Exhibit 10.38

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

This First Amendment to Credit Agreement (the “Amendment”) is made as of May 29,
2007 among the undersigned, Smart Business Advisory and Consulting, LLC a
Delaware limited liability company (the “Borrower”), Smart Business
Holdings, Inc., a Delaware corporation (the “Parent”), Bank of Montreal (“BMO”),
individually and as Administrative Agent (BMO being referred to herein in such
capacity as the “Administrative Agent”), and the other Banks currently party to
the Credit Agreement (together with BMO, collectively referred to herein as the
“Lenders”).

 

PRELIMINARY STATEMENTS

 

A.                                   The Borrower, the Parent, the
Administrative Agent and the Lenders entered into a Credit Agreement dated as of
May 15, 2007 (the “Credit Agreement”).  All capitalized terms used herein
without definition shall have the same meanings herein as such terms have in the
Credit Agreement.

 

B.                                      The Borrower has requested that the
Lenders amend certain provisions to the Credit Agreement and the Lenders are
willing to do so under the terms and conditions set forth in this Amendment.

 

NOW, THEREFORE, for good and valuable consideration, receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1.                                          AMENDMENT.

 

Subject to satisfaction of the conditions precedent set forth in Section 2
hereof, the Credit Agreement is hereby amended as follows:

 

1.01.                     The definition of “Applicable Margin” appearing in
Section 5.1 of the Credit Agreement is hereby amended by (i) striking the
reference to “Level III” appearing in the third line thereof and substituting
therefor the reference to “Level II” and (ii) amending the table appearing
therein in its entirety and as so amended shall be restated to read as follows:

 

LEVEL

 

TOTAL FUNDED
DEBT/EBITDA RATIO FOR
SUCH PRICING DATE

 

APPLICABLE MARGIN FOR
BASE RATE LOANS UNDER
REVOLVING CREDIT AND
TERM B CREDIT AND
REIMBURSEMENT
OBLIGATIONS SHALL BE:

 

APPLICABLE MARGIN FOR
EURODOLLAR LOANS UNDER
REVOLVING CREDIT AND
TERM B CREDIT AND
LETTER OF CREDIT FEE
SHALL BE:

 

APPLICABLE MARGIN FOR
COMMITMENT FEE SHALL
BE:

 

 

 

 

 

 

 

 

 

 

 

III

 

Greater than or equal to 3.50 to 1.0

 

2.00

%

3.50

%

0.50

%

 

 

 

 

 

 

 

 

 

 

II

 

Less than 3.50 to 1.0, but greater than or equal to 3.00 to 1.0

 

1.50

%

3.00

%

0.50

%

 

 

 

 

 

 

 

 

 

 

I

 

Less than 3.00 to 1.0

 

1.00

%

2.50

%

0.50

%

 

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SECTION 2.                                          CONDITIONS PRECEDENT.

 

The effectiveness of this Amendment is subject to the satisfaction of all of the
following conditions precedent:

 

Section 2.01.                    The Borrower, the Parent and the Required
Lenders shall have executed and delivered this Amendment.

 

Section 2.02.                    Legal matters incident to the execution and
delivery of this Amendment shall otherwise be satisfactory to the Administrative
Agent and its counsel.

 

Section 2.03.                    After giving effect to this Amendment, no Event
of Default shall have occurred and be continuing as of the date of this
Amendment that would otherwise take effect.

 

SECTION 3.                                          REPRESENTATIONS.

 

In order to induce the Required Banks to execute and deliver this Amendment, the
Borrower and the Parent, as applicable, hereby represent to the Required Banks
that as of the date hereof, the representations and warranties set forth in
Section 6 of the Credit Agreement are and shall be and remain true and correct
in all material respects and, unless specifically waived herein, the Borrower is
in compliance with all of the terms and conditions of the Credit Agreement after
giving effect to this Amendment and no Event of Default has occurred and is
continuing under the Credit Agreement or shall result after giving effect to
this Amendment.

 

SECTION 4.                                          MISCELLANEOUS.

 

Section 4.01.                    The Borrower and the Parent heretofore executed
and delivered the Collateral Documents.  The Borrower and the Parent hereby
acknowledge and agree that the Liens created and provided for by the Collateral
Documents continue to secure, among other things, the Obligations arising under
the Credit Agreement as amended hereby; and the Collateral Documents and the
rights and remedies of the Administrative Agent and Lenders thereunder, the
obligations of the Borrower and the Parent thereunder, and the Liens created and
provided for thereunder in each case remain in full force and effect and shall
not be affected, impaired or discharged hereby.  Nothing herein contained shall
in any manner affect or impair the priority of the liens and security interests
created and provided for by the Collateral Documents as to the indebtedness
which would be secured thereby prior to giving effect to this Amendment.

 

Section 4.02.                    Except as specifically amended herein or waived
hereby, the Credit Agreement shall continue in full force and effect in
accordance with its original terms.  Reference to this specific Amendment need
not be made in the Credit Agreement, the Notes, or any other instrument or
document executed in connection therewith, or in any certificate, letter or
communication issued or made pursuant to or with respect to the Credit
Agreement, any reference in any of such items to the Credit Agreement being
sufficient to refer to the Credit Agreement as amended hereby.

 

Section 4.03.                    This Amendment may be executed in any number of
counterparts, and by the different parties on different counterpart signature
pages, all of which taken together shall constitute one and the same agreement. 
Any of the parties hereto may execute this Amendment by signing any

 

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such counterpart and each of such counterparts shall for all purposes be deemed
to be an original.  This Amendment shall be governed by the internal laws of the
State of New York.

 

Section 4.04.                    The Borrower agrees to pay all reasonable
documented out-of-pocket costs and expenses incurred by the Administrative Agent
in connection with the preparation, execution and delivery of this Amendment and
the documents and transactions contemplated hereby, including the documented
reasonable fees and expenses of counsel for the Agent with respect to the
foregoing.

 

[SIGNATURE PAGE TO FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
Credit Agreement to be executed by their respective officers thereunto duly
authorized as of the date first above written.

 

 

SMART BUSINESS ADVISORY AND CONSULTING, LLC

 

 

 

 

 

By

 

 

 

Name

 

 

 

Title

 

 

 

 

SMART BUSINESS HOLDINGS, INC.

 

 

 

 

 

By

 

 

 

Name

 

 

 

Title

 

 

 

 

BANK OF MONTREAL, as L/C Issuer, and as Administrative Agent

 

 

 

 

 

By

 

 

 

Name

 

 

 

Title

 

 

 

 

BMO CAPITAL MARKETS FINANCING, INC., as a Lender and as Swing Line Lender

 

 

 

 

 

By

 

 

 

Name

 

 

 

Title

 

 

 

 

BANK OF MONTREAL, as a Lender

 

 

 

 

 

By

 

 

 

Name

 

 

 

Title

 

 

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