FIFTH LOAN MODIFICATION
AGREEMENT
This Fifth Loan
Modification Agreement (this “Loan Modification
Agreement”) is entered into as of June 18, 2009, and is
effective as of March 17, 2009, by and among SILICON VALLEY
BANK, a California corporation (“SVB”), as
collateral agent (the “Collateral Agent”) for the
Lenders and administrative agent (the “Administrative
Agent”) for the Lenders (Collateral Agent and Administrative
Agent are collectively the “Agent”), and the Lenders
listed on Schedule 1.1 and otherwise party hereto, including,
without limitation, SVB and JPMORGAN CHASE BANK, N.A.
(“JPMorgan”) (SVB and JPMorgan are, collectively, the
“Joint Bookrunners”) and GAIN CAPITAL HOLDINGS,
INC., a Delaware corporation
(“Borrower”).
1.
DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS . Among
other indebtedness and obligations which may be owing by Borrower
to the Lenders, Borrower is indebted to the Lenders pursuant to a
loan arrangement dated as of March 29, 2006, evidenced by,
among other documents, a certain Loan and Security Agreement dated
as of March 29, 2006, between Borrower and the Lenders, as
amended by a certain First Loan Modification Agreement dated as of
October 16, 2006, between Borrower and Lenders, as further amended
by a certain Second Loan Modification Agreement dated as of
March 20, 2007, between Borrower and Lenders, as further
amended by a certain Third Loan Modification Agreement dated as of
June 6, 2007, between Borrower and Lenders, and as further
amended by a certain Fourth Loan Modification Agreement dated as of
March 18, 2008, between Borrower and Lenders (as amended, the
“Loan Agreement”). Capitalized terms used but not
otherwise defined herein shall have the same meaning as in the Loan
Agreement.
2.
DESCRIPTION OF COLLATERAL . Repayment of the Obligations is
secured by the Collateral as described in the Loan Agreement
(together with any other collateral security granted to Agent, for
the ratable benefit of the Lenders, the “Security
Documents”). Hereinafter, the Security Documents, together
with all other documents evidencing or securing the Obligations
shall be referred to as the “Existing Loan
Documents”.
3.
DESCRIPTION OF CHANGE IN TERMS .
A.
Modifications to Loan Agreement .
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1.
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The
Loan Agreement shall be amended by deleting the following text
appearing in Section 2.3 thereof:
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(i) Credit
Extensions (other than Advances) . Each Credit Extension (other
than Advances) shall bear interest on the outstanding principal
amount thereof from the date when made, continued or converted
until paid in full at a rate per annum equal to the Prime
Rate plus the Prime Rate Margin or the LIBOR Rate plus the LIBOR
Rate Margin, as the case may be. On and after the expiration of any
Interest Period applicable to any LIBOR Credit Extension
outstanding on the date of occurrence of an Event of Default or
acceleration of the Obligations, the Effective Amount of such LIBOR
Credit Extension shall, during the continuance of such Event of
Default or after acceleration, bear interest at a rate per annum
equal to the Default Rate (as defined below). Pursuant to the terms
hereof, interest on each Credit Extension (other than Advances)
shall be paid in arrears on each Interest Payment Date. Interest
shall also be paid on the date of any prepayment of any Credit
Extension (other than Advances)
pursuant to
this Agreement for the portion of any Credit Extension (other than
Advances) so prepaid and upon payment (including prepayment) in
full thereof. All accrued but unpaid interest on the Credit
Extensions (other than Advances) shall be due and payable on the
Term Loan Maturity Date.
(ii)
Advances . Subject to Section 2.3(c), the principal
amount outstanding under the Revolving Line shall accrue interest
at a floating per annum rate equal to three quarters of one
percentage point (0.75%) above the Prime Rate, which interest shall
be payable monthly in accordance with Section 2.3(g)
below.”
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and
inserting in lieu thereof the following:
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(i) Credit
Extensions (other than Advances) . Each Credit Extension (other
than Advances) shall bear interest on the outstanding principal
amount thereof from the date when made, continued or converted
until paid in full at a rate per annum equal to the greater
of (A) four and three-quarters of one percent (4.75%), and
(B) the Prime Rate plus the Prime Rate Margin or the LIBOR
Rate plus the LIBOR Rate Margin, as the case may be. On and after
the expiration of any Interest Period applicable to any LIBOR
Credit Extension outstanding on the date of occurrence of an Event
of Default or acceleration of the Obligations, the Effective Amount
of such LIBOR Credit Extension shall, during the continuance of
such Event of Default or after acceleration, bear interest at a
rate per annum equal to the Default Rate (as defined below).
Pursuant to the terms hereof, interest on each Credit Extension
(other than Advances) shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any
prepayment of any Credit Extension (other than Advances) pursuant
to this Agreement for the portion of any Credit Extension (other
than Advances) so prepaid and upon payment (including prepayment)
in full thereof. All accrued but unpaid interest on the Credit
Extensions (other than Advances) shall be due and payable on the
Term Loan Maturity Date.
(ii)
Advances . Subject to Section 2.3(c), the principal
amount outstanding under the Revolving Line shall accrue interest
at a floating per annum rate equal to the greater of (A) four and
three-quarters of one percent (4.75%), and (B) three quarters
of one percentage point (0.75%) above the Prime Rate, which
interest shall be payable monthly in accordance with
Section 2.3(g) below.”
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2.
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The
Loan Agreement shall be amended by deleting the following appearing
as Section 6.7 thereof:
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“ 6.7
Financial Covenants.
Borrower
and its Subsidiaries shall maintain at all times, to be tested as
of the last day of each quarter, on a consolidated basis, unless
otherwise noted:
(a)
Debt Service Coverage Ratio . A ratio of EBITDA (plus all
other non-cash and/or non-recurring expenses) for the subject
quarter to the aggregate amount of Borrower’s quarterly
principal payment and monthly interest payments for borrowed money
(with respect to the three (3) months during such quarter), in
each case calculated as of the last day of each fiscal quarter, of
at least (i) 2.0 to 1.0 as of the quarters ending March 31,
2006, June 30, 2006, and September 30, 2006,
(ii) 1.50 to 1.0 as of the quarters ending December 31,
2006, March 31, 2007 and June 30, 2007, (iii) 1.75 to 1.0
as of the quarters ending September 30, 2007,
December 31, 2007, March 31, 2008 and June 30, 2008, and
(iv) 2.0 to 1.0 as of the quarter ending September 30,
2008 and as of the last day of each subsequent fiscal
quarter.
(b)
Total Funded Debt/EBITDA . A Total Funded Debt Ratio (with
respect to the immediately preceding twelve (12) month period)
of a maximum of (i) 2.0 to 1.0 as of the quarters ending
March 31, 2006, June 30, 2006, and September 30,
2006, (ii) 1.75 to 1.0 as of the quarter ending December 31,
2006, (iii) 1.50 to 1.0 as of the quarter ending
March 31, 2007, (iv) 2.0 to 1.0 as of the quarters ending
June 30, 2007 and September 30, 2007, (v) 1.75 to 1.0 as
of the quarter ending December 31, 2007, and (vi) 1.50 to
1.0 as of the quarter ending March 31, 2008 and as of the last
day of each quarter thereafter. With respect to the quarter ending
March 31, 2009 and each quarter thereafter, the Total Funded
Debt Ratio covenant levels shall be set by Lenders in their sole
discretion based upon Borrower’s 2009 operating
plan/forecast, but not less than 1.50 to 1.0 (unless Borrower and
Lenders mutually agree to a lower covenant level); provided,
however, in the event that Borrower does not agree in writing to
such covenant levels on or before February 28, 2009, then all
Obligations shall be due and payable in full on March 31,
2009. The failure of Borrower to deliver a 2009 operating plan to
Agent on or prior January 31, 2009 shall result in an immediate
Event of Default for which there shall be no grace or cure
period.”
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and
inserting in lieu thereof the following:
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“ 6.7
Financial Covenants.
Borrower and its
Subsidiaries shall maintain at all times, to be tested as of the
last day of each quarter, on a consolidated basis, unless otherwise
noted:
(a) Debt
Service Coverage Ratio . A ratio of EBITDA for the subject
quarter to the aggregate amount of Borrower’s quarterly
principal payment and monthly interest payments for borrowed money
(with respect to the three (3) months during such quarter), in
each case calculated as of the last day of each fiscal quarter, of
at least (i) 2.0 to 1.0 as of the quarters ending
March 31, 2006, June 30, 2006, and September 30,
2006, (ii) 1.50 to 1.0 as of the quarters ending
December 31, 2006, March 31, 2007 and June 30, 2007,
(iii) 1.75 to 1.0 as of the quarters ending September 30,
2007, December 31, 2007, March 31, 2008 and June 30,
2008, and (iv) 2.0 to 1.0 as of the quarter ending
September 30, 2008 and as of the last day of each subsequent
fiscal quarter.
(b) Total
Funded Debt/EBITDA . A Total Funded De
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