EXHIBIT 99.4
THIRD MODIFICATION AGREEMENT
THIS THIRD MODIFICATION AGREEMENT ("Agreement"), dated as of the 20th day
of March, 2000, is made by, between and among METRO INFORMATION SERVICES, INC.,
a Virginia corporation ("Borrower"), METRO INFORMATION SERVICES OF NORTHERN
CALIFORNIA, INC., a Virginia corporation ("Metro NC"), METRO INFORMATION
SERVICES OF LOS ANGELES, INC., a Virginia corporation ("Metro LA"), METRO
INFORMATION SERVICES OF ORANGE COUNTY, INC., a Virginia corporation ("Metro
OC"), METRO INFORMATION SERVICES OF PENNSYLVANIA, INC. a Virginia corporation
("Metro PA"), METRO INFORMATION SERVICES-ATS, INC., a Virginia corporation
("Metro ATS"), ACUITY TECHNOLOGY SERVICES, LLC, a Virginia limited liability
company ("Acuity LLC") (Metro NC, Metro LA, Metro OC, Metro PA, Metro ATS and
Acuity LLC are sometimes hereinafter individually referred to as "Guarantor" and
collectively referred to as "Guarantors"), BANK OF AMERICA, N.A. d/b/a
NationsBank, N.A., successor to NationsBank, N.A. ("Bank of America"), CRESTAR
BANK ("Crestar"), FIRST UNION NATIONAL BANK ("First Union") and Wachovia Bank,
N.A. ("Wachovia") (Bank of America, Crestar, First Union and Wachovia are
sometimes hereinafter individually referred to as a "Lender" and collectively
referred to as "Lenders").
R E C I T A L S:
A. Borrower, Bank of America, Crestar, First Union and Wachovia are parties
to a Credit Agreement, dated June 20, 1997, as modified by a First Modification
Agreement dated as of January 15, 1999 and by a Second Modification and Joinder
Agreement dated as of August 25, 1999 (collectively, the "Credit Agreement"),
pursuant to which Bank of America, Crestar and First Union have each provided
Borrower with a line of credit facility in the amount of $35,000,000 and
Wachovia has provided Borrower with a line of credit facility in the amount of
$20,000,000.
B. Borrower has requested, and each Lender has agreed, to modify the
covenants contained in Section 6.13 of the Credit Agreement on the terms and
subject to the conditions set forth in this Agreement and the Credit Agreement.
C. Each Guarantor is a wholly owned subsidiary of Borrower, or a remote
subsidiary of Borrower, and has unconditionally guaranteed payment of the
Obligations of Borrower under the Credit Agreement. Guarantors join in this
Agreement to evidence their consent to the modification to the Loan Documents
set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement and the Credit Agreement, and for other good and valuable
consideration, the parties stipulate and agree as follows:
1. DEFINITIONS. Unless the context otherwise requires, terms used in
this Agreement will have the same meanings and definitions as set forth in the
Credit Agreement.
2. MODIFICATIONS TO LOAN DOCUMENTS. The Loan Documents are modified and
amended as follows:
2.1. Section 6.13(a) of the Credit Agreement is deleted and
the following substituted in lieu thereof:
(a) MAXIMUM FUNDED DEBT TO CAPITALIZATION RATIO.
Borrower's Funded Debt to Capitalization Ratio shall
be no greater than (i) 65% during the calendar year
2000, (ii) 60% during the calendar year 2001, (iii)
55% during the calendar year 2002 and (iv) 50% at all
times after December 31, 2002. The Quarterly
Statements delivered pursuant to paragraph 6.1(a) as
of such testing dates (as well as Fiscal Year End
Statements when a testing date is at Borrower's
Fiscal Year End) must reflect compliance with this
covenant.
2.2. Section 6.13(d) of the Credit Agreement is deleted and
the following substituted in lieu thereof:
(a) MAXIMUM FUNDED DEBT TO EBITDA. Borrower's Funded Debt
to EBITDA Ratio, which shall be tested on a rolling
twelve (12) month basis, shall not be greater than
(i) 4.0 to 1.0 through September 30, 2001 and (ii)
3.0 to 1.0 for all testing periods thereafter. The
Quarterly Statements delivered pursuant to paragraph
6.1(a) as of such testing dates (as well as Fiscal
Year End Statements when a testing date is a
Borrower's Fiscal Year End) must reflect compliance
with this covenant.
2.3. Schedule 1.1 attached to the Credit Agreement is deleted
and replacement Schedule 1.1 attached to this Agreement as EXHIBIT A is
substituted in lieu thereof.
2.4. Schedule 2.2 attached as Exhibit B to the Second
Modification and Joinder Agreement is deleted and replacement Schedule
2.2 attached to this Agreement as EXHIBIT B is substituted in lieu
thereof.
3. CONDITIONS TO EFFECTIVENESS. This Agreement is limited as specified
and shall not constitute a modification, acceptance or waiver of any other
provision of the Credit Agreement or any other Loan Documents. This Agreement
shall become effective on the date (the "Modification Agreement Effective Date")
when each of the following conditions have been satisfied by Borrower and
Guarantors or waived by the Lenders:
3.1. Borrower, Guarantors and each Lender shall have signed a
counterpart of this Agreement (whether the same or different
counterparts); and
3.2. The Lenders shall have received a Certificate from the
Borrower in the form prescribed pursuant to Section 4.1(c) of the
Credit Agreement.
4. FURTHER ASSURANCES. Borrower and Guarantors will execute and
deliver, or cause to be executed and delivered, and do or make, or cause to be
done or made, on the
reasonable request of any Lender, any and all instruments, documents, acts or
things, supplemental, confirmatory or otherwise, for the purpose of effecting
the modifications to the Loan Documents described in this Agreement.
5. CONFLICT BETWEEN DOCUMENTS; RATIFICATION. If there is any conflict
between the terms and conditions of this Agreement and any one or more of the
terms and conditions of any other Loan Document, the terms and conditions of
this Agreement will supercede and control. Except as modified by the provisions
of this Agreement, the Borrower and each Lender hereby ratifies and reaffirms
all of the provisions of the Loan Documents.
6. MULTIPLE COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together will constitute one and the same
agreement, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
7. GOVERNING LAW. This Agreement has been prepared, is being executed
and delivered, and is intended to be performed in the Commonwealth of Virginia.
The substantive laws of such state and the applicable federal laws of the United
States of America will govern the validity, construction, enforcement and
interpretation of this Agreement and all of the other Loan Documents.
8. GUARANTORS' CONSENT. Each Guarantor consents to the modifications to
the Loan Documents set forth in this Agreement. The Guarantors ratify and affirm
all their obligations under their respective guarantees as modified by this
Agreement. By executing and delivering this Agreement, each Guarantor agrees
that all Obligations (including, without limitation, the additional Loans which
may be incurred pursuant to the maximum Commitments) shall be fully guaranteed
pursuant to the Guaranty to which each is a party in accordance with the terms
and provisions thereof, and shall be fully secured pursuant to each Guarantor's
respective Security Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
[Signatures begin on Page 4]
METRO INFORMATION SERVICES, INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Vice President and Chief
Financial Officer
METRO INFORMATION SERVICES OF LOS ANGELES,
INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
METRO INFORMATION SERVICES OF NORTHERN
CALIFORNIA, INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
METRO INFORMATION SERVICES OF ORANGE COUNTY,
INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
METRO INFORMATION SERVICES OF PENNSYLVANIA,
INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
METRO INFORMATION SERVICES-ATS, INC.
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
ACUITY TECHNOLOGY SERVICES, LLC
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxx X. Xxxxxxxx,
Secretary and Treasurer
BANK OF AMERICA, N.A.
d/b/a NationsBank, N.A.,
successor to NationsBank, N.A.
By: /s/ XXXXX X. OLD
-------------------------------------
Xxxxx X. Old,
Vice President
CRESTAR BANK
By: /s/ XXXX X. XXXX
-------------------------------------
Xxxx X. Xxxx,
Senior Vice President
FIRST UNION NATIONAL BANK
By: /s/ XXXXX X. XXXXXX
-------------------------------------
Title: VICE PRESIDENT
Print Name: XXXXX X. XXXXXX
WACHOVIA BANK, N.A.
By: /s/ XXXXXXXXX X. XXXXXXX
-------------------------------------
Xxxxxxxxx X. Xxxxxxx,
Senior Vice President
EXHIBIT A
SCHEDULE 1.1
GRID PERFORMANCE MODEL ("GPM")
FUNDED DEBT
TO EARNINGS APPLICABLE SPREAD
RATIO COMPONENT
------------------------------------------ --------------------------------
GREATER THAN 3.5 LESS THAN OR EQUAL TO 4.0 165 bps*
GREATER THAN 3.0 LESS THAN OR EQUAL TO 3.5 115 bps**
GREATER THAN 2.5 LESS THAN OR EQUAL TO 3.0 90 bps
GREATER THAN 1.5 LESS THAN OR EQUAL TO 2.5 70 bps
GREATER THAN .5 LESS THAN OR EQUAL TO 1.5 50 bps
LESS THAN OR EQUAL TO.5 35 bps
*If the Funded Debt to EBITDA Ratio exceeds 4.0 on or before September 30,
2001, then the Default Rate shall apply.
**If the Funded Debt to EBITDA Ratio exceeds 3.0 after September 30, 2001,
then the Default Rate shall apply.
EXHIBIT B
SCHEDULE 2.2
UNUSED COMMITMENT FEES
FUNDED DEBT
TO EBITDA BANK OF
RATIO FIRST UNION CRESTAR AMERICA WACHOVIA
------------------- ---------------- --------------- --------------- ---------------
GREATER THAN 3.5 .38 .38 .38 .38
3.0-3.5 .38 .38 .38 .38
2.5-3.0 .3125 .3125 .3125 .3125
1.5-2.5 .2500 .2500 .2500 .2500
.5-1.5 .1875 .1875 .1875 .1875
LESS THAN .5 .1875 .125 .125 .125
The "Unused Commitment" amount for purposes of determining the Unused Commitment
fee for any Fiscal Quarter shall be equal to the amount of each Lender's total
Commitment, minus the average daily amounts of the Loan actually outstanding
during such Fiscal Quarter just ended or calendar month, as the case may be.
