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EXHIBIT 10.31
AMENDMENT NUMBER ONE
TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER ONE TO LOAN AND SECURITY AGREEMENT (this
"Amendment") dated as of December 31, 1999, is entered into among PHONETEL
TECHNOLOGIES, INC., an Ohio corporation ("Phonetel"), CHEROKEE COMMUNICATIONS,
INC., a Texas corporation ("Cherokee," and together with Phonetel, each a
"Borrower" and collectively, jointly and severally, the "Borrowers"), on the one
hand, and, on the other hand, Agent (as hereinafter defined) and the financial
institutions (collectively, the "Lenders" and individually, a "Lender") that are
signatories to that certain Loan and Security Agreement, dated as of November
17, 1999 (as amended, restated, supplemented, or otherwise modified from time to
time, the "Loan Agreement"), entered into among the Borrowers, Lenders, and
FOOTHILL CAPITAL CORPORATION, a California corporation, as agent for the Lenders
(herein, in such capacity, referred to as "Agent") , in light of the following:
RECITALS
A. Borrowers have requested that the Lenders amend the Loan
Agreement.
B. Lenders are willing to amend the Loan Agreement under the
terms and conditions set forth in this Amendment.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Definitions. Capitalized terms not otherwise defined herein shall have
the meaning ascribed thereto in the Loan Agreement.
2. Amendments To The Loan Agreement. Upon the First Amendment Effective
Date, the parties agree to amend the Loan Agreement as follows:
(a) The definition of "Fixed Charge Coverage Ratio" set forth in
Section 1.1 of the Loan Agreement hereby is amended by deleting the text ", plus
(E) all amounts paid or payable by Borrower on Operating Lease Obligations
having a scheduled due date during such period" appearing in said definition.
(b) Section 1.1 of the Loan Agreement hereby is amended by inserting
the following new defined terms in the proper alphanumerical order:
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"First Amendment" means that certain Amendment Number One to
Loan and Security Agreement, dated as of December 31, 1999, among
Borrowers, Lenders and Agent.
"First Amendment Effective Date" means December 31, 1999,
provided that all conditions set forth in Section 3 of the First
Amendment have been satisfied.
(c) Section 7.20 of the Loan Agreement hereby is amended by deleting
clause (a) of said Section and inserting the following new clause (a) in lieu
thereof:
(a) Fixed Charge Coverage Ratio. Borrower will not
permit its Fixed Charge Coverage Ratio on the last day of the
fiscal period set forth below, cumulative with the applicable
fiscal periods preceding such fiscal period (if any) shown on the
chart below, to be less than the ratio set forth opposite such
fiscal period (calculated without reference to any interest and
fees under this Agreement as to which Borrower has exercised its
option to make payment in kind):
PERIOD ENDING RATIO
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fiscal quarter ending .70
December 31, 1999
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month ending .70
January 31, 2000 for the immediately
preceding 4 month period
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month ending .70
February 29, 2000 for the immediately
preceding 5 month period
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month ending .75
March 31, 2000 for the immediately
preceding 6 month period
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month ending .75
April 30, 2000 for the immediately
preceding 7 month period
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month ending .80
May 31, 2000 for the immediately preceding
8 month period
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PERIOD ENDING RATIO
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month ending .85
June 30, 2000 for the immediately preceding
9 month period
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month ending .90
July 31, 2000 for the immediately preceding
10 month period
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month ending .95
August 31, 2000 for the immediately
preceding 11 month period
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month ending 1.0
September 30, 2000 for the immediately
preceding 12 month period and as of the end
of each month thereafter for the
immediately preceding 12 months
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3. Conditions Precedent to Amendment. The satisfaction of each of the
following unless waived or deferred by Lenders, in their sole discretion, shall
constitute conditions precedent to the effectiveness of this Amendment and each
and every provisions hereof:
(a) Agent shall have received this Amendment, in form and substance
satisfactory to Agent, duly executed by each party hereto, and in full force and
effect;
(b) The representations and warranties in this Amendment, the Loan
Agreement as amended by this Amendment, and the other Loan Documents shall be
true and correct in all respects on and as of the date hereof, as though made on
such date (except to the extent that such representations and warranties relate
solely to an earlier date);
(c) No Default or Event of Default shall have occurred and be
continuing on the date hereof, nor shall result from the consummation of the
transactions contemplated herein, unless any such Event of Default has
previously been waived by in accordance with Section 15 of the Loan Agreement;
and
(d) No injunction, writ, restraining order, or other order of any
nature prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein shall have been issued and remain in force by any
Governmental Authority against either of the Borrowers, Agent or any of the
Lenders.
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4. Representations and Warranties. Each Borrower hereby represents and
warrants to the Lenders that (a) the execution, delivery, and performance of
this Amendment and of the Loan Agreement, as amended by this Amendment, are
within such Borrower's corporate powers, have been duly authorized by all
necessary corporate action, and are not in contravention of any law, rule, or
regulation, or any order, judgment, decree, writ, injunction, or award of any
arbitrator, court, or Governmental Authority, or of the terms of its Governing
Documents, or of any contract or undertaking to which it is a party or by which
any of its properties may be bound or affected, (b) this Amendment and the Loan
Agreement, as amended by this Amendment, constitute such Borrower's legal,
valid, and binding obligation, enforceable against such Borrower in accordance
with its terms, and (c) this Amendment has been duly executed and delivered by
such Borrower.
5. Choice of Law. The validity of this Amendment, its construction,
interpretation and enforcement, the rights of the parties hereunder, shall be
determined under, governed by, and construed in accordance with the laws of the
State of New York.
6. Counterparts; Telefacsimile Execution. This Amendment may be executed
in any number of counterparts and by different parties and separate
counterparts, each of which when so executed and delivered, shall be deemed an
original, and all of which, when taken together, shall constitute one and the
same instrument. Delivery of an executed counterpart of a signature page to this
Amendment by telefacsimile shall be effective as delivery of a manually executed
counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by telefacsimile also shall deliver a manually executed
counterpart of this Amendment but the failure to deliver a manually executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Amendment.
7. Effect on Loan Agreement. The Loan Agreement, as amended hereby, shall
be and remain in full force and effect in accordance with its respective terms
and hereby is ratified and confirmed in all respects. The execution, delivery,
and performance of this Amendment shall not operate as a waiver of or, except as
expressly set forth herein, as an amendment of, any right, power, or remedy of
Agent or any Lender under the Loan Agreement, as in effect prior to the date
hereof.
8. Further Assurances. Each Borrower shall execute and deliver all
agreements, documents, and instruments, in form and substance satisfactory to
Agent, and take all actions as Agent may reasonably request from time to time,
to perfect and maintain the perfection and priority of Liens in the Collateral
held by Agent for the benefit of the Lenders and to fully consummate the
transactions contemplated under this Amendment and the Loan Agreement, as
amended by this Amendment.
9. Miscellaneous.
(a) Upon and after the effectiveness of this Amendment, each
reference in the Loan Agreement to "this Agreement", "hereunder", "herein",
"hereof" or words of like
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import referring to the Loan Agreement, and each reference in the other Loan
Documents to "the Loan Agreement", "thereunder", "therein", "thereof" or words
of like import referring to the Loan Agreement, shall mean and be a reference to
the Loan Agreement as modified and amended hereby.
(b) The Loan Agreement and all other Loan Documents, are and shall
continue to be in full force and effect and are hereby in all respects ratified
and confirmed and shall constitute the legal, valid, binding and enforceable
obligations of each Borrower to Agent and Lenders.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties have entered into this Amendment as of the
date first above written.
PHONETEL TECHNOLOGIES, INC.,
an Ohio corporation
By /s/ John D. Chichester
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Name: John D. Chichester
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Title: President and CEO
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CHEROKEE COMMUNICATIONS, INC.,
a Texas corporation
By /s/ John D. Chichester
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Name: John D. Chichester
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Title: President
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[signature page continues]
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FOOTHILL CAPITAL CORPORATION, a California
corporation, as Agent and a Lender
By /s/ Thomas S. Sigurdson
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Name: /s/ Thomas S. Sigurdson
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Title: Vice President
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[signature page continues]
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FOOTHILL PARTNERS III, L.P.,
a Delaware limited partnership, as a Lender
By /s/ Dennis R. Ascher
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Name: Dennis R. Ascher
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Title: Managing General Partner
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[signature page continues]
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ABLECO FINANCE LLC,
a Delaware limited liability company,
as a Lender
By /s/ Kevin Genda
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Name: Kevin Genda
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Title: SVP -- Chief Credit Officer
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