Exhibit 10.7

 

SIXTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

 

THIS SIXTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment") dated as
of FEBRUARY 8, 2013 (the "Effective Date"), is by and among THERMO CREDIT, LLC,
a Colorado limited liability company (together with its successors and assigns,
"Lender"), and TELETOUCH COMMUNICATIONS, INC., a Delaware corporation ("TCI"),
and PROGRESSIVE CONCEPTS, INC., a Texas corporation ("PCI", collectively with
TCI, and any other Person identified or named from time to time as a "Debtor"
under the Loan Documents, jointly and severally "Debtors"), with respect to the
Loan and Security Agreement entered into as of APRIL 30, 2008 by the Lender and
the Debtors (as the same has been amended and/or supplemented from time to
time), and as the same may be further amended, supplemented, restated, or
otherwise modified from time to time (the "Agreement").

 

RECITALS

 

WHEREAS, Debtors and Lender entered into the Agreement, as heretofore amended;
and

 

WHEREAS, Lender has made Loans to Debtors pursuant to the terms of the Agreement
in the aggregate principal amount immediately prior to the effectiveness of this
Amendment of $7,022,303.76, which amount shall be paid down contemporaneously
herewith to $3,147,899.68, outstanding as of the Effective Date; and

 

WHEREAS, in connection with such payment, Debtors have executed and delivered to
Lender that certain AMENDED AND RESTATED SUBORDINATED PROMISSORY NOTE dated as
of the Effective Date (the "Note" and from and after the Effective Date all
references to the Note contained in the Loan Documents shall mean such Note);
and

 

WHEREAS, Debtors have requested that Lender grant certain waivers under the
Agreement and otherwise amend the Agreement, and Lender is willing to grant the
waivers requested by Debtors and so amend the Agreement on the terms and
conditions hereinafter set forth; and

 

WHEREAS, contemporaneously herewith, Debtors and Lender have entered into that
certain SUBORDINATION AND INTERCREDITOR AGREEMENT (the "Subordination
Agreement") for the benefit of DCP TELETOUCH LENDER, LLC ("DCP"), in its
capacity as agent for the lenders described therein; and

 

WHEREAS, contemporaneously herewith, Debtors and DCP entered into that certain
LOAN AND SECURITY AGREEMENT (as amended and in effect from time to time,
including any replacement agreement or agreements therefor, the "Senior Loan
Agreement"), wherein DCP agreed, upon the terms and subject to the conditions
contained therein, to make certain loans (the "Senior Loans") in favor of
Debtors, which loans are secured by collateral (as defined in the Senior Loan
Agreement); and

 

WHEREAS, the parties desire to amend the Agreement pursuant to the terms and
conditions set forth herein;

 

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NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

 

1.           Defined Terms. Any capitalized term used but not defined in this
Amendment shall have the meaning ascribed to such term in the Agreement. If
there should be a conflict between the provisions of the Agreement and this
Amendment, this Amendment shall control. The recitals to this Amendment are
hereby incorporated into the terms of this Amendment, and the parties hereto
agree that the statements in such recitals are true and correct.

 

2.           Waivers. Lender hereby waives any and all defaults and Events of
Default existing under the Agreement as of the Effective Date, and all
conditions or circumstances which would constitute defaults or Events of Default
under the Agreement but for the passage of time, the giving of notice, or both
(collectively, the "Existing Defaults").

 

3.           Teletouch Licenses, Inc. The parties agree and acknowledge that
effective on October 26, 2012, TLI was dissolved and merged into TCI, and
notwithstanding any provision of the Agreement to the contrary, is released from
and is no longer a party to or a "Debtor" or "Obligor" under the Agreement.

 

4.           Consents. Notwithstanding any provision of the Agreement to the
contrary, Lender hereby consents to Debtors' execution and delivery of the
Subordination Agreement and the Senior Loan Agreement and any ancillary
documents related thereto and described therein.

 

5.            Loans. After giving effect to this Amendment, (a) the aggregate
principal amount of the Loans outstanding shall be $$3,147,899.68, (b) Lender
shall have no further obligation to make any advance to Debtors under the Loan
Documents (c) there are no defenses, counterclaims, offsets, cross-complaints,
claims or demands with respect to the Indebtedness evidenced by the Note.

 

6.            Amendments to the Agreement.

 

(a)          The following defined terms described in Section 1 of the Agreement
shall be deleted and replaced with the following:

 

“Collateral” shall have the meaning set forth in the Senior Loan Agreement;
provided, however, that notwithstanding the foregoing, as used in the Agreement,
the term “Collateral“ shall not include, and Lender shall not at any time have
any security interest in or any other lien on, any Excluded Assets.

 

"Note" means, collectively, any promissory note evidencing all or part of the
Indebtedness from time to time (as any such Note may be amended, modified or
restated from time to time), including but not limited to that certain AMENDED
AND RESTATED SUBORDINATED PROMISSORY NOTE dated as of FEBRUARY 8, 2013, executed
by Debtor in favor of Lender, in the original principal amount of $3,147,899.68.

 

"Revolving Credit Maturity Date" shall mean JULY 1, 2016.

 

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(b)          The following shall be added to the end of the penultimate sentence
of the definition of "Permitted Encumbrances":

 

"; and (xxii) liens incurred in connection with the "Senior Loan Agreement".

 

(c)          The following defined term shall be added to Section 1:

 

"Senior Loan Agreement" shall mean that certain Loan and Security Agreement
between Debtors, as borrowers, and DCP Teletouch Lender, LLC, in its capacity as
agent for the lenders described therein, dated FEBRUARY 8, 2013, together with
all loan documents entered into in connection therewith.

 

(d)          Subsection 2(h) shall be deleted in its entirety and replaced with
the following:

 

"Reserved For Future Use."

 

(e)          Subsection 6(h) shall be amended by the deletion of the period at
the end of Subsection 6(h)(xvi) and the insertion of the following:

 

; and

 

(xvii) other Debt incurred in connection pursuant to the Senior Loan Agreement.

 

(f)          Subsection 6(q) shall be deleted in its entirety and replaced with
the following:

 

"Solvency. After giving effect to the transactions contemplated hereby, it is
Debtor's good faith belief after reasonable exercise of its business judgment
and subject to the assumptions set forth below, that as of the Closing Date it
will be able to pay its debts generally as they become due. For purposes of
Subsection 6(q) only, each Debtor has assumed, with Lender's permission, that
notwithstanding any defaults by a Debtor with respect thereto, the debts
evidenced by the promissory notes secured by the Debtor Mortgage will either (i)
not be declared due or accelerated or (ii) to the extent currently due, matured
and/or accelerated, will not be enforced or declared to be in default, and will
be timely renegotiated to achieve a payment plan with the existing or new
creditors."

 

(g)          Subsection 12(a) shall be deleted in its entirety and replaced with
the following:

 

(a)          Payment Default. The failure, refusal or neglect of Debtor to pay
when due any part of the principal of, or interest on, the Indebtedness owing to
Lender by Debtor from time to time; provided, however, that all such payment
obligations shall be subject to that certain SUBORDINATION AND INTERCREDITOR
AGREEMENT (the "Subordination Agreement") for the benefit of DCP TELETOUCH
LENDER, LLC ("DCP"), in its capacity as agent for the lenders described therein
and Lender.

 

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(h)          The following Sections of the Agreement are deleted in their
respective entirety: (i) Subsections 7 (l), (m), and (n); (ii) Section 9; and
(iii) Subsections 10(c) and 10(d).

 

7.            Events of Default. Notwithstanding any provision of the Agreement
to the contrary, so long as any portion of the Senior Loans remain outstanding,
Section 12 of the Agreement (other than Section 12(a) and Section 12(e), and
Section 12(j)) shall be of no force and effect, and Lender's rights and remedies
against Debtors under the Agreement shall be limited to those arising out of a
Subordinate Payment Default (as defined in the Subordination Agreement) as
described and limited in the Subordination Agreement. The occurrence and
continuance of an Event of Default (as term is used in the Senior Loan
Agreement) under the Senior Loan Agreement (a "Senior Event of Default"), shall
also constitute an Event of Default under this Agreement, but Lender's rights
with respect thereto shall remain limited by the Subordination Agreement.

 

8.            Reporting. Notwithstanding any provision of the Agreement to the
contrary, so long as any portion of the Senior Loans remain outstanding, Debtors
shall promptly provide Lender with copies of all reports and notices that
Debtors provide to DCP pursuant to Section 7 of the Senior Loan Agreement in
lieu of the reporting requirements (and any corresponding covenant/negative
covenant compliance under the Agreement, including, without limitation, the
financial covenants) set forth in the Agreement. Debtors shall promptly provide
Lender with notice of a Senior Event of Default.

 

9.            Miscellaneous.

 

(a)          Headings Descriptive. The headings of the several sections and
subsections of this Amendment are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision.

 

(b)          Severability. In case any provision in or obligation under this
Amendment shall be invalid, illegal, or unenforceable in any jurisdiction, the
validity, legality, and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.

 

(c)          Counterparts; Execution. This Amendment may be executed and
delivered in any number of counterparts and by the different parties hereto on
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument. The exchange of copies of this Amendment and of signature pages by
facsimile or electronic mail transmission shall constitute effective execution
and delivery of this Amendment as to the parties and may be used in lieu of the
original Amendment for all purposes. Signatures of the parties transmitted by
facsimile or electronic mail shall be deemed to be their original signatures for
all purposes.

 

(d)          Conditions Precedent. The obligations of Lender under this
Amendment shall be subject to the conditions precedent that Debtors shall have
(i) executed and delivered to Lender this Amendment and such other documents and
instruments incidental and appropriate to the transaction provided for herein as
Lender or its counsel may reasonably request; and (ii) Debtor shall have reduced
the outstanding principal balance of the Indebtedness to a sum not to exceed
$3,147,899.68.

 

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(e)          Representations, Warranties and Confirmations. Each Obligor hereby
represents and warrants to Lender that (i) this Amendment and the other Loan
Documents have been duly executed and delivered by any Obligor party thereto,
are valid and binding upon such Obligor and are enforceable against such Obligor
in accordance with their terms, except as limited by any applicable bankruptcy
laws, (ii) no action of, or filing with, any governmental authority is required
to authorize, or is otherwise required in connection with, the execution,
delivery and performance by any Obligor of this Amendment or any other Loan
Document, and (iii) the execution, delivery and performance by such Obligor of
this Amendment and any other Loan Documents do not require the consent of any
other person and do not and will not constitute a violation of any laws,
agreements or understandings to which such Obligor is a party or by which such
Obligor is bound.

 

(f)          Ratifications. Except as expressly modified and superseded by this
Amendment, the Loan Documents are ratified and confirmed and continue in full
force and effect. Without limiting the generality of the foregoing, each Obligor
hereby ratifies and confirms that all liens heretofore granted to Lender were
intended to, do and continue to secure the full payment and performance of the
Indebtedness. Each Obligor agrees to perform such acts and duly authorize,
execute, acknowledge, deliver, file and record such additional assignments,
security agreements, modifications or agreements to any of the foregoing, and
such other agreements, documents and instruments as Lender may reasonably
request in order to perfect and protect those liens and preserve and protect the
rights of Lender in respect of all present and future Collateral.

 

(g)          Reference to Agreement. Each of the Loan Documents, including the
Agreement and any and all other agreements, documents, or instruments now or
hereafter executed and delivered pursuant to the terms hereof containing a
reference to the Agreement shall mean and refer to the Agreement as amended
hereby.

 

(h)          Release and Indemnification. (i)          As a material inducement
to Lender to enter into this Amendment, each Obligor hereby fully, finally, and
absolutely and forever releases and discharges Lender and its present and former
directors, shareholders, officers, employees, agents, representatives,
successors and assigns, and their separate and respective heirs, personal
representatives, successors and assigns, from any and all actions, causes of
action, claims, debts, damages, demands, liabilities, obligations, and suits, of
whatever kind or nature, in law or equity of such Obligor, whether now known or
unknown to such Obligor, and whether contingent or matured (a) in connection
with any and all obligations owed or owing to the Lender under or in respect of
the Agreement, the Loan Documents, or the actions or omissions of Lender in
respect of the Agreement and the Loan Documents; and (b) arising from events
occurring prior to the date of this Amendment.

 

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(ii)         As a material inducement to each of the Debtors to enter into this
Amendment, Lender hereby fully, finally, and absolutely and forever releases and
discharges each of the Debtors and its present and former directors,
shareholders, officers, employees, agents, representatives, successors and
assigns, and their separate and respective heirs, personal representatives,
successors and assigns, from any and all actions, causes of action, claims,
debts, damages, demands, liabilities, obligations, and suits, of whatever kind
or nature, in law or equity, whether now known or unknown to such Lender,
arising out of or in connection with the actions or omissions of either or both
Debtors in respect of the Existing Defaults or otherwise arising from events
occurring prior to the date of this Amendment.

 

10.         Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF LOUISIANA
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THAT WOULD REQUIRE THE
APPLICATION OF ANY OTHER LAW.

 

11.         No Further Obligations. Debtors hereby expressly acknowledge and
agree that:

 

(a)          Beyond that which is contained in this Amendment, Lender has not
agreed to and Lender has no obligation whatsoever to discuss, negotiate or to
agree to, restructuring any of the obligations owed or owing to Lender by
Debtors or any modification, amendment, restructuring, or reinstatement of the
Loan Documents, or to forbear from exercising its rights and remedies thereunder
or hereunder at law or in equity;

 

(b)          If there are any future discussions between Lender and Debtors
concerning any such restructuring, modification, amendment, reinstatement or
forbearance, that:

 

(i)          there exists no duty or obligation on the part of Lender to Debtors
to conduct any such discussions or negotiations according to any standard of
conduct whatsoever, including, without limitation, any so-called standards of
"good faith" or "fair dealing" or the like;

 

(ii)         no restructuring, modification, amendment, reinstatement,
forbearance, compromise, settlement, agreement or understanding with respect to
any obligations owed or owing by Debtors to Lender, or the Loan Documents, for
any term, provision, covenant or condition or any aspect of said agreements,
shall constitute a legally binding agreement or contract, or have any force or
effect whatsoever unless or until reduced to writing and signed by authorized
representatives of all parties, and that none of the parties hereto shall assert
a claim in any legal proceedings or otherwise that any such agreement exists
except in accordance with the terms of the Loan Documents; and

 

(iii)        the execution and delivery of this Amendment has not established
nor shall be deemed to have established any course of dealing between the
parties hereto or obligation or agreement of any nature whatsoever on the part
of Lender with respect to any future or further restructuring, modification,
amendment, reinstatement, compromise, settlement, or understanding by Lender
with respect to the Loan Documents, in the exercise of Lender's rights and
remedies thereunder or at law or in equity, or any future or additional fundings
or extensions of credit by Lender thereunder.

 

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NOTICE OF FINAL AGREEMENT

 

THE AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS AMENDED BY THIS AMENDMENT,
REPRESENT THE FINAL AGREEMENT BETWEEN AND AMONG THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN AND AMONG THE
PARTIES.

 

 

  

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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
as of the Effective Date.

 

LENDER:   ADDRESS:       THERMO CREDIT, LLC   639 Loyola Avenue, Suite 2565    
New Orleans, LA 70113 By: /s/ Seth Block   Name: Seth Block     Title: Executive
Vice President             DEBTOR:   ADDRESS:       TELETOUCH COMMUNICATIONS,
INC.   5718 Airport Freeway       Ft. Worth, TX 76117 By: /s/ Thomas A. Hyde,
Jr.     Name: Thomas A. Hyde, Jr.     Title: President and Chief Operating
Officer             PROGRESSIVE CONCEPTS, INC.   ADDRESS:       By: /s/ Thomas
A. Hyde, Jr.   5718 Airport Freeway Name: Thomas A. Hyde, Jr.   Ft. Worth, TX
76117 Title: President and Chief Executive Officer    

 

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