**Exhibit 10.25**

 

WAIVER AND THIRDAMENDMENT TOLOAN AND SECURITY AGREEMENT

 

THIS WAIVER AND THIRD AMENDMENT TO LOAN AND SECURITYAGREEMENT (this “Waiver and Amendment”), dated as of November 18, 2005, isentered into by and among Channell Commercial Corporation, a Delawarecorporation (“Domestic Borrower”), Channell Commercial Canada Inc., an Ontariocorporation (“Canadian Borrower”), Channell Limited, a limited liabilitycompany incorporated under the laws of England and Wales (“CLU”), ChannellCommercial Europe Limited, a limited liability company incorporated under thelaws of England and Wales (“CCEL” and, together with CLU, “UK Borrowers”, and,together with Domestic Borrower, Canadian Borrower and CLU, “Borrowers”), Bankof America, N.A., as assignee of Banc of America Leasing Capital, LLC,successor-in-interest to Fleet Capital Corporation, as Administrative Agentunder the Loan Agreement referred to below (in such capacity, the “AdministrativeAgent”), BABC Global Finance Inc., fka Fleet Capital Global Finance, Inc.,as assignee of Fleet Capital Canada Corporation, as Canadian Agent under theLoan Agreement referred to below (in such capacity, the “Canadian Agent”), Bankof America, N.A., as successor-in-interest to Fleet National Bank, London U.K.Branch, as UK Agent under the Loan Agreement referred to below (in suchcapacity, the “UK Agent”), and the Lenders party to the Loan Agreement referredto below, with reference to the following facts:

 

RECITALS

 

Borrowers are parties tothe Loan and Security Agreement, dated as of September 25, 2002, asamended (collectively, the “Loan Agreement”), with the Administrative Agent,the Canadian Agent, the UK Agent and the Lenders party thereto, pursuant towhich the Lenders have provided Borrowers with certain credit facilities.

 

Borrowers currently arein default under Section 10.1.3 of the Loan Agreement due to theirbreach of Section 8.3 of the Loan Agreement by failing to maintaina Fixed Charge Coverage Ratio of at least 1.15 to 1.00 as of September 30,2005 (Borrower’s actual Fixed Charge Coverage Ratio as of September 30,2005 was 0.36 to 1.00) – such Event of Default hereinafter is referred to asthe “Existing Event of Default”.

 

The Borrowers haverequested that the Lenders waive the Existing Event of Default and modify theminimum Fixed Charge Covenant to facilitate the Borrower’s future compliancewith the Loan Agreement.

 

The Lenders are willingto grant such accommodations to Borrowers as set for below.

 

NOW, THEREFORE, the parties hereby agree as follows:

 

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1.             Defined Terms. Any and all initially-capitalized terms used in this Waiver and Amendment(including, without limitation, in the recitals hereto) without definitionshall have the respective meanings specified in the Loan Agreement.

 

2.             Waiver of Existing Event of Default.  TheLenders hereby waive the Existing Event of Default.  Such waiver by the Lenders shall constitute awaiver of only the Existing Event of Default and not a waiver of any futurebreach of Section 8.3 or any other provision of the Loan Agreementor any other Loan Document.

 

3.             Amendment to Minimum AggregateAvailability Covenant.  Section 8.2.18 ishereby amended to read in full as follows:

 

“8.2.18   Aggregate Availability.  Permit Aggregate Availability to be less than$2,500,000 at any time.”

 

4.             Amendment to Minimum Fixed ChargeCoverage Ratio Covenant.  Exhibit 8.3 to theLoan Agreement is hereby amended to read in full as follows:

 

“EXHIBIT 8.3FINANCIAL COVENANTS

 

Minimum Fixed ChargeCoverage Ratio.  Borrowers shall not permit, as of the lastday of any fiscal quarter of Domestic Borrower (beginning with the fiscalquarter ending December 31, 2005), the Fixed Charge Coverage Ratio to beless than 0.20 to 1.00.”

 

5.             Waiver and Amendment Fee. In consideration of the Agreement of the Agents and the Lenders to enterinto this Waiver and Amendment, Domestic Borrower hereby agrees to pay to theAdministrative Agent on the Effective Date of this Waiver and Amendment, forthe sole account of the Domestic Lender**,** a one-timefee in the amount of $10,000 (the “Waiver and Amendment Fee”), which fee shallbe deemed fully-earned and non-refundable once paid.  Domestic Borrower hereby acknowledges andagrees that the Administrative Agent may effect payment of the Waiver and AmendmentFee by charging the full amount thereof to the Domestic Loan Account.

 

6.             Conditions Precedent. The effectiveness of this Waiver and Amendment shall be subject to theprior satisfaction of the following conditions:

 

(a)           The Administrative Agent and Banc of AmericaLeasing Capital, LLC, as successor-in-interest to Fleet Capital Corporation,shall have entered into an assignment agreement in form and substancesatisfactory to the Administrative Agent;

 

(b)           The Administrative Agent shall havereceived, in form and substance satisfactory to the Administrative Agent, thisWaiver and Amendment, duly executed by the Borrowers, the Canadian Agent, theUK Agent and Majority Lenders;

 

(c)           Egerton shall have executed the consentto this Waiver and Amendment attached hereto;

 

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(d)           The Borrowers and all other Loan Partiesshall be in compliance with all the terms and provisions of the Loan Documentsapplicable to such Person or its Property and no Default or Event of Default (otherthan the Existing Event of Default waived hereby) shall have occurred and becontinuing; and

 

(e)           All of the Borrowers’ representations andwarranties contained herein shall be true and correct on and as of the date ofexecution hereof.

 

7.             Representations and Warranties.

 

(a)           Reaffirmation of Prior Representationsand Warranties.  Each Borrower hereby reaffirms and restatesas of the date hereof all of the representations and warranties made by suchBorrower in the Loan Agreement and the other Loan Documents, which shall betrue and correct in all material respects, except to the extent suchrepresentations and warranties specifically relate to an earlier date.

 

(b)           No Default.  Other thanthe Existing Event of Default waived hereby, no Default or Event of Default hasoccurred and remains continuing under any of the Loan Documents.

 

8.             Miscellaneous.

 

(a)           Reference to Loan Agreement. The Loan Agreement, each of the other Loan Documents, and any and allother agreements, documents or instruments now or hereafter executed anddelivered pursuant to the terms hereof, or pursuant to the terms of the LoanAgreement as amended hereby, are hereby amended so that any reference thereinto the Loan Agreement shall mean a reference to the Loan Agreement as amendedby this Waiver and Amendment.

 

(b)           Loan Agreement Remains in Effect. The Loan Agreement and the other Loan Documents remain in full force andeffect and the Borrowers ratify and confirm their agreements and covenantscontained therein.

 

(c)           APPLICABLE LAW. THIS WAIVER AND AMENDMENT SHALL BE DEEMED TO HAVE BEEN MADE AND TO BEPERFORMABLE IN THE STATE OF CALIFORNIA AND SHALL BE GOVERNED BY AND CONSTRUEDIN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

 

(d)           Counterparts. This Waiver and Amendment may be executed in multiple counterparts, eachof which when so executed shall be deemed to be an original, but all of whichwhen taken together shall constitute one and the same instrument.

 

*[Rest of page intentionally left blank;signature pages follow]*

 

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IN WITNESSWHEREOF, the parties have entered into this Waiver and Amendment by theirrespective duly authorized officers as of the date first above written.

 
|   | **Channell  Commercial Corporation**,    |
|--------|------------------------------------------|
|   | a Delaware corporation                   |
|   |                                     |
|   | By:                                      | /s/ William H. Channell, Jr. |   |
|   | Name:                                    | William H. Channell, Jr. |
|   | Title:                                   | President and Chief Executive Officer |
|   |                                     |
|   | ** **                               |
|   | **Channell  Commercial Canada Inc.**,    |
|   | an Ontario corporation                   |
|   |                                     |
|   | By:                                      | /s/ William H. Channell, Jr. |   |
|   | Name:                                    | William H. Channell, Jr. |
|   | Title:                                   | President and Chief Executive Officer |
|   |                                     |
|   | ** **                               |
|   | **Channell  Limited**,                   |
|   | a limited liability company incorporated |
|   | under the laws of England and Wales      |
|   |                                     |
|   | By:                                      | /s/ William H. Channell, Jr. |   |
|   | Name:                                    | William H. Channell, Jr. |
|   | Title:                                   | President and Chief Executive Officer |
|   |                                     |
|   | ** **                               |
|   | **Channell  Commercial Europe Limited**, |
|   | a limited liability company incorporated |
|   | under the laws of England and Wales      |
|   |                                     |
|   | By:                                      | /s/ William H. Channell, Jr. |   |
|   | Name:                                    | William H. Channell, Jr. |
|   | Title:                                   | President and Chief Executive Officer |

 

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|   | **Bank of  America, N.A.**,                                                                       |
|--------|---------------------------------------------------------------------------------------------------|
|   | (as assignee of Banc of America                                                                   |
|   | Leasing & Capital, LLC, successor-                                                       |
|   | in-interest to Fleet Capital Corporation),                                                        |
|   | as Administrative Agent and as sole                                                               |
|   | Domestic Lender                                                                                   |
|   |                                                                                              |
|   | By:                                                                                               | /s/Matthew R. Van Steenhuyse |   |
|   |                                                                                              | Matthew R. Van Steenhuyse |
|   |                                                                                              | Senior Vice President |
|   |                                                                                              |
|   | ** **                                                                                        |
|   | **BABC  GLOBAL FINANCE INC.,**                                                                    |
|   | (as assignee of Fleet Capital Global  Finance, Inc.,                                         |
|   | as assignee of Fleet Capital Canada  Corporation),                                                |
|   | as Canadian Agent and as Canadian Lender                                                          |
|   |                                                                                              |
|   | By:                                                                                               |   |   |
|   | Name:                                                                                             |   |   |
|   | Title:                                                                                            |   |   |
|   |                                                                                              |
|   | ** **                                                                                        |
|   | **Bank of  America, N.A.**                                                                        |
|   | (successor-in-interest to Fleet National  Bank, London U.K. Branch), as UK Agent and as UK Lender |
|   |                                                                                              |
|   |                                                                                              |
|   | By:                                                                                               |   |   |
|   | Name:                                                                                             |   |   |
|   | Title:                                                                                            |   |   |
|        |                                                                                                   |  |  |  |  |  |  |

 

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Consent of Egerton

 

Reference is made to that certain Loan and SecurityAgreement, dated as of September 25, 2002, among Channell CommercialCorporation, a Delaware corporation, Channell Commercial Canada Inc., an Ontariocorporation, Channell Limited, a limited liability company incorporated underthe laws of England and Wales, Channell Commercial Europe Limited, a limitedliability company incorporated under the laws of England and Wales, Bank ofAmerica, N.A., as assignee of Banc of America Leasing & Capital, LLC,successor-in-interest to Fleet Capital Corporation, as Administrative Agent,****BABC Global Finance Inc., fka Fleet Capital Global Finance, Inc.,as assignee of Fleet Capital Canada Corporation, a Canadian corporation, asCanadian Agent, Bank of America, N.A., successor-in-interest to Fleet NationalBank, London U.K. Branch, which traded as FleetBoston Financial, as UK Agent,and the Lenders party thereto.

 

The undersigned hereby consents to the execution, deliveryand performance of the foregoing Waiver and Third Amendment to Loan andSecurity Agreement.

 

 

Dated:  November 18,2005

 

 

A.C. Egerton (Holdings) Limited,a company incorporated under the laws of England and Wales

 

 
| By:    | /s/ William H. Channell, Jr.     |   |
|--------|---------------------------------------|--------|
| Name:  | William H. Channell, Jr.         |
| Title: | President and Chief Executive Officer |

 

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