EXHIBIT 4.1(i)
AMENDMENT AND WAIVER, dated as of this 14th day of May, 2003 (this
"Amendment and Waiver") to the Amended and Restated Credit Agreement, dated as
of September 10, 2002 (as it may be further amended, restated, modified or
otherwise supplemented, from time to time, the "Credit Agreement"), by and
between GLOBAL PAYMENT TECHNOLOGIES, INC. (the "Company") and JPMORGAN CHASE
BANK (the "Lender").
WHEREAS, the Company has requested and the Lender has agreed, subject to
the terms and conditions of this Amendment and Waiver, to waive certain
provisions of the Credit Agreement as set forth herein; and
WHEREAS, the Company has requested and the Lender has agreed, subject to
the terms and conditions of this Amendment and Waiver, to amend certain
provisions of the Credit Agreement as set forth herein;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
1. WAIVERS.
(a) Compliance with Section 7.13(a) of the Credit Agreement is hereby
waived for the period commencing January 1, 2003 and ending March 31, 2003 to
permit Consolidated Tangible Net Worth to be less than $17,500,000 during such
period; provided, however, Consolidated Tangible Net Worth was not less than
$15,506,000 at any time during such period.
(b) Compliance with Section 7.13(b) of the Credit Agreement is hereby
waived for the two fiscal quarters ended March 31, 2003 to permit the
Consolidated Interest Coverage Ratio to be less than 1.75:1.00 as of the two
fiscal quarters ended March 31, 2003; provided, however, such ratio was not less
than (12.89):1.00 as of the end of such two fiscal quarters.
(c) Compliance with Section 7.13(c) of the Credit Agreement is hereby
waived for the two fiscal quarters ended March 31, 2003 to permit the ratio of
Consolidated Funded Debt to Consolidated EBITDA to be greater than 2.95:1.00 as
of the two fiscal quarters ended March 31, 2003.
(d) Compliance with Section 7.13(e) of the Credit Agreement is hereby
waived for the period commencing January 1, 2003 and ending March 31, 2003 to
permit the ratio of Consolidated Total Unsubordinated Liabilities to
Consolidated Tangible Net Worth to be greater than .50:1.00 during such period;
provided, however, such ratio was not greater than .67:1.00 at any time during
such period.
(e) Compliance with Section 7.13(f) of the Credit Agreement is hereby
waived for the period commencing December 31, 2002 and ending March 31, 2003 to
permit the ratio of Consolidated Quick Assets to Consolidated Current
Liabilities to be less than 1.90:1.00 during
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such period; provided, however, such ratio was not less than .98:1.00 at any
time during such period.
(f) Compliance with Section 7.04 of the Credit Agreement is hereby waived
solely with respect to the sale by the Company on April 17, 2003 of it's full
interest in the cash handling division of International Payment Systems Pty Ltd.
and a portion of its interest in Global Payment Technologies Holdings
(Proprietary) Limited.
(g) Compliance with Section 6.15 of the Credit Agreement is hereby waived
solely with respect to the Company's failure to deliver to the Lender a Notice
and Acknowledgment of Assignment with respect to Global Payment Technologies
Australia Pty. Ltd. and an opinion of counsel as to the due execution and
delivery of such Notice and Acknowledgment of Assignment.
2. AMENDMENTS.
(a) Section 1.01 of the Credit Agreement is hereby amended to add a new
definition in alphabetical order to read in its entirety as follows:
"Test Currency" has the meaning set forth in Section 6.18(a) hereof.
(b) The definition of "Consolidated EBIT" is hereby amended and restated
in its entirety to read as follows:
"Consolidated EBIT" shall mean, for any period, the Consolidated Net
Income (or net loss), plus the sum, without duplication, of (a)
Consolidated Interest Expense, (b) all income taxes to any government or
governmental instrumentality expensed on the Company's and each
Guarantor's books (whether paid or accrued), and (c) all cash dividends
received by the Company and any Guarantor from any Unconsolidated
Affiliate, minus the sum, without duplication, of (a) all extraordinary or
unusual gains, and (b) equity in positive income of Unconsolidated
Affiliates, in each case, determined in accordance with Generally Accepted
Accounting Principles applied on a consistent basis. All of the foregoing
categories shall be calculated with respect to the Company and the
Guarantors, on a consolidated basis, and shall be calculated (without
duplication) as of the end of each calendar month for the twelve
consecutive calendar months then ended commencing with the twelve month
period ending March 31, 2005, provided, however, that (i) for the fiscal
quarter ending June 30, 2004, all such categories shall be calculated with
respect to the one fiscal quarter then ending, (ii) for the fiscal quarter
ending September 30, 2004, all such categories shall be calculated with
respect to the two fiscal quarters then ending, and (iii) for the fiscal
quarter ending December 31, 2004, all such categories shall be calculated
with respect to the three fiscal quarters then ending.
(c) The definition of "Consolidated EBITDA" is hereby amended and restated
in its entirety to read as follows:
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"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income (or net loss), plus the sum, without duplication, of (a)
Consolidated Interest Expense, (b) depreciation and amortization expenses
or charges, (c) all income taxes to any government or governmental
instrumentality expensed on the Company's and each Guarantor's books
(whether paid or accrued), and (d) all cash dividends received by the
Company and any Guarantor from any Unconsolidated Affiliate, minus the
sum, without duplication, of (a) all extraordinary or unusual gains and
(b) equity in positive income of Unconsolidated Affiliates, in each case,
determined in accordance with Generally Accepted Accounting Principles
applied on a consistent basis. All of the foregoing categories shall be
calculated with respect to the Company and the Guarantors, on a
consolidated basis, and shall be calculated (without duplication) as of
the end of each calendar month for the twelve consecutive calendar months
then ended commencing with the twelve month period ending December 31,
2004, provided, however, that (i) for the fiscal quarter ending March 31,
2004, all such categories shall be calculated with respect to the one
fiscal quarter then ending, (ii) for the fiscal quarter ending June 30,
2004, all such categories shall be calculated with respect to the two
fiscal quarters then ending, and (iii) for the fiscal quarter ending
September 30, 2004, all such categories shall be calculated with respect
to the three fiscal quarters then ending.
(d) The definition of "Consolidated Funded Debt" is hereby amended and
restated in its entirety to read as follows:
"Consolidated Funded Debt" shall mean, on the date of determination,
all debt for borrowed money of the Company and Guarantors, on a
consolidated basis, with an original maturity of one year or more,
including the current portion thereof and including, without limitation,
the outstanding principal amount of the Loans. Funded Debt shall be
calculated as of the end of each calendar month commencing with the
calendar month ending December 31, 2004, provided, however that Funded
Debt shall be calculated to be equal to (i) twenty five percent (25%) of
the actual Funded Debt as of March 31, 2004, with respect to the calendar
months included in the fiscal quarter ending Xxxxx 00, 0000, (xx) fifty
percent (50%) of the actual Funded Debt as of June 30, 2004, with respect
to the calendar months included in the fiscal quarter ending June 30,
2004, and (iii) seventy-five percent (75%) of the actual Funded Debt as of
September 30, 2004, with respect to the calendar months included in the
fiscal quarter ending September 30, 2004.
(e) The definition of "Consolidated Interest Expense" is hereby amended
and restated in its entirety to read as follows:
"Consolidated Interest Expense" shall mean, for any period, the
gross interest expense of the Company and the Guarantors, on a
consolidated basis, determined in accordance with Generally Accepted
Accounting Principles applied on a consistent basis and calculated as of
the end of each calendar month for the twelve calendar months then ended
commencing with the twelve month period ending March 31, 2005, provided,
however, that (i) for the fiscal quarter
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ending June 30, 2004, all such categories shall be calculated with respect
to the one fiscal quarter then ending, (ii) for the fiscal quarter ending
September 30, 2004, all such categories shall be calculated with respect
to the two fiscal quarters then ending, and (iii) for the fiscal quarter
ending December 31, 2004, all such categories shall be calculated with
respect to the three fiscal quarters then ending.
(f) The definition of "Consolidated Tangible Net Worth" in Section 1.01 of
the Credit Agreement is hereby amended to add a comma and the text "capitalized
software costs" immediately following the words "training costs".
(g) The definition of "Revolving Credit Commitment" in Section 1.01 of the
Credit Agreement is hereby amended by deleting the reference to "$3,500,000"
contained therein and inserting the amount of "$2,000,000" in place thereof.
(h) Section 6.03 of the Credit Agreement is hereby amended to delete the
"." at the end of subsection (j) and replace it with "; and"; and Section 6.03
of the Credit Agreement is further amended to add a new subsection (k) to read
in its entirety as follows:
(k) promptly following receipt thereof, (i) copies of the annual
financial statements and/or reports received by the Company with respect
to the Unconsolidated Affiliates, and (ii) such interim financial
statements and/or reports, to the extent available, as the Lender may
request from time to time with respect to the Unconsolidated Affiliates.
(i) Section 6.15 of the Credit Agreement is hereby amended to add the
parenthetical "(other than Global Payment Technologies Australia Pty. Ltd.)"
immediately following the words "United States" in the third line thereof.
(j) A new Section 6.16 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 6.16. ENGAGEMENT OF CONSULTANT. Upon the request of the
Lender, at any time after the earlier of (i) September 30, 2003, or (ii)
the occurrence and continuance of an Event of Default, retain a consultant
acceptable to the Lender in its sole discretion (the "Consultant") to
advise the Company in connection with Company's formulation of a revised
business plan and other items. The scope and terms of the Consultant's
engagement by the Company shall be set forth in an engagement agreement
acceptable to the Lender in its sole discretion which shall provide that
the Lender may contact the Consultant at any time, and without notice to
the Company, to discuss the Company's financial affairs. The Company shall
instruct the Consultant, upon the Lender's request, to provide the Lender
with copies of any and all documents of the Company reviewed by the
Consultant, as well as copies of all documents prepared by the Consultant
in the performance of the Consultant's duties for the Company. The Company
shall be solely responsible for all fees and expenses incurred in
connection with the engagement of the Consultant.
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(k) A new Section 6.17 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 6.17. CREDIT INSURANCE.
(a) Deliver to the Lender, no later than June 16, 2003, evidence
that the Company has obtained credit insurance, having a deductible of not
greater than $300,000, with the Export-Import Bank of the United States
("EXIM") on such terms and conditions, and with such policy limits,
satisfactory to the Lender, insuring all Receivables owing to the Company
from Foreign Account Debtors located in, or arising from sales in, the
countries of Australia, Germany, Italy and Austria, and such other
countries as the Lender may require in order to maintain credit insurance
on at least seventy percent (70%) of the Company's Receivables. All such
policies of credit insurance shall be assigned to the Lender and shall
provide for at least thirty (30) days' prior written notice to the Lender
of any modification or cancellation of the policy. The Company shall at
all times maintain the foregoing credit insurance in full force and effect
and shall provide to the Lender promptly upon receipt thereof evidence of
the annual renewal of such policy of credit insurance.
(b) Simultaneously with delivery to EXIM, but not later than the
last day of each month, deliver to the Lender a true, correct and complete
copy of the monthly shipment report delivered to EXIM for the prior month,
together with a copy of the check showing payment of the next required
credit insurance premium.
(l) A new Section 6.18 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 6.18. TEST CURRENCY.
(a) Deliver to the Lender, as soon as available and in any event
within fifteen (15) days after the end of each fiscal quarter, a report,
in form and substance satisfactory to the Lender, identifying by type and
amount (using the denomination of the respective foreign country) of all
U.S. and foreign currency held by the Company at its Hauppauge, New York
facility and used in connection with the testing of the Company's products
(collectively, "Test Currency"); and
(b) Deliver the Test Currency to the Lender in accordance with
Section 3.03(d) of the Security Agreement.
(m) A new Section 6.19 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 6.19. SHIPMENT REPORT. In the event either Australia Joint
Venture Agreement shall cease to be in full force and effect on
substantially the same terms as in effect on the dates of execution
thereof, then, as soon as available, and in any
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event within twenty (20) days after the end of each month, furnish to the
Lender a monthly report, in form and substance satisfactory to the Lender,
detailing all (i) open orders for supplies received by the Company under
such agreements, together with estimated dates of shipment, (ii)
forecasted shipments of supplies from the Company under such agreements
over the succeeding six (6) month period (on a monthly basis), and (iii)
actual shipments made by the Company under such agreements for the month
then ended and for each of the thirteen months immediately preceding the
date of such report.
(n) A new Section 6.20 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 6.20. LANDLORD WAIVER. Deliver to the Lender, no later than
June 30, 2003, a duly completed landlord's waiver, in form and substance
satisfactory to the Lender, with respect to the Company's premises located
at 000X Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx.
(o) A new Section 7.17 is hereby added to the Credit Agreement to read in
its entirety as follows:
SECTION 7.17. TEST CURRENCY COVENANT. Permit at any time the value
of the Test Currency to be less than $800,000, such value to be determined
as of the last day of each fiscal quarter of the Company based upon the
daily 12:00 noon foreign exchange buying rates in New York as published by
the Federal Reserve Bank of New York for such date, or if such rates are
unavailable, such value to be determined based upon the Lender's foreign
currency exchange rates in effect for such date.
(p) Section 7.03(d) of the Credit Agreement is hereby amended by deleting
each reference to "$3,900,000" contained therein and substituting the amount of
"$2,500,000" in place thereof in each instance.
(q) Section 7.03(e) of the Credit Agreement is hereby amended by deleting
each reference to "$3,900,000" contained therein and substituting the amount of
"$2,500,000" in place thereof in each instance.
(r) Section 7.06(b) of the Credit Agreement is hereby amended by deleting
each reference to "$3,900,000" contained therein and substituting the amount of
"$2,500,000" in place thereof in each instance.
(s) Section 7.06(c) of the Credit Agreement is hereby amended by deleting
each reference to "$3,900,000" contained therein and substituting the amount of
"$2,500,000" in place thereof in each instance.
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(t) Section 7.12 of the Credit Agreement is hereby amended by deleting
each reference to "$3,900,000" contained therein and substituting the amount of
"$2,500,000" in place thereof in each instance.
(u) The text of Section 7.13(a) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(a) Consolidated Tangible Net Worth. Permit at any time Consolidated
Tangible Net Worth to be less than the amount set forth below opposite the
applicable period:
Period Amount
------ ------
April 1, 2003 through June 29, 2004 $12,300,000
June 30, 2004 through September 29, 2004 Actual
Consolidated
Tangible Net
Worth as of
September 30,
2003 plus
$285,000.
September 30, 2004 and thereafter Actual
Consolidated
Tangible Net
Worth as of June
30, 2004 plus
$410,000.
(v) The text of Section 7.13(b) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(b) Consolidated Interest Coverage Ratio.
(i) Permit the Consolidated Interest Coverage Ratio, at the
end of the following fiscal quarters, to be less than the ratio set
forth set forth below opposite the applicable fiscal quarter end:
Fiscal Quarter Ending Ratio
--------------------- -----
Fiscal quarter ending June 30, 2004 3.00:1.00
Two fiscal quarters ending September 30, 2004 3.50:1.00
Three fiscal quarters ending December 31, 2004 3.50:1.00
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(ii) Commencing with the fiscal quarter ending March 31, 2005,
permit the Consolidated Interest Coverage Ratio to be less than
3.50:1.00, at any time.
(w) The text of Section 7.13(c) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(c) Consolidated Funded Debt to Consolidated EBITDA.
(i) Permit the ratio of Consolidated Funded Debt to
Consolidated EBITDA, at the end of the following fiscal quarters, to
be greater than the ratio set forth set forth below opposite the
applicable fiscal quarter end:
Fiscal Quarter Ending Ratio
--------------------- -----
Fiscal quarter ending March 31, 2004 4.00:1.00
Two fiscal quarters ending June 30, 2004 2.00:1.00
Three fiscal quarters ending September 30, 2004 1.25:1.00
(ii) Commencing with the fiscal quarter ending December 31,
2004, permit the ratio of Consolidated Funded Debt to Consolidated
EBITDA to be greater than 1.25:1.00, at any time.
(x) The text of Section 7.13(d) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(d) Consolidated Interim EBIT. Permit Consolidated Interim EBIT to
be less than (i) ($1,450,000), for the fiscal quarter ending Xxxxx 00,
0000, (xx) ($995,000), for the fiscal quarter ending June 30, 2003, (iii)
($650,000), for the fiscal quarter ending September 30, 2003, (iv)
($350,000), for the fiscal quarter ending December 31, 2003, (v)
($185,000), for the fiscal quarter ending March 31, 2004, (vi) $125,000,
for the fiscal quarter ending June 30, 2004, or (vii) $335,000, for the
fiscal quarter ending September 30, 2004.
(y) The text of Section 7.13(e) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(e) Consolidated Total Unsubordinated Liabilities to Consolidated
Tangible Net Worth. Permit at any time the ratio of Consolidated Total
Unsubordinated Liabilities to Consolidated Tangible Net Worth to be
greater than the ratio set forth below opposite the applicable period:
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Period Ratio
------ -----
April 1, 2003 through June 29, 2003 .80:1.00
June 30, 2003 through June 29, 2004 .60:1.00
June 30, 2004 and thereafter .50:1.00
(z) The text of Section 7.13(f) of the Credit Agreement is hereby amended
and restated in its entirety, effective as of April 1, 2003, to read as follows:
(f) Consolidated Quick Assets to Consolidated Current Liabilities.
Permit at any time the ratio of Consolidated Quick Assets to Consolidated
Current Liabilities to be less than the ratio set forth below opposite the
applicable period:
Period Ratio
------ -----
April 1, 2003 through June 29, 2003 1.10:1.00
June 30, 2003 through September 29, 2003 1.25:1.00
September 30, 2003 through June 29, 2004 1.30:1.00
June 30, 2004 through September 29, 2004 1.40:1.00
September 30, 2004 and thereafter 1.50:1.00
(aa) The preamble in Article VII of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:
The Company covenants and agrees with the Lender that so long as the
Commitments remain in effect or any of the principal of or interest on any
Note or any other Obligation hereunder shall be unpaid, it will not cause
or permit any direct or indirect Subsidiary of the Company or any Direct
Affiliate which the Company shall have the power, direct or indirect, to
direct or cause the direction of management or policies of such Direct
Affiliate whether through the ownership of voting securities, by contract
or otherwise, directly or indirectly, to incur, create, assume or suffer
to exist or otherwise become liable in respect of any indebtedness for
borrowed money, and it will not, and will not cause or permit any
Guarantor, directly or indirectly to:
(bb) Schedule VI to the Credit Agreement is hereby amended to reduce the
amount under the heading "Aggregate Permitted Loans, Guarantee Obligations, and
Capital
9
Contributions" with respect to Global Payment Technologies Holdings
(Proprietary) Limited from "$1,650,000" to "$250,000" and is further amended to
reduce the "Total" from "$3,900,000" to "$2,500,000".
(cc) The form of Security Agreement attached as Exhibit E to the Credit
Agreement is hereby deleted and replaced with the form of Security Agreement
attached hereto as Exhibit 1.
3. CONDITIONS OF EFFECTIVENESS. This Amendment and Waiver shall become effective
following: (a) the Company's repayment of $500,000 of Revolving Credit Loans
outstanding as of the date hereof, such repayment to be made in accordance with
and subject to the terms and conditions of the Credit Agreement, (b) the
Company's prepayment of $1,400,000 of Term Loan B outstandings, such prepayment
to be made in accordance with and subject to the terms and conditions of the
Credit Agreement, including, without limitation, the payment of any amounts due
under Section 3.08 of the Credit Agreement, such amount under Section 3.08 not
to exceed $3,500, and (c) upon receipt by the Lender on the date hereof of each
of the following:
(i) this Amendment and Waiver, duly executed by the Company;
(ii) an amendment and waiver fee of $25,000, together with the fees and
expenses of the Lender's legal counsel;
(iii) the amended and restated Security Agreement in the form attached
hereto as Exhibit 1 duly executed by the Company and each Guarantor;
(iv) evidence that the Company has duly completed and submitted an
application to the Export-Import Bank of the United States to obtain credit
insurance insuring all Receivables owing to the Company from Foreign Account
Debtors located in, or arising from sales in, the countries of Australia,
Germany, Italy and Austria (the "Credit Insurance");
(v) a First Note Modification Agreement duly executed by the Company in
the form attached hereto as Exhibit 2;
(vi) a certificate of insurance confirming that the Company has obtained
insurance covering the Company's "Test Currency" (as more particularly described
on Schedule I attached hereto) in an amount not less than $1,000,000 and naming
the Lender as loss payee thereon;
(vii) a certificate of the Secretary of the Company certifying that
attached thereto is a true and complete copy of the resolutions adopted by the
Board of Directors of the Company authorizing the execution, delivery and
performance of this Amendment and Waiver; and
(viii) a general release duly executed by the Company in the form attached
hereto as Exhibit 3.
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4. MISCELLANEOUS.
The amendments and waivers herein contained are limited specifically to
the matters set forth above and for the specific instances and purposes for
which given and do not constitute directly or by implication a waiver or
amendment of any other provisions of the Credit Agreement or a waiver of any
other Default or Event of Default.
Capitalized terms used herein and not otherwise defined herein shall have
the same meanings as defined in the Credit Agreement.
Except as expressly amended or waived hereby, the Credit Agreement shall
remain in full force and effect in accordance with the original terms thereof.
The Credit Agreement is ratified and confirmed in all respects by the Company.
The Company hereby represents and warrants that (a) after giving effect to
this Amendment and Waiver, the representations and warranties in the Credit
Agreement and the other Loan Documents are true and correct in all material
respects as of the date hereof with the same effect as though such
representations and warranties have been made on and as of such date, unless
such representation is as of a specific date, in which case, as of such date,
and (b) after giving effect to this Amendment and Waiver, no Default or Event of
Default has occurred and is continuing.
Should there be a request for further waivers or amendments with respect
to the covenants described in paragraph 1 hereof or any other covenants, such
request shall be evaluated by the Lender when formally requested, in writing, by
the Company, and the Lender may deny any such request for any reason in its sole
discretion.
This Amendment and Waiver may be executed in one or more counterparts,
each of which shall constitute an original, but all of which when taken together
shall constitute but one amendment and waiver.
THIS AMENDMENT AND WAIVER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICT
OF LAWS.
This Amendment and Waiver shall constitute a Loan Document.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment and
Waiver to be duly executed as of the day and year first above written.
GLOBAL PAYMENT TECHNOLOGIES, INC.
By:_______________________________
Name:
Title:
By:_______________________________
Name:
Title:
JPMORGAN CHASE BANK
By:_______________________________
Name:
Title:
ACKNOWLEDGMENT
The undersigned, not a party to the Credit Agreement but a Guarantor,
hereby acknowledges and agrees to the terms of this Waiver and Amendment and
confirms that its Guaranty is in full force and effect.
-------------------------------------------------------------------------------
ABACUS FINANCIAL MANAGEMENT SYSTEMS LTD., USA
================================================================================
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
-------------------------------------------------------------------------------
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SCHEDULE I
(Test Currency)
[DETAILED DESCRIPTION TO BE PROVIDED]
13
EXHIBIT 1
(Amended and Restated Security Agreement)
14
EXHIBIT 2
(First Note Modification Agreement)
15
EXHIBIT 3
(General Release)
16
