Exhibit 10.8


 


FIRST AMENDMENT TO CREDIT AGREEMENT


 


THIS FIRST AMENDMENT TO
CREDIT AGREEMENT (this “Amendment”) is entered into as of May 3, 2004, by
and between FIRST CONSULTING GROUP, INC., a Delaware corporation (“Borrower”),
and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”).


 


RECITALS


 


WHEREAS, Borrower is currently indebted to Bank pursuant to the terms
and conditions of that certain Credit Agreement between Borrower and Bank dated
as of May 1, 2003, as amended from time to time (“Credit Agreement”).


 


WHEREAS, Bank and Borrower have agreed to certain changes in the terms
and conditions set forth in the Credit Agreement and have agreed to amend the
Credit Agreement to reflect said changes.


 


NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree that the Credit
Agreement shall be amended as follows:


 


1.                                       Section 1.1. (a) is hereby
amended by deleting “May 3, 2004” as the last day on which Bank will make
advances under the Line of Credit, and by substituting for said date “May 2,
2005,” with such change to be effective upon the execution and delivery to Bank
of a promissory note dated as of May 3, 2004 (which promissory note shall
replace and be deemed the Line of Credit Note defined in and made pursuant to
the Credit Agreement) and all other contracts, instruments and documents
required by Bank to evidence such change.


 


2.                                       Section 4.9 (a), (b), and (c) are
hereby deleted in their entirety, and the following substituted therefor:


 


(a)                                 Tangible Net Worth not at any time less than
$65,000,000.00, with “Tangible Net Worth” defined as the aggregate of total
stockholders’ equity plus subordinated debt less any intangible assets.


 


(b)                                Total Liabilities divided by Tangible Net
Worth not at any time greater than 1.00 to 1.00, with “Total Liabilities”
defined as the aggregate of current liabilities and non-current liabilities
less subordinated debt, and with “Tangible Net Worth” as defined above.


 


(c)                                 Quick Ratio not at any time less than 1.75 to
1.0, with “ Quick Ratio” defined as the aggregate of: unrestricted cash,
unrestricted marketable securities, accounts receivables and non-billed
accounts receivables (recorded in financial statements) convertible into cash
divided by total current liabilities.”


 


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3.                                       The following is hereby added to the Credit Agreement as Section 4.9
(e):


 


(e)                                  Unencumbered liquid assets (defined as cash and readily marketable securities
acceptable to Bank) with an aggregate not at any time less than Seven Million
Dollars ($7,000,000.00).”


 


4.                                       Except as specifically provided herein, all
terms and conditions of the Credit Agreement remain in full force and effect,
without waiver or modification. All terms defined in the Credit Agreement shall
have the same meaning when used in this Amendment. This Amendment and the
Credit Agreement shall be read together, as one document.


 


5.                                       Borrower hereby remakes all representations
and warranties contained in the Credit Agreement and reaffirms all covenants
set forth therein. Borrower further certifies that as of the date of this
Amendment there exists no Event of Default as defined in the Credit Agreement,
nor any condition, act or event which with the giving of notice or the passage
of time or both would constitute any such Event of Default.


 


IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the day and year first written above.


 


	
  FIRST
  CONSULTING GROUP, INC.

  	
  WELLS FARGO BANK, 

  NATIONAL ASSOCIATION

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Walter J. McBride

  	
   

  	
  By:

  	
  /s/
  Elizabeth Fuchs

  	
   

  
	
   

  	
  Walter
  J. McBride

  	
   

  	
   

  	
  Elizabeth
  Fuchs

  	
   

  
	
   

  	
  Executive
  Vice President/CFO

  	
   

  	
   

  	
  Vice
  President

  	
   

  
							



 


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  WELLS FARGO

  	
   

  	
  REVOLVING LINE OF CREDIT NOTE

  
	
   

  	
   

  	
   

  
	
  $7,000,000.00

  	
   

  	
  Long Beach, California

  
	
   

  	
   

  	
  May 3,
  2004

  



 


FOR VALUE
RECEIVED, the undersigned First Consulting Group, Inc.
(“Borrower”) promises to pay to the order of WELLS FARGO BANK, NATIONAL
ASSOCIATION (“Bank”) at its office at South Bay RCBO, 111 West
Ocean Blvd., Suite #300, Long Beach, CA 90802, or at such other
place as the holder hereof may designate, in lawful money of the United States
of America and in immediately available funds, the principal sum of $7,000,000.00, or so much thereof as may be advanced and be outstanding,
with interest thereon, to be computed on each advance from the date of its
disbursement as set forth herein.


 


1.                                INTEREST:


 


1.1                          Interest.  The outstanding principal balance of this
Note shall bear interest (computed on the basis of a 360-day
year, actual days elapsed) at a rate per annum equal to
the Prime Rate in effect from time to time. The “Prime Rate” is a base rate
that Bank from time to time establishes and which serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto. Each change in the rate of interest hereunder shall become effective
on the date each Prime Rate change is announced within Bank.


 


1.2                          Payment
of Interest.  Interest accrued on
this Note shall be payable on the 1st day of each
month, commencing June 1,
2004.


 


1.3                          Default
Interest.   From and after the maturity date of this Note,
or such earlier date as all principal owing hereunder becomes due and payable
by acceleration or otherwise, the outstanding principal balance of this Note
shall bear interest until paid in full at an increased rate per annum (computed
on the basis of a 360-day
year, actual days elapsed) equal to 4% above the rate of interest from time to
time applicable to this Note.


 


2.                              BORROWING
AND REPAYMENT:


 


2.1                        Borrowing
and Repayment.  Borrower may from
time to time during the term of this Note borrow, partially or wholly repay its
outstanding borrowings, and reborrow, subject to all of the limitations, terms
and conditions of this Note and of the Credit Agreement between Borrower and
Bank defined below; provided however, that the total outstanding borrowings
under this Note shall not at any time exceed the principal amount stated above.  The unpaid principal balance of this
obligation at any time shall be the total amounts advanced hereunder by the
holder hereof less the amount of principal payments made hereon by or for any Borrower,
which balance may be endorsed hereon from time to time by the holder.  The outstanding principal balance of this
Note shall be due and payable in full on May 2, 2005.


 


2.2                        Advances.  Advances hereunder, to the total amount of
the principal sum available hereunder, may be made by the holder at the oral or
written request of (a) Luther J. Nussbaum, Walter
J. McBride or Philip H. Ockelmann, any one acting alone, who are
authorized to request advances and direct the disposition of any advances until
written notice of the revocation of such authority is received by the holder at
the office designated above, or (b) any person, with respect to advances
deposited to the credit of any deposit account of any Borrower, which advances,
when so deposited, shall be conclusively presumed to have been made to or for
the benefit of each Borrower regardless of the fact that persons other than those
authorized to request advances may have authority to draw against such account.
The holder shall have no obligation to determine whether any person requesting
an advance is or has been authorized by any Borrower.


 


2.3                        Application
of Payments.  Each payment made on
this Note shall be credited first, to any interest then due and second, to the
outstanding principal balance hereof.


 


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3.                                 EVENTS OF DEFAULT:


 


This Note is made pursuant to and is subject
to the terms and conditions of that certain Credit Agreement between Borrower
and Bank dated as of May 1, 2003,
as amended from time to time (the “Credit Agreement”). Any default in the
payment or performance of any obligation under this Note, or any defined event
of default under the Credit Agreement, shall constitute an “Event of Default”
under this Note.


 


4.                                 MISCELLANEOUS:


 


4.1                        Remedies.  Upon the occurrence of any
Event of Default, the holder of this Note, at the holder’s option, may declare
all sums of principal and interest outstanding hereunder to be immediately due
and payable without presentment, demand, notice of nonperformance, notice of
protest, protest or notice of dishonor, all of which are expressly waived by
each Borrower, and the obligation, if any, of the holder to extend any further
credit hereunder shall immediately cease and terminate. Each Borrower shall pay
to the holder immediately upon demand the full amount of all payments,
advances, charges, costs and expenses, including reasonable attorneys’ fees (to
include outside counsel fees and all allocated costs of the holder’s in-house counsel),
expended or incurred by the holder in connection with the enforcement of the
holder’s rights and/or the collection of any amounts which become due to the
holder under this Note, and the prosecution or defense of any action in any way
related to this Note, including without limitation, any action for declaratory relief,
whether incurred at the trial or appellate level, in an arbitration proceeding
or otherwise, and including any of the foregoing incurred in connection with
any bankruptcy proceeding (including without limitation, any adversary
proceeding, contested matter or motion brought by Bank or any other
person)  relating to any Borrower or any
other person or entity.


 


4.2                        Obligations Joint and Several.  Should
more than one person or entity sign this Note as a Borrower, the obligations of
each such Borrower shall be joint and several.


 


4.3                        Governing Law.  This
Note shall be governed by and construed in accordance with the laws of the
State of California.


 


IN
WITNESS WHEREOF, the undersigned has executed this Note as of the date first
written above.


 


First
Consulting Group, Inc.


 


	
  By:

  	
  /s/
  Walter J. McBride

  	
   

  
	
   

  	
  Walter
  J. McBride, Executive Vice President/CFO

  



 


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  WELLS FARGO

  	
   

  	
  CERTIFICATE OF INCUMBENCY

  



 


TO:  WELLS FARGO BANK, NATIONAL
ASSOCIATION


 


The undersigned, Michael A. Zuercher,
Secretary of First Consulting Group, Inc.,
a corporation created and existing under the laws of the state of Delaware, hereby certifies to Wells Fargo Bank, National
Association (“Bank”) that (a) the following named persons are duly elected
officers of this corporation and presently hold the titles specified below, (b) said
officers are authorized to act on behalf of this Corporation in transactions
with Bank, and (c) the signature opposite each officer’s name is his or
her true signature:


 


	
  TITLE

  	
   

  	
  NAME

  	
   

  	
  SIGNATURE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Chief Executive
  Officer/Chairman

  	
   

  	
  Luther J. Nussbaum

  	
   

  	
  /s/ Luther J. Nussbaum

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Executive Vice
  President/CFO

  	
   

  	
  Walter J. McBride

  	
   

  	
  /s/ Walter J. McBride

  



 


The undersigned further certifies that if any of the above-named
officers change, or if, at any time, any of said officers are no longer
authorized to act on behalf of this corporation in transactions with Bank, this
corporation shall immediately provide to Bank a new Certificate of Incumbency.
Bank is hereby authorized to rely on this Certificate of Incumbency until a new
Certificate of Incumbency certified by the Secretary of this corporation is
received by Bank.


 


IN TESTIMONY WHEREOF, I
have hereunto set my hand and affixed the corporate seal of said corporation as
of May 1, 2004.


 


	
   

  	
  /s/
  Michael A. Zuercher

  
	
   

  	
  Michael A. Zuercher, Secretary

  
	
  (SEAL)

  	
   

  



 


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