NationsBank
NationsBank of Texas, N.A.
THIRD AMENDMENT
to
FINANCING AND SECURITY AGREEMENT
This Third Amendment to Financing and Security Agreement is
executed and entered into by COMPUCOM SYSTEMS, INC.
("Borrower") and NATIONSBANK OF TEXAS, N.A. ("Lender"),
effective as of the 26 day of April, 1995, as follows:
Recitals
Borrower and Lender are parties to the certain Financing
and Security Agreement dated effective as of August 4,
1993, as amended by the certain First Amendment to
Financing and Security Agreement dated as of March 31,
1994 and Second Amendment to Financing and Security
Agreement dated December 12, 1994 (hereinafter called
the "Financing and Security Agreement"). Terms defined
in the Financing and Security Agreement wherever used in
this Third Amendment, shall have the same meanings as
are prescribed by the Financing and Security Agreement.
Borrower and Lender have agreed to amend the Financing
and Security Agreement as provided herein.
NOW THEREFORE, premises considered, for value received,
Borrower and Lender hereby agree as follows:
1. ARTICLE I ("DEFINITIONS") of the Financing and Security
Agreement hereby is amended to add the following definitions,
which shall be deemed added immediately following paragraph
1.74 thereof:
" 1.75 Overadvance Allowance Amount means an amount
equal to the lesser of (i) ten percent (10.0%) of the
aggregate net amount of Eligible Accounts and Eligible
Inventory, or (ii) Fifteen Million Dollars
($15,000,000.00)."
2. Each of the following definitions contained in ARTICLE I
("DEFINITIONS") of the Financing and Security Agreement
hereby is amended to read in its entirety as follows:
" 1.7 Borrowing Base at any time means an amount equal
to the sum of (i) up to a maximum of eighty-five percent
(85.0%) of the net amount of Eligible Accounts plus (ii)
up to a maximum of fifty percent (50.0%) (but limited,
however, to an amount not exceeding $20,000,000.00) of
the net amount of Eligible Inventory plus (iii) the
Overadvance Allowance Amount if, and to the limited
extent, allowed by paragraph 2.7a and elected by
Borrower as provided therein, less (iv) the Reserve."
" 1.15 Credit Limit means the amount of One Hundred
Seventy Five Million and no/100 Dollars, less the
amount, if any, of any applicable reduction in the
Credit Limit pursuant to paragraph 2.11."
" 1.36 "Lender's Maximum Amount means the amount of
Fifty Three Million and no/100 Dollars ($53,000,000.00).
3. A new paragraph shall be added immediately following
paragraph 2.7 of the Financing and Security Agreement, which
shall read in its entirety as follows:
"2.7a Overadvance Allowance. On written notice
by Borrower to Lender, Borrower may elect to include the
Overadvance Allowance Amount in calculation of the
Borrowing Base, subject, however, to the following
conditions and requirements:
(a) Borrower shall notify Lender in writing
of its intention to elect to include the
Overadvance Allowance Amount in calculation of the
Borrowing Base, therein specifying the effective
date that such election will begin;
(b) As of the effective date of any such
election, no Event of Default shall have occurred
and be continuing, and no other event or condition
which would be the subject of a required notice
under paragraph 6.14 shall be in existence;
(c) Each such election shall be effective for
a period of sixty (60) days from the effective date
of such election specified in Borrower's written
notice thereof referenced above, and upon
expiration of such period the Overadvance Allowance
Amount shall automatically be excluded in
calculation of the Borrowing Base (until the
effective date specified in any subsequent election
(if any) allowed by this paragraph 2.7a); and
(d) No more than two (2) of such elections
may be made by Borrower during any calendar year;
and
(e) Subject to paragraph 9.10, on the
effective date of each election by Borrower under,
and allowed by, this paragraph 2.7a, Borrower shall
pay to Lender an overadvance fee in the amount of
$37,500.00 (at Lender's option with no obligation
to do so, such fee may be added to the amount due
by Borrower under the Facility, in which event such
fee will be deemed paid and the amount thereof
shall be treated as a loan under the Facility).
Upon the occurrence, and during the continuance of any
Event of Default, Lender shall have the right, upon
written notice to Borrower but without requirement for
prior notice, to terminate any election under this
paragraph then in effect, whereupon the Overadvance
Allowance Amount shall automatically be excluded in
calculation of the Borrowing Base (until the effective
date specified in any subsequent election (if any)
allowed by this paragraph 2.7a)."
4. The second sentence of paragraph 6.6 ("Interim Financial
Statements") hereby is amended to read in its entirety as
follows:
"Such financial statements shall be accompanied by a
statement signed by Borrower's president, chief
financial officer or controller representing to Lender
that such financial statements are true and complete and
fairly present the financial condition and results of
operations of Borrower and the Subsidiaries."
5. The following shall be added to paragraph 6.5 ("Annual
Financial Statements") immediately following the end thereof:
"Notwithstanding the foregoing, until directed otherwise
by Lender in writing, at Borrower's option the foregoing
consolidating financial statements, and accompanying
signed statement, may exclude ClientLink, Inc."
6. The following shall be added to paragraph 6.6 ("Interim
Financial Statements") immediately following the end thereof:
"Notwithstanding the foregoing, until directed otherwise
by Lender in writing, at Borrower's option the foregoing
consolidating financial statements, and accompanying
signed statement, may exclude ClientLink, Inc."
7. Borrower acknowledges that effective simultaneously upon
execution hereof Lender and one or more Participants have
agreed to amend the Participant's Committed Amount under
their respective Participation Agreements. Lender and
Borrower acknowledge and confirm the following in respect of
Participants and the Participant's Committed Amount relative
to each, and Lender's Maximum Amount, effective as of the
date hereof:
Participants
Participant Participant's Participant's
Committed Amount Change (+ or -) Committed Amount
(existing) (revised)
Barnett Bank of Tampa $14,500,000.00 -0- $14,500,000.00
Midlantic Bank, N.A. $20,000,000.00 -0- $20,000,000.00
The Daiwa Bank, Ltd. $8,000,000.00 $7,000,000.00 $15,000,000.00
National Canada
Finance Corp. $15,000,000.00 $2,500,000.00 $17,500,000.00
Sanwa Business Credit
Corporation $22,500,000.00 $7,500,000.00 $30,000,000.00
Union Bank $20,000,000.00 $5,000,000.00 $25,000,000.00
Lender
Lender Lender's Change (+ or -) Lender's
Maximum Maximum
Amount (existing) Amount (revised)
NationsBank of Texas, N.A. $50,000,000.00 $3,000,000.00 $53,000,000.00
8. Subject to paragraph 9.10 of the Financing and Security
Agreement, in consideration of this Third Amendment and
increase of the Credit Limit as provided herein, Borrower
agrees to pay to Lender a Credit Limit increase fee in the
amount of $62,500.00 [which is calculated by multiplying the
amount of increase of the Credit Limit resulting from this
Agreement ($25,000,000.00) by one-quarter of one percent
(0.25%)], which shall be payable upon execution hereof.
9. The following items shall be delivered to Lender prior
to or simultaneously with execution and delivery of this
Third Amendment (or, in the case of any of the items
referenced in subparagraphs (e) and (f) below, within such
period of time thereafter as Lender may specify to Borrower
in writing):
(a) A certificate signed by the corporate
secretary of Borrower (i) certifying to Lender that its
Certificate of Incorporation and Bylaws have not been
amended since Borrower's certification thereof under
Secretary's Certificate dated April 5, 1994 previously
delivered to Lender, and that the officers of Borrower
specified therein are duly elected, qualified and acting
in the capacities therein stated, as of the effective
date hereof and (ii) attaching and certifying
resolutions duly adopted by the board of directors of
Borrower authorizing this Third Amendment and the
transactions evidenced hereby, and authorizing and
directing one or more named officers of Borrower to
execute and deliver this Third Amendment, and all
related documentation required by Lender, on behalf of
Borrower, which certificate shall be in form
satisfactory to Lender;
(b) The Revolving Note, amended and restated, and
duly executed.
(c) Amendments to Participation Agreements as
referenced in paragraph 4, in form satisfactory to
Lender;
(d) Such consents and agreements in respect of the
Subordinated Note Agreement and the Intercreditor
Agreements as Lender may require, in form satisfactory
to Lender;
(e) If requested by Lender, an opinion of
Borrower's counsel, in form satisfactory to Lender; and
(f) Such other documentation as Lender may
reasonably require in connection with the Financing and
Security Agreement or this Third Amendment.
10. In consideration of this Third Amendment, Borrower
represents to Lender that (i) no Event of Default, or other
event or condition which would be the subject of a required
notice under paragraph 6.14 of the Financing and Security
Agreement, is in existence as of the effective date hereof,
(ii) each of the representations and warranties contained in
the following paragraphs of the Financing and Security
Agreement are true and correct as of the effective date of
this Third Amendment: paragraphs 3.3, paragraph 3.4, and
paragraph 5.1 through paragraph 5.18. Borrower hereby
ratifies and confirms the Financing and Security Agreement as
being and continuing in full force and effect, as amended by
this Third Amendment.
11. This Third Amendment (i) shall be deemed effective
prospectively as of the effective date specified in the
preamble, (ii) contains the entire agreement among the
parties and may not be amended or modified except in writing
signed by all parties, (iii) shall be governed and construed
according to the laws of the State of Texas and (iv) may be
executed in any number of counterparts, each of which shall
be valid as an original and all of which shall be one and the
same agreement. A telecopy of any executed counterpart shall
be deemed valid as an original.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
EXECUTED as of the effective date specified in the
preamble.
NATIONSBANK OF TEXAS, N.A.
By: /s/ Dan Lane
Dan Lane
Vice President
COMPUCOM SYSTEMS, INC.
By: /s/ Robert J. Boutin
Robert J. Boutin
Senior Vice President, Finance
and Chief Financial Officer
CONSENT BY PARTICIPANTS
Each of the undersigned consents to Borrower's and
Lender's execution of the above Second Amendment to Financing
and Security Agreement:
BARNETT BANK OF TAMPA MIDLANTIC BANK, N.A.
By: /s/ Emily D. Waterman By: /s/ Joseph G. Meterchick
Name: Emily D. Waterman Name: Joseph G. Meterchick
Title: Vice President Title: Vice President
NATIONAL CANADA FINANCE CORP. UNION BANK
By: /s/ Bill Handley/Larry L. Sears By: /s/Stephen Sweeney
Name: Bill Handley/Larry L. Sears Name: Stephen Sweeney
Title: Vice President/Group Vice President Title: Vice President
SANWA BUSINESS CREDIT CORPORATION THE DAIWA BANK, LTD.
By: /s/ Michael J. Cox By: /s/ James T. Wang
Name: Michael J. Cox Name: James T. Wang
Title: Vice President Title: Vice President/Manager
By: /s/ Kirk L. Stites
Name: Kirk L. Stites
Title: Vice President