AMENDMENTS TO SECURITIZATION AGREEMENTS AND WAIVER
AMENDMENTS TO SECURITIZATION AGREEMENTS AND WAIVER, dated as
of March 10, 2000 (these "Amendments") among MERISEL AMERICAS, INC. ("Merisel
Americas"), MERISEL CAPITAL FUNDING, INC. ("Merisel Capital Funding"), REDWOOD
RECEIVABLES CORPORATION ("Redwood") and GENERAL ELECTRIC CAPITAL CORPORATION
("GE Capital").
WHEREAS, Merisel Americas, as originator and Merisel Capital
Funding are parties to an Amended and Restated Receivables Transfer Agreement,
dated as of September 27, 1996, as amended by Amendment No. 1, dated as of
November 7, 1996, Amendment No. 2, dated as of December 19, 1997 and Amendment
No. 3, dated as of July 31, 1998 (the "MAI Transfer Agreement");
WHEREAS, Merisel Capital Funding, as seller (in such capacity,
the "Seller"), Redwood as purchaser (in such capacity, the "Purchaser"), GE
Capital, as operating agent (in such capacity, the "Operating Agent") and
collateral agent (in such capacity, the "Collateral Agent") and Merisel
Americas, as servicer (in such capacity, the "Servicer") are parties to an
Amended and Restated Receivables Purchase and Servicing Agreement, dated as of
September 27, 1996, as amended by Amendment No. 1, dated as of November 7, 1996,
Amendment No. 2, dated as of December 19, 1997, Amendment No. 3, dated as of
July 31, 1998, Amendment No. 4, dated as of February 22, 1999, Amendment No. 5,
dated as of May 12, 1999 and Amendment No. 6, dated as of August 13, 1999 (the
"Purchase Agreement");
WHEREAS, Redwood and GE Capital, as liquidity agent (in such
capacity, the "Liquidity Agent"), Operating Agent and Collateral Agent are
parties to a Liquidity Loan Agreement, dated as of October 2, 1995, as amended
by Amendment No. 1, dated as of July 31, 1998 (the "Liquidity Loan Agreement");
WHEREAS, definitions and interpretations of the Purchase
Agreement and the Transfer Agreement are set forth in Annex X thereto, dated as
of September 27, 1996, as amended ("Annex X," and, together with the Purchase
Agreement, the MAI Transfer Agreement and the Liquidity Loan Agreement, the
"Securitization Agreements"); and
WHEREAS, the parties hereto desire to amend the Securitization
Agreements (such amendments collectively referred to herein as these
"Amendments").
FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY
OF WHICH ARE HEREBY ACKNOWLEDGED, THE PARTIES HERETO, INTENDING TO BE LEGALLY
BOUND HEREBY, AGREE AS FOLLOWS:
ARTICLE I : DEFINITIONS
SECTION 1.1 All capitalized terms used herein, unless otherwise defined, are
used as defined in the Purchase Agreement.
ARTICLE II : AMENDMENT NO. 7 TO PURCHASE AGREEMENT
SECTION 2.1 The Purchase Agreement is hereby amended by adding Exhibit K
to read as set forth in Annex 1 to this Amendment.
SECTION 2.2 Recital E of the Purchase Agreement is hereby amended by:
(i) adding the symbol "(i)" between the second set of
the words "to" and "the" which appear in the
second line therein;
(ii)inserting the acronym "MAI" before the word
"Transfer" which appears in the third line
therein;
(iii) deleting the words "the Originator" and
substituting therefor the words "Merisel
Americas, Inc."; and
(iv)adding the phrase "(ii) the Receivable Transfer
Agreement, dated as of March 10, 2000, between
MOCA and MCF, as amended or amended and restated
from time to time (the "MOCA Transfer
Agreement"), and (iii) such other receivables
transfer agreement between the Purchaser and a
Subsidiary of Merisel, Inc., as may be entered
into from time to time and approved by the
Operating Agent and Collateral Agent (the
"Additional Transfer Agreement," and together
with the MAI Transfer Agreement and the MOCA
Transfer Agreement, the "Transfer Agreement")"
after the word "Seller" which appears in the
final line therein.
SECTION 2.3 Recital I of the Purchase Agreement is hereby amended by deleting
the words "the Originator" and substituting therefor the words "Merisel
Americas, Inc.".
SECTION 2.4 Section 2.03(a) of the Purchase Agreement is hereby amended
by:
(i) deleting the word "the" which appears in the
fourth line therein and substituting therefor the
word "each"; and
(ii)deleting the word "the" which appears in the
thirteenth line therein after the word "under"
and substituting therefor the word "each".
SECTION 2.5 Section 2.04(d) of the Purchase Agreement is hereby amended by (i)
replacing the word "the" before the word "Originator" in the first line thereof
and substituting therefor the word "either" and (ii) replacing the word "the"
before the word "Transfer" in the second line thereof and substituting therefor
the word "either".
SECTION 2.6 Section 2.08 of the Purchase Agreement is hereby amended by
changing the reference to 3:00 ▇.▇.▇▇ 1:00 p.m.
SECTION 2.7 Section 4.01(q) of the Purchase Agreement is hereby amended
by:
(i)adding the phrase "only with respect to" after
the word "and" and before the word "those";
(ii)deleting the words "the Originator" and
substituting therefor the words "Merisel
Americas, Inc."; and
(iii) inserting the acronym "MAI" before the word
"Transfer" which appears in the fifth line
therein.
SECTION 2.8 Section 4.01(u) of the Purchase Agreement is amended by changing the
word "the" that appears before the word "Transfer" in the eleventh line of such
definition to the word "any".
SECTION 2.9 Section 4.01(v) of the Purchase Agreement is amended by changing the
word "the" that appears before the word "Transfer" in the second line of such
definition to the word "any".
SECTION 2.10 Section 4.01(bb) of the Purchase Agreement is hereby amended by
deleting each occurrence of the words "the Originator" and substituting therefor
the words "Merisel Americas, Inc."
SECTION 2.11 Section 5.02 of the Purchase Agreement is hereby amended by:
(i) deleting the word "and" after subclause (j);
(ii)striking the period after subclause (k) and
adding a semi-colon and the word "and"; and
(ii)adding subclause (l) to read as follows:
"as soon as available, a Weekly Availability Report
in the Form of Exhibit K.
SECTION 2.12 Section 5.02(a) of the Purchase Agreement is amended and
restated to read as follows:
(a)an Investment Base Certificate in the form of
Exhibit C weekly, as soon as available, and in
any event within three Business Days after the
end of each week, no later than 11:00 a.m. New
York time on the day required.
SECTION 2.13 Section 5.03(h)(i) of the Purchase Agreement is hereby amended by
(i) replacing the word "the" before the word "Originator" in the second line
thereof and substituting therefor the word "either", (ii) replacing the word
"the" before the word "Transfer" in the third line thereof and substituting
therefor the word "either" and (iii) replacing the word "the" before the word
"Subordinated" in the third line thereof and substituting therefor the word
"either".
SECTION 2.14 Section 6.02(a) of the Purchase Agreement is amended by
changing the reference to 10:00 ▇.▇.▇▇ 1:00 p.m.
SECTION 2.15 Section 6.02(a)(vi) of the Purchase Agreement is hereby amended by
(i) replacing the word "the Originator" before the word "made" in the first line
thereof and substituting therefor the words "Merisel Americas, Inc.", (ii)
inserting the acronym "MAI" before the word "Transfer" in the third line thereof
and (iii) replacing the words "the Originator" before the word "for" in the
fourth line thereof and substituting therefor the words "Merisel Americas,
Inc.".
SECTION 2.16 Section 6.03 of the Purchase Agreement is amended to changing
the reference to 12:00 p.m. to 1:00 p.m.
SECTION 2.17 Section 7.04 of the Purchase Agreement is hereby amended by
deleting the words "the Originator" after the word "is" and before the word "or"
and substituting therefor the words "Merisel Americas, Inc.".
SECTION 2.18 Section 7.06(f) of the Purchase Agreement is hereby amended by
inserting the acronym "MAI before the word "Transfer" in the third line thereof.
SECTION 2.19 Section 8.01(b) of the Purchase Agreement is hereby amended by
deleting the word "the" which appears in the first line therein and substituting
therefor the words "each".
SECTION 2.20 Section 9.01 of the Purchase Agreement is hereby amended by:
(i)adding the word "or" after subclause (w); and
(ii)adding subclause (x) to read as follows:
"if the non-consolidation opinion of special counsel
to Merisel Americas between Merisel Americas, Inc. and the
Seller, in form and substance satisfactory to the Operating
Agent and its counsel is not received by the Operating Agent
within 60 days of the effective date of the Amendments to
Securitization Agreements and Waiver, dated as of March 10,
2000, among Merisel Americas, Inc., the Seller, the Purchaser,
the Collateral Agent and the Operating Agent.
SECTION 2.21 Section 14.03(a) of the Purchase Agreement is hereby amended by
deleting the phrase "after a termination event".
SECTION 2.22 Schedule 3 of the Purchase Agreement is hereby amended by:
(i) deleting the definition of "Daily Margin" and
substituting therefor the following definition of
"Daily Margin":
"`Daily Margin'" means as of any date, a percentage
per annum (the "Reference Percentage") divided by 360, which
Reference Percentage shall be determined by reference to the
Daily Margin Fixed Charge Coverage Ratio for the most recent
four fiscal quarters of the Parent for which financial results
are required to be delivered pursuant to Section 5.02(c) or
(e), as the case may be, of this Agreement ended on or most
recently prior to such date as set forth below:
MARGIN LEVEL
Daily Margin Reference
Fixed Charge Coverage Ratio Percentage
Level I 3.00%
Less than or equal to 0.40 x
Level II 2.25%
Greater than 0.40 x, but less than or equal to
0.70 x
Level III 1.75%
Greater than 0.70 x, but less than or equal to
1.00 x
Level IV 1.00%
Greater than 1.00 x
The Daily Margin shall be (i) calculated for the four
preceding fiscal quarters of the Parent for which financial
results are required to be delivered pursuant to Section 5.02
(c) or (e), as the case may be, of this Agreement and (ii)
determined by reference to the Daily Margin Fixed Charge
Coverage Ratio in effect from time to time; provided, that (A)
no change in the Daily Margin shall be effective until three
Business Days after the date on which the Operating Agent and
the Purchaser receive financial statements pursuant to Section
5.02(c) or Section 5.02(e) and a certificate of the chief
financial officer of the Parent demonstrating the computation
of the Daily Margin Fixed Charge Coverage Ratio, (B) if the
Operating Agent and the Purchaser have not received the
information described in clause (A) of this proviso within ten
days of the day required under Section 5.02(c), or Section
5.02(e), as the case may be, or if a Termination Event or
Incipient Event has occurred and is continuing, the Daily
Margin shall be determined by reference to Level I for so long
as such information has not been received by the Operating
Agent and Purchaser or such Termination Event or Incipient
Event continues; and (C) until May 15, 2000, the Daily Margin
shall be determined by reference to Level II; and
(ii)amending and restating the definition of "Daily
Margin Fixed Charge Coverage Ratio" to read as
follows:
"Daily Margin Fixed Charge Coverage Ratio" means the
Fixed Charge Coverage Ratio then in effect in accordance with
Exhibit H.
SECTION 2.23 Schedule 7 of the Purchase Agreement is hereby amended by
adding subclause 7 to read as follows:
"Receivables Transfer Agreement
Dated as of March 10, 2000
Merisel Capital Funding, Inc. as Buyer
MOCA, as Seller".
SECTION 2.24 Exhibit H of the Purchase Agreement is hereby amended and restated
in its entirety to read as follows:
(a) All covenants (i) shall be calculated on the
basis of the financial ratios and net worth percentages for
the most recent four consecutive fiscal quarters just
completed for which financial results are required to be
delivered pursuant to Section 5.02(c) or (e), as the case may
be, of this Agreement, and (ii) shall be calculated on a
quarterly basis. For purposes of determining the covenants set
forth in this Exhibit H, Funded Debt shall include any notes,
bonds, certificates or other interests issued in
securitization of assets of the Parent or any of its
Subsidiaries and principal of such securities and Cash
Interest Expense shall include any payments or distributions
in respect of interest on such securities. The Fixed Charge
Coverage Ratio, Minimum EBITDA and Tangible Net Worth
covenants with respect to any four fiscal quarters (i) ending
before the Second Quarter of 2000 are to be calculated on a
pro-forma basis excluding the reserve of $21 million relating
to the loss recorded by the Parent in connection with the
Turnberry Settlement (except to the extent of any net
insurance proceeds, if any, collected in connection with the
Turnberry Settlement) and (ii) ending before the First Quarter
of 2001 are to be calculated on a pro forma basis excluding
$10 million relating to the restructuring plan announced by
the Parent in the Fourth Quarter of 1999.
Covenant Covenant Level
I. Parent Fixed Charge Coverage Ratio (minimum)
Fourth Quarter of 1997 1.00 to 1.00
First Quarter of 1998 1.00 to 1.00
Second Quarter of 1998 1.00 to 1.00
Third Quarter of 1998 0.85 to 1.00
Fourth Quarter of 1998 0.70 to 1.00
First Quarter of 1999 0.46 to 1.00
Second Quarter of 1999 0.60 to 1.00
Third Quarter of 1999 0.40 to 1.00
Fourth Quarter of 1999 0.45 to 1.00
First Quarter of 2000 0.35 to 1.00
Second Quarter of 2000 0.45 to 1.00
Third Quarter of 2000 0.70 to 1.00
Fourth Quarter of 2000 1.00 to 1.00
Each Quarter Thereafter 1.10 to 1.00
II. Seller Net Worth Percentage (minimum) 15%
III. Parent Tangible Net Worth Covenant Level
Measurement Period
First Quarter of 2000 $80,000,000
Second Quarter of 2000 75,000,000
1 Commencing with the First Quarter of 2001, Tangible Net Worth on the last day
of each fiscal quarter shall be not less than the minimum Tangible Net Worth of
the Parent required pursuant to this Covenant III for the immediately prceding
fiscal quarter, plus 50% of Net Income for the fiscal quarter then ended.
Third Quarter of 2000 80,000,000
Fourth Quarter of 2000 90,000,000
Each Quarter Thereafter 90,000,000 plus 50% of
(commencing First Quarter Net Income for fiscal
of 2001)1 quarter then ended
IV. Parent Minimum EBITDA Covenant Level
Measurement Period
Third Quarter of 1999 36,000,000
Fourth Quarter of 1999 35,000,000
First Quarter of 2000 30,000,000
Second Quarter of 2000 35,000,000
Third Quarter of 2000 50,000,000
Fourth Quarter of 2000 65,000,000
Each Quarter Thereafter 85,000,000
[END OF CHART]
Capitalized terms used above and not otherwise defined below
shall have the meanings specified in Annex X to the Purchase Agreement.
"Capital Expenditures" means all payments for any
fixed assets or improvements or for replacements, substitutions, or
additions thereto, which are required to be capitalized in accordance
with GAAP, including, without limitation, any such expenditures
financed by the proceeds received from the sale of Receivables under
the Transfer Agreement, but excluding expenditures under (i) Capital
Leases and (ii) financed by the incurrence of Debt (other than pursuant
to the Inventory Facility).
"Cash Interest Expense" means, with respect to the
Parent and its consolidated subsidiaries for any period, (i) the sum of the
amount of cash interest payable on all Debt of the Parent and its consolidated
Subsidiaries (other than interest expense eliminated in consolidation in
accordance with GAAP) and (ii) Redwood Yield, if any, for such Person.
"EBITDA" means, for any Person with respect to any
period, (a) consolidated net income of the Parent and its consolidated
subsidiaries for such period, plus to the extent deducted in determining net
income, (b) the sum of (i) the Parent's and its consolidated subsidiaries'
depreciation and amortization for such period, (ii) Cash Interest Expense for
such period, (iii) any provision for taxes based on income or profits that was
deducted in computing consolidated net income for such period, and (iv) any
other non-cash charges.
"Fixed Charges" means, with respect to the Parent's
for any period, the sum of the following amounts payable during such period by
the Parent's and its consolidated subsidiaries: (i) Cash Interest Expense in
respect of Debt; (ii) regularly scheduled principal payments on Funded Debt; and
(iii) cash taxes.
"Fixed Charge Coverage Ratio" means with respect to
the Parent and its consolidated subsidiaries, the ratio of (i) EBTDA to (ii)
Fixed Charges plus Capital Expenditures.
"Funded Debt" means, with respect to any Person and
its consolidated subsidiaries, all Debt of such Person and its consolidated
subsidiaries which by the terms of the agreement governing or instrument
evidencing such Debt matures more than one year from or is directly or
indirectly renewable or extendable at the option of the debtor under a revolving
credit or similar agreement obligating the lender or lenders to extend credit
over a period of more than one year from, the date of creation thereof,
including current maturities of long-term debt, revolving credit, and short-term
debt extendable beyond one year at the option of such Person and its
consolidated subsidiaries.
"Net Income" means, for the Parent with respect to
any period, the consolidated net income of the Parent and its consolidated
subsidiaries.
"Net Worth Percentage" means a fraction (expressed
as a percentage) (i) the numerator of which is the excess of assets over
liabilities, each determined in accordance with GAAP on a basis consistent with
the last audited financial statements and (ii) the denominator of which is the
Outstanding Balance of Transferred Receivables.
"Tangible Net Worth" means, with respect to the
Parent and its consolidated subsidiaries, assets minus liabilities.
ARTICLE III : AMENDMENT NO. 3 TO ANNEX X
SECTION 3.1 Annex X is hereby amended by:
(i) adding the following definitions:
"MAI Secured Obligations" means all obligations of
every nature of the Originator now or hereafter existing,
under the MAI Transfer Agreement and any promissory note or
other document or instrument delivered pursuant to such
documents, and all amendments, extensions or renewals thereof,
whether for principal, interest, fees, expenses or otherwise,
whether now existing or hereafter arising, voluntary or
involuntary, whether or not jointly owed with others, direct
or indirect, absolute or contingent, liquidated or
unliquidated, and whether or not from time to time decreased
or extinguished and later increased, created or incurred and
all or any portion of such obligations that are paid, to the
extent all or any part of such payment is avoided or recovered
directly or indirectly from MCF as a preference, fraudulent
transfer to otherwise.
"MAI Subordinated Note" has the meaning specified in
Section 2.01(c) of the MAI Transfer Agreement.
"MAI Transfer Agreement" means the Amended and
Restated Receivables Transfer Agreement, dated as of
September 27, 1996 as amended by Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇
▇▇. ▇ and Amendment No. 3, as amended or amended and restated
from time to time, between Merisel Americas, Inc. and MCF.
"MOCA" means Merisel Open Computing Alliance, Inc. a
Delaware corporation.
"MOCA Effective Date" means the effective date of the
MOCA Transfer Agreement.
"MOCA Secured Obligations" means all obligations of
every nature of the Originator now or hereafter existing,
under the MOCA Transfer Agreement and any promissory note or
other document or instrument delivered pursuant to such
documents, and all amendments, extensions or renewals thereof,
whether for principal, interest, fees, expenses or otherwise,
whether now existing or hereafter arising, voluntary or
involuntary, whether or not jointly owed with others, direct
or indirect, absolute or contingent, liquidated or
unliquidated, and whether or not from time to time decreased
or extinguished and later increased, created or incurred and
all or any portion of such obligations that are paid, to the
extent all or any part of such payment is avoided or recovered
directly or indirectly from MCF as a preference, fraudulent
transfer or otherwise.
"MOCA Subordinated Note" has the meaning specified in
Section 2.01(c) of the MOCA Transfer Agreement.
"MOCA Transfer Agreement" means the Receivables
Transfer Agreement, dated as of March 10, 2000, as amended or
amended and restated from time to time, between MOCA and MCF.
"Net Worth Percentage" means a fraction (expressed as
a percentage) (i) the numerator of which is the excess of
assets over liabilities, each determined in accordance with
GAAP on a basis consistent with the last audited financial
statements and (ii) the denominator of which is the
Outstanding Balance of Transferred Receivables.
(ii) adding the following text to the cover of Annex X after the date "September
27, 1996":
"AND
RECEIVABLES TRANSFER AGREEMENT
Dated as of
▇▇▇▇▇ ▇▇, ▇▇▇▇".
(▇▇▇) amending the definition of "Adjusted Generated Receivables" by deleting
the word "the" before the word "Originator" and substituting therefor the word
"each".
(iv) the definition of "Contract" is hereby amended (i) deleting the words "an
Obligor" in the second line hereof and replacing such words with the words "a
Person" and (ii) deleting the words "such Obligor" in the second line thereof
and replacing such words with the words "such Person".
(v) amending the definition of "Contributed Receivable" by inserting the acronym
"MAI" before the word "Transfer" and after the word "the".
(vi) amending the definition of "Credit and Collection Policies" by deleting the
word "the" before the word "Originator" and substituting therefor the word
"each".
(vii) amending the definition of "Effective Date" by adding the phrase "(i) in
the case of MAI," after the word "means" and the phrase "and (ii) in the case of
MOCA, the date of the MOCA Transfer Agreement" after the word "Agreement".
(viii) amending the definition of "Eligible Receivable" by (a) adding the word
"applicable" before the word "Transfer" after the word "the" in subclause (e)
and (b) amending and restating subclause (f) to read as follows: "(f) which
complies with such other criteria and requirements as the Operating Agent may
from time to time specify to the Seller or the Originator upon prior written
notice and in its reasonable credit discretion.
(ix) amending the definition of "MCF" by deleting the phrase "as a purchaser and
transferee of Transferred Receivables under the Transfer Agreement and the
Seller under the Purchase Agreement" and substituting therefor the phrase ", a
Delaware corporation".
(x) amending the definition of "Obligor" by (i) deleting the words "this Section
1" and substituting therefor the words" Annex X" and (ii) inserting at the end
thereof the following sentence.
"Unless otherwise stated, the term "Obligor"
of any Receivable refers to both the Original Obligor that
owes such Receivable and, if applicable, the Floor Plan
Obligor that finances, or may finance, such Receivable."
(xi) amending the definition of "Orders" by deleting the word "the" before the
word "Transfer" and substituting therefor the word "each".
(xii) amending the definition of "Original Obligor" by deleting the words "this
Section 1" and substituting therefor the words" Annex X".
(xiii) amending the definition of "Proceeds" by adding the following at the end
thereof: "Provided that returned goods, for all purposes other than Section 2.02
of each Transfer Agreement and Section 8.01 of the Purchase Agreement or
inventory shall not constitute Proceeds to the extent the Billed Amount thereof
less all collections thereof have been paid to MCF in accordance with Section
4.04 of either Transfer Agreement."
(xiv) amending the definition of "Originator" by deleting the word "initially",
adding the phrase "(ii) Merisel Open Computing Alliance, Inc., a Delaware
corporation," after the word "and" and before the symbol "(ii)", and deleting
the symbol "(ii)" and substituting therefor the symbol "(iii)".
(xv) amending the definition of "Purchase Agreement" by adding the phrase "as
the same may be amended from time to time" after the word "Servicer".
(xvi) amending and restating the definition of "Receivable" to read as
follows:
"Receivable" means
(a) indebtedness of a Person (whether
constituting an account, chattel paper, instrument or general
intangible) arising from the sale by an Originator of goods,
merchandise or inventory to such Person or the provision by an
Originator of services, related to the processing of payments
for a Person, including the right to payment of any interest
or finance charges and other obligations of such Person with
respect thereto including, without limitation, (i) the
indebtedness of any Person under an agreement (including an
invoice), pursuant to which such Person is obligated to pay an
Originator from time to time, arising from a sale of
merchandise by an Originator to such Person, including without
limitation any such indebtedness which may be financed by any
other Person, and (ii) the indebtedness of any Person arising
from the sale by the Originator of any indebtedness referred
to in clause (i) above to such Person under the agreement or
arrangement of the type described in clause (c) hereof
relating to such indebtedness.
(b) all security interests or liens and
property subject thereto from time to time securing or
purporting to secure payment by such Person; provided that,
except for the purposes of Section 2.02 of each Transfer
Agreement and Section 8.01 of the Purchase Agreement, (i)
Returned Goods (as defined in the Intercreditor Agreement)
therein ceases to exist and (ii) returned goods or inventory
related to an Originator shall not constitute a "Receivable"
to the extent the Billed Amount of the Receivable created in
connection with the sale of such goods or inventory less all
Collections thereon have been paid to MCF in accordance with
Section 4.04 of the relevant Transfer Agreement.
(c) all rights under any floor plan repurchase
agreements, repurchase agreements, inventory financing
agreements, and other floor plan agreements, and all
guarantees, indemnities and warranties and proceeds thereof,
proceeds of insurance policies, financing statements and other
agreements or arrangement of whatever character, in each case
from time to time supporting or securing payment of such
Receivable whether pursuant to the contract related to such
Receivable or otherwise.
(d) all Collections with respect to any of the
foregoing.
(e) all Records with respect to any of the foregoing;
and
(f) all Proceeds of any of the foregoing."
Notwithstanding anything to the contrary expressed or implied by the foregoing,
indebtedness or other obligations of a vendor or seller of merchandise, goods or
inventory relating to credits, discounts, rebates, refunds and incentive
payments shall be excluded from this definition of "Receivable".
(xvii) amending the definition of "Related Documents" by deleting the word "the"
before the word "Transfer" and substituting therefor the word "each".
(xviii) amending and restating the definition of "Reserves" to read as
follows:
"Reserves" means, for any day, the sum of the Concentration
Discount Amount, the Defective Goods Reserve, the Refused
Shipment Reserve, the Price Protection Reserve and such other
reserves as the Operating Agent may establish from time to
time in its reasonable credit discretion.
(xix) amending the definition of "Servicer" by deleting the word the
"Originator" and substituting therefor the words "Merisel Americas, Inc.".
(xx) amending the definition of "Sold Receivable" by adding the word
"applicable" before the word "Transfer".
(xxi) amending and restating the term "Subordinated Note" to read as follows:
"Subordinated Note" means, as applicable, the MAI Subordinated
Note, the MOCA Subordinated Note, or a subordinated note
between MCF and an additional originator as may be approved by
the Operating Agent in its sole discretion.
(xxii) amending and restating the definition of "Transfer Agreement" it in its
entirety to read as follows:
"means individually or collectively, as the case may be, or
the context may require (i) the MAI Transfer Agreement, (ii)
the MOCA Transfer Agreement, and (iii) such other receivables
transfer agreement between an Originator and MCF, as shall be
approved by the Operating Agent and as may be amended or
amended and restated from time to time".
(xxiii) amending the definition of "Transferred Receivable" by adding
the word "applicable" before the word "Transfer".
ARTICLE IV : AMENDMENT NO. 4 TO MAI TRANSFER AGREEMENT
SECTION 4.1 Article I of the MAI Transfer Agreement is hereby amended by
adding Section 1.03 to read as follows:
"Definition of Receivables, Transferred Receivable and
Contract. Whenever the terms "Receivables", "Transferred
Receivable" or "Contract" are used herein, such terms shall
mean only those Receivables, Transferred Receivables or
Contract (as such terms are defined in Annex X) originated by
Merisel Americas, Inc., and no other Subsidiary of Merisel,
Inc."
SECTION 4.2 Section 2.01(b) is amended by deleting the word "opening"
immediately preceding the words "of business" and replacing such word with the
word "close".
SECTION 4.3 Section 2.01(c) of The MAI Transfer Agreement is hereby
amended by:
(i) amending and restating the phrase "Subordinated Note" to
read "MAI Subordinated Note" each time such term is used
in the MAI Transfer Agreement.
(ii) adding the phrase ", and provided further that, in any
event, the indebtedness under the MAI Subordinated Note
shall not be increased on any day if such increase would
interfere with the transfer of receivables by MOCA to MCF"
after the number "15%".
SECTION 4.4 Section 2.02 is amended and restated in its entirety to read:
"(a) It is the intention of the parties
hereto that each transfer of Receivables to be made hereunder
shall constitute a purchase and sale, and not a loan. In the
event, however, that a court of competent jurisdiction were to
hold that any transaction provided for hereby constitutes a
loan and not a purchase and sale or for any reason such
purchase and sale is not effective, it is the intention of the
parties hereto that this Agreement shall constitute a security
agreement under applicable law and that the Originator shall
be deemed to have granted to MCF and the Originator hereby
grants to MCF for such purpose a first priority security
interest in all of the Originator's right, title and interest
in, to and under the Receivables transferred hereunder (or any
other Receivables which would have been transferred hereunder
if the transactions contemplated hereunder were deemed to be a
purchase or sale and not a loan), all payments of principal,
interest, fees, charges and indemnities on or under such
Receivables and all Proceeds of any such Receivables as
security for the prompt payment or performance when due,
whether at stated maturity, by acceleration or otherwise of
all MAI Secured Obligations.
(b) To the extent a Receivable relates to a returned
good or inventory, the security interest granted under this
Agreement with respect thereto shall terminate and MCF shall
automatically release such security interest immediately upon
the payment to MCF of the Billed Amount of the Receivable
relating to such returned good or inventory less all
Collections thereon in accordance with Section 4.04 of this
Agreement and MCF shall, at the request of the Originator,
provide such additional documentation requested by the
Originator to evidence such release of the security interest."
SECTION 4.5 Section 4.01(a)(ii) is hereby amended by inserting the text "to
which it is a party" immediately following the words "Related Documents".
SECTION 4.6 Sections 4.01(a)(ii) through 4.01(a)(v) and Sections 4.01(a)(viii),
4.01(a)(xiv) and 4.01(b)(xv) are each hereby amended by inserting the words "to
which it is a party" immediately following each occurrence of the words "Related
Documents".
SECTION 4.7 Section 4.01(a)(xxiii) is hereby amended by deleting the text "G"
immediately following the word "Regulations" and replacing such text with the
text "T".
SECTION 4.8 Section 4.02(d)(i) is hereby amended by inserting the words "to
which it is a party" immediately following the words "Related Documents".
SECTION 4.9 Section 4.02(d)(ii) is hereby amended by replacing the words
"the Seller" with the text "MCF".
SECTION 4.10 Section 4.02(k)(iii) is hereby amended by inserting the words
"Merisel Open Computing Alliance, Inc. and" immediately following the words
"Receivables from the Originator and".
SECTION 4.11 Section 4.02(n) is hereby amended by inserting the words "to which
the Originator is a party" immediately following each occurrence of the words
"Related Documents".
SECTION 4.12 Section 4.04 is hereby amended by inserting the text "(and MCF
shall transfer such Receivable to the Originator)" immediately following the
words "under the Subordinated Note or both".
SECTION 4.13 Section 5.01 is hereby amended by deleting each occurrence of the
text "wilful" and replacing such text with the text "willful" in each instance.
SECTION 4.14 Section 6.03 is hereby amended by deleting the text "pursuant to
Sections 4.01, 4.02 and 4.03" and replacing such text with the text "pursuant to
Sections 4.01(b), 4.02(b) and (c) and 4.03 (a), (b) and (c)".
ARTICLE V : AMENDMENT NO. 2 TO LIQUIDITY LOAN AGREEMENT
SECTION 5.1 Section 1.01 of the Liquidity Loan Agreement is hereby amended by
adding the following definitions:
"MAI Transfer Agreement" means the Amended and
Restated Receivables Transfer Agreement, dated as of September
27, 1996, as amended by Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇ and
Amendment No. 3, as amended or amended and restated from time
to time, between Merisel Americas, Inc. and MCF.
"MOCA" means Merisel Open Computing Alliance, Inc., a
Delaware corporation.
"MOCA Transfer Agreement" means the Receivables
Transfer Agreement, dated as of March 10, 2000, as amended or
amended and restated from time to time, between MOCA and MCF.
"Transfer Agreement" means collectively, the MAI
Transfer Agreement and the MOCA Transfer Agreement.
ARTICLE VI : WAIVER OF DEFAULT UNDER PURCHASE AGREEMENT
SECTION 6.1 The Operating Agent, the Collateral Agent and the Purchaser agree to
waive compliance with the financial covenants in Exhibit H of the Purchase
Agreement for the fiscal quarter ended December 31, 1999 and any Incipient Event
or potential Termination Event resulting from the potential breach of the
Financial Covenants contained in Exhibit H of the Purchase Agreement for the
fiscal quarter ended December 31, 1999.
ARTICLE VI : CONDITIONS PRECEDENT
SECTION 7.1 The effectiveness of these Amendments and waiver is subject to the
conditions precedent that the Collateral Agent, the Operating Agent and the
Purchaser shall have received each of the following, in form and substance
satisfactory to each such party:
(a) A certificate of the Secretary of each of the Seller and the Servicer,
dated the date of these Amendments and certifying (i) that attached
thereto is a true and complete copy of a resolution of the Board of
Directors of the Seller or the Servicer, as the case may be,
authorizing the execution, delivery and performance of these
Amendments, and all other documents required or necessary to be
delivered hereunder and that such resolution has not been modified,
rescinded or amended and is in full force and effect and (ii) as to the
incumbency and specimen signature of each Person's officers executing
these Amendments, and all other documents required or necessary to be
delivered hereunder.
(b) A certificate of an officer of each of the Seller and the Servicer,
dated the date of these amendments, certifying that each of the
representations and warranties made by the Seller and the Servicer in
these Amendments is true and correct in all material respects as of the
date hereof.
(c) The opinion of counsel to the Seller, in form and substance reasonably
satisfactory to the Purchaser, the Operating Agent and the Collateral
Agent, as to certain matters including, without limitation, (i) the
valid existence and good standing of the Seller and Servicer, (ii) the
power and authority of the Seller and Servicer (or Originator, as the
case may be) to execute the Amendments, (iii) the due authorization,
execution and delivery of the Amendments by the Seller and Servicer (or
Originator, as the case may be), (iv) the enforceability of the
Amendments against the Seller and Servicer (or Originator, as the case
may be), (v) that the execution and delivery of the Amendments (x) does
not conflict with the organizational documents of the Seller or
Servicer and (y) does not violate or constitute a default under any
material financing agreements of the Seller or Servicer and (v) "true
sale" opinions covering the transfers from Merisel Americas to Merisel
Capital Funding and MOCA to Merisel Capital Funding.
(d) An Officer's Certificate in form and substance satisfactory to the
Operating Agent to the effect that all of the representations and
warranties in the Transfer Agreement and Purchase Agreement are true
and correct in all material respects as of the date hereof after giving
effect to this Amendment No. 7.
(e) The Seller shall pay the fees and expenses of the Purchaser incurred in
connection with preparing these Amendments (including, without
limitation, reasonable legal fees and expenses and all amounts due and
owing under the Amendment No. 7 Fee Letter).
(f) The Operating Agent shall have received written confirmation from the
Rating Agencies that these Amendments will not result in a withdrawal,
downgrade or qualification of the ratings assigned to the Commercial
Paper.
ARTICLE VIII : SELLER'S AND SERVICER'S REPRESENTATIONS AND WARRANTIES
SECTION 8.1 Each of the Seller and the Servicer represents and warrants that:
(a) these Amendments have been duly authorized, executed and
delivered pursuant to its corporation power;
(b) these Amendments constitute its legal, valid and binding
obligation subject to the effect of bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally; and
(c) after giving effect to the amendments referred to herein,
there does not exist any Termination Event.
ARTICLE IX: MISCELLANEOUS
SECTION 9.1 Confirmation of Securitization Agreements. Each of the Seller and
the Servicer agree that, except for the specific amendments and waiver set forth
herein, nothing herein shall be deemed to be a waiver or amendment of any
covenant or agreement contained in the Securitization Agreements and each of the
other documents executed in connection therewith are ratified and confirmed in
all respects and shall remain in full force and effect in accordance with its
terms. Each reference in the Transfer Agreement to "this Agreement" and in each
of the other documents to be executed in connection therewith to the "Transfer
Agreement," shall mean the Transfer Agreement as amended by these Amendments and
as each such agreement may be hereinafter amended or restated. Each reference in
the Purchase Agreement to "this Agreement" and in each of the other documents to
be executed in connection therewith to the "Purchase Agreement," shall mean the
Purchase Agreement as amended by these Amendments and as each such agreement may
be hereinafter amended or restated. Nothing herein shall obligate the Seller,
the Servicer, the Purchaser, the Operating Agent or the Collateral Agent to
enter into any future amendment (whether similar or dissimilar).
SECTION 9.2 Waiver by the Seller and Servicer. Except for manifest errors on the
part of the Operating Agent, each of the Seller and the Servicer hereby waives
any claim, defense, demand, action or suit of any kind or nature whatsoever
against the Purchaser, the Operating Agent and the Collateral Agent arising on
or prior to the date hereof in connection with the Purchase Agreement or the
transactions contemplated thereunder.
SECTION 9.3 Counterparts. Delivery of an executed counterpart of a signature
page to these Amendments by facsimile shall be effective as delivery of a
manually executed counterpart of these Amendments. These Amendments may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 9.4 Governing Law. These Amendments shall be governed by, and construed
in accordance with, California law.
SECTION 9.5 Effective Date of Amendments. Upon the execution and delivery of
these Amendments by the parties hereto and the satisfaction of the conditions
precedent set forth herein, the Purchase Agreement shall be amended by these
Amendments, effective as of the date of hereof.
* * *
IN WITNESS WHEREOF, the Seller, the Servicer, the Collateral
Agent, the Operating Agent and the Purchaser have caused these Amendments to be
duly executed by their respective authorized officers as of the date and year
first above written.
MERISEL CAPITAL FUNDING, INC.,
as Seller
By:___________________________
Title:
Name:
MERISEL AMERICAS, INC.,
as Originator and Servicer
By:___________________________
Title:
Name:
GENERAL ELECTRIC CAPITAL CORPORATION,
as Operating Agent and Collateral Agent
By:___________________________
Title:
Name:
GENERAL ELECTRIC CAPITAL CORPORATION,
as Liquidity Agent
By:___________________________
Title:
Name:
REDWOOD RECEIVABLES CORPORATION,
as Purchaser
By:___________________________
Title:
Name: