EXHIBIT 10.04(b)
AMENDMENT NO. 1 TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
("Amendment No. 1") is made as of the 30th day of September, 1997, by and
among THE HUNTER GROUP, INC., a Maryland corporation ("THG"), THG CONSULTING
INC., a corporation organized under the laws of Canada ("THG Canada"), THE
HUNTER GROUP (SINGAPORE) PTE LTD, a corporation incorporated under The
Companies Act of the Republic of Singapore ("THG Singapore"), HUNTER
CONSULTING ASSOCIATES, PTY. LIMITED, a corporation organized under the laws
of New South Wales, Australia ("THG Australia"), HUNTER CONSULTING
ASSOCIATES, LIMITED, a corporation organized under the laws of Great Britain
("THG England"), and THE HUNTER GROUP INTERNATIONAL, INC., a Delaware
corporation ("THG International," and THG Canada, THG Singapore, THG
Australia, THG England and THG International collectively, "Affiliate
Borrowers" and each individually an "Affiliate Borrower," and THG and
Affiliate Borrowers collectively, "Borrowers," and each individually a
"Borrower"), and SIGNET BANK, a Virginia banking corporation ("Bank").
RECITALS
Reference is made to that certain Amended and Restated Loan and Security
Agreement made as of June 20, 1997, by and among Borrowers and Bank (the
"Loan Agreement"), pursuant to which Bank extended credit to Borrowers in an
aggregate principal amount not to exceed Eight Million Dollars
($8,000,000.00). In order to amend the Loan Agreement as provided herein, the
parties hereto have entered into this Amendment No. 1.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants set forth herein, and such other consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:
1. All capitalized terms not otherwise defined herein which are defined
in the Loan Agreement shall have the same meanings assigned to them in the
Loan Agreement.
2. All references herein, in the Loan Agreement and in the Note to
"this Loan Agreement", "this Agreement", "the Loan Agreement" and "the
Agreement" shall mean and include the Loan Agreement as amended by this
Amendment No. 1.
3. The definition of "Maximum Loan Amount" is hereby amended by
amending the final sentence thereof to read in its entirety as follows:
Notwithstanding the foregoing, but subject to the terms of the
Closing Agreement, upon the giving to Bank of not less than ten (10)
days written notice prior to the first day of any calendar month
commencing on or after July 1, 1997, Borrowers may elect to limit the
Maximum Loan Amount during such month to the lesser of (x) the amount
determined under clause (b)(i), or (y) $6,000,000.00 or $7,000,000.00
(as indicated by Borrowers in such notice); provided, however, that
from and after the Initial Public Offering or the Private Equity
Offering (as defined in Subsection 6.17(a) hereof), the Maximum Loan
Amount shall be the lesser of (1) the amount determined under clause
(b)(i), or (2) $8,000,000.00.
4. The following defined term is hereby added to Section 1 of the Loan
Agreement in the alphabetically correct location"
"Initial Public Offering" shall mean the initial public offering
of the common stock of THG.
5. Subsection 6.15 of the Loan Agreement is hereby amended to read in
its entirety as follows:
6.15 Tangible Net Worth. (a) Maintain Consolidated Tangible Net
Worth of not less than (i) $25,000.00 as of September 30, 1997; (ii)
$225,000.00 as of December 31, 1997, and Xxxxx 00, 0000, (xxx)
$400,000.00 as of June 30, 1998, (iv) $2,000,000.00 as of September 30,
1998, and (v) $4,500,000.00 as of December 31, 1998, and at all times
thereafter; provided, however, that from and after the consummation of
the Initial Public Offering, Borrowers shall maintain Consolidated
Tangible Net Worth of not less than $15,000,000.00. Compliance with the
provisions of this Subsection 6.15(a) shall be measured as of the end
of each quarterly accounting period of Borrowers, commencing with the
quarterly accounting period ending September 30, 1997.
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(b) Maintain a ratio of Consolidated Liabilities to
Consolidated Tangible Net Worth of not greater than 7.0 to 1
commencing December 31, 1998, and at all times thereafter;
provided, however, that from and after the consummation of the
Initial Public Offering, Borrowers shall maintain a ratio of
Consolidated Liabilities to Consolidated Tangible Net Worth of not
greater than 2.0 to 1. Compliance with the provisions of this
Subsection 6.15(b) shall be measured as of the end of each
quarterly accounting period of Borrowers.
6. Subsection 6.16 of the Loan Agreement is hereby amended to read in its
entirety as follows:
6.16 Net Income. Realize positive Consolidated Net Income for each
quarterly accounting period of Borrowers, commencing with the quarterly
accounting period ending December 31, 1997.
7. Subsection 6.17(a) of the Loan Agreement is hereby amended to read in
its entirety as follows:
6.17 Additional Fees. (a) Pay to Bank (i) at Closing a fee (the
"Closing Fee") in the amount of $60,000.00, and (ii) on the first Banking
Day of each calendar month thereafter, a fee (the "Commitment Fee") in
the amount of three-quarters of one percent (0.75%) (the "Commitment Fee
Percentage") of the Maximum Loan Amount on such date (determined with
reference to the applicable fixed dollar amount expressed in the
"Maximum Loan Amount" definition and not the product of Acceptable
Receivables times the Receivables Loan Percentage); provided, however,
that if on or before February 28, 1998, THG has not consummated (A) a
private offering of stock and/or subordinated indebtedness of THG on
terms and conditions satisfactory to Bank resulting in the receipt by
THG of net proceeds after accounting for all costs of issuance of not
less than $10,000,000.00 (the "Private Equity Offering"), or (B) the
Initial Public Offering, the Commitment Fee Percentage shall immediately
be increased from three-quarters of one percent (0.75%) to one and
one-half percent (1.5%). Payment of the Closing Fee and the Commitment
Fees shall be in addition to the payment of all other fees and expenses
payable under this Agreement, including,
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without limitation, those fees and expenses payable pursuant to
Subsections 2.01(c) and 10.02 hereof. Subject to the provisions of
Subsection 6.17(b) and Subsection 6.17(c) below, the Closing Fee and
Commitment Fees shall be deemed to have been earned by Bank on the date
of payment and shall not be subject to refund or rebate by Bank.
8. Subsection 6.17(c) of the Loan Agreement is hereby
amended to read in its entirety as follows:
(c) Notwithstanding the provisions of Subsection
6.17(a) above, if Borrowers do not elect the Warrant Option
(as defined in Subsection 6.18 below) Borrowers' obligation to
pay certain Commitment Fees shall be suspended under the
circumstances described in this Subsection 6.17(c). If
Borrowers certify to Bank at any time, that Consolidated
Tangible Net Worth is equal to or greater than $10,000,000.00,
Borrowers' obligation to pay additional Commitment Fees shall
be suspended; provided,however, that if the monthly financial
statements of Borrowers delivered to Bank in accordance with
the provisions of Subsection 6.01(a) hereof for the last
month of the quarterly accounting period during which such
certification has been delivered to Bank indicate that as of
the last day of such monthly accounting period (A)
Consolidated Tangible Net Worth was less than $10,000,000.00,
or (B) the ratio of Consolidated Liabilities to Consolidated
Tangible Net Worth was greater than 2.5 to 1.0, Borrowers
shall upon the demand of Bank pay to Bank the Commitment Fees
which would have been payable but for such suspension, and the
obligation of Borrowers to pay future Commitment Fees shall
resume. Further, if the financial statements of Borrowers for
the last month of any quarterly accounting period thereafter
(a "Subsequent Calendar Quarter") indicate that as of the last
day of such monthly accounting period (A) Consolidated
Tangible Net Worth was less than $10,000,000.00, or (B) the
ratio of Consolidated Liabilities to Consolidated Tangible Net
Worth was greater than 2.5 to 1.0, Borrowers shall pay to Bank
upon demand the Commitment Fees which would otherwise have
been payable during such calendar quarter.
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9. Subsection 7.16 of the Loan Agreement is hereby amended to read
in its entirety as follows:
7.16 Dividends. Directly or indirectly declare or pay any
dividend on, or make any other distribution with respect to
(whether by reduction of capital or otherwise), any shares of its
capital stock; provided, however, that (a) any Affiliate Borrower
shall be permitted to declare and pay dividends to THG, and (b) if
(i) the Initial Public Offering has been consummated, and (ii) no
Default or Event of Default shall have occurred and be continuing,
or would exist after the declaration and payment thereof, THG may
declare and pay dividends on its common stock in any quarterly
accounting period in an aggregate amount which does not exceed
fifty percent (50%) of the net income of THG for the immediately
preceding quarterly accounting period.
10. Borrowers acknowledge and agree that Bank's prior written
consent to the Private Equity Offering shall be required; provided, however,
that such consent shall not unreasonably be withheld if prior to the
consummation thereof Borrowers and Bank shall have amended the Loan
Agreement to incorporate revised financial covenants satisfactory to Bank in
its sole and absolute discretion. Bank acknowledges that it has consented to
the Initial Public Offering in accordance with the provisions of a certain
letter to THG of even date herewith.
11. Borrowers and Bank acknowledge and agree that the Warrant
Option has expired without exercise by Borrowers.
12. Concurrently with the execution hereof, Borrowers shall pay to
Bank in consideration of Bank's execution hereof an Amendment Fee in the
amount of $30,000.00, which shall be in addition to all other fees and
expenses payable by Borrowers under the Loan Agreement. An additional fee in
the amount of $20,000.00 (which shall be in addition to all other fees and
expenses payable by Borrowers under the Loan Agreement) shall be payable by
Borrowers to Bank on or before November 30, 1997; provided, however, that
such additional fee shall not be payable if the Initial Public Offering shall
have been consummated on or before such date and no Default or Event of
Default shall have occurred and be continuing.
13. Except as amended hereby, the Loan Agreement shall remain
unchanged, and the Loan Agreement, as so amended, shall continue in full
force and effect in accordance with its terms.
14. This Amendment No. 1 may be executed in any number of
counterparts and by the different parties hereto on separate counterparts,
each of
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which, when so executed and delivered, shall be an original, but all such
counterparts shall together constitute one and the same instrument.
15. The recitals hereto and all of the terms of the Loan Agreement
are hereby incorporated into and made a part hereof as though fully set forth
herein.
[SIGNATURES CONTAINED ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to
Amended and Restated Loan and Security Agreement to be duly executed under
seal by their duly authorized respective officers as of the day and year
first above written.
ATTEST/WITNESS: THE HUNTER GROUP, INC.
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX X. XXXXXX (SEAL)
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Name:
----------------
Title: President
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THG CONSULTING INC.
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX X. XXXXXX (SEAL)
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Name:
----------------
Title: President
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THE HUNTER GROUP (SINGAPORE)
PTE LTD
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX XXX XXXXXX (SEAL)
-------------------- ----------------------
Name:
----------------
Title: President
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HUNTER CONSULTING ASSOCIATES,
PTY, LIMITED
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX X. XXXXXX (SEAL)
-------------------- ----------------------
Name:
----------------
Title: President
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HUNTER CONSULTING ASSOCIATES,
LIMITED
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX X. XXXXXX (SEAL)
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Name:
---------------
Title: President
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THE HUNTER GROUP
INTERNATIONAL, INC.
/s/ A. XXXXX XXXXXXX By: /s/ XXXXX X. XXXXXX (SEAL)
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Name:
----------------
Title: President
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BORROWERS
SIGNET BANK
/s/ A. XXXXX XXXXXXX By: /s/ XXXXXX X. BOUSILIER (SEAL)
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Xxxxxx X. Bousilier
Vice President
BANK
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