Exhibit 10.14
SECOND AMENDMENT AND
MODIFICATION
TO LOAN AND SECURITY
AGREEMENT
THIS SECOND AMENDMENT AND
MODIFICATION TO LOAN AND SECURITY AGREEMENT (the “Amendment” ) is made
effective as of the
day of
,
2006, by and among INFO LOGIX INC. , a Delaware corporation
( “Infologix” ), OPT ACQUISITION LLC , a
Pennsylvania limited liability company (
“Optasia” ), EMBEDDED TECHNOLOGIES, LLC ,
a Delaware limited liability company (
“Embedded” and together with Infologix and
Optasia, jointly, severally and collectively
“Borrowers” and each a
“Borrower” ) and SOVEREIGN BANK (the
“Bank” ).
BACKGROUND
A.
Pursuant to that certain Loan and Security Agreement dated March
16, 2006 by and among Borrowers and Bank (as amended by that
certain First Amendment and Modification to Loan and Security
Agreement dated August 25, 2006 (the “First Amendment”
) and as the same
may hereafter be amended, modified, supplemented or restated from
time to time, being referred to herein as the “Loan Agreement” ), Bank agreed, inter
alia , to extend to Borrowers the following credit
facilities: (i) a line of credit in the maximum principal
amount of Eight Million Five Hundred Thousand Dollars
($8,500,000.00), (ii) a term loan in the original principal amount
of One Million Five Hundred Thousand Dollars ($1,500,000.00) and
(iii) a term loan in the original principal amount of One Million
Dollars ($1,000,000.00).
B.
Borrowers have requested and Bank has agreed to amend the Loan
Agreement in accordance with the terms and conditions contained
herein.
C.
All capitalized terms contained herein and not otherwise defined
herein shall have the meanings set forth in the Loan
Agreement.
NOW, THEREFORE
, intending to be legally bound
hereby, the parties hereto agree as follows:
1.
Waiver of Covenant
Default .
(a)
Bank hereby waives any Default or Event of Default that exists or
may arise under the Loan Agreement as a result of Borrowers’
failure to comply with the Fixed Charge Coverage Ratio set forth
in Section 8.3
of the Loan
Agreement as of Borrowers’ fiscal quarter ended September 30,
2006.
(b)
The foregoing waiver applies solely with respect to the covenant
and period referenced in Section 1(a) above and does not apply to
or constitute a waiver for any other Default or Event of Default
that exists or may exist under the Loan Agreement or any of the
other Loan Documents, including, without limitation,
Borrower’s failure to comply with the covenant set forth
in Section 8.3
of the Loan
Agreement as of any other date.
2.
Definitions
.
Section 1.1(o)A
of the Loan
Agreement is hereby deleted in its entirety and replaced with the
following:
“(o)A
“ Cut-Off Date ” means November 30,
2006.”
3.
Term Loan B - Principal
Payments .
Section 4.3A
of the Loan
Agreement is hereby deleted in its entirety and replaced with the
following:
“4.3A
Principal Payments on Term Loan B . Subject to the
next succeeding sentence, Borrowers will pay the principal of Term
Loan B in (a) equal and consecutive monthly installments of
Twenty-Seven Thousand Seven Hundred Seventy-Seven and 78/100
Dollars ($27,777.78) each, on the first day of each calendar month
commencing on December 1, 2006, and (b) one (1) final payment of
the remaining principal balance, plus all accrued and unpaid
interest thereon on March 15, 2009. Notwithstanding the
foregoing, if the Capital Raise Date has not occurred prior to the
Cut-Off Date, Borrower will pay the entire outstanding principal
balance of Term Loan B, plus all accrued and unpaid interest
thereon on December 31, 2006.”
4.
Additional Conditions
.
Section 11
of the First
Amendment is hereby deleted and replaced with the
following:
“11.
Additional Conditions . If the Capital Raise
Date does not occur prior to the Cut-Off Date, on November 30,
2006, at Borrowers’ sole option, (i) Bank shall institute a
reserve against Eligible Receivables or Eligible Inventory in an
amount equal to Five Hundred Thousand Dollars ($500,000.00) or (ii)
Borrower shall deposit in a non-interest bearing cash collateral
account maintained at Bank (the “Additional Cash
Collateral Account” ) an amount equal to Five Hundred
Thousand Dollars ($500,000.00).
Bank will have sole dominion and
control over all items and funds in the Additional Cash Collateral
Account and such items and funds may be withdrawn only by
Bank. Bank will have the right to apply all or any part of
such funds towards payment of any of the Bank Indebtedness.
Items and funds in the Additional Cash Collateral Account shall be
referred to herein as the “Additional Cash
Collateral” .”
5.
Amendment/References
. The Loan Agreement and
the Loan Documents are hereby amended to be consistent with the
terms of this Amendment. All references in the Loan Agreement and
the Loan Documents to (a) the “Loan Agreement” shall mean the Loan Agreement
as amended hereby; and (b) the “Loan Documents” shall include this Amendment
and all other instruments or agreements executed pursuant to or in
connection with the terms hereof.
6.
Cross-Collateralization;
Confirmation of Collateral . Borrowers hereby
confirm, acknowledge and agree that all Bank Indebtedness is and
shall be cross-collateralized and, without limiting the foregoing,
Term Loan B, the other Loans, and all other Bank Indebtedness are
and shall continue to be secured by all liens, security interests,
assignments, suretyship obligations, stock pledges, rights and
remedies granted to Bank in the Loan Documents, which liens,
mortgages, security interests, rights and remedies are hereby
reaffirmed and continued as security for the foregoing; and all of
the Loan Documents are hereby amended to reflect the same.
None of the
2
Collateral shall
be impaired
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