AMENDMENT #4 TO
AGREEMENT FOR WHOLESALE FINANCING
(Security Agreement)
This Amendment #4 to the Agreement for Wholesale Financing (this "Amendment") is
made as of April 30, 1998 by and between MicroAge Computer Centers, Inc., a
Delaware corporation ("MCCI"), MicroAge Logistics Services, Inc., a Delaware
corporation ("MLS"), Pinacor, Inc., a Delaware corporation ("Pinacor"), and IBM
Credit Corporation, a Delaware corporation ("IBM Credit").
RECITALS
WHEREAS, MCCI, MLS and IBM Credit have entered into that certain
Agreement for Wholesale Financing dated as of December 17, 1993 (as amended,
supplemented or as otherwise modified from time to time, the "Agreement");
WHEREAS, Pinacor is an affiliate of MCCI and MLS and will be acquiring
inventory with financing provided by IBM Credit;
WHEREAS, IBM Credit, MCCI, MLS and Pinacor believe it is in their best
interests to make Pinacor a party to the Agreement;
WHEREAS, MCCI, MLS and Pinacor desire to participate in the corporate
restructuring described on Exhibit C attached hereto (the "Restructuring")' and
WHEREAS, MCCI, MLS and Pinacor desire the consent of IBM Credit to the
Restructuring and in connection therewith to amend the Agreement in the manner
hereinafter set forth.
AGREEMENT
NOW, THEREFORE, for and in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, IBM Credit ("you"), MCCI, MLS and Pinacor ("we" or "us") hereby
agree as follows (except as otherwise defined herein, all capitalized terms
shall have the same meanings set forth in the Agreement).
1. MCCI, MLS and Pinacor hereby represent and warrant to IBM Credit
that Exhibit C completely and accurately describes the Restructuring. IBM Credit
consents to the Restructuring.
2. Pinacor is hereby made a party to the Agreement, and all references
to "MCCI" in the Agreement shall be deemed to be references to MicroAge Computer
Centers, Inc., MicroAge Logistics Services, Inc., and Pinacor, Inc. acting
jointly and severally. Pinacor hereby expressly assumes, on a joint and several
basis, all obligations of MCCI and MLS under the agreement, including without
limitation, all obligations regarding interest charges, fees and other amounts
payable to IBM Credit under letter agreements executed by MCCI, MLS and IBM
Credit in connection with the Agreement. Nothing herein shall be deemed to
release MCCI or MLS from any such obligations. MCCI, MLS and Pinacor
hereby affirm all representations, warranties and obligations of MCCI and MLS in
the Agreement. MCCI, MLS and Pinacor agree that they shall be jointly and
severally responsible and liable for all obligations, representations and
warranties of MCCI and/or MLS and/or Pinacor under the Agreement, as amended
hereby.
In furtherance of the foregoing and not as a limitation, to secure all of its
current and future debts owed to IBM Credit, whether under the Agreement or any
current or future guaranty or other agreement, Pinacor grants to IBM Credit a
security interest in all inventory, equipment, fixtures, accounts, contract
rights, chattel paper, instruments, documents of title, deposit accounts,
reserves and general intangibles, now owned or hereafter acquired, and all
attachments, parts, accessories, accessions, substitutions, and replacements
thereto and all proceeds thereof, and to the extent related to the property
described above, all books, correspondence, credit files, records, invoices and
other papers and documents, including without limitation, to the extent so
related, all tapes, cards, computer runs, computer programs and other papers and
documents in the possession or control of Pinacor or any computer bureau from
time to time acting for Pinacor, and, to the extent so related, all rights in,
to and under all policies of insurance, including claims of rights to payments
thereunder and proceeds therefrom, including any credit insurance, and all
proceeds thereof.
3. Paragraph 13(c) of the Agreement is hereby amended by deleting such
Paragraph 13(c) in its entirety and substituting, in lieu thereof, the
following.
"(c) For the period commencing May 1, 1998 and ending August 31, 1998,
the Consolidated Group shall at all times maintain, on a consolidated basis, a
ratio of (i) the sum of (A) total liabilities plus (B) that portion of the
Outstanding Balance (as defined in the Purchase Agreement executed with Deutche
Financial Services (DFS) of all Sold Receivables (as defined in the Purchase
Agreement executed with DFS) which we and our affiliates have elected to receive
if we and our affiliates have received any or all of the amount due prior to
Collections (as defined in the Purchase Agreement executed with DFS) of such
Sold Receivables by DFS pursuant to Section 2.1.B of such Purchase Agreement, to
(ii) Tangible Net Worth of less than seven and one half (7.5) to one (1.0)(the
"Leverage Ratio"). Commencing September 1, 1998, the Leverage Ratio shall at all
time be less than six and one half (6.5) to one (1).
4. Exhibit A to the Agreement is hereby restated in its entirety and
replaced by Exhibit A attached hereto and incorporated herein by reference.
5. Exhibit B to the Agreement is hereby restated in its entirety and
replaced by Exhibit B attached hereto and incorporated herein by reference.
6. Representations and Warranties. We make to you the following
representations and warranties all of which are material and are made to induce
you to enter into this Agreement.
6.1 Accuracy and Completeness of Warranties and Representations. All
representations made by us in the Agreement were true and accurate and complete
in every respect as of the date made, and, as amended by this Amendment, all
representations made by us in the Agreement are true, accurate and complete in
every material respect as of the date hereof, and do not fail to disclose any
material fact necessary to make representations not misleading.
6.2 Violation of Other Agreements. The execution and delivery of this
Amendment and the performance and observance of the covenants to be performed
and observed hereunder do not violate or cause us not to be in compliance with
the terms of any agreement to which we are a party.
6.3 Litigation. Except as has been disclosed by us to you in writing,
there is no litigation, proceeding, investigation or labor dispute pending or
threatened against us, which if adversely determined, would materially adversely
affect our ability to perform our obligations under the Agreement and the other
documents, instruments and agreements executed in connection therewith or
pursuant hereto.
6.4 Enforceability of Amendment. This Amendment has been duly
authorized, executed and delivered by us and is enforceable against us in
accordance with its terms.
7. Ratification of Agreement. Except as specifically amended hereby,
all of the provisions of the Agreement shall remain unamended and in full force
and effect. We hereby, ratify, confirm and agree that the Agreement, as amended
hereby, represents a valid and enforceable obligation of ours, and is not
subject to any claims, offsets or defense.
8. Governing Law. This Amendment shall be governed by and interpreted
in accordance with the laws of the State of Arizona.
9. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement.
IN WITNESS WHEREOF, this Amendment has been duly executed by the authorized
officers of the undersigned as of the day and year first above written.
MICROAGE COMPUTER CENTERS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Title: Treasurer
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/s/ Xxxxx X. Xxxxx
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Asst. Secretary
MICROAGE LOGISTICS SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxx
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Title: Treasurer
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/s/ Xxxxx X. Xxxxx
---------------------------------
Asst. Secretary
PINACOR, Inc.
By: /s/ Xxxxx X. Xxxxxx
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Title: Treasurer
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/s/ Xxxxx X. Xxxxx
---------------------------------
Asst. Secretary
Accepted and Agreed:
IBM CREDIT CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
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Title: Mgr. Global Strategic
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Account Marketing
