or
any or all the other agreements and documents required to be executed and
delivered by the Company in order to give effect to and consummate the
transactions contemplated by the Loan Agreement and the Amendment
Agreement. None of the foregoing is or will be in contravention of the
Company's Articles of Incorporation, Bylaws or any document or agreement to
which the Company is a party or which is binding on the Company.
4 The Note, the Loan Agreement, the Amendment Agreement and each of the
other agreements anal documents required to be executed and delivered by
the Company have been duly authorized, executed and delivered in the name
and on behalf of the Company by as the of
the Company and the officer authorized to do so, and such officer has been
and is, on and as of the Closing Date, the duly elected, qualified and
acting of the Company. A specimen of such officer's genuine signature is
provided below:
Name Signature
- ------------------- ------------------------
IN WITNESS WHEREOF, the undersigned has executed and delivered this
certificate in the name and on behalf of the Company on and as of the
Closing Date.
------------------------
Name:
As: Secretary
2.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated statement of earnings and the consolidated balance sheet and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 49345
<SECURITIES> 0
<RECEIVABLES> 45669
<ALLOWANCES> 350
<INVENTORY> 68629
<CURRENT-ASSETS> 168709
<PP&E> 35894
<DEPRECIATION> 0
<TOTAL-ASSETS> 217825
<CURRENT-LIABILITIES> 30724
<BONDS> 130478
0
0
<COMMON> 61
<OTHER-SE> 54710
<TOTAL-LIABILITY-AND-EQUITY> 217825
<SALES> 229631
<TOTAL-REVENUES> 229631
<CGS> 187956
<TOTAL-COSTS> 215749
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4069
<INCOME-PRETAX> 9813
<INCOME-TAX> 3835
<INCOME-CONTINUING> 5978
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5978
<EPS-PRIMARY> .95
<EPS-DILUTED> .95
</TABLE>
