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EXHIBIT 10.14
SECURITY AND LOAN AGREEMENT
AND ADDENDUM, EXHIBIT "A," THERETO
WAIVER TO CERTAIN PROVISIONS
This Waiver ("Waiver") waives certain provisions of that Security and Loan
Agreement dated January 2, 1997, by and between Imperial Bank ("Bank") and
▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. ("Borrower") and the Addendum, Exhibit "A," (the
"Addendum") thereto, of even date (collectively herein the Security and Loan
Agreement and the Addendum as previously amended are referred to as the
"Agreement").
RECITALS
A. Pursuant to the terms and conditions of the Agreement the Borrower can only
make distributions to the shareholders of Borrower if such distributions would
not cause a violation of the Tangible Net Worth and Fixed Charge Coverage Ratios
of the Agreement.
B. The Borrower has requested that the Bank waive the Tangible Net Worth and
Fixed Charge Coverage Ratio covenants for the period ending December 31, 1997 so
that the Borrower may make excess distribution to its shareholders to allow the
Borrower to make an Initial Public Offering and to convert from and
S-Corporation to a C Corporation.
C. The Bank has agreed to waive the above covenants for the above period
mentioned but only on the terms and conditions contained herein.
The parties hereto agree as follows:
1. The Bank hereby waives the following covenants for the period ending
December 31, 1997, provided that the conditions contained in paragraph 2 below
are complied with:
a. Section 7.a of the Agreement which requires the Borrower to maintain a
Tangible Net Worth of not less than ($4,450,000) as of December 31, 1997.
b. Section 7.e of the Agreement which requires the Borrower to maintain a
Fixed Charge Coverage Ratio of not less than 1.25 to 1.00 as of December 31,
1997.
2. The above waivers are conditioned upon the following:
a. Not more than $10,500,000 shall be distributed to the shareholders.
b. The Borrower must complete an Initial Public Offering with proceeds of
at least $15,000,000 to Borrower by January 31, 1998.
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3. ▇▇▇▇▇▇ ▇▇▇▇▇ hereby agrees that if the Borrower cannot comply with the
requirements of 2.b above he will reinvest an amount in the Borrower,
subordinated in form and substance satisfactory to the Bank, necessary for the
Borrower to comply with the covenants contained in 1.a and 1.b above proforma
as of December 31, 1997, giving effect for such subordinated debt.
4. The Bank may revoke the above waivers at any time if: (i) the Borrower
does not comply with the provisions of 2.a above, or (ii) the Borrower does not
comply with the provisions of 2.b above and ▇▇▇▇▇▇ ▇▇▇▇▇ does not comply with
the provisions of 3 above.
5. The above waivers are specific as to content and time, and the Bank does
not waive any other rights or remedies that it may have pursuant to any
agreement or law as a result of any violations past, present, or future of any
agreement between the Borrower and the Bank, and the Bank reserves all rights,
powers and remedies available to it.
6. Except as provided above, the Agreement remains unchanged.
7. This Amendment is effective as of December 8, 1997, and the parties hereby
confirm that the Agreement, other than for the waivers provided herein, remains
full force and effect.
▇▇▇▇▇▇ ▇▇▇▇▇ & ASSOCIATES, INC.
BY: [SIG]
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TITLE: E.V.P. & C.O.O. ACKNOWLEDGED AND AGREED
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BY: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇
TITLE: President, Chairman
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IMPERIAL BANK
BY: [SIG]
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TITLE: V.P.
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