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EXHIBIT 10.33
THIRD AMENDMENT TO LOAN AGREEMENT
This Third Amendment to Loan Agreement is made by and among BROADWAY &
SEYMOUR, INC., a Delaware corporation ("Broadway") with a principal place of
business at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000, ELITE
INFORMATION SYSTEMS, INC., a California corporation ("Elite") with a principal
place of business at 0000 Xxxxx Xxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, THE MINICOMPUTER COMPANY OF MARYLAND, INC., a Maryland
corporation ("TMC") with a principal place of business at Executive Plaza I,
00000 XxXxxxxxx Xxxx, Xxxxx 000, Xxxx Xxxxxx, XX 00000-0000, ELITE INFORMATION
SYSTEMS INTERNATIONAL, INC., a California corporation ("Elite International")
with a principal place of business at 0000 Xxxxx Xxxxxxxxx Xxxxxxxxx, Xxxxx 000,
Xxx Xxxxxxx, Xxxxxxxxxx 00000 (Broadway, Elite, TMC and Elite International are
hereinafter jointly and severally referred to as, the "Borrower") and FLEET
NATIONAL BANK, a national banking association organized under the laws of the
United States and having an office at Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 as Agent for itself and each of the other Lenders who now and/or hereafter
become parties to the hereinafter defined Loan Agreement pursuant to the terms
of Section 9.11 thereof (sometimes the "Agent" and sometimes "Fleet" and in its
capacity as a Lender, sometimes "Fleet" and sometimes a "Lender"). Capitalized
terms used herein and not expressly defined herein shall have the respective
meanings ascribed to such terms in the hereinafter defined Loan Agreement.
WITNESSETH THAT:
WHEREAS, the Borrower and the Agent are parties to that certain Loan
Agreement dated as of July 23, 1997 pursuant to which the Lenders extended a
$15,000,000 revolving credit facility, as amended by that certain First
Amendment to Loan Agreement dated September 30, 1997 and as further amended by
that certain Second Amendment to Loan Agreement dated December 31, 1997 (as
amended hereby and as hereafter amended from time to time, the "Loan
Agreement"); and
WHEREAS, the Borrower and the Agent desire to amend certain provisions
of the Loan Agreement as hereinafter set forth.
NOW, THEREFORE, the Borrower and the Agent hereby agree as follows:
1. All references in the Loan Agreement to the Financing Documents
shall be deemed to refer to such documents and in addition shall also refer to
this Third Amendment to Loan Agreement.
2. Effective as of the date hereof, a definition of "EBITDA" is hereby
added to Section 1.1 of the Loan Agreement to read in its entirety:
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"EBITDA" means, for any fiscal period, Net Income plus, to the
extent accounted for in Net Income, Interest Expense, taxes, depreciation,
amortization and other noncash charges, for such period determined on an accrual
and consolidated basis in accordance with GAAP.
3. Effective as of the date hereof, a definition of "Net Outstanding
Amount of Permitted Foreign Receivables" is hereby added to Section 1.1 of the
Loan Agreement to read in its entirety:
"Net Outstanding Amount of Permitted Foreign Receivables"
means the net amount of Permitted Foreign Receivables outstanding after
eliminating from the aggregate amount of outstanding Permitted Foreign
Receivables all payments, adjustments and credits applicable thereto.
4. Effective as of the date hereof, a definition of "Permitted Foreign
Receivables" is hereby added to Section 1.1 of the Loan Agreement to read in its
entirety:
"Permitted Foreign Receivables" means accounts receivable of
the Borrower from an account debtor located either in the United Kingdom or
Canada evidencing Indebtedness of Persons to the Borrower for goods actually
sold and delivered or services actually performed in the ordinary course of
business by the Borrower to or for such Person, as to which goods or services no
written notice has been received by Borrower from such Person that alleges a
breach by the Borrower of its obligation to deliver such goods and/or services
and which accounts receivable have been outstanding for less than ninety (90)
days since their respective invoicing dates, but excluding, however, (i)
accounts receivable owing by officers, directors, shareholders or employees of
Borrower, (ii) accounts receivable with respect to which goods are placed on
consignment, guaranteed sale, "xxxx and hold" or other terms by reason of which
the payment by the account debtor may be conditional, (iii) accounts receivable
owing by the United States or any agency, department or instrumentality thereof
unless such accounts are freely assignable to the Agent under the United States
Assignment of Claims Act and the Borrower has separately assigned each such
account to the Agent in compliance with such Act, (iv) accounts receivable owing
by any Subsidiary or Affiliate of Borrower, (v) accounts receivable with respect
to which Borrower or any Subsidiary or Affiliate is liable to the account debtor
for goods sold or services provided to Borrower or any Subsidiary or Affiliate
by such account debtor to the extent of Borrower's or any Subsidiary's or
Affiliate's liability to such account debtor, (vi) as to any particular account
debtor, not more than 50% of the total accounts receivable of such debtor shall
be outstanding for more than ninety (90) days since their respective invoicing
dates, (vii), any accounts receivable as to which the account debtor has claimed
in writing any setoff or any dispute as to the amount owing by the account
debtor to the extent of the amount in dispute, (viii) any accounts receivable
subject to any Lien other than pursuant to the Security Documents, (ix) any
accounts receivable owing by any Person which is insolvent and/or the subject of
any bankruptcy, receivership or other insolvency proceeding, and (x) any
accounts receivable deemed by the Agent in the Agent's sole discretion exercised
in good faith difficult to collect or uncollectible.
5. Effective as of the date hereof, the definition of "Revolving Credit
Loan Formula Amount" is hereby amended to read in its entirety:
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"Revolving Credit Loan Formula Amount" means an amount equal
to the sum of (i) eighty percent (80%) of the Net Outstanding Amount of Eligible
Receivables and (ii) eighty percent (80%) of the Net Outstanding Amount of
Permitted Foreign Receivables.
6. Effective as of the date hereof, a new Section 5.1.25 of the Loan
Agreement is hereby added to read in its entirety:
Section 5.1.25. Minimum Debt Service Coverage Ratio. To the
extent that at any time there shall be an outstanding balance of the Revolving
Credit Loan or the sum of Borrower's and its Subsidiaries' (i) cash on hand or
on deposit in any bank or trust company which has not suspended business and
(ii) Cash Equivalent Investments (without duplication with (i)) is less than
$10,000,000, maintain a ratio of (i) EBITDA less, for the fiscal periods in
question, the sum of taxes paid and Capital Expenditures to (ii) the sum of (y)
Interest Expense and (z) the then outstanding balance of the Revolving Credit
Loan multiplied by .25 of not less than 1.25:1.00, such ratio to be measured at
each Borrower fiscal quarter end for the rolling four Borrower fiscal quarter
period consisting of the Borrower fiscal quarter then ending and the three
immediately preceding Borrower fiscal quarters.
7. Effective as of the date hereof, Section 5.1.13 of the Loan
Agreement is hereby amended to read in its entirety:
Section 5.1.13. Minimum Adjusted Net Income. To the extent that at any time
there shall be an outstanding balance of the Revolving Credit Loan or the sum of
Borrower's and its Subsidiaries' (i) cash on hand or on deposit in any bank or
trust company which has not suspended business and (ii) Cash Equivalent
Investments (without duplication with (i)) is less than $10,000,000, maintain a
Minimum Adjusted Net Income at each Borrower fiscal quarter end for the Borrower
fiscal quarter then ending and for the immediately preceding Borrower fiscal
quarter in an amount not less than zero (0) provided that Minimum Adjusted Net
Income for the rolling four Borrower fiscal quarter period consisting of the
Borrower fiscal quarter then ending and the three immediately preceding Borrower
fiscal quarters is greater than zero (0).
8. Effective as of the date hereof, Section 5.1.11 of the Loan
Agreement is hereby amended to read in its entirety:
Section 5.1.11. Minimum Quick Ratio. Maintain at the end of
each fiscal quarter of the Borrower a ratio of (i) the sum of (w) cash on hand
or on deposit in any bank or trust company which has not suspended business, (x)
Cash Equivalent Investments (without duplication with (w)) and (y) net
outstanding amount of accounts receivable to (ii) (x) Current Liabilities plus
the outstanding amount of the Revolving Credit Loan less the amount of any
deferred revenue of not less than 1.50:1.00. Each item described in clauses (i)
and (ii) of this Section 5.1.11 shall be calculated as of the last day of the
Borrower fiscal quarter and include only the item(s) in question of the Borrower
and its Subsidiaries on a consolidated basis.
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9. Effective as of the date hereof, Section 5.2.12(ii) of the Loan
Agreement is hereby amended to read in its entirety:
(ii) other employee loans not to exceed $250,000 in the
aggregate outstanding at any one time to all such employees,
10. The Borrower hereby restates all of the representations, warranties
and covenants of the Borrower set forth in the Loan Agreement to the same extent
as if fully set forth herein and the Borrower hereby certifies that all such
representations and warranties are true and accurate as of the date hereof.
11. The Borrower and the Agent hereby ratify, confirm and approve the
Loan Agreement, amended as set forth herein, as a binding obligation,
enforceable in accordance with its terms. The Borrower further acknowledges and
agrees that Agent has not waived any of its rights under the Loan Agreement,
amended as set forth herein, or any Event(s) of Default that may hereafter exist
thereunder and that there does not exist (i) any offset or defense against
payment or performance of any of the Indebtedness and Obligations of the
Borrower evidenced thereby, or (ii) any claim or cause of action by Borrower
against Agent with respect to the transactions described therein.
12. The Borrower represents and warrants to the Agent that no Default
or Event of Default exists under the Loan Agreement, amended as set forth
herein, any of the Financing Documents or any document or agreement executed in
connection therewith or herewith.
13. As consideration for the Agent entering into this Third Amendment
to Loan Agreement, the Borrower shall pay to the Agent a nonrefundable amendment
fee equal to Fifteen Thousand Dollars ($15,000) (the "Amendment Fee"), together
with fees and disbursements of the Agent's legal counsel incurred in connection
with such amendment.
14. This Third Amendment to Loan Agreement shall be effective as of
March 31, 1998.
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IN WITNESS WHEREOF, the Borrower and the Agent have caused this Second
Amendment to Loan Agreement to be executed as a sealed instrument by their
proper representatives hereunto duly authorized as of the 6th day of May, 1998.
Witness: Broadway & Seymour, Inc.
_________________________ By: /s/ Xxxxx X. Xxxxxx
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Xxxxx Xxxxxx, Treasurer
Witness: Elite Information Systems, Inc.
_________________________ By: /s/ Xxxxx X. Xxxxxx
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Xxxxx Xxxxxx, Assistant Treasurer
Witness: The MiniComputer Company of Maryland,
Inc.
_________________________ By: /s/ Xxxxx X. Xxxxxx
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Xxxxx Xxxxxx, Assistant Treasurer
Witness: Elite Information Systems
International, Inc.
_________________________ By: /s/ Xxxxx X. Xxxxxx
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Xxxxx Xxxxxx, Assistant Treasurer
Witness: Fleet National Bank, as Agent for the
Lenders and as a Lender
/s/ Xxxx X. Bosets AVP By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
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