ADDENDUM TO BUSINESS FINANCING AGREEMENT AND AGREEMENT FOR WHOLESALE FINANCING
Exhibit
10- 61
ADDENDUM
TO BUSINESS FINANCING AGREEMENT AND
AGREEMENT
FOR WHOLESALE FINANCING
This
Addendum is made to (i) that certain Business Financing Agreement executed
on
the 25th day
of
June, 2004, between En Pointe Technologies Sales, Inc. and En Pointe
Gov, Inc. (individually, collectively and jointly and
severally "Dealer") and GE Commercial Distribution Finance
Corporation ("CDF"), as amended ("BFA") and (ii) that certain Agreement
for Wholesale Financing between Dealer and CDF dated June 25, 2004 as amended
("AWF").
FOR
VALUE RECEIVED, CDF and
Dealer agree that the following paragraph is incorporated into the AWF
and BFA
as if fully and originally set forth therein (capitalized
terms shall
have the same meaning as defined in the BFA unless otherwise
indicated):
|
1.
|
Section
2.1 of the BFA is hereby amended in its entirety to read as
follows:
|
|
|
"2.1 Accounts
Receivable Facility. Subject to the terms of this
Agreement, CDF agrees to provide to Dealer an Accounts Receivable
Facility
of Forty Five Million Dollars ($45,000,000.00); provided,
however, that at no time will the principal amount outstanding
under the
Accounts Receivable Facility and Dealer's inventory floorplan
credit
facility with CDF exceed, in the aggregate, Forty Five Million
Dollars
($45,000,000.00). CDF's decision to advance
funds will not be binding until the funds are actually
advanced."
|
|
|
In
addition, subject to the terms of the AWF, CDF agrees to provide
to Dealer
an inventory floorplan credit facility of Forty Five Million
Dollars
($45,000,000.00); provided, however, that at no time will
the principal amount outstanding under Dealer's inventory floorplan
credit
facility with CDF and Dealer's Accounts Receivable Facility exceed,
in the
aggregate, Forty Five Million Dollars
($45,000,000.00). CDF's decision to advance
funds will not be binding until the funds are actually
advanced.
|
|
2.
|
Section
5.2(d) of the BFA is hereby amended by deleting it in its entirety
and
replacing it with the following:
|
“(d)
acquired the assets or ownership interest of any other Entity in excess
of Three
Million Dollars ($3,000,000.00), so long as, both before and after giving
effect
to same, Dealer is not and would not be in default under this Agreement
or the
Other Agreements or with respect to the CDF Obligations, whether as a result
of
same or otherwise.”
3.
Section 7.1 of the BFA is hereby
amended to read as follows
|
|
“7.1
|
Termination. This
Agreement will continue in full force and effect (except that
it may be
terminated by either party upon sixty (60) days written notice
to the
other party or immediately by CDF in the exercise of its rights
and
remedies upon Default by Dealer) for a period of three (3) years
from
August 1, 2007 and for successive one (1) year periods thereafter,
subject
to termination at the end of any such period on at least sixty
(60) days
prior written notice by either party to the other party. If
such notice of termination is given by Dealer to CDF, such notice
will be
ineffective unless Dealer pays to CDF all Obligations on or before
the
termination date. Any termination of this Agreement by Dealer
or CDF will have the effect of accelerating the maturity of all
Obligations not then otherwise due, thereby making all of the
Obligations
immediately due and payable on the effective date of termination,
and will
be without any additional penalty or premium of any
kind.
|
|
|
7.1.1
|
Effect
of Termination. Dealer will remain obligated to CDF for CDF's
advances or commitments made before the effective termination
date of this
Agreement. CDF will retain all of its rights, interests and
remedies hereunder until Dealer has paid CDF in full. All
waivers, and the agreement to arbitrate, set forth in this Agreement
will
survive any termination of this
Agreement.”
|
|
4.
|
As
of the date of execution of this Amendment, all prior financial
convenants
as previously set forth are hereby deleted in their entirety
and restated
to read as follows:
|
“En
Pointe Technologies, Inc., Guarantor of Dealer’s obligations to CDF under a
Collateralized Guaranty dated June 25, 2004 (“Guarantor”), will maintain, as of
the last day of each calendar quarter set forth below:
|
(a)
|
a
Tangible Net Worth and Subordinated Debt in the combined amount
of not
less than the amount shown below:
|
Quarter-end Amount
June
30, 2007 and each quarter-end thereafter $12,750,000
|
(b)
|
a
ratio of Debt minus Subordinated Debt to Tangible Net Worth and
Subordinated Debt of not more than the amount shown
below:
|
Quarter-end Ratio
Amount
June
30,
2007 5.0:1
September
30, 2007 and each quarter-end thereafter 4.75:1.0
(c) Dealer
covenants that the ratio of Guarantor's Total Funded Indebtedness, calculated
as
of the last day of each fiscal quarter, commencing with the fiscal quarter
ending on June 30, 2007, to EBITDA, calculated as of the last day of each
such
fiscal quarter, for the preceding four fiscal quarters then ended, shall
be no
more than three to one (3.00:1.00).
For
purposes of this paragraph: (i) 'Tangible Net Worth' means the
book value of Guarantor's assets less liabilities, excluding from
such assets all Intangibles; (ii) 'Intangibles' means and includes
general intangibles; software (purchased or developed in-house); accounts
receivable and advances due from officers, directors, employees, stockholders,
members, owners and affiliates; leasehold improvements net of depreciation;
licenses; good will; prepaid expenses; escrow deposits; covenants not to
compete; the excess of cost over book value of acquired assets; franchise
fees;
organizational costs; finance reserves held for recourse obligations;
capitalized research and development costs; the capitalized cost of patents,
trademarks, service marks and copyrights net of amortization; and such
other
similar items as CDF may from time to time determine in CDF's sole discretion;
(iii) 'Debt' means all of Guarantor's liabilities and
indebtedness for borrowed money of any kind and nature whatsoever, whether
direct or indirect, absolute or contingent, and including obligations under
capitalized leases, guaranties, or with respect to which Guarantor
has pledged assets to secure performance, whether or not direct recourse
liability has been assumed by Guarantor; (iv) 'Subordinated
Debt' means all of Guarantor's Debt which is subordinated to the
payment of Guarantor's liabilities to CDF by an agreement in form and
substance satisfactory to CDF; (v) 'Current Tangible Assets'
means Guarantor's current assets less, to the extent otherwise
included therein, all Intangibles (vi) ‘Funded Debt’
means, the sum of the following, without duplication
(1) Dealer's outstanding principal and interest indebtedness to CDF
excluding the principal outstanding under Dealer's
inventory floorplan credit facility and, (2) Guarantor's aggregate
outstanding principal balance of all other indebtedness for borrowed money,
including, without limitation, the amount which would have been the aggregage
cost of all property leased pursuant to a capital lease if such property
would
have been purchased rather than leased, but,
excluding, (3) Subordinated Debt, and (4) that portion of the
outstanding principal balance of Guarantor's Pakistan affiliates' indebtedness
for borrowed money up to the amount of such affiliates' interest bearing
assets
and (vii) ‘EBITDA’ means, net operating income plus
depreciation and amortization plus other income as reflected on Guarantor's
quarterly consolidated financial statements that have been prepared according
to
GAAP (“GAAP”)
All
terms
used herein to the extent not defined shall be used in accordance with
generally
accepted accounting principles consistently applied. All amounts, if
applicable, shall be calculated on a consolidated basis (“GAAP”).
Dealer
waives notice of CDF’s acceptance of this Addendum.
All
other
terms and provision of the BFA and AWF, to the extent consistent with the
foregoing, are hereby ratified and will remain unchanged and in full force
and
effect.
IN
WITNESS WHEREOF, Dealer and CDF have both read this Addendum to the BFA and
AWF,
understand all the terms and provisions hereof, and agree to be bound thereby
and subject thereto as of this 25th day of
July , 2007.
| ATTEST: EN POINTE TECHNOLOGIES SALES, INC. | ||||
|
/s/Xxxxxx
X. Xxxxxx
|
By:
|
/s/Attiazaz
Din
|
Date: July 30, 2007 | |
|
Xxxxxx
X. Xxxxxx,
|
Attiazaz
“Xxx” Din
|
|||
|
Secretary
|
Chief
Executive Officer
|
| ATTEST: EN POINTE GOV, INC. | ||||
|
/s/Xxxxxx
X. Xxxxxx
|
By
:
|
/s/Attiazaz
Din
|
Date: July 30, 2007 | |
|
Xxxxxx
X. Xxxxxx,
|
Attiazaz
“Xxx” Din
|
|||
|
Secretary
|
Chief
Executive Officer
|
|
GE
COMMERCIAL DISTRIBUTION FINANCE CORPORATION
|
|||
|
|
By:
|
/s/
Xxxxx X. Xxxxx
|
Date: July 30, 2007 |
|
Name
Xxxxx X. Xxxxx
|
|||
|
Vice
President of Operations
|
|||
ACKNOWLEDGEMENT
BY GUARANTOR:
| EN POINTE TECHNOLOGIES, INC | ||
|
By:
|
/s/ Attiazaz Din | Date: July 30, 2007 |
|
Attiazaz
“Xxx” Din
|
||
|
President
|
||
