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EXHIBIT 10.2
AMENDMENT NUMBER ONE
TO LOAN AGREEMENT
This AMENDMENT NUMBER ONE TO LOAN AGREEMENT (the "Amendment") is
entered into as of April 20, 2001, between FOOTHILL CAPITAL CORPORATION, a
California corporation ("Lender"), and FUTURELINK EUROPE LIMITED, a company
organized under the laws of England and Wales ("Subsidiary Borrower"), with
reference to the following:
WHEREAS, Subsidiary Borrower has previously entered into that
certain Loan Agreement, dated as of December 14, 2000 (as amended, restated,
supplemented, or otherwise modified from time to time, the "Loan Agreement"),
with Lender, pursuant to which Lender has made certain loans and financial
accommodations available to Subsidiary Borrower;
WHEREAS, Subsidiary Borrower has requested that Lender amend the
Loan Agreement as set forth herein;
WHEREAS, subject to the terms and conditions set forth herein,
Lender is willing to so amend the Loan Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Amendments to the Loan Agreement.
(a) The following new definition hereby is added in its entirety
to Section 1.1 of the Loan Agreement, in alphabetical order:
"Maturity Date" has the meaning set forth in Section 3.4.
(b) The following definitions set forth in Section 1.1 of the Loan
Agreement hereby are amended and restated in their entirety as follows:
"Eligible Accounts" means Eligible UK Accounts.
"Maximum Subsidiary Revolver Amount" means $1,700,000.
(c) The definitions of "ASP Dilution," "ASP Dilution Reserve",
"Eligible ASP Accounts," and "Renewal Date" set forth in Section 1.1 of the Loan
Agreement hereby are deleted in their entirety.
(d) Section 2.1(a) of the Loan Agreement hereby is amended and
restated in its entirety to read as follows:
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2.1 REVOLVER ADVANCES.
(a) Subject to the terms and conditions of this
Agreement, and during the term of this Agreement, Lender agrees to
make advances ("Subsidiary Borrower Advances") to Subsidiary
Borrower in an amount at any one time outstanding not to exceed an
amount equal to the lesser of (i) the then extant Maximum
Subsidiary Revolver Amount less the Letter of Credit Usage, or
(ii) the Subsidiary Borrower Borrowing Base less the Letter of
Credit Usage. For purposes of this Agreement, "Subsidiary Borrower
Borrowing Base," as of any date of determination, shall mean the
result of:
(y) the lesser of
(i) 85% of the amount of Eligible UK
Accounts; provided, however, that the amount of
Eligible UK Accounts owing by all Account Debtors
located in the Republic of Ireland shall not exceed
$250,000, less the amount, if any, of the Dilution
Reserve, and
(ii) an amount equal to Subsidiary Borrower's
Collections with respect to Accounts for the
immediately preceding 45 day period, minus
(z) the aggregate amount of reserves, if any,
established by Lender under Section 2.1(b).
(e) Section 3.4 of the Loan Agreement hereby is amended and
restated in its entirety to read as follows:
3.4 TERM. This Agreement shall become effective upon the
execution and delivery hereof by Subsidiary Borrower and Lender
and shall continue in full force and effect for a term ending on
November 30, 2001 (the "Maturity Date"). The foregoing
notwithstanding, Lender shall have the right to terminate its
obligations under this Agreement immediately and without notice
upon the occurrence and during the continuation of an Event of
Default.
(f) The first sentence of Section 3.6 of the Loan Agreement hereby
is amended and restated in its entirety to read as follows:
Subsidiary Borrower has the option, at any time upon 30
days prior written notice by Subsidiary Borrower to Lender, to
terminate this Agreement by paying to Lender, in cash, the
Obligations (including either (i) providing cash collateral to be
held by Lender in an amount
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equal to 105% of the then extant Letter of Credit Usage, or (ii)
causing the original Letters of Credit to be returned to Lender).
(g) Section 6.2(h) of the Loan Agreement hereby is amended and
restated in its entirety to read as follows:
(h) a calculation of Dilution for the prior month, and
2. Conditions Precedent to Amendment. The satisfaction of each of the
following, unless waived or deferred by Lender in its sole discretion, shall
constitute conditions precedent to the effectiveness of this Amendment and each
and every provision hereof:
(a) Lender shall have received this Amendment, duly
executed by the parties hereto, and the same shall be in full force and effect.
(b) The representations and warranties in this Amendment,
the Loan Agreement as amended by this Amendment, and the other Loan Documents
shall be true and correct in all respects on and as of the date hereof, as
though made on such date (except to the extent that such representations and
warranties relate solely to an earlier date).
(c) After giving effect to this Amendment, no Default or
Event of Default shall have occurred and be continuing on the date hereof, nor
shall result from the consummation of the transactions contemplated herein.
(d) No injunction, writ, restraining order, or other order
of any nature prohibiting, directly or indirectly, the consummation of the
transactions contemplated herein shall have been issued and remain in force by
any Governmental Authority against any Borrower or Lender.
(e) Lender shall have received the reaffirmation and
consent attached hereto as Attachment "A," duly executed and delivered by an
authorized official of each of the Borrowers and UK Holding Company.
3. Representations and Warranties. Subsidiary Borrower hereby represents
and warrants to Lender that (a) the execution, delivery, and performance of this
Amendment and of the Loan Agreement, as amended by this Amendment, are within
Subsidiary Borrower's powers, have been duly authorized by all necessary action,
and are not in contravention of any law, rule, or regulation, or any order,
judgment, decree, writ, injunction, or award of any arbitrator, court, or
Governmental Authority, or of the terms of its Governing Documents, or of any
contract or undertaking to which it is a party or by which any of its properties
may be bound or affected, (b) this Amendment and the Loan Agreement, as amended
by this Amendment, constitute Subsidiary Borrower's legal, valid, and binding
obligation, enforceable against Subsidiary Borrower in accordance with its
terms, and (c) this Amendment has been duly executed and delivered by Subsidiary
Borrower.
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4. Choice of Law. The validity of this Amendment, its construction,
interpretation and enforcement, the rights of the parties hereunder, shall be
determined under, governed by, and construed in accordance with the laws of the
State of California.
5. Counterparts; Telefacsimile Execution. This Amendment may be executed
in any number of counterparts and by different parties and separate
counterparts, each of which when so executed and delivered, shall be deemed an
original, and all of which, when taken together, shall constitute one and the
same instrument. Delivery of an executed counterpart of a signature page to this
Amendment by telefacsimile shall be effective as delivery of a manually executed
counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by telefacsimile also shall deliver a manually executed
counterpart of this Amendment but the failure to deliver a manually executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Amendment.
6. Effect on Loan Documents.
(a) The Loan Agreement, as amended hereby, and the other
Loan Documents shall be and remain in full force and effect in accordance with
its respective terms and hereby is ratified and confirmed in all respects. The
execution, delivery, and performance of this Amendment shall not, except as
expressly set forth herein, operate as a waiver of or, except as expressly set
forth herein, as an amendment of, any right, power, or remedy of Lender under
the Loan Agreement, as in effect prior to the date hereof. The waivers,
consents, and modifications herein are limited to the specifics hereof, shall
not apply with respect to any facts or occurrences other than those on which the
same are based, shall not excuse future non-compliance with the Loan Agreement,
and shall not operate as a consent to any further or other matter, under the
Loan Documents.
(b) Upon and after the effectiveness of this Amendment,
each reference in the Loan Agreement to "this Agreement", "hereunder", "herein",
"hereof" or words of like import referring to the Loan Agreement, and each
reference in the other Loan Documents to "the Agreement", "thereunder",
"therein", "thereof" or words of like import referring to the Loan Agreement,
shall mean and be a reference to the Loan Agreement as modified and amended
hereby.
(c) To the extent that any terms and conditions in any of
the Loan Documents shall contradict or be in conflict with any terms or
conditions of the Loan Agreement, after giving effect to this Amendment, such
terms and conditions are hereby deemed modified or amended accordingly to
reflect the terms and conditions of the Loan Agreement as modified or amended
hereby.
7. Further Assurances. Subsidiary Borrower shall execute and deliver all
agreements, documents, and instruments, in form and substance satisfactory to
Lender, and take all actions as Lender may reasonably request from time to time,
to perfect and maintain the perfection and priority of Lender's security
interests in the Collateral and to fully consummate the transactions
contemplated under this Amendment and the Loan Agreement, as amended by this
Amendment.
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8. Entire Agreement. This Amendment, together with all other instruments,
agreements, and certificates executed by the parties in connection herewith or
with reference thereto, embody the entire understanding and agreement between
the parties hereto and thereto with respect to the subject matter hereof and
thereof and supersede all prior agreements, understandings, and inducements,
whether express or implied, oral or written.
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IN WITNESS WHEREOF, the parties have entered into this Amendment
as of the date first above written.
FUTURELINK EUROPE LIMITED, a company
organized under the laws of England and Wales
By: /s/ XXXX X. PASEA
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Title: Managing Director (Europe)
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/ XXXX XXXXXX
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Title: Vice President, Senior Account
Executive
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ATTACHMENT "A"
REAFFIRMATION AND CONSENT
All capitalized terms used herein shall have the meanings ascribed
to them in that certain Amendment Number One to Loan Agreement, dated as of
April __, 2001 (the "Amendment"). The undersigned hereby (a) represents and
warrants to Lender that the execution, delivery, and performance of this
Reaffirmation and Consent are within its corporate powers, have been duly
authorized by all necessary corporate action, and are not in contravention of
any law, rule or regulation, or any order, judgment, decree, writ, injunction,
or award of any arbitrator, court, or governmental authority, or of the terms of
its charter or bylaws, or of any contract or undertaking to which it is a party
or by which any of its properties may be bound of affected; (b) consents to the
amendments of the Loan Agreement as amended by the Amendment; (c) acknowledges
and reaffirms its obligations owing to Lender under the UK Guaranty (as defined
in the Loan Agreement) and any other Loan Documents (as defined in the Loan
Agreement) to which it is a party; and (d) agrees that each of the UK Guaranty
(as defined in the Loan Agreement) and any other Loan Documents (as defined in
the Loan Agreement) to which it is a party is and shall remain in full force and
effect.
Although the undersigned has been informed of the matters set
forth herein and has acknowledged and agreed to same, it understands that Lender
has no obligations to inform it of such matters in the future or to seek its
acknowledgement or agreement to future amendments, and nothing herein shall
create such a duty. Delivery of an executed counterpart of this Reaffirmation
and Consent by telefacsimile shall be equally as effective as delivery of an
original executed counterpart of this Reaffirmation and Consent. Any party
delivering an executed counterpart of this Reaffirmation and Consent by
telefacsimile also shall deliver an original executed counterpart of this
Reaffirmation and Consent, but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Reaffirmation and Consent.
FUTURELINK CORP.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
FUTURELINK MICRO VISIONS CORP.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
[signature pages continue]
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FUTURELINK ASYNC CORP.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
FUTURELINK PLEASANTON CORP.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
FUTURELINK MADISON CORP.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
FUTURELINK VSI CORP.,
a Maryland corporation
By: /s/ XXXXXX X. XXXXXX
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Title: President and Chief Executive Officer
KNS HOLDINGS LIMITED, a company organized
under the laws of England and Wales
By: /s/ XXXX X. PASEA
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Title: Managing Director (Europe)
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