EXHIBIT 10.4
SECOND EXTENSION AND AMENDMENT TO
FORBEARANCE AGREEMENT
Second Extension and Amendment dated as of July 31, 2001 (this
"Amendment") to Forbearance Agreement dated as of May 17, 2001, as amended by
Amendment to Forbearance Agreement and Limited Waiver dated as of June 21, 2001
and an Extension and Amendment dated as of June 29, 2001 (as so amended, the
"Forbearance Agreement") by and among AZTEC TECHNOLOGY PARTNERS, INC., a
Delaware corporation ("Aztec"), BLUEFLAME INC. (DE) (f/k/a PROFESSIONAL COMPUTER
SOLUTIONS, INC.) ("Blueflame" and together with Aztec, collectively called the
"Borrower"), as Co-Borrower with respect to $15,000,000 in outstanding principal
amount of Acquisition Loans under the Credit Agreement (as defined below), FLEET
NATIONAL BANK (f/k/a BANKBOSTON, N.A.) and the other lending institutions listed
on SCHEDULE 1 to the Credit Agreement (the "Banks") relating to the Revolving
Credit Agreement dated as of July 27, 1998 by and among the Borrower, the Banks
and the Agent (as amended and in effect from time to time, the "Credit
Agreement"). Terms not otherwise defined herein which are defined in the
Forbearance Agreement, or if not defined therein, in the Credit Agreement, shall
have the same respective meanings herein as therein.
WHEREAS, the Forbearance Agreement is scheduled to expire July 31, 2001
and the Borrower has requested an extension of the Forbearance Period until
August 31, 2001; and
WHEREAS, the Banks have agreed with the Borrower, subject to the terms
and conditions contained herein, to modify certain terms and conditions of the
Forbearance Agreement and grant such extension as specifically set forth in this
Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. EXTENSION AND AMENDMENT. (a) Section 1(a) of the Forbearance
Agreement is hereby amended by deleting the reference to "July 31, 2001" in
clause (i) thereof and replacing it with "August 31, 2001".
(b) Section 2(h) of the Forbearance Agreement is hereby
amended by deleting it in its entirety and replacing it with the following:
(h) The Overadvance Fee provisions of Section 2.2.2 of the
Credit Agreement shall apply during the Forbearance Period and any Overadvance
Fee accrued through June 30, 2001 pursuant to Section 2.2.2 of the Credit
Agreement shall be due and payable on June 30, 2001. An Overadvance Fee shall
also accrue for that portion of the fiscal quarter (i) beginning on July 1, 2001
and ending on July 31, 2001, payable on July 31, 2001 and (ii) beginning on
August 1, 2001 and ending on August 31, 2001, payable on August 31, 2001. The
percentage
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used to calculate the Overadvance Fee of 1.5% quarterly will be pro rated
to .5% monthly for the Forbearance Period.
SECTION 2. CONDITIONS TO EFFECTIVENESS. This Amendment shall become
effective only upon the satisfaction of the following conditions:
(a) this Amendment shall have been executed by each Borrower,
all of the Banks and the Agent and the Ratification of Guaranty in the form
attached hereto shall have been executed by each Guarantor;
(b) the Borrower shall have paid all Overadvance Fees due on
or before July 31, 2001; and
(c) the Borrower shall have paid all reasonable expenses,
including legal fees and disbursements incurred by the Agent and the Banks in
connection with this Amendment and the transactions contemplated hereby and any
other expenses, legal fees and disbursements required to be paid pursuant to
Section 17.1 of the Credit Agreement and not heretofore paid by the Borrower for
which an invoice has been submitted.
SECTION 3. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents
and warrants that (a) the execution and delivery by the Borrower and each
Guarantor of this Amendment and the performance by the Borrower and each
Guarantor of all of its agreements and obligations under the Credit Agreement
and the Forbearance Agreement as amended hereby and the other Loan Documents are
within the corporate authority of the Borrower and each Guarantor and have been
duly authorized by all necessary corporate action on the part of the Borrower
and each Guarantor party thereto.
SECTION 4. RATIFICATION, ETC. Except as expressly amended hereby, the
Forbearance Agreement and the Credit Agreement and all documents, instruments
and agreements related thereto, including, but not limited to the Security
Documents, are hereby ratified and confirmed in all respects and shall continue
in full force and effect. The Forbearance Agreement and this Amendment shall be
read and construed as a single agreement. All references in the Forbearance
Agreement or any related agreement or instrument to the Forbearance Agreement
shall hereafter refer to the Forbearance Agreement as amended hereby. All
references in the Credit Agreement or any related agreement or instrument to the
Credit Agreement shall hereafter refer to the Credit Agreement as affected by
the Forbearance Agreement and this Amendment.
SECTION 5. NO WAIVER. Nothing contained herein shall constitute a waiver
of, impair or otherwise affect any Obligations, any other obligation of the
Borrower or any rights of the Agent or the Banks consequent thereon.
Furthermore, nothing in this Agreement shall be construed as a waiver of or
acquiescence in the Existing Event of Default, which shall continue in existence
subject only to the agreement of the Banks and the Agent set forth herein not to
enforce certain remedies for a limited period of time. Except as expressly
provided herein, the execution and delivery of this Agreement shall not: (i)
constitute an extension, modification, or waiver of any aspect of the Credit
Agreement; (ii) extend the terms of the Credit Agreement or the due date of any
of the Obligations; (iii) give rise to any obligation on the part of the Agent
or the Banks to
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extend, modify or waive any term or condition of the Credit Agreement; or (iv)
give rise to any defenses or counterclaims to the Agent's or the Banks' right to
demand payment of the Obligations or to otherwise enforce their rights and
remedies under the Credit Agreement. Following termination of the Forbearance
Period, the Agent and the Banks shall be entitled to enforce the Credit
Agreement according to the original terms of the Credit Agreement, as the Credit
Agreement has been heretofore amended from time to time.
SECTION 6. RELEASE OF CLAIMS. The Borrower and, by executing the attached
Ratification of Guaranty, each of the Borrower's Subsidiaries hereby releases
the Agent and the Banks and all agents, officers, directors, shareholders, or
anyone acting at the direction or control of the Agent or each or all Banks from
any and all liabilities and claims under the Credit Agreement, the Forbearance
Agreement, this Amendment, the Registration Rights Agreement or any Security
Documents or otherwise in connection with the transactions contemplated thereby,
except those arising after the time of execution and delivery of this Amendment.
SECTION 7. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
SECTION 8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
(WITHOUT REFERENCE TO CONFLICT OF LAWS).
SECTION 9. ENTIRE AGREEMENT. This Amendment, together with the
Forbearance Agreement contains the entire understanding among the parties hereto
with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements and understandings, inducements or conditions,
express or implied, oral or written, except as herein contained.
SECTION 10. AMENDMENTS. Neither this Amendment nor any provision hereof
may be modified, supplemented, waived or amended, except pursuant to Section 11
of the Forbearance Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as a
document under seal as of the date first above written.
AZTEC TECHNOLOGY PARTNERS, INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
BLUEFLAME INC. (DE)
(f/k/a PROFESSIONAL COMPUTER
SOLUTIONS, INC.)
(HAVING JOINT AND SEVERAL LIABILITY
FOR A PORTION OF THE ACQUISITION
LOANS HAVING AN OUTSTANDING
PRINCIPAL AMOUNT OF $15,000,000)
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
FLEET NATIONAL BANK (AS AGENT AND
AS A BANK)
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
CITIZENS BANK OF MASSACHUSETTS
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇
Title: Vice President
THE FUJI BANK, LIMITED
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: First Vice President
PEOPLE'S BANK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
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RATIFICATION OF GUARANTY
Each of the undersigned guarantors hereby acknowledges and consents to
the foregoing Amendment as of July 31, 2001, and agrees that the Guaranty dated
as of (a) July 27, 1998; (b) September 17, 1998; (c) October 2, 1998, (d) June
26, 2000 or (e) November 1, 2000 from each of the undersigned Guarantors remain
in full force and effect, and each of the Guarantors confirms and ratifies all
of its obligations thereunder.
AZTEC INTERNATIONAL LLC
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
AZTEC TECHNOLOGY PARTNERS OF NEW
ENGLAND LLC (f/k/a BAY STATE
COMPUTER GROUP LLC)
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
ENTRA COMPUTER CORP.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
TWO TWO TWO CORPORATION (f/k/a PCM,
INC.)
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & CO., INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
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BLUEFLAME INC.(DE)(f/k/a
PROFESSIONAL COMPUTER SOLUTIONS,
INC.)
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
PROFESSIONAL NETWORK SERVICES, INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
SOFTECH COMMUNICATIONS, INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
SOLUTIONS E.T.C. INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
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DIGITAL NETWORK ASSOCIATES LLC
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
OFFICE EQUIPMENT SERVICE, INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
BLUEFLAME, INC.
By: /s/ T. Kenwood Mullare
--------------------------------
Title: Secretary
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