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Exhibit 10.38
Bank of America Amendment to Documents
AMENDMENT NO. 2 TO BUSINESS LOAN AGREEMENT
This Amendment No. 2 (the "Amendment") dated as of December 21, 1995,
is among Bank of America National Trust and Savings Association (the "Bank")
and Calnetics Corporation ("Borrower 1"), Manchester Plastics Co., Inc.
("Borrower 2"), NY-Glass Plastics, Inc. ("Borrower 3") and Agricultural
Products, Inc. ("Borrower 4") (Borrower 1, Borrower 2, Borrower 3 and Borrower
4 are sometimes referred to collectively as the "Borrowers" and individually as
the "Borrower") .
RECITALS
A. The Bank and the Borrowers entered into a certain Business Loan
Agreement dated as of June 20, 1994, as previously amended (the "Agreement") .
B. The Bank and the Borrowers desire to further amend the Agreement.
AGREEMENT
1. Definitions. Capitalized terms used but not defined in this
Amendment shall have the meaning given to them in the Agreement.
2. Amendments. The Agreement is hereby amended as follows:
2.1 In Paragraph 1A.1(a) of the Agreement, the amount "Two Million
Five Hundred Thousand dollars ($2,500,000)" is substituted for
the amount "Two Million Dollars ($2,000,000)".
2.2 In Paragraph 1A.2 of the Agreement, the date "December 31,
1996" is substituted for the date "December 30, 1995".
2.3 Paragraph 1A.3(a) of the Agreement is amended to read in its
entirety as follows:
"(a) The interest rate if the Bank's Reference Rate."
2.4 In Paragraph 2.1(a) of the Agreement, the amount "Two Hundred
Thousand Dollars ($200,000)" is substituted for the amount "One
Hundred Thirty Thousand dollars ($130,000)".
2.5 Paragraph 3.2 of the Agreement is amended to read in its
entirety as follows:
"3.2 RELEASE OF COLLATERAL. If (i) the Borrowers' total
liabilities to tangible net worth is less than 1.50:1.00, as
evidenced by financial statements of the Borrowers' delivered
to the Bank, (ii) there are no defaults hereunder, and (iii)
the Bank has received satisfactory evidence that The Bank of
California N.A. ("Bank Cal") has released its security interest
in all collateral of the Borrowers excluding only the
collateral of Borrower 4 securing Borrower 4's reimbursement
obligations in respect of a standby letter of credit issued by
Bank Cal and subject to Bank Cal's agreement that it may only
realize proceeds of receivables up to a maximum of Five Hundred
Thousand Dollars ($500,000), then the Bank will release the
collateral required under paragraph 3.1 of this Agreement
within a reasonable period following receipt of such financial
statements and evidence of the release of collateral."
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2.6 Paragraph 7.5 of the Agreement is amended to read in its entirety
as follows:
"7.5 TOTAL LIABILITIES TO TANGIBLE NET WORTH. To maintain on a
consolidated basis, a ratio of total liabilities to tangible net
worth not exceeding 3.00:1.00, from and including the date hereof
to but excluding the date of any release of collateral under
Paragraph 3.2 of this Agreement, and not exceeding 2.00:1.00
thereafter. This ratio will be calculated on the last day of each
fiscal quarter of the Borrowers.
"Total liabilities" means the sum of current liabilities plus long
term liabilities."
2.7 Paragraph 7.6 of the Agreement is amended to read in its entirety
as follows:
"7.6 CASH FLOW RATIO. To maintain quarterly on a consolidated
basis, a cash flow of at least 1.25:1.00, as calculated on the
last day of each such quarter.
"Cash flow ratio" means the ratio of cash flow to the aggregate of
the current portion of long term debt. "Cash flow" is defined as
consolidated net income after taxes, plus depreciation and other
net non-cash charges plus the assurance of stock, less gain on
sale of assets, dividends, withdrawals, treasury stock purchases
and capital expenditures, the sum of which is divided by the
aggregate of the current portion of long term debt. This ratio
will be calculated at the end of each fiscal quarter, using fiscal
year-to-date results on an annualized basis. The current portion
of long term debt will be measured as of the last day of the
current quarter."
2.8 Paragraph 7.9 of the Agreement is amended to read in its entirety
as follows:
"7.9 CAPITAL EXPENDITURES. With respect to all Borrowers on an
aggregate basis, not to spend or incur obligations (excluding
capital leases) to acquire fixed or capital assets for more than
Seven Hundred Fifty Thousand Dollars ($750,000) in any single
fiscal year."
3. CONDITIONS. This Amendment will not be effective until the Bank has
received the following:
(a) A copy of this Amendment, duly executed by Borrower; and
(b) A written consent to the terms of this Amendment, duly
executed by The Bank of California, N.A.
4. EFFECT OF AMENDMENT. Except as provided in this Amendment, all of the
terms and conditions of the Agreement shall remain in full force and effect.
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This Amendment is executed as of the date stated at the beginning of
this Amendment.
BANK OF AMERICA
National Trust and Savings Calnetics Corporation
Association
X /s/ Janet K. Trout X /s/ Steven L. Strawn
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By: Janet K. Trout, Vice President By: Steven L. Strawn, Vice President
X /s/ Clinton G. Geriach
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By: Clinton G. Geriach, Chairman of
the Board and President
Manchester Plastics Co., Inc.
X /s/ Steven L. Strawn
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By: Steven L. Strawn, President
X /s/ Clinton G. Geriach
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By: Clinton G. Geriach
Chairman of the Board
NY-Glass Plastics, Inc.
X /s/ Michael A. Hornak
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By: Michael A. Hornack, President
X /s/ Clinton G. Geriach
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By: Clinton G. Geriach
Chairman of the Board
Agricultural Products, Inc.
X /s/ Lon Schultz
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By: Lon Schultz, President
X /s/ Clinton G. Geriach
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By: Clinton G. Geriach
Chairman of the Board
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