EXHIBIT 10.2
FIFTH AMENDMENT TO BUSINESS LOAN AGREEMENT
BETWEEN
CFI PROSERVICES, INC.
AND
BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION
DECEMBER 31, 1996
FIFTH AMENDMENT TO BUSINESS LOAN AGREEMENT
THIS FIFTH AMENDMENT TO BUSINESS LOAN AGREEMENT ("Amendment") is made
between CFI ProServices, Inc., an Oregon corporation ("Borrower"), and Bank of
America National Trust & Savings Association, successor by merger to Bank of
America Oregon (including its successors and/or assigns, "Bank").
BACKGROUND
A. On November 8, 1995, Bank and Borrower executed that certain Business
Loan Agreement ("Original Agreement"), in which Bank agreed to lend, and
Borrower agreed to borrow, a revolving line of credit in the maximum original
principal sum of $5,000,000.00. Since the date of the Original Agreement, Bank
and Borrower have entered into the following amendments that have changed
certain terms and conditions of the Original Agreement, including but without
limitation (i) increasing the maximum amount of the revolving line of credit to
$7,500,000 ("Loan") and (ii) extending the maturity date of the Loan to January
1, 1997: Amendment No. 1 to Business Loan Agreement, dated as of May 17, 1996
("First Amendment"); Amendment No. 2 to Business Loan Agreement, dated as of
July 1, 1996 ("Second Amendment"); Amendment No. 3 to Business Loan Agreement,
dated as of September 24, 1996 ("Third Amendment"); and Amendment No. 4 to
Business Loan Agreement, dated as of November 21, 1996 ("Fourth Amendment"). The
Original Agreement, as modified by the First Amendment, Second Amendment, Third
Amendment and Fourth Amendment, is hereinafter called the "Agreement".
B. Recently, Borrower and Bank discussed extending the term of the Loan and
changing certain other terms and conditions contained in the Agreement.
C. Bank and Borrower desire to enter into this Amendment to set forth the
terms and conditions on which the Loan shall be extended.
AGREEMENTS
For valuable consideration, the receipt and sufficiency of which is hereby
acknowledged by Bank and Borrower, the parties agree to amend the Agreement as
follows:
I. LINE OF CREDIT AMOUNT AND TERMS
1. COMMITMENT. Subsection 1.1(a) of the Agreement is hereby deleted in
its entirety, and the following Subsection 1.1(a) is inserted in its place:
(a) During the availability period described below, the Bank will
provide a line of credit to the Borrower. The "Commitment" shall be
as follows: (1) for the period covering January 1, 1997 through the
end of February, 1997, the amount of the line of credit shall be
Seven Million Five Hundred Thousand and No/100 Dollars
($7,500,000.00); and (2) for the period commencing March 1, 1997 and
continuing through the Expiration Date, and subject to Borrower's
satisfaction of the conditions precedent set forth in that certain
Fifth Amendment to Business Loan Agreement, dated as of December 31,
1996 and executed by and between Bank and Borrower ("Fifth
Amendment"), the amount of the line of credit shall be Seven Million
Five Hundred Thousand and No/100 Dollars ($7,500,000.00), subject to
the Borrowing Base (as defined in the Fifth Amendment).
2. MAXIMUM AMOUNT OF THE LINE OF CREDIT. Subsection 1.1(c) of the
Agreement is hereby deleted in its entirety, and the following Subsection
1.1(c) is inserted in its place:
(c) Borrower shall not permit the outstanding principal balance of the
line of credit to exceed (1) for the period covering January 1, 1997
through the end of February, 1997, Seven Million Five Hundred
Thousand and No/100 Dollars ($7,500,000.00), and (2) for the period
commencing March 1, 1997 and continuing through the Expiration Date,
the lesser of (i) Seven Million Five Hundred Thousand and No/100
Dollars ($7,500,000.00), or (ii) the amount of the Borrowing Base.
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II. AVAILABILITY PERIOD
1. EXPIRATION DATE. Subsection 1.2 of the Agreement is hereby deleted in
its entirety, and the following Subsection 1.2 is inserted in its place:
1.2 AVAILABILITY PERIOD. Subject to the timely satisfaction of the
conditions precedent outlined in this Agreement, as it may be amended from
time to time, the line of credit is available between the date of this
Agreement and December 1, 1997 (the "Expiration Date") unless the Borrower
is in default.
III. REPAYMENT TERMS
1. BORROWING BASE. The following new Subsection 1.4(d) is hereby inserted
into the Agreement:
(d) If at anytime on or after March 1, 1997, the principal amount
outstanding under the line of credit exceeds the amount of the
Borrowing Base, Borrower shall immediately repay, without notice from
Bank, the line of credit in an amount that equals the difference
between the principal amount outstanding under the line of credit,
less the amount of the Borrowing Base.
IV. DISBURSEMENTS
1. REQUESTS FOR CREDIT. Subsection 3.1 of the Agreement is hereby deleted
in its entirety, and the following Subsection 3.1 is inserted in its place:
3.1 REQUESTS FOR CREDIT. Each request for an extension of credit will
be made in writing in a manner acceptable to the Bank, or by another means
acceptable to the Bank, and on and after March 1, 1997 shall include the
current Borrowing Base Certificate (as defined in the Fifth Amendment).
V. CONDITIONS
1. CUSTOMER BORROWING PLAN. Subsection 4.2 of the Agreement is hereby
deleted in its entirety, and the following Subsection 4.2 is inserted in its
place:
4.2 CUSTOMER BORROWING PLAN. Notwithstanding the generality of the
foregoing or anything to the contrary in this Agreement, Bank shall have no
obligation to extend, or to continue to extend, any credit to Borrower under
this Agreement on or after March 1, 1997 if Borrower has not executed and
delivered to Bank the Customer Borrowing Plan, in conformity with the Fifth
Amendment.
VI. COVENANTS AND DEFAULTS
1. FINANCIAL INFORMATION. Subsection 6.2(c) of the Agreement is hereby
deleted in its entirety, and the following Subsection 6.2(c) is inserted in its
place:
(c) Promptly provide Bank all reports and information required by the
Customer Borrowing Plan.
2. CURRENT RATIO. Subsection 6.3 of the Agreement is hereby deleted in its
entirety, and the following Subsection 6.3 is inserted in its place:
6.3 CURRENT RATIO. To maintain a ratio of current assets to current
liabilities equal to at least the amounts indicated for each date specified
below; provided that Borrower shall not be in default of this covenant if
noncompliance with the ratios indicated below is cured within 45 days of the
applicable dates noted below and such cure is documented on a month-end
financial statement acceptable to the Bank:
DATE RATIO
---------------------------------------- -----
12/31/96, 3/31/97 and 6/30/97 1.00
9/30/97 1.20
3. CURE PERIODS. All references in the Agreement to a 90 day cure period
for noncompliance with covenants contained in the Agreement are hereby deleted
in their entirety, including but without limitation the reference contained in
Subsection 6.4 of the Agreement.
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4. DEFAULTS. Clause (iv) of Section 7 of the Agreement is hereby deleted
in its entirety.
VII. CONDITIONS PRECEDENT.
1. PAYMENT OF FEES AND DELIVERY OF DOCUMENTS. Unless waived in writing by
Bank, this Amendment shall be of no force or effect for the period commencing
January 1, 1997 and extending through the end of February, 1997 until Borrower
pays to Bank the sums due Bank under this Amendment and delivers to Bank a fully
executed copy of this Amendment. Unless waived in writing by Bank, this
Amendment shall be of no force or effect for the period commencing March 1, 1997
and continuing through the Expiration Date until Borrower pays to Bank the sums
due Bank under this Amendment and delivers to Bank a fully executed copy of this
Amendment and the customer borrowing plan, substantially in the form of EXHIBIT
A, attached to and hereby incorporated into this Amendment, which document shall
constitute the "Customer Borrowing Plan". Bank and Borrower further agree that,
between the date of this Amendment and March 1, 1997: (a) Bank, at Borrower's
expense up to $5,000 in any twelve month period, shall audit Borrower's Accounts
(as defined in EXHIBIT A); and (b) Bank and Borrower shall negotiate in good
faith to set the amount of the margin used to determine the Borrowing Base (as
defined in EXHIBIT A), but in no event shall the margin exceed 60% of Borrower's
Accounts.
2. DOCUMENTATION EXPENSE. Borrower shall pay, reimburse and indemnify Bank
for all expenses and allocated cost of Bank's in-house counsel incurred in
connection with the negotiation, preparation and execution of this Amendment;
provided that the total amount due shall not exceed $1,500.
VIII. MISCELLANEOUS.
a. Except as expressly amended by this Amendment, the Agreement remains in
full force and effect and is hereby ratified and confirmed.
b. This Amendment shall be governed by the laws of the State of Oregon.
c. If any provision or clause of this Amendment conflicts with applicable
law, such conflict shall not affect other provisions or clauses hereof which can
be given effect without the conflicting provision, and to this end the
provisions hereof are declared to be severable.
d. The captions and headings of the sections of this Amendment are for
convenience only and shall not be used to interpret or define the provisions
hereof.
e. This Amendment may be signed in any number of counterparts and shall
constitute an enforceable agreement when all signed counterparts are assembled
together in one Amendment that is signed by all parties.
WRITTEN AGREEMENTS: UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND
COMMITMENTS MADE BY THE BANK AFTER OCTOBER 3, 1989, CONCERNING LOANS AND OTHER
CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR
SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS
CONSIDERATION AND BE SIGNED BY THAT BANK TO BE ENFORCEABLE.
BORROWER: BANK:
CFI PROSERVICES, INC. BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By: /s/ XXXX XXXX By: /s/ XXXXXX X. XXXXXXX
------------------------------------------ ------------------------------------------
Name: Xxxx Xxxx Name: Xxxxxx X. Xxxxxxx
Its: Vice President and CFO Its: Vice President
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EXHIBIT A
(TO FIFTH AMENDMENT TO BUSINESS LOAN AGREEMENT)
CUSTOMER BORROWING PLAN -- REVOLVING LINE OF CREDIT -- ACCOUNTS
BANK'S NAME: BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION
BORROWER'S NAME: CFI ProServices, Inc.
TOTAL LINE LIMIT: $7,500,000.00
TERMS OF SALE: PROGRESS XXXXXXXX -- NET 30
ACCOUNTS BORROWING BASE/LIMIT
Total borrowing base up to % (which percentage shall in no event exceed
60%) of Accounts (as defined in the next sentence) to a maximum of Total Line
Limit ("Borrowing Base"). ACCOUNTS shall mean all of Borrower's receipts,
accounts, drafts, acceptances, letters of credit, contract rights of and for
moneys and performances due or to become due, chattel paper and other forms of
gross receivables, which are reflected on Borrower's financial statements as of
the end of the most recent calendar month in conformity with generally accepted
accounting principles.
REPORTING REQUIREMENTS
Borrower shall submit the following:
Borrowing Base Certificates not later than 10 days after the end of each
fiscal month in the form attached to and hereby incorporated as SCHEDULE
1; and Other financial reports and information reasonably requested by
Bank from time to time, such as Accounts agings, within 10 days of Bank's
request.
COMPANY RECORDS
At reasonable times, Bank will have access to all books and records of the
Borrower. Bank may conduct regular examinations at its discretion and Borrower's
expense, including but without limitation semi-annual inspections.
SUBJECT TO TERMS OF BUSINESS LOAN AGREEMENT
This Customer Borrowing Plan is executed in connection with and is subject
to the terms of the Business Loan Agreement, as amended. In the event of any
conflict between the terms of this Customer Borrowing Plan and the terms of the
Business Loan Agreement, the most stringent terms shall control, unless Bank
shall have otherwise agreed in writing.
Dated this 1st day of March, 1997.
BORROWER: CFI ProServices, Inc.
By ___________________________________
Its __________________________________
Date _________________________________
BANK: BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By ___________________________________
Its __________________________________
Date _________________________________
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SCHEDULE 1
CFI PROSERVICES, INC.
BORROWING BASE CERTIFICATE #
--------------
Accounts reflected on most recent monthly financial statement dated
-------------------------------
BORROWING BASE (method of calculation based on Accounts):
1. Total Accounts $ ------------
2. Less: less than=60%* multiplied by Line 1 $( ------------)
3. Borrowing Base $ ------------
LOAN ACTIVITY:
4. Beginning Loan Balance (Line 8 of previous Borrowing
Base Certificate) $ ------------
PLUS: Advances since last Borrowing Base Certificate $ ------------
5. Less: Payments since last Borrowing Base Certificate $( ------------)
6. Current Loan Balance (Lines 4 + 5 + 6) $ ------------
7. Add: New Advance Requested $ ------------
8. New Loan Balance (Lines 6 + 7) $ ------------
9. Excess Borrowing Base (Lines 3 - 8) $ ------------
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In accordance with the terms and conditions of that certain Business Loan
Agreement, as amended ("Agreement"), dated as of November 8, 1995, between (a)
CFI ProServices, Inc. ("Borrower") and (b) Bank of America National Trust &
Savings Association ("Bank"), Borrower hereby applies for an advance in the
amount stated in Line 7 above. In making this application, Borrower certifies
that this Borrowing Base Certificate and any accompanying documents are true,
complete and correct. Borrower warrants that it is not in default under the
Agreement and no default would exist after the giving of a notice, the lapse of
time or after giving effect to the advance requested.
CFI PROSERVICES, INC.
By:
-------------------------------------------------- Dated:
--------------------------
--------------------------------------------------
Title of Authorized Signer
* To be set in conformity with the Fifth Amendment to the Agreement
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