exv10we






EXHIBIT 10(E)




	 	 	 	 	 

	Customer No.
	 	 	 	 
	 

	 	 

	 	 
	Loan No.
	 	 	 	 
	 

	 	 

	 	 
	Loan No.
	 	 	 	 
	 

	 	 

	 	 
	Loan No.
	 	 	 	 
	 

	 	 

	 	 






RBC BANK (USA)




SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT




     This Second Amendment to Loan and Security Agreement (this “Amendment”) is made and entered
into as of February 26, 2010 by and between VIDEO DISPLAY CORPORATION, a Georgia corporation
(“Parent”), LEXEL IMAGING SYSTEMS, INC. (“Lexel”), FOX INTERNATIONAL, LTD., INC. (“Fox”), Z-AXIS,
INC. (“Z-Axis”), TELTRON TECHNOLOGIES, INC. (“Teltron”) and AYDIN DISPLAYS, INC. (“Aydin” and
together with Lexel, Fox, Z-Axis and Teltron, collectively, the “Subsidiaries”; and the
Subsidiaries, together with Parent, collectively, the “Borrower”), and RBC BANK (USA) (formerly
known as RBC Centura Bank) (the “Bank”);



W I T N E S S E T H:




     WHEREAS, the Borrower and the Bank have made and entered into that certain Loan and Security
Agreement, dated as of September 26, 2008, as amended by that certain Amendment to Loan and
Security Agreement and Waiver, dated as of August 14, 2009, between Bank and Borrower (the
“Original Loan Agreement” and as amended hereby, the “Loan Agreement”; capitalized terms used
herein and not otherwise defined shall have the meanings ascribed thereto in the Loan Agreement);



     WHEREAS, pursuant to the original Loan Agreement, the Bank has extended to the Borrower (a) a
primary revolving loan facility in the original principal amount of up to $17,000,000, which
primary revolving loan is evidenced by a promissory note, dated as of August 14, 2009, from
Borrower to the order of the Bank in the principal amount of $17,000,000, (b) a secondary revolving
loan facility in the original principal amount of up to $3,500,000, which secondary revolving loan
is evidenced by a promissory note, dated as of August 14, 2009, from Borrower to the order of the
Bank in the principal amount of $3,500,000, and (c) a term loan in the original principal amount of
up to $1,700,000, which term loan is evidenced by a promissory note, dated as of August 14, 2009,
from Borrower to the order of the Bank in the principal amount of $1,403,170.42 ;



     WHEREAS, Borrowers desires to extend the term of the secondary revolving loan to June 30,
2010, and the Borrower desires to amend certain provisions of the Loan Agreement in connection
therewith, and the Bank is willing to agree to the same on the terms and conditions set forth
herein;



     NOW THEREFORE, for and in consideration of the foregoing and for ten dollars ($10.00) and
other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
the parties hereto agree as follows:



 









 





ARTICLE 1.

Amendments to Loan Agreement




     Section 1.1 Definition Amendments. The following definitions in Section 1.1 of the Loan
Agreement are hereby amended in their entirety to read as follows:




“Revolving Loan Termination Date” or “Termination Date” means (i) with respect to
the Primary Revolving Loan only, June 30, 2010 and (ii) with respect to the
Secondary Revolving Loan only, June 30, 2010, in each case as such date may be
renewed from time to time as provided herein.



     Section 1.2 Covenant Amendment. Section 2.2(b) of the Loan Agreement is hereby amended in its
entirety to read as follows:




(b) The Secondary Revolving Loan shall be evidenced by a renewal promissory note in
the face amount of the Maximum Secondary Revolving Loan Amount, dated as of February
26, 2010, from Borrower to the order of Bank (as amended, modified, supplemented,
restated or renewed from time to time, the “Secondary Revolving Note”).



     Section 1.3 Covenant Amendment. Section 7.3 of the Loan Agreement is hereby amended in its
entirety to read as follows:




7.3. Asset Coverage Ratio. Borrower shall have an Asset Coverage Ratio of
not greater than 1.0 to 1.0 at each fiscal quarter end on and after May 31, 2010,
calculated on a consolidated basis for Borrower and all Subsidiaries.



     Section 1.4 Attachments. Exhibit 5.6 to the Loan Agreement is hereby amended in its entirety
to read in the form attached hereto as Exhibit 5.6.



ARTICLE 2.

Conditions to Effectiveness 




     Section 2.1 Conditions. The amendments to the Loan Agreement set forth in this Amendment
shall become effective as of February 26, 2010 (the “Effective Date”) after all of the conditions
set forth in this Article 2 shall have been satisfied.



     Section 2.2 Execution of Amendment. This Amendment shall have been executed and delivered by
the Borrower.



     Section 2.3 Execution of Note. The renewal Secondary Revolving Note shall have been executed
and delivered by the Borrower.



2









 





     Section 2.4 Confirmation of Guaranty. Ronald D. Ordway shall have executed and delivered his
Unconditional Limited Guaranty Agreement, in form and substance satisfactory to Bank.



     Section 2.5 Representations and Warranties. As of the Effective Date, the representations and
warranties set forth in the Loan Agreement, and the representations and warranties set forth in
each of the Loan Documents, shall be true and correct in all material respects; (b) as of the
Effective Date, no Defaults or Events of Default shall have occurred and be continuing; (c) the
Bank shall have received from the Borrower a certificate dated the Effective Date, certifying the
matters set forth in subsections (a) and (b) of this Section.



     Section 2.6 Loan Fee. Borrower shall have paid a modification and extension fee of $10,000,
which fee has been fully earned by the Bank and is non-refundable in its entirety.



ARTICLE 3.

Miscellaneous




     Section 3.1 Entire Agreement; No Novation or Release. This Amendment, together with the Loan
Documents, as in effect on the Effective Date, reflects the entire understanding with respect to
the subject matter contained herein, and supersedes any prior agreements, whether written or oral.
This Amendment is not intended to be, and shall not be deemed or construed to be, a satisfaction,
novation or release of the Loan Agreement or any other Loan Document. Except as expressly amended
hereby, all representations, warranties, terms, covenants and conditions of the Loan Agreement and
the other Loan Documents shall remain unamended and unwaived and shall continue in full force and
effect.



     Section 3.2 Fees and Expenses. All fees and expenses of the Bank incurred in connection with
the issuance, preparation and closing of the transactions contemplated hereby shall be payable by
the Borrower promptly upon the submission of the bill therefor. If the Borrower shall fail to
promptly pay such bill, the Bank is authorized to pay such bill through an advance of funds under
the Revolver Facility or by debiting its accounts with the Bank.



     Section 3.3 Choice of Law; Successors and Assigns. This Amendment shall be construed and
enforced in accordance with and governed by the internal laws (as opposed to the conflicts of laws
provisions) of the State of Georgia. This Amendment shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.



3









 




WITNESS the hand and seal of each of the undersigned as of the date first written above.




	 	 	 	 	 	 	 

	 	 	BANK:	 	 
	 
	 	 	 	 	 	 
	 	 	RBC BANK (USA)	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	VIDEO DISPLAY CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 
	 
	 	 	 	 	 	 
	 	 	LEXEL IMAGING SYSTEMS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 
	 
	 	 	 	 	 	 
	 	 	FOX INTERNATIONAL, LTD., INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 
	 
	 	 	 	 	 	 
	 	 	Z-AXIS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 






4









 






	 	 	 	 	 	 	 

	 	 	TELTRON TECHNOLOGIES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 
	 
	 	 	 	 	 	 
	 	 	AYDIN DISPLAYS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 
	 	 

	 	 
	 	 	[SEAL]
	 	 






5









 





Exhibit 5.6

COMPLIANCE CERTIFICATE




	 	 	 

	TO:

	 	RBC BANK (USA) (the “Bank”)
	 
	 	 
	FROM:

	 	VIDEO DISPLAY CORPORATION





The undersigned authorized officer of VIDEO DISPLAY CORPORATION (“Parent”) hereby certifies that in
accordance with the terms and conditions of the Loan and Security Agreement between Parent, certain
of its Subsidiaries and Bank, dated September 26, 2008, as amended (the “Agreement”), (i) Borrowers
are in complete compliance for the period ending                      with all covenants set forth in
the Agreement, except as noted below and (ii) all representations and warranties of Borrowers
stated in the Agreement are true, correct and accurate as of the date hereof. Attached herewith
are the required documents supporting the above certification. The undersigned authorized officer
further certifies that this Compliance Certificate and any supporting financial documents have been
prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are consistently
applied from one period to the next except as explained in an accompanying letter or footnotes – or
unless otherwise permitted in the Agreement. Reference is made to the Agreement for the relevant
meanings of the reporting requirements and covenants which are stated below in a “short-hand”
manner.




Please indicate compliance status by circling Yes/No under “Complies” column.




	 	 	 	 	 	 	 
	Reporting Covenant	 	Required	 	Complies
	Quarterly financial statements

	 	Quarterly within 45 days
	 	Yes
	 	No
	Annual financial statements (Audited)

	 	FYE within 150 days
	 	Yes
	 	No
	 

	 	 	 	Yes
	 	No
	Budget/Forecast

	 	30 days after FYE
	 	Yes
	 	No
	Guarantor personal financial statements

	 	FYE within 150 days
	 	Yes
	 	No






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Financial Covenant	 	Required	 	Actual	 	Complies
	Adjusted Total Liabilities to Adjusted
Tangible Net Worth
	 	 	2.00	 	 	 	1.00	 	 	 	 	 	 	 	1.00	 	 	Yes	 	No
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Fixed Charge Coverage Ratio
	 	 	1.35	 	 	 	1.00	 	 	 	 	 	 	 	1.00	 	 	Yes	 	No
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Asset Coverage Ratio*
	 	 	1.00	 	 	 	1.00	 	 	 	 	 	 	 	1.00	 	 	Yes	 	No
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 







 




			
	*	 	applies at each FQE on and after May 31, 2010





(Continued on Next Page)




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Compliance Certificate




(Continued from Previous Page)



	 	 	 	 	 	 	 	 	 	 	 

	Comments Regarding Exceptions:
See Attached.	 	   BANK USE ONLY	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	   Received by:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Authorized Signer	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	   Date:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Authorized Signatory of Borrower
	 	 	 	 	 	 	 	 	 	 
	 	 	   Verified:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Authorized Signer	 	 	 	 
	 

Title

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	   Date:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Date
	 	 	 	 	 	 	 	 	 	 
	 	 	   Compliance Status
 	 	Yes	 	No   







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