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Exhibit
10.1
AMENDMENT NO. 5 TO CREDIT
AGREEMENT AND WAIVER
This Amendment No. 5 to
Credit Agreement and Waiver (“Amendment”) executed as
of May 14, 2008 by and between Software Brokers of America, Inc., a
Florida corporation (“Company”) and Comerica Bank
(“Bank”).
RECITALS:
A. Company and Bank entered
into that certain Credit Agreement dated August 25, 2005, as
amended four times (“Agreement”).
B. Company and Bank desire to
amend the Agreement as set forth below
NOW, THEREFORE, Company and
Bank agree as follows:
1. Company has advised Bank
that it failed to comply with the provisions of Sections 6.11 and
6.12 of the Agreement for its fiscal quarter ended March 31,
2008 (the “Covenant Violations”). Company has requested
that the Bank waive any Event of Default under the Agreement
resulting from the Covenant Violations. Bank hereby waives any
Event of Default under the Agreement resulting from the Covenant
Violations. This waiver shall not be deemed to amend or alter in
any respect the terms and conditions of the Agreement or any of the
other Loan Documents, or to constitute a waiver or release by the
Bank of any right, remedy or Event of Default under the Agreement
or any of the other Loan Documents, except to the extent
specifically set forth herein.
2. The definitions of
“Eurodollar-based Rate” and “Prime-based
Rate” set forth in Section 1 of the Agreement are
amended to read as follows:
“‘Eurodollar-based Rate’ shall mean a per
annum interest rate which is the sum of two hundred forty basis
points (2.40%) plus_ the quotient of:
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(a) |
the per annum interest rate at which Bank’s Eurodollar
Lending Office offers deposits to prime banks in the eurodollar
market in an amount comparable to the relevant Eurodollar-based
Advance or relevant principal portion and for a period equal to the
relevant Interest Period at or about 11:00 a.m. (Detroit, Michigan
time) (or as soon thereafter as practicable) one (1) Business
Day prior to the first day of such Interest Period; divided
by |
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(b) |
a percentage equal to 100% minus the maximum rate on such
date at which Bank is required to maintain reserves on
“Euro-currency Liabilities” as defined in and pursuant
to Regulation D of the Board of Governors of the Federal Reserve
System or, if such regulation or definition is modified, and as
long as Bank is required to maintain reserves against a category of
liabilities which includes eurodollar deposits or includes a
category of assets which includes eurodollar loans, the rate at
which such reserves are required to be maintained on such
category.” |
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“ ‘Prime-based
Rate’ shall mean for any day a per annum interest rate which
is the greater of (i) the Prime Rate or (ii) the
Alternate Base Rate. “
3. Section 6.11 of the
Agreement is amended to read in its entirety as follows:
“6.11 Maintain as of
the end of each fiscal quarter of Company, commencing with the
fiscal quarter ending June 30, 2008, a Senior Debt to Tangible
Effective Net Worth Ratio of not more than the following as of the
specified dates:
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| June 30, 2008 and June 30 of each year
thereafter |
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6.0 to1.0 |
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| September 30, 2008 and September 30 of each year
thereafter |
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6.0 to1.0 |
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| December 31, 2008 and December 31 of each year
thereafter |
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5.0 to1.0 |
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| March 31, 2009 and March 31 of each year
thereafter |
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6.0 to1.0 |
.” |
4. Section 6.12 of the
Agreement is amended to read in its entirety as follows:
“6.12 Maintain as of
the end of each fiscal quarter of Company, commencing with the
fiscal quarter ending June 30, 2008, a Tangible Effective Net
Worth of not less than the following as of the specified
dates:
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June 30, 2008
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$ |
25,000,000 |
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September 30,
2008
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$ |
20,000,000 |
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December 31, 2008
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$ |
25,000,000 |
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March 31, 2009 .
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$ |
20,000,000 |
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June 30, 2009 and the end of
each fiscal quarter thereafter
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$ |
25,000,000 |
.” |
5 .
Section 6.13 of the Agreement is amended to read in its
entirety as follows:
“6.13 Maintain as of
the end of each fiscal year of Company commencing December 31,
2008, Net Income of not less than $7,500,000.
“
6. Section 7.11
of the Agreement is amended to read as follows:
“7.11
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