AMENDMENT #2 TO THE THIRD RESTATED AND AMENDED LOAN AND SECURITY AGREEMENT
November 23, 2004
JACO ELECTRONICS, INC. ("Jaco")
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NEXUS CUSTOM ELECTRONICS, INC. ("Nexus")
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INTERFACE ELECTRONICS CORP. ("Interface")
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Gentlemen:
Reference is made to the Third Restated and Amended Loan and Security
Agreement in effect between GMAC Commercial Finance LLC, as successor by merger
to GMAC Commercial Credit LLC, which was the successor in interest to BNY
Financial Corporation ("GMAC"), as Agent and Lender, and PNC Bank, National
Association ("PNC") as Lender and Co-Agent, and Jaco, Nexus and Interface, dated
December 22, 2003, as supplemented and amended from time to time, (the
"Agreement"). Reference is also made to Amendment #1, to the Agreement, dated
September 20, 2004 (the "Amendment"). Both GMAC and PNC may hereinafter be
referred to jointly as the "Lenders", and individually, as a "Lender" and GMAC
may also be herein referred to as "Agent" when acting in such capacity, as the
case may be and PNC may also herein be referred as "Co-Agent", as the case may
be. Initially capitalized terms not defined herein shall have the meanings
ascribed to such terms in the Agreement. Jaco, Nexus and Interface may
hereinafter and in the Agreement, be referred to jointly and severally as
"Debtors", and each individually as a "Debtor".
It is hereby agreed, among the parties to the Agreement, that the
Agreement and the Amendment are hereby amended effective as of the date hereof,
as follows:
1. The definition of "EBITDA" appearing in Section 1.2., of the Agreement,
is hereby deleted, in its entirety, and replaced by the following definition:
" "EBITDA" shall mean (i) for any period
ending prior to October 1, 2004, earnings
before interest, taxes, depreciation and
amortization and (ii) for any period
commencing on or after October 1, 2004,
earnings minus any extraordinary gains,
including any gains derived from the sale of
assets of Nexus, before interest, taxes,
depreciation and amortization."
2. The definition of "Fixed Charge Coverage Ratio" appearing in
Section 1.2., of the Agreement, is hereby deleted, in its
entirety, and replaced by the following definition:
" "Fixed Charge Coverage Ratio" shall mean,
during any period, the ratio of (y) EBITDA
(minus any extraordinary gains, including
any gains derived from the sale of the
assets of Nexus, for any period ending prior
to October 1, 2004) minus unfunded Capital
Expenditures, to (x) the sum of (i)
interest, (ii) term debt repayments and
other repayments of Indebtedness (other than
Obligations under this Agreement), (iii)
taxes due for such period, and (iv) required
reductions of the Additional Availability
Amount during such period."
3. Section 6.12. of the Agreement is hereby deleted, in its
entirety, and replaced by the following Section 6.12.:
"6.12. Permanent Undrawn Availability .
Maintain at all times (for all Loan
Parties) an aggregate Undrawn
Availability of $1, 500,000, provided
however, that such Undrawn
Availability may be reduced to $500,
000 at all times on the later to
occur of (i) 3-31-05 or (ii) the last
day of the second consecutive fiscal
quarter during which the Fixed Charge
Coverage Ratio equals 1.1 to 1.0,
calculated on a rolling four quarter
basis."
4. By their signatures below, Jaco, Nexus and Interface hereby
ratify the Agreement (as hereby amended) and agree to be
jointly and severally liable for all Obligations under the
Agreement and agree that all of the outstanding amounts of
the Loans under the Agreement, as of the date hereof, shall
be valid and binding Obligations of each of them, and shall
be deemed Obligations outstanding under the Agreement, and
hereby agree and promise to repay to the Agent, for the
benefit of the Lenders, such Obligations (including but not
limited to all applicable interest) in accordance with the
terms of the Agreement, but in no event, later than the
Termination Date.
5. By their signatures below, Jaco, Nexus and Interface hereby
ratify and affirm to the Agent and the Lenders that as of
the date hereof, they are in full compliance with all
covenants under the Agreement (except as waived above), and
certify (i) that all representations and warranties of the
Agreement are true and accurate as of the date hereof, with
the same effect as if they had been made as of the date
hereof, (ii) no Default or Event of Default has occurred and
is continuing, or would result from the execution, delivery
and performance by Debtors, of this Amendment or the
Agreement (as amended by this Amendment), except as
specifically waived herein; (iii) each Debtor has full
power, right and legal authority to execute, deliver and
perform its obligations under this Amendment; (iv) each
Debtor has taken all action necessary to authorize the
execution and delivery of, and the performance of its
obligations under this Amendment; and (v) this Amendment
constitutes a legal, valid and binding obligation of each
Debtor enforceable against such Debtor in accordance with
its terms, and does not constitute a breach of any other
agreement or understanding to which such Debtor is a party
or by which its property is bound.
Except as herein specifically amended, the Agreement shall remain in
full force and effect in accordance with its original terms, except as
previously amended.
If the foregoing accurately reflects our understanding, kindly sign the
enclosed copy of this letter and return it to our office as soon as practicable.
Very truly yours,
GMAC COMMERCIAL FINANCE LLC
(as Agent and Lender)
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: 1st VP
AGREED AND ACCEPTED:
JACO ELECTRONICS, INC. PNC BANK NATIONAL ASSOCIATION
(as Lender)
By:/s/ ▇▇▇▇▇▇▇ D, Gash By: /s/ ▇▇▇▇ ▇▇▇▇▇
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Title: CFO Title: VP
NEXUS CUSTOM ELECTRONICS, INC. INTERFACE ELECTRONICS CORP.
By:/s/ ▇▇▇▇▇▇▇ D, Gash By:/s/ ▇▇▇▇▇▇▇ D, ▇▇▇▇
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Title: CFO Title: CFO