AMENDMENT NO. 4 TO
LOAN AND SECURITY AGREEMENT
This Amendment No. 4 to Loan and Security Agreement is made as
of May 10, 2000 by and among each of the undersigned and amends that certain
Loan and Security Agreement dated as of June 30, 1998, as previously amended by
Amendment No. 1 to Loan and Security Agreement dated as of May 11, 1999,
Amendment No. 2 to Loan Agreement dated as of September 30, 1999, and Amendment
No. 3 to Loan and Security Agreement ("Amendment No. 3") dated as of March 10,
2000 (the "Loan Agreement"), by and among the financial institutions listed on
the signature pages thereof as lenders (such financial institutions, together
with their respective successors and assigns, are referred to hereinafter each
individually as a "Lender" and collectively as the "Lenders"), Bank of America,
National Association (formerly known as BankAmerica Business Credit, Inc.), a
Delaware corporation, as agent for the Lenders (in its capacity as agent, the
"Agent"), and Merisel Americas, Inc., a Delaware corporation (the "Borrower").
Capitalized terms used herein without definition have the meanings assigned
thereto in the Loan Agreement.
RECITALS
A. The Borrower has requested that the Loan Agreement be amended and
modified as provided herein, and certain proposed actions by the Borrower be
consented to by the Agent and the Lenders, all as more fully described below.
B. On the terms and subject to the conditions set forth in this
Amendment, the Borrower, the Agent and the Lenders, have agreed to the
amendments and waivers to the Loan Agreement as set forth below.
AGREEMENT
In consideration of the foregoing, and for good and valuable
consideration, the receipt of which is hereby acknowledged, the undersigned
hereby agree as follows:
ARTICLE 1
AMENDMENTS AND WAIVERS TO LOAN AND SECURITY AGREEMENT
1.1 Amendment to the Definition of "Borrowing Base". The definition of
"Borrowing Base" set forth in Section 1.1 of the Loan Agreement is hereby
amended by deleting such definition in its entirety, and inserting in its place
the following:
"`Borrowing Base' means (a) the sum of fifty percent (50%) of Eligible
Domestic Inventory, plus fifteen percent (15%) of Eligible Imported
Inventory; less (b) the sum of the Inventory Mix Reserve, the
Liquidation Expense Reserve, the Foreign Exchange Reserve and the
Vendor Lien Reserve."
<PAGE>
1.2 Amendment to the Definition of "Foreign Exchange Transactions". The
definition of "Foreign Exchange Transactions" set forth in Section 1.1 of the
Loan Agreement is hereby amended by deleting such definition in its entirety,
and inserting in its place the following:
"`Foreign Exchange Transactions' means (a) the foreign exchange line of
$35,000,000 (notional value) from Bank of America for foreign exchange
contracts in $ Canadian, and (b) any other foreign exchange line of
credit with Bank of America or a Lender and for any currency; provided
that, with respect to (a) and (b) above, the settlement risk shall not
exceed $10,000,000 on any settlement day."
1.3 Amendment to the Definition of "Inventory Mix Reserve Percentage". The
definition of "Inventory Mix Reserve Percentage" set forth in Section 1.1 of the
Loan Agreement is hereby amended by deleting such definition in its entirety,
and inserting in its place the following:
"`Inventory Mix Reserve Percentage' means the result, expressed as a
percentage, of the following:
1 - OLV
where OLV means the amount determined by the Agent as the realizable
value of Eligible Inventory (expressed as a percentage of cost)
calculated based on the methodology of the Dovebid, Inc. appraisal most
recently submitted to Agent pursuant to Section 6.5 and adjusted weekly
to reflect the inventory mix as reflected in the Borrowing Base
Certificate delivered pursuant to section 6.7(b). At no time shall the
Inventory Mix Reserve Percentage be less than zero."
1.4 Amendment to the Definition of "Liquidation Expense Reserve". The definition
of "Liquidation Expense Reserve" set forth in Section 1.1 of the Loan Agreement
is hereby amended by deleting such definition in its entirety, and inserting in
its place the following:
"`Liquidation Expense Reserve' means a reserve of $4,500,000, subject
to adjustment upwards and downwards by the Agent in its sole discretion."
1.5 Amendment to the Definition of "Maximum Revolver Amount". The definition of
"Maximum Revolver Amount" set forth in Section 1.1 of the Loan Agreement is
hereby amended by deleting such definition in its entirety, and inserting in its
place the following:
"`Maximum Revolver Amount' means $35,000,000."
<PAGE>
1.6 MOCA Disposition Definition. A new definition of "MOCA Disposition" is
added to Section 1.1 of the Loan Agreement as follows:
"'MOCA Disposition' means the sale or other disposition of all or
substantially all of the assets or shares of Merisel Open Computing
Alliance, Inc. by the Borrower or the Parent, but excluding the
transfer of the shares of Merisel Open Computing
Alliance, Inc. by the Borrower to Parent."
1.7 Monthly Gross Profit Definition. A new definition of "Monthly Gross
Profit" is added to Section 1.1 of the Loan Agreement
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as follows:
"`Monthly Gross Profit' means, for any given month for the Borrower,
the amount identified as "Total FE" for such month on the report
delivered to the Agent pursuant to section 7.2(l)."
1.8 New Exhibit G. The Loan Agreement is hereby amended to add Exhibit G
hereto as Exhibit G thereto.
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1.9 Amendment to Definition of Subsidiary. The definition of "Subsidiary" set
forth in Section 1.1 of the Loan Agreement is hereby amended by inserting the
following at the end of the first sentence thereof:
"provided, that, notwithstanding the foregoing, Merisel Open Computing
Alliance, Inc. shall, for all purposes of this
Agreement, not be deemed a Subsidiary of the Borrower."
1.10 Amendment to Amount of Total Credit Facility. Section 2.1(a) of the Loan
Agreement is hereby amended by deleting the amount "$100,000,000" and inserting
the amount "$35,000,000" in its place.
1.11 Amendment to Minimum Availability Requirement. Section 2.2(a) of the Loan
Agreement is hereby amended by deleting such section in its entirety, and
inserting in its place the following:
"(a) Amounts. Subject to the satisfaction of the conditions
precedent set forth in Article 10, each Lender severally agrees, upon
the Borrower's request from time to time on any Business Day during the
period from the Closing Date to the Termination Date, to make revolving
loans (the "Revolving Loans") to the Borrower, in amounts not to exceed
(except for BABC with respect to BABC Loans or Agent Advances) such
Lender's Pro Rata Share of the Borrower's Avail-ability. The Lenders,
however, in their discretion, may elect to make Revolving Loans or
participate (as provided for in Section 2.3(f)) in the credit support
or enhancement provided through the Agent to the issuers of Letters of
Credit in excess of the Availability on one or more occasions, but if
they do so, neither the Agent nor the Lenders shall be deemed thereby
<PAGE>
to have changed the limits of the Maximum Revolver Amount or the
Availability or to be obligated to exceed such limits on any other
occasion. If at any time the Aggregate Revolver Outstanding exceeds the
Availability (with the Availability calculated as if the Aggregate
Revolver Outstandings were zero), then the Lenders may refuse to make
or otherwise restrict the making of Revolving Loans as the Lenders
determine until such excess has been eliminated, subject to the Agent's
authority, in its sole discretion, to make Agent Advances pursuant to
the terms of Section 2.2(i)."
1.12 Commitment Amount. On the Effective Date (as defined in section 3.1(a)
below) the Bank of America, National Association's Commitment will be
$35,000,000.
1.13 Amendment to Section 4.1. Section 4.1 of the Loan Agreement is hereby
amended by deleting such section in its entirety, and inserting in it place the
following:
"4.1 Revolving Loans.
(a) The Borrower shall repay the outstanding principal balance of the
Revolving Loans, plus all accrued but unpaid interest thereon, on the
Termination Date. The Borrower may prepay Revolving Loans at any time,
and reborrow subject to the terms of this Agreement; provided, however,
that with respect to any LIBOR Revolving Loans prepaid by the Borrower
prior to the expiration date of the Interest Period applicable thereto,
the Borrower promises to pay to the Agent for account of the Lenders
the amounts described in Section 5.4; provided, however, if at any time
the prepayment of Loans pursuant to this Agreement would result, in the
Borrower incurring breakage costs under Section 5.4 as a result of
LIBOR Revolving Loans being prepaid other than on the last day of an
Interest Period applicable thereto (the "Affected LIBOR Loans"), then
the Borrower may in its sole discretion initially deposit a portion (up
to 100%) of the amounts that otherwise would have been paid in respect
of the Affected LIBOR Loans with the Bank of America or an Affiliate
for the benefit of the Agent (which deposit, after giving effect to
interest to be earned on such deposit prior to the last day of the
relevant Interest Periods, must be equal in amount to the amount of
Affected LIBOR Loans not immediately prepaid) to be held as security
for the obligations of the Borrower hereunder pursuant to an agreement
to be entered into in form and substance reasonably satisfactory to the
Agent, with such cash collateral to be directly applied upon the first
occurrence (or occurrences) thereafter of the last day of an Interest
Period applicable to the relevant Loans that are LIBOR Revolving Loans
(or such earlier date or dates as shall be requested by the Borrower),
to repay an aggregate principal amount of such Loans equal to the
Affected LIBOR Loans not initially repaid pursuant to this sentence.
Notwithstanding anything to the contrary contained in the immediately
preceding sentence, all amounts deposited as cash collateral pursuant
to the immediately preceding sentence shall be held for the sole
<PAGE>
benefit of the Lenders whose Loans would otherwise have been
immediately repaid with the amounts deposited and upon the taking of
any action by the Agent or the Lenders pursuant to the remedial
provisions of Section 11, any amounts held as cash collateral pursuant
to this Section 4.1 shall, subject to the requirements of applicable
law, be immediately applied to the relevant Loans. Following repayment
of the relevant Loans, any remaining cash collateral will be returned
to the Borrower. In addition, and without limiting the generality of
the foregoing, upon demand and no later than the next Business Day
following such demand, the Borrower promises to pay to the Agent, for
account of the Lenders, the amounts, without duplication, by which at
any time the Aggregate Revolver Outstanding exceeds the Availability
(with Availability for purposes of this clause (a) calculated as if the
Aggregate Revolver Outstandings were zero).
(b) Upon consummation of the MOCA Disposition (the "MOCA Prepayment
Date"), the Borrower shall prepay any and all of the following: (a) all
outstanding Loans, together with accrued interest thereon; and (b) all
other Obligations then due together with accrued interest thereon. If
any LIBOR Revolving Loans are prepaid pursuant to this section 4.1(b)
prior to the expiration date of the Interest Period applicable thereto,
then the Borrower shall pay the Lenders the amounts described in
Section 5.4. From the MOCA Prepayment Date through earlier of the date
which is 10 calendar days thereafter or the date on which notice is
delivered under this section 4.1(b) (the "Notification Period"), no
Loans shall be outstanding, the Lenders shall have no obligation to
make Loans, and the Agent shall have no obligation to cause any Letter
of Credit to be issued, extended or amended under this Agreement. At
any time during the Notification Period, the Lenders may deliver notice
to the Borrower indicating that this Agreement shall continue in effect
or that this Agreement shall automatically terminate on the date that
is 60 days from the date of such notice. During such 60-day period the
Lenders may (but shall not be obligated to) make Loans to the Borrower
in their sole discretion. If this Agreement terminates pursuant to
notice under this section 4.1(b), the provisions of Section 12.1 shall
apply. If no notice is delivered under this section 4.1(b), this
Agreement shall continue in full force and effect."
1.14 Amendment to Provision Regarding Appraisals. Section 6.5 of the Loan
Agreement is hereby amended by deleting such section in its entirety, and
inserting in its place the following:
"6.5 Appraisals. Whenever a Default or Event of Default exists, and at
such other times not more frequently than once per month as the Agent
requests, the Borrower shall, at its expense and upon the Agent's
request, provide the Agent with appraisals or updates thereof of any or
all of the Collateral from an appraiser, and prepared on a basis,
reasonably satisfactory to the Agent."
<PAGE>
1.15 Amendment to Collateral Reporting Requirements. Section 6.7 of the Loan
Agreement is hereby amended by deleting such section in its entirety, and
inserting in its place the following:
"6.7 Collateral Reporting. The Borrower shall provide the Agent with
the following documents at the following times in form reasonably
satisfactory to the Agent: (a) on a daily basis no later than 9:00 a.m.
(Pacific time), a report reflecting gross on hand Inventory, (b) on a
weekly basis no later than the third Business Day of the following
week, a Borrowing Base Certificate, a summary of total Inventory which
details all inventory excluded from Eligible Inventory, a calculation
of the Impaired Inventory Percentage, a valuation summary report which
details Inventory by category and calculates the then current Inventory
Mix Percentage, a summary report listing on hand Inventory balances by
vendor and accounts payable owing to any vendor or supplier who has a
Lien on any Inventory, a summary report with such information as is
included in the Borrower's currently produced report titled "Top Fifty
Manufacturers Summary of Accounts Payable Owed" (such summary report
shall specifically include all amounts owed and accounts payable to
Compaq), summary Inventory reports by category (and, if requested by
the Agent, additional detail thereof); (c) on a quarterly basis no
later than the 45th day following the end of each of the Borrower's
first three fiscal quarters in each fiscal year and no later than the
90th day following the end of the last fiscal quarter in each fiscal
year, a statement of the balance of each of the Intercompany Accounts;
(d) upon the occurrence and during the continuance of an Event of
Default, (i) as frequently as requested by the Agent, Borrowing Base
certificates, and (ii) on a monthly basis (or more frequently if
requested by the Agent), an aging of accounts payable which is aged by
due date, an aging of Accounts reconciled against the previous month's
aging and the Borrower's general ledger and copies of invoices and
purchase orders as requested by the Agent; and (e) such other reports
as to the Collateral of the Borrower as the Agent shall reasonably
request from time to time. If any of the Borrower's records or reports
of the Collateral are prepared by an accounting service or other agent,
the Borrower hereby authorizes such service or agent to deliver such
records, reports, and related documents to the Agent, for distribution
to the Lenders. For the purposes of this Section 6.7, the word "month"
shall mean "fiscal month.""
1.16 Amendment to Section 6.9. The third and fourth sentences of Section 6.9 are
hereby amended by deleting such sentences in their entirety, and inserting in
their place the following sentences:
"The Payment Account Agreement shall provide, inter alia, that upon
notice to the bank by the Agent that (i) an Event of Default and
acceleration of the Obligations have occurred, or (ii) the Aggregate
Revolver Outstanding is greater than zero and exceeds the Availability
(with Availability calculated as if the Aggregate Revolver Outstandings
were zero), the bank is authorized to transfer all funds in the Payment
<PAGE>
Account to the Agent. The notice from the Agent shall confirm that the
Agent's Lien does not extend to the Payment Account itself, but does
extend to the extent contemplated in this Agreement, to the proceeds of
the Borrower's Inventory and Accounts which are deposited into the
Payment Account."
1.17 Amendment to Financial Reporting Requirements. Section 7.2 of the Loan
Agreement is hereby amended by adding a new subparagraph (l) to read as follows:
"(l) No later than 5 days after the end of each fiscal month, a report
in substantially the form of Exhibit G accurately reflecting the
information in such Exhibit G for such fiscal month calculated in a
manner consistent with past practices."
1.18 Amendment to Section 7.2(b). Section 7.2(b) of the Loan Agreement is hereby
amended by deleting such section in its entirety, and inserting in its place the
following:
"(b) As soon as available after the end of each fiscal month, an
unaudited consolidating balance sheet of the Parent and its
Subsidiaries (or upon the Agent's request, of the Borrower and its
Subsidiaries, which in each case may include Merisel Open Computing
Alliance, Inc. with regard to the Borrower) as of the end of such
fiscal month and the related consolidating statements of income for
such fiscal month"
1.19 Replacement of Cash Flow Covenant with Minimum Monthly Gross Profit
Covenant. Section 9.20 of the Loan Agreement is hereby amended by deleting such
section in its entirety, and inserting in its place the following:
"9.20 Minimum Monthly Gross Profit.
(a) The Borrower will not permit its Monthly Gross Profit for any
fiscal month listed below, to be less than the amount set forth
opposite such month:
May 2000 $4,500,000
June 2000 $6,250,000
July 2000 $5,000,000
August 2000 $6,000,000
September 2000 $7,000,000
October 2000 $5,500,000
November 2000 $5,500,000
December 2000 $7,250,000
The first month of each fiscal quarter
beginning after December 2000 $5,000,000
<PAGE>
The second month of each fiscal quarter
beginning after December 2000 $5,000,000
The third month of each fiscal quarter
after December 2000 $7,000,000
(b) For purposes of calculating the Borrower's compliance with the
covenant set forth in this Section 9.20, any amount in excess of the
minimum Monthly Gross Profit for a particular fiscal month may be added
and applied to the minimum Monthly Gross Profit requirement for any
succeeding fiscal month (or fiscal months) in the same fiscal quarter
provided that amounts so applied may not in the aggregate exceed such
excess amount. For example, if the Monthly Gross Profit for January
2001 were $7,000,000, the excess of $2,000,000 ($7,000,000 -
$5,000,000) could be applied to February or March of 2001 or both such
months in any combination not exceeding an aggregate amount of
$2,000,000.
(c) For purposes of calculating the Borrower's compliance with the
covenant set forth in this Section 9.20, at the Borrower's option, the
Borrower may apply to any month or months in a fiscal quarter the
amount (not to exceed $3,750,000 per fiscal quarter) of Capital
Expenditures that have not been made or incurred during the applicable
fiscal quarter which are otherwise permitted by Section 9.22; provided
that the Capital Expenditures otherwise permitted by Section 9.22 for
such fiscal quarter shall be reduced by the amount or amounts applied
hereunder.
1.20 Amendment to Section 9.22. Section 9.22 of the Loan Agreement is hereby
amended by deleting such section in its entirety, and inserting in its place the
following:
"9.22 Capital Expenditures. Neither the Parent nor the Borrower, nor
any of their Subsidiaries, shall, commencing with Fiscal Year 2000,
make or incur any Capital Expenditure if, after giving effect thereto,
the aggregate amount of all Capital Expenditures (net of proceeds from
sales of fixed assets) by such parties on a consolidated basis would
exceed (i) $25,000,000 for any Fiscal Year (which amount shall be
reduced by all amounts applied pursuant to section 9.20(c)) (ii)
$7,500,000 for any fiscal quarter (which amount shall be reduced by all
amounts with respect to such fiscal quarter applied pursuant to section
9.20(c)).
1.21 New Event of Default. Section 11.1(i) of the Loan Agreement (which was
Intentionally Omitted) is hereby amended by deleting such section in its
entirety, and inserting in its place the following:
"(i) the Borrower shall not have received on or before June 12, 2000 a
cash infusion from the Parent in a minimum amount of $15,000,000,
evidenced by documentation in form and substance reasonably
satisfactory to the Required Lenders;
<PAGE>
1.22 Waiver to Covenants and Representations. The Agent and the Lenders hereby
waive compliance with any representation, warranty, or covenant under Articles
6, 7, 8 or 9 of the Loan Agreement and any Default or Event of Default under
Article 11 of the Loan Agreement, to the extent the Borrower would breach such
representation, warranty or covenant or create a Default or Event of Default in
consummating or effectuating the MOCA Disposition (as such term is defined in
Section 1.1 of the Loan Agreement as amended by this Amendment) as consented to
in Section 1.19 below or the distribution of shares of Merisel Open Computing
Alliance, Inc. to Parent.
1.23 Consent to MOCA Disposition. The Agent and the Lenders hereby approve of
and consent to the MOCA Disposition provided that the Borrower shall receive
cash proceeds from the MOCA Disposition, or otherwise have cash on hand, in each
case sufficient to fulfill the Borrower's obligations as set forth in Section
4.1(b) of the Loan Agreement, as amended by this Amendment. Concurrently with
the consummation of the MOCA Disposition, the Borrower shall deliver to the
Agent copies, certified by a Responsible Officer, of the sale agreement and each
of the other sale documents entered into in connection with the MOCA
Disposition.
1.24 MOCA Guaranty. The Agent and the Lenders hereby agree that upon
consummation of the MOCA Disposition and the Borrower's compliance with section
4.1(b) of the Loan Agreement, the Guaranty made and entered into as of March 10,
2000 by Merisel Open Computing Alliance, Inc. in favor of the Agent, as amended
on the date hereof, shall automatically terminate.
1.25 Confirmation of Amendment No. 3. The Agent and the Lenders hereby confirm
that the waivers, consents and approvals set forth in Section 1.21 and 1.22 of
Amendment No. 3 are and continue to be applicable regardless of the fact that
the stock of Merisel Open Computing Alliance, Inc. has not been distributed to
the Parent. The Agent and the Lenders hereby consent to the distribution of the
stock of Merisel Open Computing Alliance, Inc. to the Parent at such time as the
Borrower may elect to make such distribution.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
The Borrower warrants and represents to the Agent and the Lenders that:
2.1 Representations and Warranties True and Correct. The representations and
warranties contained in the Loan Agreement and the other Loan Documents are
correct in all material respects on and as of the date hereof after giving
effect to this Amendment (except representations and warranties which are made
as of a specified date shall only be required to be true and correct in all
material respects as of such specified date).
<PAGE>
2.2 No Default or Event of Default. No event has occurred and is continuing
which constitutes a Default or an Event of Default after giving effect to this
Amendment.
2.3 Corporate Authority; No Breach. The execution, delivery and performance by
the Borrower of this Amendment have been duly authorized by all necessary
corporate and other action and do not and will not (i) require any registration
with, consent or approval of, notice to or action by, any Person (including any
Governmental Authority) in order to be effective and enforceable, (ii)
contravene the terms of the Borrower's Certificate of Incorporation or bylaws,
or (iii) conflict with, or result in any breach or contravention of, any other
document to which the Borrower is a party or any order, injunction, writ or
decree of any Governmental Authority to which the Borrower or its property is
subject. The Loan Agreement as amended by this Amendment constitutes a legal,
valid and binding obligation of the Borrower, enforceable against the Borrower
in accordance with its respective terms, without defense, counterclaim or
offset, except as the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in equity or at law).
ARTICLE 3
MISCELLANEOUS
3.1 Effective Date and Availability Date.
(a) This Amendment shall be effective as of the date (the
"Effective Date") when each of the following conditions has been satisfied: (i)
the Agent has received (a) a duly executed counterpart of this Amendment from
the Borrower and the Majority Banks, (b) a duly executed Guarantor
Acknowledgment and Consent in the form attached hereto, (c) a duly executed
"Third Amended Fee Letter" (in a form acceptable to the Agent in its sole
discretion) from the Borrower to the Agent dated as of the date hereof, (d) an
unaudited consolidating balance sheet of the Borrower and its Subsidiaries as of
the end of the fiscal quarter ended March 31, 2000 and the related consolidating
statements of income for the three months then ending, (e) a copy of the
irrevocable written notice to be delivered to the partners of Stonington Capital
Appreciation 1994 Fund, L.P. on the date hereof (with a copy to the Agent)
requesting funds to make an aggregate capital contribution to Parent of at least
$15,000,000, which notice shall be in form and substance reasonably satisfactory
to the Majority Lenders, and (ii) all conditions to the effectiveness of the
Assignment and Acceptance Agreement of even date herewith between Bank of
America, National Association and Congress Financial Corporation shall have been
satisfied. The financial information required to be delivered to the Agent by
clause (d) of subsection (i) above shall be certified by the chief financial
officer of the Borrower as having been prepared in accordance with GAAP (subject
to good faith year-end audit adjustments and the absence of footnotes) and as
fairly presenting the Parent's or Borrower's financial position as at the dates
thereof.
<PAGE>
(b) Notwithstanding the occurrence of the Effective Date,
Availability and the Unused Letter of Credit Subfacility shall be each be deemed
equal to $0, and the Lenders shall have no obligation to make Loans, and the
Agent shall have no obligation to cause any Letter of Credit to be issued,
extended or amended under the Loan Agreement until each of the following
conditions has been satisfied: (i) the Agent has received (a) the monthly
financial reports identified in section 7.2(b) of the Loan Agreement (as amended
by this Amendment) for December of 1999 and January and February of 2000, and
(b) consolidating monthly financial projections through December 31, 2000 for
the Parent and its Subsidiaries, together with a narrative statement with regard
to the assumptions reflected in such financial projections, (ii) the Borrower,
the Agent and Bank One (successor in interest to The First National Bank of
Chicago) shall have entered into an amendment to the Payment Account Agreement
in form and substance reasonably satisfactory to the Agent, (iii) the Agent
shall have received a signed copy of the notice referenced in section
3.1(a)(i)(e) above, and (iv) the Agent shall have received the payment
referenced in Section 3 of the Third Amended Fee Letter referred to in Section
3.1(a)(i)(c) above. The financial information required to be delivered to the
Agent by subsection (i) above shall be certified by the chief financial officer
of the Borrower, with respect to clause (a) of that subsection, as having been
prepared in accordance with GAAP (subject to good faith year-end audit
adjustments and the absence of footnotes) and as fairly presenting the Parent's
and its Subsidiaries' financial position as at the dates thereof, and with
respect to clause (b) of that subsection, as representing the Borrower's best
estimate of the future financial performance for the Parent and its Subsidiaries
for the periods set forth therein.
3.2 No Other Waiver. The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of the Agent or the Lenders under the Loan Documents, nor
constitute a waiver of any provisions of the Loan Documents.
3.3 Governing Law. This Amendment is to be construed in accordance with and
governed by the internal laws of the State of California (as permitted by
Section 1646.5 of the California Civil Code or any similar successor provision)
without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of
California to the rights and duties of the parties.
3.4 Binding Effect. This Amendment shall be binding upon and shall inure to the
benefit of the parties hereto and each of their respective successors and
assigns.
3.5 Entire Agreement. This Amendment, together with the Loan Agreement and the
other Loan Documents, contains the entire and exclusive agreement of the parties
hereto with reference to the matters discussed herein and therein, and cannot be
amended, modified or supplemented except by an instrument in writing executed by
each party hereto. This Amendment supersedes all prior drafts and communications
between the parties with respect to the subject matter addressed herein.
<PAGE>
3.6 Severability. If any term or provision of this Amendment shall be deemed
prohibited by or invalid under any applicable law, such provision shall be
invalidated without affecting the remaining provisions of this Amendment or the
Loan Agreement, respectively.
3.7 Costs and Expenses; Further Assurances. Without limiting any provisions of
any of the Loan Documents: (i) the Borrower agrees to pay on demand all costs
and expenses of the Agent and the Lenders in connection with the preparation,
execution, delivery and enforcement of this Amendment, including, without
limitation, the reasonable fees and expenses of counsel for the Agent with
respect thereto and with respect to advising Agent as to its rights and
responsibilities hereunder; and (ii) the Borrower, the Agent and the Lenders
agree to execute and deliver such instruments and documents and take such other
action as shall be reasonably necessary or advisable in order to carry out the
intent of this Amendment.
3.8 References to Loan Agreement and Loan Documents. From and after the
effectiveness of this Amendment, all references in the Loan Agreement to "this
Agreement", "hereof", "herein", and similar terms shall mean and refer to the
Loan Agreement as certain provisions thereof are amended or supplemented by this
Amendment, and all references in other documents to the Loan Agreement shall
mean such agreement as certain provisions thereof are amended or supplemented by
this Amendment. The Loan Agreement and the other Loan Documents are hereby
ratified and confirmed and, except as herein otherwise agreed, remain unmodified
and in full force and effect.
3.9 Counterparts. This Amendment may be executed in any number of counterparts,
and by the Agent and the Borrower in separate counterparts, each of which shall
be an original, but all of which shall together constitute one and the same
agreement.
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S-1
sf-878736
IN WITNESS WHEREOF, the parties have entered into this Amendment on the
date first above written.
"BORROWER"
Merisel Americas, Inc., a Delaware corporation
By:______________________________________________
Name:____________________________________________
Title:___________________________________________
Address: 200 Continental Boulevard
El Segundo, CA 90245
Telecopy No.: (310) 615-1234
"AGENT"
Bank of America, National Association, as the Agent
By:_____________________________________________
Name:___________________________________________
Title:__________________________________________
Address: 40 East 52nd Street
New York, New York 10022
Telecopy No.: (212) 836-5167
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"LENDERS"
Bank of America, National Association, as a Lender
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
Address: 40 East 52nd Street
New York, New York 10022
Telecopy No.: (212) 836-5167
