EXHIBIT 10.3
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LETTER ACKNOWLEDGING NEW FINANCIAL COVENANTS TO THE AMENDED
AND RESTATED LOAN AND SECURITY AGREEMENTS, DATED DECEMBER 31, 0000
XXXXXXX XXX XXXXXXXXXX XXX XXXXXXXXXX BANK, N.A.
July 17, 1997
Xx. Xxxx X. Landing, II
Chief Financial Officer
IBAH, Inc.
Four Valley Square
000 Xxxxxxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000
Re: New Financial Covenants
Dear Xxxx:
This letter is written in reference to the Amended and Restated Loan and
Security Agreement dated 12/31/96 ("Agreement") between CoreStates Bank, N.A.
(formerly Meridian Bank) ("Bank"), and IBAH, Inc., a Delaware corporation
("Debtor").
The Bank hereby amends and restates section 7.13 Financial Covenants (in its
entirety) of the Agreement as of 7/1/97:
7.13 Financial Covenants: Debtor shall comply with the following at the
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respective times indicated:
(A) Debtor Coverage Ratio: Debtor to maintain a minimum debt coverage ratio of
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1.35x (rolling for quarters) for the term of the loan(s). Covenant to be tested
quarterly. Debt coverage ratio defined as net income less dividend plus
depreciation/amortization dividend by current portion of long term debt and
current portion of capital leases. For the periods ending 9/30/97; 12/31/97 and
3/31/98 the net income portion of the calculation will be annualized for the
quarter or quarters elapsed. From 6/30/98, forward the calculation will be
on a rolling four quarter basis.
(B) Fund Debt Ratio: Debtor to maintain a minimum funded debt coverage ratio of
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1.25x for the term of the loan(s). Covenant to be tested quarterly. Funded debt
ratio defined as cash and cash equivalents plus short-term investments plus
billed accounts receivable divided by funded debt (short-term and long-term).
Sincerely,
/s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Vice President
Accepted and agreed this 21st day of July, 1997.
IBAH, Inc.
By: /s/Xxxx X. Xxxxxxx, XX
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Xxxx X. Xxxxxxx, XX
Chief Financial Officer
