EXHIBIT 10.4
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT ("Agreement"), dated as of the 29th
day of May, 1992, is made and entered into on the terms and conditions
hereinafter set forth, by and among CCS TECHNOLOGY GROUP, INC., a Florida
corporation ("Borrower"), and SIRROM CAPITAL, L.P., a Tennessee limited
partnership ("Lender").
RECITALS:
WHEREAS, Borrower has requested that Lender make available to
Borrower a loan in the principal amount of $1,000,000 (the "Loan") on the
terms and conditions hereinafter set forth, and for the purposes hereinafter
set forth; and
WHEREAS, in order to induce Lender to make the Loan to Borrower,
Borrower has made certain representations to Lender; and
WHEREAS, Lender, in reliance upon the representations and
inducements of Borrower, has agreed to make the Loan upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the agreement of Lender to make
the Loan, the mutual covenants and agreements hereinafter set forth, and
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Borrower and Lender hereby agree as follows:
ARTICLE I
THE LOAN
1.01 EVIDENCE OF LOAN INDEBTEDNESS AND REPAYMENT. The Loan shall
be evidenced by a Secured Promissory Note in the original principal amount of
One Million and No/100 Dollars($1,000,000), substantially in the form
attached hereto as EXHIBIT A (the "Note"), of even date herewith, executed by
Borrower, in favor of Lender. The Loan shall be payable in accordance with
the terms of the Note.
1.02 COMMITMENT FEE. Borrower shall pay to Lender a commitment
fee of $15,000 on the date the Loan is funded.
ARTICLE II
SECURITY
2.01 SECURITY. The Secured Obligations (as hereinafter
defined) are and shall continue to be secured as follows:
(A) Borrower hereby assigns and pledges to Lender a first and prior
security interest in the following described property and interests in
property, together with all proceeds thereof (collectively, "the Collateral"):
(i) EQUIPMENT. All machinery and equipment, all data processing
and office equipment, all computer equipment, hardware and firmware,
all furniture, fixtures, appliances and all other goods of every type
and description, whether now owned or hereafter acquired and wherever
located, together with all parts, accessories and attachments and all
replacements thereof and additions thereto; notwithstanding the
foregoing, Lender acknowledges that Borrower has previously granted a
security interest in certain equipment to IBM Credit Corporation and
other equipment lessors which security interests may be found to be
senior to the security interest in equipment granted to Lender in this
Section 2.01(A)(i); and
(ii) INVENTORY. All inventory and goods of Borrower, whether
held for lease, sale or furnishing under contracts of service, all
agreements for lease of same and rentals
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therefrom, whether now in existence or owned or hereafter acquired
and wherever located; and
(iii) GENERAL INTANGIBLES. All rights, interests, chooses in
action, causes of action, claims and all other intangible property of
Borrower of every kind and nature, in each instance whether now owned
or hereafter required but not limited to, all corporate and business
records; all loans, royalties, and other obligations receivable; all
trade secrets, inventions, designs, patents, patent applications,
registered or unregistered service marks, trade names, trademarks,
copyrights and the goodwill associated therewith and incorporated
therein, and all registrations and applications for registration
related thereto; goodwill, licenses, permits, franchises, customer
lists and credit files; all customer and supplier contracts, firm sale
orders, rights under license and franchise agreements, and other
contracts and contract rights; all right, title and interest under
leases, subleases, licenses and concessions and other agreements
relating to real or personal property and any security agreements
relating thereto; all rights to indemnification; all proceeds of
insurance of which Borrower is beneficiary; all letters of credit,
guarantees, liens, security interests and other security held by or
granted to Borrower; and all other intangible property, whether or not
similar to the foregoing; and
(iv) ACCOUNTS CHATTEL PAPER, INSTRUMENTS AND DOCUMENTS. All of
Borrower's accounts, accounts receivable, chattel paper, instruments
and documents, whether now in existence or owned or hereafter
acquired, entered into, created or arising, and wherever located;
provided, however, that Lender will release its claim to a first and
prior security interest in a portion of Borrower's accounts
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receivable and, if required, inventory to the extent
necessary to secure additional financing of up to $1,000,000 from a
third party lender as provided in Section 4.02; and
(v) SOFTWARE AND RELATED MATERIALS. The object codes and the
source codes comprising the computer software programs listed on
SCHEDULE 2.01 as the same exist on the date hereof and all future
improvements, enhancements, revisions and versions thereof, including
all versions of such software as adapted and as marketed for use on
all types of computer hardware (collectively, the "Software"); all
rights to royalties generated from the Software pursuant to licensing,
distribution, purchase or similar agreements presently or hereinafter
in effect; and all rights, interests, choses in action, causes of
action and claims for infringement relative to such property interest
of Borrower; any and all documentation, specifications, instructions,
user manuals and other written materials and software necessary to run
the Software, to provide a complete understanding of the development
of the Software, and to enable the continued and uninterrupted
marketing of the Software; and
(vi) STOCK OF SUBSIDIARIES. All of Borrower's right, title and
interest in and to the capital stock of each of its subsidiaries
(collectively, the "Subsidiaries") listed on SCHEDULE 2.01(A)(vi) and
all payments thereunder and all dividends, instruments or other
property from time to time distributed in respect thereof; and
(vii) OTHER PROPERTY. All property or interests in property
now owned or hereafter acquired by Borrower.
(B) The guaranty of each of Borrower's Subsidiaries with such
guaranty being secured by the grant to Lender of a security interest in certain
property and assets of such Subsidiaries as set forth in a Guaranty and Security
Agreement in the form of EXHIBIT B hereto.
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This Agreement and any other instruments, documents or agreements now
or hereafter securing the Secured Obligations are herein collectively referred
to as the "Security Instruments". The Security Instruments, together with the
Note and any other instruments and documents now or hereafter evidencing,
securing or in any way related to the indebtedness evidenced by the Note are
herein individually referred to as a "Loan Document" and collectively referred
to as the "Loan Documents".
2.02 SECURED OBLIGATIONS. Without limiting any of the
provisions thereof, the Security Instruments shall secure:
(a) The full and timely payment of the indebtedness
evidenced by the Note, together with interest thereon, and any
extensions, modifications, consolidations, and/or renewals
thereof and any notes given in payment thereof,
(b) The full and prompt performance of all of the
obligations of Borrower to Lender under the Loan Documents to
which Borrower is a party,
(c) The full and prompt payment of all court costs,
expenses and costs of whatever kind incident to the collection of
the indebtedness evidenced by the Note, the enforcement or
protection of the security interests of the Security Instruments
or the exercise by Lender of any rights or remedies of Lender
with respect to the indebtedness evidenced by the Note, including
without limitation reasonable attorney's fees incurred by Lender,
all of which Borrower agrees to pay to Lender upon demand, and
(d) The full and prompt payment and performance of any and
all other indebtedness and other obligations of Borrower to
Lender, direct or contingent, however evidenced or denominated,
and however and whenever incurred,
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including but not limited to indebtedness incurred pursuant to
any present or future commitment of Lender to Borrower,
together with interest thereon, and any extensions,
modifications, consolidations and/or renewals
thereof and any notes given in payment thereof.
All of the foregoing indebtedness and other obligations are herein collectively
referred to as the "Secured Obligations".
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Borrower hereby represents and warrants to Lender as follows:
3.01 CORPORATE STATUS. (a) Borrower and each of its Subsidiaries is
a corporation duly organized, validly existing and in good standing under the
laws of its state of incorporation, and has the corporate power to own and
operate its properties, to carry on its business as now conducted and to
enter into and to perform its obligations under this Agreement and the other
Loan Documents to which it is a party. Borrower and each of its Subsidiaries
is duly qualified to do business and is in good standing in each state in
which a failure to be so qualified would have a material adverse effect on
such entity's financial position or its ability to conduct its business in
the manner now conducted.
3.02 AUTHORIZATION. Borrower and each of its Subsidiaries
has full legal right, power and authority to enter into and perform its
obligations under the Loan Documents, including the delivery of certificates
representing shares of capital stock of each of Borrower's Subsidiaries,
without the consent or approval of any other person, firm, governmental
agency or other legal entity. The execution and delivery of this Agreement,
the borrowing hereunder, the execution and delivery of each Loan Document to
which Borrower or any of its Subsidiaries is a party, and the performance by
Borrower and each of its Subsidiaries of their obligations hereunder and/or
thereunder are within the corporate powers of each such entity and have been
duly authorized by all
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necessary corporate action properly taken, have received all necessary
governmental approvals, if any were required, and do not and will not
contravene or conflict with any provision of law, any applicable judgment,
ordinance, regulation or order of any court or governmental agency, the
charter or bylaws of Borrower and its Subsidiaries, or any agreement binding
upon Borrower, its Subsidiaries or their respective properties. The
officer(s) executing this Agreement, the Note and all of the other Loan
Documents to which Borrower or its Subsidiaries is a party, are duly
authorized to act on behalf of such entity.
3.03 VALIDITY AND BINDING EFFECT. This Agreement and the other Loan
Documents are the legal, valid and binding obligations of the Borrower and
its Subsidiaries, enforceable in accordance with their respective terms,
subject to limitations imposed by bankruptcy, insolvency, moratorium, or
similar laws or provisions of general application.
3.04 OTHER TRANSACTIONS. Except as disclosed in Section 2.01 and on
SCHEDULE 3.04, there are no outstanding loans, liens, pledges, security
interests, agreements or other financing upon which Borrower or any of its
Subsidiaries is obligated or by which Borrower or any of its Subsidiaries is
bound that will in any way permit any third person to have or obtain priority
over Lender as to any of the collateral security granted to Lender pursuant
to this Agreement and the other Security Instruments. Consummation of the
transactions hereby contemplated and the performance of the obligations of
Borrower and its Subsidiaries under and by virtue of the Loan Documents to
which such entity is a party will not result in any breach of, or constitute
a default under, any mortgage, security deed or agreement, deed of trust,
lease, bank loan or credit agreement, corporate charter or bylaws, agreement
or certificate of limited partnership, partnership agreement, license,
franchise or any other instrument or agreement to which Borrower or any of
its Subsidiaries is a party or by which Borrower, its Subsidiaries or their
respective properties may be bound or affected or to which Borrower or such
Subsidiaries have not obtained an effective waiver.
3.05 PLACES OF BUSINESS. The records with respect to all intangible
personal property constituting the collateral security for the Secured
Obligations are maintained
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at the chief executive offices of Borrower at 000 Xxxxxxxxx Xxxxx, Xxxxxxxx,
Xxxxxxx 00000 or at the principal office of Borrower's Subsidiaries;
notwithstanding the foregoing, the location of such records may be changed
upon prior written notice to Lender of such change.
3.06 LITIGATION. Except as set forth on SCHEDULE 3.06 hereto, there
are no actions, suits or proceedings pending, or, to the knowledge of
Borrower, threatened, against or affecting Borrower or its Subsidiaries or
involving the validity or enforceability of any of the Loan Documents or the
priority of the liens thereof, at law or in equity, or before any
governmental or administrative agency, except actions, suits and proceedings
that are fully covered by insurance and that, if adversely determined, would
not impair materially the ability of Borrower or its Subsidiaries to perform
each and every one of their respective obligations under and by virtue of the
Loan Documents; and to Borrower's knowledge, neither Borrower nor any
Subsidiary is in default with respect to any order, writ, injunction, decree
or demand of any court or any governmental authority.
3.07 FINANCIAL STATEMENTS. The financial statement(s) of Borrower
and its Subsidiaries heretofore delivered to Lender are true and correct in
all material respects, have been prepared on the basis of accounting
principles consistently applied, and, except with regard to interim financial
statements which may be subject to year-end adjustments, fairly present the
financial condition of the subjects thereof as of the date(s) thereof. No
material adverse change has occurred in the financial condition of Borrower
and its Subsidiaries since the date(s) thereof, and no additional borrowings
have been made by Borrower or its Subsidiaries since the date(s) thereof
other than in the ordinary course of business.
3.08 NO DEFAULTS. Except as set forth on SCHEDULE 8.03, no default
or event of default by Borrower or its Subsidiaries exists under this
Agreement or any of the other Loan Documents, or under any other instrument
or agreement to which Borrower or its Subsidiaries is a party or by which
Borrower or any Subsidiary or its respective properties may be bound or
affected, and no event has occurred
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and is continuing that with notice or the passage of time or both would
constitute a default or event of default thereunder.
3.09 COMPLIANCE WITH LAW. Borrower and its Subsidiaries have
obtained all necessary licenses, permits and governmental approvals and
authorizations necessary or proper in order to conduct its business and
affairs as heretofore conducted and as hereafter intended to be conducted.
To Borrower's knowledge, Borrower and each Subsidiary is in compliance with
all laws, regulations, decrees and orders applicable to it (including but not
limited to laws, regulations, decrees and orders relating to environmental,
occupational and health standards and controls, antitrust, monopoly,
restraint of trade or unfair competition) to the extent that noncompliance,
in the aggregate, cannot reasonably be expected to have a material adverse
effect on its business, operations, property or financial condition and will
not materially adversely affect its ability to perform its obligations under
the Loan Documents.
3.10 NO BURDENSOME RESTRICTIONS. No instrument, document or
agreement to which Borrower or its Subsidiaries is a party or by which
Borrower, any Subsidiary or its respective properties may be bound or
affected materially adversely affects, or may reasonably be expected to so
affect, the business, operations, property or financial condition thereof.
3.11 TAXES. Borrower and each Subsidiary has filed or caused to be
filed all tax returns that to its knowledge are required to be filed (except
for returns that have been appropriately extended), and has paid all taxes
shown to be due and payable on said returns and all other taxes, impositions,
assessments, fees or other charges imposed on it by any governmental
authority, agency or instrumentality, prior to any delinquency with respect
thereto (other than taxes, impositions, assessments, fees and charges
currently being contested in good faith by appropriate proceedings, for which
appropriate amounts have been reserved). No tax liens have been filed against
Borrower, any Subsidiary or any of the respective property thereof.
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3.12 COLLATERAL. Each of Borrower and its Subsidiaries has all
necessary right, power end authority to grant to Lender a valid and
enforceable security interest in the collateral security for the Secured
Obligations. Except as provided in Section 2.01 and on SCHEDULE 3.04,
Lender's security interest in such collateral security constitutes a first
and prior lien upon and security interest in such collateral, and, except for
liens arising by operation of law, no other person or entity has any right,
title, interest, security interest, claim or lien with respect thereto.
3.13 CERTAIN TRANSACTIONS. Except as to indebtedness incurred in the
ordinary course of business and approved by the Board of Directors of
Borrower or the appropriate Subsidiary and except as otherwise disclosed in
SCHEDULE 3.13, neither Borrower nor any Subsidiary is indebted, directly or
indirectly, to any of its respective officers or directors or to their
respective spouses or children, in excess of an aggregate amount of $50,000;
none of said officers or directors or any members of their immediate families
are indebted to the Borrower or any Subsidiary in excess of an aggregate
amount of $50,000 or have any direct or indirect ownership interest in any
firm or corporation with which the Borrower or any Subsidiary is affiliated
or with which the Borrower or any Subsidiary has a business relationship, or
any firm or corporation which competes with the Borrower or any Subsidiary,
except that officers and/or directors of the Borrower or any Subsidiary may
own no more than 4.9% of the outstanding stock of publicly traded companies
which competes directly with the Borrower or any Subsidiary. No officer or
director or any member of their immediate families, is, directly or
indirectly, interested in any material contract with the Borrower or any
Subsidiary unless such contract has been fully disclosed to and approved by
the Board of Directors of the Borrower or such Subsidiary is on arm's length
terms. Neither the Borrower nor any Subsidiary is a guarantor or indemnitor
of any indebtedness, other than the Loan and indebtedness of the Borrower or
any Subsidiary, of any other person, firm or corporation.
3.14 TITLE TO PROPERTY. Except as described on SCHEDULE 3.14 or
in the financial statements, neither Borrower nor any Subsidiary own any real
property. As of the date
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hereof, the Borrower and each Subsidiary has good and marketable title to all
of its personal property, free and clear of any and all claims, liens,
encumbrances, equities and restrictions of every kind and nature whatsoever,
except as disclosed on SCHEDULE 3.14 hereto and except for such claims,
liens, encumbrances, equities and restrictions as are not in the aggregate
material to the business, operations or financial condition of the Borrower
and its Subsidiaries taken as a whole.
3.15 INTELLECTUAL PROPERTY. Except as set forth in SCHEDULE 3.15,
the Borrower and each Subsidiary are the lawful owners of the proprietary
information free and clear of any claim, right, trademark, patent or
copyright protection of any third party. As used herein, "proprietary
information" includes without limitation (a) the Software Collateral Package
(as hereinafter defined), (b) any computer software and related
documentation, inventions, technical and nontechnical data related thereto,
and (c) other documentation, inventions and data related to patterns, plans,
methods, techniques drawings, finances, customer lists, suppliers, products,
special pricing and cost information, designs, processes, procedures,
formulas, research data owned or used by Borrower or marketing studies
conducted by Borrower, all of which Borrower considers to be commercially
important and competitively sensitive and which generally has not been
disclosed to third parties other than customers in the ordinary course of
business. Except as set forth in SCHEDULE 3.15, the Borrower and each
Subsidiary has good and marketable title to all patents, trademarks, trade,
names, service marks, copyrights or other intangible property rights, and
registrations or applications for registration thereof, owned by Borrower or
its Subsidiaries or used or required by each such entity in the operation of
its business as presently being conducted. Neither Borrower nor any
Subsidiary has knowledge of any infringements or conflict with (and knows of
no infringement with or conflict with) asserted rights of others with respect
to copyrights, patents, trademarks, service marks, trade names, trade secrets
or other intangible property rights or know how which could result in any
material adverse effect upon the Borrower. To the Borrower's knowledge, no
products or processes of the Borrower or any Subsidiary infringe or conflict
with any rights of patent or
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copyright, or any discovery, invention product or process, that is the
subject of a patent or copyright application or registration known to
Borrower. The Borrower follows such procedures as the Board of Directors of
the Borrower deem necessary or appropriate to provide reasonable protection
of the Borrower's trade secrets and proprietary rights in intellectual
property of all kinds. To the knowledge of the Borrower, no person employed
by or affiliated with the Borrower has employed or proposes to employ any
trade secret or any information or documentation proprietary to any former
employer, and to the knowledge of the Borrower, no person employed by or
affiliated with the Borrower has violated any confidential relationship that
such person may have had with any third person, in connection with the
development, manufacture or sale of any product or proposed product or the
development or sale of any service or proposed service of the Borrower.
3.16 STATEMENTS NOT FALSE OR MISLEADING. No representation or
warranty given as of the date hereof by the Borrower contained in this
Agreement or any schedule attached hereto or any statement in any document,
certificate or other instrument furnished or to be furnished to the Lender
pursuant hereto, taken as a whole, contains or will (as of the time so
furnished) contain any untrue statement of a material fact, or omits or will
(as of the time so furnished) omit to state any material fact which is
necessary in order to make the statements contained therein not misleading.
3.17. SMALL BUSINESS CONCERN. The Company, together with its
"affiliates" (as that term is defined in Xxxxx 00, Xxxxxx Xxxxxx Code of
Federal Regulations Section 121.401, if any, is a "small business concern"
within the meaning of Section 121.802 of Title 13 of the United States Code
of Federal Regulations. The information set forth in the Small Business
Administration Form 480, Form 652-D and Part A of Form 1031 regarding the
Company is accurate and complete.
3.18 SURVIVAL. The representations and warranties of the Borrower
contained in this Agreement shall survive until the later of five years
following the execution and delivery of this Agreement or until this
Agreement terminates in accordance with Article VII hereof.
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ARTICLE IV
COVENANTS AND AGREEMENTS
Borrower covenants and agrees that during the term of this Agreement:
4.01 PAYMENT OF SECURED OBLIGATIONS. Borrower Shall pay the
indebtedness evidenced by the Note according to the terms thereof, and shall
timely pay or perform, as the case may be, all of the other Secured
Obligations.
4.02 SALES OF AN ENCUMBRANCES ON COLLATERAL. Borrower will not, and
will cause each of its Subsidiaries not to, sell, exchange, lease, negotiate,
pledge, assign or grant any security interest in or otherwise dispose of the
collateral security described in Section 2.01 or the Security Instruments to
anyone other than Lender, nor permit any other lien of any kind to attach
thereto without Lender's prior written consent, except:
(i) purchase money liens granted by Borrower or such
Subsidiary (including the interest of a lessor under a capital lease)
arising in the ordinary course of business;
(ii) liens arising by operation of law;
(iii) liens with respect to judgments or attachments which
are actively contested by Borrower or such Subsidiary and which do not
have a material adverse effect on the business of Borrower or such
Subsidiary; and
(iv) a lien on accounts receivable granted by Borrower or
such Subsidiary to a third party lender providing up to $l,000,000 of
additional financing to Borrower or its Subsidiaries.
Nothing contained in this Section 4.02 or elsewhere in this Agreement or any
other Loan Document shall prohibit any of the following transactions from
being undertaken by the Borrower or any subsidiary:
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(a) The acquisition from time to time of equipment for use
in the ordinary course of its business, whether said equipment is
financed through a purchase money security interest or capitalized
leases.
(b) The sale from time to time of equipment due to
obsolescence, replacement or repair and, in such event, any security
interest therein shall be released at the time of said sale, and any
new equipment shall be subject to the Lender's security interest
hereunder.
(c) The granting of licenses from time to time to third
parties of the right to use software and, in said events, the rights
granted to said third parties to use said software pursuant to the
applicable license agreement shall be prior to any rights of the
Lender hereunder. Said grants shall be in accordance with the ordinary
and normal course of business of the Borrower, consistent with past
practice, or customary in the software industry. At the request of any
customer, the Lender shall confirm in writing that any interest which
it may have in any of the collateral will not adversely affect the
rights of the customer under said license agreement.
(d) The sale by the Borrower of any of its unprofitable
subsidiaries, provided said sale is to unaffiliated third parties.
4.03 MAINTAIN SOFTWARE COLLATERAL PACKAGE. During the term of this
Agreement and any extension hereof, Borrower will maintain for the benefit of
the Lender, at Borrower's principal place of business, a package consisting
of (i) accurate, current, complete copies of each component of the Software
in source code form and in machine readable object code as well as the
associated job control language
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and any other software needed to compile and link-edit the code in order that
it will compile; (ii) all documentation, specifications, instructions, user
manuals and other written materials and software necessary to run the
Software, to provide a complete understanding of the development of the
Software, and to enable the continued and uninterrupted marketing of the
Software; and (iii) a listing of all programs represented by the source codes
(collectively, the "Software Collateral Package"). Borrower will maintain at
its principal place of business archival copies of all such Software and will
take all actions necessary to update and currently maintain the Software
Collateral Package to reflect the most recent changes thereto.
4.04 USE OF PROCEEDS. Borrower shall use the proceeds of the Loan
for any corporate and business purpose of the Borrower or its Subsidiaries,
excluding, however, without the prior written consent of Lender, passive
investments, capital expenditures, acquisitions or purchases other than in
the ordinary course of business consistent with past practices.
4.05 FURTHER ASSURANCES. Borrower will take all actions requested by
Lender to create and maintain in Lender's favor valid liens upon, security
titles to and/or perfected security interests in any collateral security
described in Section 2.01 or Security Instruments and all other security for
the Secured Obligations now or hereafter held by or for Lender. Without
limiting the foregoing, Borrower agrees to execute such further instruments
(including financing statements and continuation statements) as may be
required or permitted by any law relating to notices of, or affidavits in
connection with, the perfection of Lender's security interests, and to
cooperate with Lender in the filing or recording and renewal thereof.
4.06 LIMITATIONS ON DEBT AND OBLIGATION. Except as to the
indebtedness incurred pursuant to the Note, or as listed on SCHEDULE 3.13 or
accounts payable and other trade payables incurred in the ordinary course of
business, Borrower shall not incur additional indebtedness in excess of
$1,000,000. Borrower agrees that all loans, debts and
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obligations will be incurred only after Lender has been notified, at the
address set forth in Section 8.09 of this Agreement.
4.07 FINANCIAL STATEMENTS AND REPORTS. Beginning with the month
ended May, 1992 and until such time as the Loan is no longer outstanding,
Borrower shall furnish to Lender (i) within one hundred and twenty (120) days
after the end of each fiscal year of Borrower, a consolidated balance sheet
of Borrower and its Subsidiaries as of the close of such fiscal year,
statements of earnings and retained earnings of Borrower and its Subsidiaries
as of the close of such fiscal year, and statements of cash flows for
Borrower and its Subsidiaries for such fiscal year, all in reasonable detail,
prepared in accordance with generally accepted accounting principles
consistently applied, and in such form as has customarily been prepared by
Borrower, and a certificate of the chief executive or chief financial officer
of Borrower, stating that, to the best of the knowledge of such officer,
Borrower has kept, observed, performed and fulfilled each covenant, term and
condition of this Agreement and the other Loan Documents during the preceding
fiscal year and that no Event of Default hereunder has occurred and is
continuing (or if an Event of Default has occurred and is continuing,
specifying the nature of same, the period of existence of same and the action
Borrower proposes to take in connection therewith), (ii) within thirty (30)
days of the end of each calendar month, balance sheets of Borrower and its
Subsidiaries as of the close of such month and statements of earnings and
retained earnings of Borrower and its Subsidiaries as of time close of such
month, all in reasonable detail, and prepared on the basis of accounting
principles consistently applied, and (iii) with reasonable promptness, such
other financial data as Lender may reasonably request.
4.08 MAINTENANCE OF BOOKS AND RECORDS; INSPECTION. Borrower shall
maintain its books, accounts and records on the basis of accounting
principles consistently applied, and permit a representative of Lender, at
Lender's expense, to visit and inspect any of its properties (including but
not limited to the collateral security described in Section 2.01 or the
Security Instruments), corporate books and financial records, and to discuss
its accounts, affairs and
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finances with Borrower or the principal officers of Borrower during
reasonable business hours, all at such times as Lender may reasonably request.
4.09 INSURANCE. Without limiting any of the requirements of any of
the other Loan Documents, Borrower shall maintain, in amounts customary for
entities engaged in comparable business activities, life, fire, liability and
other forms of insurance on its properties (including but not limited to the
collateral security now or hereafter securing payment and performance of the
Secured Obligations), against such hazards and in at least such amounts as is
customary in Borrower's business. At the request of Lender, Borrower will
deliver forthwith a certificate specifying the details of such insurance in
effect.
4.10 TAXES AND ASSESSMENTS. Borrower shall, and shall cause its
Subsidiaries to, (a) file all tax returns and appropriate schedules thereto
that are required to be filed under applicable law, prior to the date of
delinquency, (b) pay and discharge all taxes, assessments and governmental
charges or levies imposed upon Borrower or its respective Subsidiaries, upon
its income and profits or upon any properties belonging to it, prior to the
date on which penalties attach thereto, and (c) pay all taxes, assessments
and governmental charges or levies that, if unpaid, might become a lien or
charge upon any of its properties; provided, however, that Borrower in good
faith may contest any such tax, assessment, governmental charge or levy
described in the foregoing clauses (b) and (c) so long as appropriate
reserves are maintained with respect thereto.
4.11 CORPORATE EXISTENCE. Borrower shall maintain its corporate
existence and good standing in the state of its incorporation, and its
qualification and good standing as a foreign corporation in each jurisdiction
in which such qualification is required by applicable law.
4.12 COMPLIANCE WITH LAW AND AGREEMENTS. Borrower shall maintain its
business operations and property owned or used in connection therewith in
compliance with (i) all applicable federal, state and local laws, regulations
and ordinances governing such business operations and the use and
17
ownership of such property, and (ii) all agreements, licenses, franchises,
indentures and mortgages to which Borrower is a party or by which Borrower or
any of its properties is bound. Without limiting the foregoing, Borrower
shall pay all of its indebtedness promptly in accordance with the terms
thereof.
4.13 NOTICE OF DEFAULT. Borrower shall give written notice to Lender
of the occurrence of any default, event of default or Event of Default under
this Agreement or any other Loan Document promptly upon the occurrence
thereof.
4.14 NOTICE OF LITIGATION. Borrower shall give notice, in writing,
to Lender of (i) any actions, suits or proceedings instituted by any persons
whomsoever against Borrower or materially affecting any of the assets of
Borrower, and (ii) any dispute between Borrower on the one hand and any
governmental regulatory body on the other hand, which dispute might interfere
with the normal operations of Borrower; provided, however, that Lender shall
not disclose any such information to any third party other than Lender's
counsel and except to the extent compelled by legal process or law or
otherwise authorized by Borrower.
4.15 CONDUCT OF BUSINESS. Borrower will continue to engage, in an
efficient and economical manner, in a business of the same general type as
conducted by it on the date of this Agreement.
4.16 ERISA PLAN. If Borrower has in effect, or hereafter institutes,
a pension plan that is subject to the requirements of Title IV of the
Employee Retirement Income Security Act of 1974, Pub. L. No. 93-406,
September 2, 1974, 88 Stat. 829, 29 U.S.C.A. Section 1001 ET SEQ. (1975), as
amended from time to time ("ERISA"), then the following warranty and
covenants shall be applicable during such period as any such plan (the
"Plan") shall be in effect: (i) Borrower hereby warrants that no fact that
might constitute grounds for the involuntary termination of the Plan, or for
the appointment by the appropriate United States District Court of a trustee
to administer the Plan, exists at the time of execution of this Agreement,
(ii) Borrower hereby covenants that throughout the existence of the Plan,
Borrower's contributions under the Plan will meet the minimum funding
standards required by ERISA and
18
Borrower will not institute a distress termination of the Plan, and (iii)
Borrower covenants that it will send to Lender a copy of any notice of a
reportable event (as defined in ERISA) required by ERISA to be filed with the
Labor Department or the Pension Benefit Guaranty Corporation, at the time
that such notice is so filed.
4.17 OBSERVER RIGHTS. Borrower shall invite one representative of
Lender to attend, at Lender's expense, all meetings of Borrower's Board of
Directors and all committees of Borrower's Board of Directors in a nonvoting
capacity and, in this respect, shall give such representative copies of all
notices and meeting agenda in advance of such meetings and shall permit such
representative to review all documents and other materials provided to
directors at such meetings.
4.18 INFORMATION. Borrower will furnish to Lender such financial
data and other information relating to the business of Borrower and its
Subsidiaries as Lender may from time to time reasonably request. Borrower
will, upon reasonable request, cooperate fully with Lender, Lender's
representatives and counsel in the preparation of any document or other
material which may be required by the United States Small Business
Administration or any other governmental agency as a predicate to or result
of the transaction herein contemplated.
ARTICLE V
CONDITIONS TO CLOSING
5.01 CONDITIONS OF THE LENDER OBLIGATIONS. The obligation of the
Lender to make the Loan is subject to the receipt by Lender of the following
documents, each of which shall be satisfactory to Lender in form and
substance:
(a) CORPORATE DOCUMENTS. A copy of the Articles of
Incorporation of the Borrower, as amended and restated, certified by
the Secretary of State of Florida, and a certificate of good standing
from the Secretary of State, each as of a recent date.
19
(b) OFFICER'S CERTIFICATE. A certificate of the President
and Chief Executive Officer of Borrower to the effect set forth in
EXHIBIT C hereto.
(c) OPINION OF COUNSEL. The opinion of Akerman,
Senterfitt & Xxxxxx, P.A., counsel to Borrower, in form satisfactory
to Xxxxxx Xxxxxxx Xxxxxx & Xxxxx, counsel to the Lender, substantially
in the form of EXHIBIT D hereto.
(d) THE NOTE. The Note, duly completed and executed.
(e) SUBSIDIARY STOCK CERTIFICATES. Certificates
representing all of the outstanding shares of capital stock owned by
Borrower of each of Borrower's Subsidiaries accompanied by duly
executed instruments of transfer or assignments in blank.
(f) GUARANTY AND SECURITY AGREEMENT. The Guaranty and
Security Agreement, duly completed and executed by each of Borrower's
Subsidiaries.
(g) UCC-1 FINANCING STATEMENTS. Financing Statements on
Form UCC-1 duly completed and executed by Borrower and each of its
Subsidiaries securing the rights of Lender to the collateral security
listed in Section 2.01 and the Guaranty and Security Agreement.
(h) IBM SUBORDINATION OF SECURITY INTEREST. A written
agreement between Lender and IBM Credit Corporation pursuant to which
IBM Credit Corporation agrees to subordinate to Lender its security
interest in the Collateral other than certain equipment as provided in
Section 2.01(A)(i) hereof.
(i) STOCK PURCHASE WARRANT. A Stock Purchase Warrant to
purchase up to 30,000 shares of the Borrower's Common Stock.
20
(j) COMMITMENT FEE. Evidence that the Commitment Fee
provided in Section 1.02 has been or is being paid in full.
ARTICLE VI
DEFAULT AND REMEDIES
6.01 EVENTS OF DEFAULT. The occurrence of any of the following
shall constitute an Event of Default hereunder:
(a) Default in the payment of the principal of or interest on
the indebtedness evidenced by the Note in accordance with the terms
of the Note, which default is not cured within fifteen (15) business
days;
(b) Failure by Borrower to update and keep current the Software
Collateral Package
(c) Any misrepresentation by Borrower as to any material matter
hereunder or under any of the other Loan Documents, or delivery by
Borrower of any schedule, statement, resolution, report, certificate,
notice or writing to Lender that is untrue in any material respect on
the date as of which the facts set forth therein are stated or
certified;
(d) Failure of Borrower to perform any of its obligations under
this Agreement, any of the Security Instruments or any of the other
Loan Documents;
(e) Borrower (i) admits in writing its inability to pay its
debts generally as they become due; or (ii) shall make an assignment
for the benefit of creditors or petition or apply to any tribunal for
the appointment of a custodian, receiver or trustee for it or a
substantial part of its assets; or (iii) shall commence any
proceeding under any bankruptcy, reorganization, arrangement,
readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; or (iv) shall
have had any such petition or application filed or any such
proceeding commenced against it in which an order for relief is
21
entered or an adjudication or appointment is made; or (v) shall
indicate, by any act or omission, its consent to, approval of or
acquiescence in any such petition, application, proceeding or order
for relief or the appointment of a custodian, receiver or trustee
for it or a substantial part of its assets; or (vi) shall suffer any
such custodianship, receivership or trusteeship to continue
undischarged for a period of thirty (30) days or more;
(f) Borrower shall be liquidated, dissolved, partitioned or
terminated, or the articles of incorporation thereof shall expire or
be revoked;
(g) A default or event of default shall occur under any of the
other Loan Documents and, if subject to a cure right, such default or
event of default shall not be cured within the applicable cure
period;
(h) Borrower shall default in the timely payment or performance
of any obligation now or hereafter owed to Lender in connection with
any indebtedness of Borrower now or hereafter owed to Lender other
than the Loan; or
(i) Borrower shall default in the timely payment or performance
of any indebtedness other than the Loan, which in the aggregate
exceeds $10,000 and which is not actively contested by Borrower.
With respect to any Event of Default described above that is capable
of being cured and that does not already provide its own cure procedure (a
"Curable Default"), the occurrence of such Curable Default shall not
constitute an Event of Default hereunder if such Curable Default is fully
cured and/or corrected within thirty (30) business days (ten (10) business
days, if such Curable Default may be cured by payment of a sum of money) of
notice thereof to Borrower; provided, however, that any Curable Default which
may be cured by payment of a sum of money may be cured, for purposes of this
Section 6.01, by a Subsidiary of Borrower.
22
6.02 ACCELERATION OF MATURITY; REMEDIES. Upon the occurrence of any
Event of Default described in subsection 6.01, the indebtedness evidenced by
the Note as well as any and all other indebtedness of Borrower to Lender
shall be immediately due and payable in full; and upon the occurrence of any
other Event of Default described above, Lender at any time thereafter may at
its option accelerate the maturity of the indebtedness evidenced by the Note
as well as any and all other indebtedness of Borrower to Lender; all without
notice of any kind. Upon the occurrence of any such Event of Default and the
acceleration, of the maturity of the indebtedness evidenced by the Note:
(a) Lender shall be immediately entitled to exercise any
and all rights and remedies possessed by Lender pursuant to the terms
of the Security Instruments and all of the other Loan Documents;
(b) Lender shall have all of the rights and remedies of a
secured party under the Uniform Commercial Code; and
(c) Lender shall have any and all other rights and remedies
that Lender may now or hereafter possess at law, in equity or by
statute.
6.03 REMEDIES CUMULATIVE; NO WAIVER. No right, power or remedy
conferred upon or reserved to Lender by this Agreement or any of the other
Loan Documents is intended to be exclusive of any other right, power or
remedy, but each and every such right, power and remedy shall be cumulative
and concurrent and shall be in addition to any other right, power and remedy
given hereunder, under any of the other Loan Documents or now or hereafter
existing at law, in equity or by statute. No delay or omission by Lender to
exercise any right, power or remedy accruing upon the occurrence of any Event
of Default shall exhaust or impair any such right, power or remedy or shall
be construed to be a waiver of any such Event of Default or an acquiescence
therein, and every right, power and remedy given by this Agreement and the
other Loan Documents to Lender may be exercised from time to time and as
often as may be deemed expedient by Lender.
23
6.04 PROCEEDS OF REMEDIES. Any or all proceeds resulting from the
exercise of any or all of the foregoing remedies shall be applied as set
forth in the Loan Document(s) providing the remedy or remedies exercised; if
none is specified, or if the remedy is provided by this Agreement, then as
follows:
First, to the costs and expenses, including reasonable
attorney's fees, incurred by Lender in connection with the exercise
of its remedies;
Second, to the expenses of curing the default that has occurred,
in the event that Lender elects, in its sole discretion, to cure the
default that has occurred;
Third, to the payment of the Secured Obligations, including but
not limited to the payment of the principal of and interest on the
indebtedness evidenced by the Note, in such order of priority as
Lender shall determine in it sole discretion; and
Fourth, the remainder, if any, to Borrower or to any other person
lawfully thereunto entitled.
ARTICLE VII
TERMINATION
This Agreement shall remain in full force and effect until the later
of (i) May 29, 1997, or (ii) the payment by Borrower of all amounts owed to
Lender under the Loan Documents.
ARTICLE VIII
MISCELLANEOUS
8.01 PERFORMANCE BY LENDER. If Borrower shall default in the
payment, performance or observance of any covenant, term or condition of this
Agreement, Lender may, at its option, pay, perform or observe the same, and
all payments made or costs or expenses incurred by Lender in connection
therewith (including but not limited to reasonable attorney's
24
fees), with interest thereon at the highest default rate provided in the Note
(if none, then at the maximum rate from time to time allowed by applicable
law), shall be immediately repaid to Lender by Borrower and shall constitute
a part of the Secured Obligations and be secured hereby until fully repaid.
Lender shall be the sole judge of the necessity for any such actions and of
the amounts to be paid.
8.02 SUCCESSORS AND ASSIGNS INCLUDED IN PARTIES. Whenever in this
Agreement one of the parties hereto is named or referred to, the heirs, legal
representatives, successors, successors-in-title and assigns of such parties
shall be included, and all covenants and agreements contained in this
Agreement by or on behalf of Borrower or by or on behalf of Lender shall bind
and inure to the benefit of their respective heirs, legal representatives,
successors-in-title and assigns, whether so expressed or not.
8.03 COSTS AND EXPENSES. Borrower agrees to pay all costs and
expenses incurred by Lender in connection with the making of the Loan that is
the subject of this Agreement, including but not limited to filing fees,
recording taxes and reasonable attorney's fees, promptly upon demand of
Lender. Borrower further agrees to pay all premiums for insurance required to
be maintained pursuant to the terms of the Loan Documents and all of the
out-of-pocket costs and expenses incurred by Lender in connection with the
administration, servicing and/or collection of the Loan that is the subject
of this Agreement, including but not limited to reasonable attorney's fees,
promptly upon demand of Lender.
8.04 ASSIGNMENT. The Note, this Agreement and the other Loan
Documents may be endorsed, assigned and/or transferred in whole or in part by
Lender, and any such holder and/or assignee of the same shall succeed to and
be possessed of the rights and powers of Lender under all of the same to the
extent transferred and assigned. Lender may grant participations in all or
any portion of its interest in the indebtedness evidenced by the Note.
Borrower shall not assign any of its rights nor delegate any of its duties
hereunder or under any of the other Loan Documents without the prior express
written consent of Lender.
25
8.05 TIME OF THE ESSENCE. Time is of the essence with respect to
each and every covenant, agreement and obligation of Borrower hereunder and
under all of the other Loan Documents.
8.06 SEVERABILITY. If any provision(s) of this Agreement or the
application thereof to any person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the
application of such provisions to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by
law.
8.07 INTEREST AND LOAN CHARGES NOT TO EXCEED MAXIMUM ALLOWED BY LAW.
Anything in this Agreement, the Note, the Security Instruments or any of the
other Loan Documents to the contrary notwithstanding, in no event whatsoever,
whether by reason of advancement of proceeds of the loan made pursuant to
this Agreement, acceleration of the maturity of the unpaid balance of the
loan or otherwise, shall the interest and loan charges agreed to be paid to
Lender for the use of the money advanced or to be advanced hereunder exceed
the maximum amounts collectible under applicable laws in effect from time to
time. It is understood and agreed by the parties that, if for any reason
whatsoever the interest or loan charges paid or contracted to be paid by
Borrower in respect of the indebtedness evidenced by the Note shall exceed
the maximum amounts collectible under applicable laws in effect from time to
time, then IPSO FACTO, the obligation to pay such interest and/or loan
charges shall be reduced to the maximum amounts collectible under applicable
laws in effect from time to time, and any amounts collected by Lender that
exceed such maximum amounts shall be applied to the reduction of the
principal balance of the indebtedness evidenced by the Note and/or refunded
to Borrower so that at no time shall the interest or loan charges paid or
payable in respect of the indebtedness evidenced by the Note [exceed] the
maximum amounts permitted from time to time by applicable law.
8.08 ARTICLE AND SECTION HEADINGS; DEFINED TERMS. Numbered and
titled article and section headings and defined terms are for convenience
only and shall not be
26
construed as amplifying or limiting any of the provisions of this Agreement.
8.09 NOTICES. Any and all notices, elections or demands permitted or
required to be made under this Agreement shall be in writing, signed by the
party giving such notice, election or demand and shall be delivered
personally, telecopied, telexed, or sent by certified mail or nationally
recognized courier service (such as Federal Express), to the other party at
the address set forth below, or at such other address as may be supplied in
writing and of which receipt has been acknowledged in writing. The date of
personal delivery, telecopy or telex or the date of mailing (or delivery to
such courier service), as the case may be, shall be the date of such notice,
election or demand. For the purposes of this Agreement:
The Address of Sirrom Capital, L.P.
Lender is: Xxxxxxxxx Xxxx Xxxxxx, Xxxxx 000
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, XX
with a copy to: Xxxxxx Xxxxxxx Xxxxxx & Xxxxx
Nashville City Center
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: X. Xxxxx Xxxx, Esq.
The Address of CCS Technology Group, Inc.
Borrower is: 000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx,
President and Chief Executive Officer
27
with a copy to: Akerman, Senterfitt & Xxxxxx, P.A.
00xx Xxxxx, Xxxxxxxx Xxxxxxxx
000 Xxxxx Xxxxxx Xxxxxx
Xxxx Xxxxxx Xxx 000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxxxxx, Esq.
8.10 ENTIRE AGREEMENT. This Agreement and the other written
agreements between Borrower and Lender represent the entire agreement between
the parties concerning the subject matter hereof, and all oral discussions
and prior agreements are merged herein; provided, however, if there is a
conflict between this Agreement and any other document executed
contemporaneously herewith with respect to the Secured Indebtedness, the
provision most favorable to Lender shall control.
8.11 MISCELLANEOUS. This Agreement shall be construed and enforced
under the laws of the State of Tennessee. No amendment or modification hereof
shall be effective except in a writing executed by each of the parties
hereto.
28
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
or have caused this Agreement to be executed by their duly authorized
officers, as of the day and year first above written.
LENDER:
SIRROM CAPITAL, L.P.
By: Sirrom Corporation
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx, XX
------------------------
Xxxxxx X. Xxxxxx, XX
Vice President
BORROWER:
CCS TECHNOLOGY GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------
Title: President
29
INDEX OF SCHEDULES AND ATTACHMENTS
Exhibit A. Form of Secured Promissory Note
Exhibit B. Form of Guaranty and Security Agreement
Exhibit C. Form of Officer's Certificate
Exhibit D. Form of Opinion of Counsel
Schedule 2.01 Software Collateral
Schedule 2.01(A) (vi) Stock of Subsidiaries
Schedule 3.04 Other Transactions
Schedule 3.06 Litigation
Schedule 3.08 Defaults
Schedule 3.13 Insider Transactions
Schedule 3.14 Title to Property
Schedule 3.15 Intellectual Property
30
SCHEDULE 2.01
SOFTWARE COLLATERAL
CCS Technology Group, Inc. Software Systems and ownership Rights
I. Products/Systems/Modules owned solely by CCS
CARDPAC - Transaction Management System
CMP - Cardholder/Merchant Processing
(CARDPAC Base System)
OLA - On-Line Authorizations
OLC - On-Line Collections (Formerly CMC
or CMCS - Collections Management
and Control System)
ITS - Interchange Tracking System
SBS - Settlement and Balancing System
CSM - Customer Service Module
VISION 21 - Retail Credit Portfolio Management System
CMS - Credit Management System
(Vision21 Base System)
CAS - Customer Authorization System
CTA - Collection, Tracking and Analysis
ASM - Account Services and Management System
RMS - Retail Merchant System
Combined Products (Work with both CARDPAC and VISION21 Systems)
CDM - Credit Decision Management
(Formerly APS - Application
Processing System)
MTS - Memo Tickler System
LTS - Letters System
EXAM - Utility Extract System
SPP - Securitization Portfolio
Processing
SS/IMP - Security and Implementation System
31
PARS - Data Dictionaries and User Exits
to interface the CCA (Praxis)
IMAGINE produt to the CCS
Products.
Other Systems
UCS - Utilities Collection System
II. Products offered by CCS to users but owned by third parties & CCS
Magnum BAS - Bureau Access System (CREDITCHEK) -
interfaces to CDM
PRAXIS/ IMAGINE - Report Writer and Inquiry Utility
CCA Marketpulse - Direct Marketing Management System
FAIR, TRIAD - Behavorial Scoring and
XXXXX Analysis/Adaptive Control System
32
SCHEDULE 2.01 (A) (vi)
STOCK OF SUBSIDIARIES
(1) Credit Card Software Group, Inc.
1,000 shares - par value: $1 per share
(2) Revolving Credit Solutions, Inc.
1,000 shares - par value: $1 per share
(3) Credit Card Software International, Inc.
1,000 shares - par value: Fifty Cents per share
33
SCHEDULE 3.04
The Company is the maker of a demand promissory note dated October 31, 1991,
payable to a Sales employee of the Company for $150,000 with 10% interest per
annum. This note is included in the Company's financial statement as short
term debt.
34
SCHEDULE 3.06
CLAIMS & LITIGATION
On April 21, 1992, the Company received a letter (copy attached) from an
Orlando attorney on behalf of two employees who were released as part of a
general reduction in work force. They were pregnant at the time of their
release. They threaten to file a claim with the EEOC for discrimination.
The Company replied per the attached letter dated May 1, 1992, by Xxxxxx
Xxxxxx, Esquire, of the law firm of Akerman, Senterfitt and Xxxxxx. We
believe the claims are without merit.
I am not aware of any other such claims or litigation.
/s/ P. Xxxxxxx Xxxxxx May 26, 1992
----------------------------- --------------------
P. Xxxxxxx Xxxxxx
Corporate Counsel & Secretary
35
SCHEDULE 3.08
DEFAULTS
NONE
36
May 28, 1997
PaySys International, Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Re: Amendment to that certain Loan Agreement dated May 29,
1992 (the "Loan Agreement"), by and between Sirrom
Capital, L.P. ("Sirrom") and CCS Technology Group, Inc.
("Borrower")
Dear Xx. Xxxxxxxx:
The purpose of this letter is to confirm an amendment to the Loan
Agreement and the Loan Documents. Capitalized terms not otherwise defined
shall have the meanings set forth in the Loan Agreement. Specifically, we
have agreed to amend the Loan Documents as follows:
1. CCS Technology Group, Inc. has changed its name to PaySys
International, Inc.
2. Sirrom Capital Corporation is the successor to Sirrom Capital,
L.P.
3. Sirrom Capital Corporation has assigned its interest in the
Secured Promissory Note dated May 29, 1992, executed by CCS
Technology Group, Inc. in favor of Sirrom Capital, L.P. (the
"Note"), the Stock Purchase Warrant between CCS Technology Group,
Inc. and Sirrom Capital, L.P. (the "Warrant"), and the other Loan
Documents to Sirrom Investments, Inc.
4. The Note is amended as follows:
Principal shall be paid as follows: $100,000
shall be due and payable on June 2, 1997 and
$900,000 shall be due and payable on
September 1, 1997. The maturity date as
defined in the Note shall be September 1, 1997.
5. The Warrant is amended to provide that it shall be exercisable
until September 30, 1997.
If you find that the foregoing adequately sets forth your understanding and
agreement with respect to the above, please execute this Letter Agreement
where indicated below.
Sincerely,
SIRROM INVESTMENTS, INC. (assignee
of Sirrom Capital Corporation, the successor
of Sirrom Capital, L.P.)
By: ________________________________
Title: _______________________________
Accepted and agreed to as of May ____, 1997
PAYSYS INTERNATIONAL, INC.
(formerly CCS Technology Group, Inc.)
By: __________________________________
Title: _________________________________
