EXHIBIT 10.1
AMENDMENT NUMBER THREE TO
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AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
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This AMENDMENT NUMBER THREE TO AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT (this "Amendment") is entered into as of April 26, 2002, by and
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between FOOTHILL CAPITAL CORPORATION, a California corporation ("Foothill"), on
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the one hand, and MICROSTRATEGY INCORPORATED, a Delaware corporation ("Parent"),
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and MICROSTRATEGY SERVICES CORPORATION, a Delaware corporation ("Borrower"), on
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the other hand, with reference to the following facts:
A. Foothill, Parent, and Borrower heretofore have entered into that
certain Amended and Restated Loan and Security Agreement, dated as of
June 14, 2001, as amended by that certain Consent and Amendment Number
One to Amended and Restated Loan and Security Agreement, entered into
as of August 29, 2001, and Amendment Number Two to Amended and
Restated Loan and Security Agreement, entered into as of February 28,
2002 (as the same may be further amended, restated, supplemented, or
otherwise modified from time to time, the "Agreement"), pursuant to
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which Foothill has made certain loans and financial accommodations
available to Borrower;
B. Foothill, Parent and Borrower desire to amend the Agreement, as set
forth in this Amendment;
C. Foothill, Parent and Borrower are willing to so amend the Agreement in
accordance with the terms and conditions hereof; and
D. Unless the context requires otherwise, all capitalized terms used
herein and not defined herein shall have the meanings ascribed to them
in the Agreement, as amended hereby.
NOW, THEREFORE, in consideration of the above recitals and the mutual
promises contained herein, Foothill, Borrower, and Parent hereby agree as
follows:
1. Amendments to the Agreement.
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a. The sentence "`Additional Financing' has the meaning set forth in
Section 6.18." in Section 1.1 of the Agreement and Section 6.18 of the Agreement
are hereby deleted in their entirety.
b. Sections 7.1(j) and 8.16 of the Agreement are hereby deleted in
their entirety and replaced with "(j) [Intentionally Deleted]." and "8.16
[Intentionally Deleted].", respectively.
c. The definition of "Permitted Liens" in Section 1.1 of the
Agreement is hereby amended by deleting the phrase ", and (n) Liens securing
Indebtedness permitted under clause (j) of Section 7.1; provided that any such
Liens securing Indebtedness permitted under Section 7.1(j) are subordinated to
any Liens held by Lender" immediately prior to the "." at the end thereof.
d. Section 2.1(a) of the Agreement is hereby amended and restated in
its entirety to read as follows:
"(a) Subject to the terms and conditions of this Agreement, and
during the term of this Agreement, Lender agrees to make advances
("Advances") to Borrower in an amount at any one time outstanding not to
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exceed an amount equal to the lesser of (i) the result of the Maximum
Revolver Amount less the Letter of Credit Usage or (ii) the Borrowing Base
less the Letter of Credit Usage. For purposes of this Agreement, "Borrowing
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Base," as of any date of determination, shall mean the result of:
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(x) the lesser of
(i) an amount equal to the Maintenance Advance
Rate multiplied by the Dollar amount of Eligible
Maintenance Accounts, less the amount, if any, of the
Dilution Reserve calculated with respect to the
Eligible Maintenance Accounts, and
(ii) the Maximum Maintenance Sub-Facility, plus
(y) the lesser of
(i) 85% of the Dollar amount of Eligible License
Accounts, less the amount, if any, of the Dilution
Reserve calculated with respect to the Eligible License
Accounts, and
(ii) an amount equal to 66 2/3% of Borrower's and
Canadian Obligor's Collections with respect to their
License Receivables for the immediately preceding 90
day period, minus
(z) the aggregate amount of reserves, if any, established
by Lender under Section 2.1(b), without any duplication of any
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Dilution Reserve deducted under clause (x)(i) or (y)(i) above."
e. Section 7.20(a)(i) of the Agreement is hereby amended and
restated in its entirety to read as follows:
"(i) Minimum EBITDA. EBITDA of Parent (on a consolidated basis),
measured on a fiscal quarter-end basis, of not less than the required
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amount set forth in the following table for the applicable period set
forth opposite thereto;
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Applicable Amount Applicable Period
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($28,650,000) For the 3 month period
ending March 31, 2001
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($37,635,000) For the 6 month period
ending June 30, 2001
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($40,375,000) For the 9 month period
ending September 30, 2001
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($35,360,000) For the 12 month period
ending December 31, 2001
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($12,000,000) For the 12 month period
ending March 31, 2002
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($2,500,000) For the 12 month period
ending June 30, 2002
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$4,500,000 For the 12 month period
ending September 30, 2002
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$1,650,000 For the 12 month period
ending December 31, 2002
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$11,500,000 For the 12 month period
ending March 31, 2003
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$15,000,000 For the 12 month period
ending June 30, 2003
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$19,000,000 For the 12 month period
ending September 30, 2003
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$20,500,000 For the 12 month period
ending December 31, 2003
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$21,000,000 For the 12 month period
ending each fiscal quarter thereafter"
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2. Additional Agreement
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In connection with that certain Amended and Restated Stock Pledge
Agreement, dated as of August 29, 2001, by and among Parent, Aventine and
Foothill (the "Stock Pledge Agreement"), Parent pledged to Foothill, inter alia,
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(i) 345,446 shares of iBasis, Inc. common stock (certificate number IBAS 0959)
and (ii) Future Rights (as such term is defined in the Stock Pledge Agreement)
of Parent with respect to iBasis, Inc. including without limitation an
additional 109,057 shares of iBasis, Inc. common stock held in Parent's name
subject to a certain escrow agreement with iBasis, Inc. (such 454,053 shares and
rights, collectively, the "iBasis Stock") as security for prompt payment and
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performance of Parent's Secured Obligations (as such term is defined in the
Stock Pledge Agreement). In addition, Parent has granted certain liens and
security interests to Foothill in the iBasis Stock pursuant to the Agreement.
Effective as of the date hereof, Foothill hereby releases and terminates the
pledge by Parent of the iBasis Stock pursuant to the Stock Pledge Agreement, the
liens and security interests granted to Foothill in the iBasis Stock under or
pursuant to the Agreement, and any and all other rights or interests of Foothill
to or in the iBasis Stock under any of the Loan Documents or otherwise. In
connection with such releases and terminations, Foothill shall return to Parent
as soon as reasonably practicable after the date hereof all stock certificates
in its possession relating to or evidencing the iBasis Stock, and further agrees
to, at Borrower's expense, execute and deliver any and all other documents,
instruments, certificates and agreements relating to or evidencing such releases
and terminations as may be reasonably requested by Parent or Borrower.
3. Representations and Warranties. Each of Borrower and Parent hereby
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represents and warrants to Foothill that:
a. the execution, delivery, and performance of this Amendment and of
the Agreement, as amended by this Amendment, are within its corporate powers,
have been duly authorized by all necessary corporate action, and are not in
contravention of any law, rule, or regulation, or any order, judgment, decree,
writ, injunction, or award of any arbitrator, court, or governmental authority,
or of the terms of its charter or bylaws, or of any contract or undertaking to
which it is a party or by which any of its properties may be bound or affected;
b. this Amendment and the Agreement, as amended by this Amendment,
constitute a legal, valid, and binding obligation, enforceable against such
party in accordance with their terms; and
c. this Amendment has been duly executed and delivered by such
party.
4. Conditions Precedent to Amendment. The satisfaction of each of the
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following shall constitute conditions precedent to the effectiveness of the
Amendments set forth in Section 1 hereof:
a. Foothill shall have received the reaffirmation and consent
attached hereto as Exhibit A, duly executed and delivered by an authorized
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officer of each Guarantor;
b. Foothill shall have received, on or prior to April 30, 2002,
a certificate executed by the CFO of Parent certifying that the EBITDA of Parent
(on a consolidated basis),
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for the three month period ended March 31, 2002, is not less than ($200,000)
(i.e., negative $200,000);
c. The representations and warranties contained in this Amendment
and the Agreement as amended by this Amendment (as qualified by the Exhibits and
Schedules attached hereto) shall be true and correct in all respects on and as
of the date hereof, as though made on such date (except to the extent that such
representations and warranties relate solely to an earlier date);
d. No Event of Default or event which with the giving of notice or
passage of time would constitute an Event of Default shall have occurred and be
continuing on the date hereof, nor shall result from the consummation of the
transactions contemplated herein;
e. No injunction, writ, restraining order, or other order of any
nature prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein shall have been issued and remain in force by any
governmental authority against Borrower, Parent or Foothill;
f. All other documents and legal matters in connection with the
transactions contemplated by this Amendment shall have been delivered or
executed or recorded and shall be in form and substance satisfactory to Foothill
and its counsel; and
g. Foothill shall have received a non-refundable amendment fee in
the total amount of $5,000.00, which amount Borrower and Parent authorize
Foothill to charge to the Loan Account.
5. Miscellaneous.
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a. Upon the effectiveness of this Amendment, each reference in the
Agreement to "this Agreement", "hereunder", "herein", "hereof" or words of like
import referring to the Agreement shall mean and refer to the Agreement as
amended by this Amendment.
b. Upon the effectiveness of this Amendment, each reference in the
Loan Documents to the "Loan Agreement", "thereunder", "therein", "thereof" or
words of like import referring to the Agreement shall mean and refer to the
Agreement as amended by this Amendment.
c. This Amendment shall be governed by and construed in accordance
with the laws of the State of California. The parties hereto agree that the
provisions of Section 13 of the Agreement are hereby incorporated herein by this
reference mutatis mutandis.
d. This Amendment may be executed in any number of counterparts and
by different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Amendment. Delivery of an
executed counterpart of this Amendment by telefacsimile shall be equally as
effective as delivery of a manually executed counterpart of this Amendment. Any
party delivering an executed counterpart of this Amendment by telefacsimile also
shall deliver a manually executed counterpart of this Amendment but the failure
to deliver a manually executed counterpart shall not affect the validity,
enforceability, and binding effect of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered as of the date first written above.
MICROSTRATEGY INCORPORATED,
a Delaware corporation
By: /s/ XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: President & CFO
MICROSTRATEGY SERVICES CORPORATION,
a Delaware corporation
By: /s/ XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: Vice President & Treasurer
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/ XXXX XXXXXX
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Name: Xxxx Xxxxxx
Title: Vice President
EXHIBIT A
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REAFFIRMATION AND CONSENT
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All capitalized terms used herein but not otherwise defined herein
shall have the meanings ascribed to them in that certain Amendment Number Three
to Amended and Restated Loan and Security Agreement, dated as of April 26, 2002
(the "Amendment"). The undersigned hereby (a) represents and warrants to
Foothill that the execution, delivery, and performance of this Reaffirmation and
Consent are within its corporate powers, have been duly authorized by all
necessary corporate action, and are not in contravention of any law, rule, or
regulation, or any order, judgment, decree, writ, injunction, or award of any
arbitrator, court, or governmental authority, or of the terms of its charter or
bylaws, or of any contract or undertaking to which it is a party or by which any
of its properties may be bound or affected; (b) consents to the amendment of the
Agreement by the Amendment and to the transactions described therein; (c)
acknowledges and reaffirms its obligations owing to Foothill under the Guaranty
as amended and restated and any other Loan Documents to which it is a party; and
(d) agrees that each of the Guaranty and any other Loan Documents to which it is
a party is and shall remain in full force and effect. Although the undersigned
has been informed of the matters set forth herein and has acknowledged and
agreed to same, it understands that Foothill has no obligations to inform it of
such matters in the future or to seek its acknowledgement or agreement to future
amendments, and nothing herein shall create such a duty. Delivery of an executed
counterpart of this Reaffirmation and Consent by telefacsimile shall be equally
as effective as delivery of an original executed counterpart of this
Reaffirmation and Consent. Any party delivering an executed counterpart of this
Reaffirmation and Consent by telefacsimile also shall deliver an original
executed counterpart of this Reaffirmation and Consent but the failure to
deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Reaffirmation and Consent. This
Reaffirmation and Consent shall be governed by the laws of the State of
California.
[signature page follows]
MICROSTRATEGY INCORPORATED,
a Delaware corporation
By: /s/ XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: President & CFO
AVENTINE, INCORPORATED,
a Delaware corporation
By: /s/ XXXXXXX X. XXXXXXXXXX, XX.
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Name: Xxxxxxx X. Xxxxxxxxxx, Xx.
Title: Chairman & President
MicroStrategy Administration Corporation,
a Delaware corporation
By: /s/ XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: President & Treasurer
XXXXXXXX.XXX INCORPORATED,
a Delaware corporation
By: /s/ XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer,
Vice President, Finance & Treasurer
