Exhibit 10.29
AMENDMENT NO. 3
to
Credit Agreement
This Amendment No. 3 to Credit Agreement (this "Amendment") is made as
of June 30, 1998, by and between MLC GROUP, INC., a Virginia corporation ("MLC")
and FIRST UNION NATIONAL BANK, a national banking association ("First Union"),
successor by merger to CoreStates Bank, N.A. ("CoreStates"), for itself and as
agent for the Participants (defined below).
Preliminary Statement
WHEREAS, MLC and CoreStates are parties to that certain Credit
Agreement dated as of June 5, 1997 (the "Initial Agreement"), pursuant to which
CoreStates agreed to make available to MLC, upon the terms and conditions
expressed in the Initial Agreement, a credit facility (the "Credit Facility") in
the principal amount of up to $15,000,000.
WHEREAS, pursuant to that certain Amendment No. 1 to Credit Agreement
dated September 5, 1997 (the "First Amendment") between CoreStates and MLC, the
maximum principal amount available to MLC under the Credit Facility was
increased to $25,000,000.
WHEREAS, pursuant to that certain Amendment No. 2 to Credit Agreement
dated as of December 19, 1997 (the "Second Amendment") between CoreStates and
MLC, the maturity date of the Credit Facility was extended to December 19, 1998.
The Initial Agreement, the First Amendment and the Second Amendment are
collectively referred to as the "Credit Agreement". All capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed to
them in the Credit Agreement.
WHEREAS, Bank Leumi USA and Riggs Bank N.A. (together, the
"Participants") have obtained participation interests in the Credit Facility in
the amount of up to $5,000,000 for each Participant, with CoreStates acting as
agent for the Participants.
WHEREAS, First Union is the successor by merger to all of CoreStates'
right, title and interest in and to the Credit Agreement and the other Loan
Documents, including the right to act as Agent for the Participants. The
Participants, together with First Union, are referred to collectively as the
"Banks".
WHEREAS, MLC has requested that First Union: (i) increase from
$25,000,000 to $35,000,000 the Loan Commitment; and (ii) increase from
$1,000,000 to $5,000,000 the sublimit on Eligible Non-AMC Inventory and
Equipment contained in the calculation of the Borrowing Base.
WHEREAS, First Union is willing to agree to such request on the terms
and conditions set forth herein.
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NOW, THEREFORE, in consideration of the premises and promises
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and intending to be legally
bound hereby, the parties hereto agree as follows:
1. Section 1.1 of the Credit Agreement. In clause (iv) of the
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definition of "Borrowing Base" contained in Section 1.1 of the Credit Agreement,
the dollar amount "$1,000,000" is deleted and replaced with the dollar amount
"$5,000,000".
2. Section 2.1 of the Credit Agreement. The dollar amount of the Loan
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Commitment set forth in ss.2.1 of the Credit Agreement as "$25,000,000" is
hereby deleted and it shall be and is hereby replaced by the dollar amount of
"$35,000,000".
3. Section 2.2 of the Credit Agreement. The dollar amount set forth in
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the first paragraph of ss.2.2 of the Credit Agreement as "TWENTY FIVE MILLION
DOLLARS ($25,000,000)" is hereby deleted and shall be and it is hereby replaced
by the dollar amount of "THIRTY FIVE MILLION DOLLARS ($35,000,000)."
4. Exhibit A to the Credit Agreement. Exhibit A to the Credit Agreement
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shall be and is hereby amended and restated in its entirety to be as set forth
in Exhibit A attached hereto. Upon delivery of the $35,000,000 Note, dated as of
June 15, 1998, to the First Union, First Union shall mark the $25,000,000 Note,
dated December 19, 1997, "canceled and replaced by $35,000,000 Note, dated as of
June 15, 1998."
5. Representations and Warranties. MLC hereby restates the
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representations and warranties made in the Credit Agreement, including but not
limited to Article 3 thereof, on and as of the date hereof as if originally
given on this date.
6. Covenants. MLC hereby represents and warrants that it is in
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compliance and has complied with each and every covenant set forth in the Credit
Agreement, including but not limited to Articles 5 and 6 thereof, on and as of
the date hereof.
7. Corporate Authorization and Delivery of Documents. First Union shall
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have received copies, certified as of the date hereof, of all action taken by
MLC and any other necessary Person to authorize this Amendment and such other
papers as First Union shall require.
8. Affirmation. MLC hereby affirms its absolute and unconditional
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promise to pay to First Union the Loans and all other amounts due under the
Credit Agreement and any other Loan Document on the maturity date(s) provided in
the Credit Agreement or any other Loan Document, as such documents may be
amended hereby.
9. Effect of Amendment. This Amendment amends the Credit Agreement only
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to the extent and in the manner herein set forth, and in all other respects the
Credit Agreement is ratified and confirmed.
10. Counterparts. This Amendment may be signed in any number of
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counterparts, each of which shall be an original, with the same effect as if the
signatures hereto were upon the same instrument.
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IN WITNESS WHEREOF, the parties hereto have each caused this Amendment
to be duly executed by their duly authorized representatives as of the date
first above written.
MLC GROUP, INC.
By _/s/ Phillip G. Norton___________________
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Phillip G. Norton, President
FIRST UNION NATIONAL BANK
By __/s/ Michael J. Labrum______________________
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Michael J. Labrum, Vice President
The undersigned, MLC Holdings, Inc. ("Holdings"), the guarantor of the
obligations of MLC Group, Inc. to First Union National Bank (successor by merger
to CoreStates Bank, N.A.) pursuant to that certain Guaranty Agreement dated June
5, 1997 (the "Guaranty"): (i) hereby consents to the making of this Amendment
(and to all prior amendments to the Loan Documents); (ii) confirms the
continuing validity of the Guaranty; and (iii) restates all of the
representations and warranties of Holdings made in any of the Loan Documents
(including, without limitation, those set forth in Section 4 of the Guaranty),
on and as of the date hereof as if originally given on the date of this
Amendment.
MLC HOLDINGS, INC.
By:__/s/ Phillip G. Norton__________________________
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Phillip G. Norton, President
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EXHIBIT A
Note
$35,000,000 Philadelphia, PA
As of June 30, 1998
For Value Received, MLC GROUP, INC., a Virginia corporation ("MLC"), hereby
promises to pay to the order of FIRST UNION NATIONAL BANK (the "First Union"),
successor by merger to CoreStates Bank, N.A., in lawful currency of the United
States of America in immediately available funds at First Union's offices
located at Broad and Chestnut Streets, Philadelphia, Pennsylvania, on the
earliest to occur of demand, acceleration of the maturity date as provided in
the Credit Agreement described below or the Credit Termination Date, the
principal sum of THIRTY FIVE MILLION DOLLARS ($35,000,000) or, if less, the then
unpaid principal amount of all Loans made by First Union pursuant to the Credit
Agreement (defined below).
MLC promises also to pay interest on the unpaid principal amount hereof in like
money at such office from the date hereof until paid in full at the rates and at
the times provided in the Credit Agreement.
This Note is the Note referred to in, is entitled to the benefits of and is
secured by security interests referred to in the Credit Agreement, dated as of
June 5, 1997 by and between MLC and CoreStates Bank, N.A. (as such Credit
Agreement may be amended, modified, supplemented, restated or replaced from time
to time, the "Credit Agreement") and is a replacement Note substituted in its
entirety for a Note dated December 19, 1997 in the amount of $25,000,000. As a
result of a merger between CoreStates Bank, N.A. and First Union, First Union
has succeeded to all of the right, title and interest of CoreStates Bank, N.A.
in the Credit Agreement and all of the Loan Documents. Capitalized terms used in
this Note but not defined herein shall have the meanings ascribed to such terms
in the Credit Agreement. This Note is subject to voluntary prepayment and
mandatory repayment prior to demand, acceleration of maturity or the Credit
Termination Date, in whole or in part, as provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the maturity date of
the principal of and the accrued interest on this Note may be accelerated and be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
MLC hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.
Notwithstanding the face amount of this Note, the undersigned's liability
hereunder shall be limited, at all times, to the actual aggregate outstanding
indebtedness to First Union relating to First Union's Loans, including all
principal and interest, together with all fees and expenses as provided in the
Credit Agreement, as established by First Union's books and records which shall
be conclusive absent manifest error.
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THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OF CONFLICT OF LAWS.
MLC GROUP, INC.
By:__________________________
Phillip G. Norton, President
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