c55645_10q.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing





EXHIBIT 10.1


     AMENDMENT No. 6, dated as of November 11, 2008 and effective as provided herein (“Amendment”) is executed in connection with the Credit
Agreement, dated as of November 23, 2005, and entered into by and among MTM Technologies, Inc., a New York corporation (“MTM”), MTM Technologies (US), Inc., a Delaware corporation (“MTM-US”), MTM Technologies (Massachusetts),
LLC, a Delaware limited liability company (“MTM-MA”) and Info Systems, Inc., a Delaware corporation (“ISI”, MTM, MTM-US, MTM-MA and ISI being collectively, the “Borrowers” and each a “Borrower”); Columbia
Partners, L.L.C. Investment Management, as Investment Manager; and National Electrical Benefit Fund, as Lender (as amended or modified, the “Credit Agreement”). Terms which are capitalized in this Amendment and not otherwise defined shall
have the meanings ascribed to such terms in the Credit Agreement. 


     WHEREAS, the Borrowers have requested that the Investment Manager and the Lender: (a) amend certain financial covenants contained in Section 6.3 of the
Credit Agreement, and (b) waive certain terms of the Credit Agreement in relation to the foregoing request, and the Investment Manager and the Lender have agreed to the foregoing requests on the terms contained in this Amendment; 


     NOW, THEREFORE, in consideration of the mutual promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows: 


     Section One. Amendment to Credit Agreement.


     (a) For all reporting periods after September 1, 2008, Section 6.3(b) of the Credit Agreement is deleted in its
entirety, and following is substituted in lieu thereof: 


“(b)      Minimum EBITDA. Each Borrower covenants that as of the last day of each fiscal quarter, for the fiscal quarter then ended, Borrowers’
EBITDA shall not be less than the amounts set forth in the table below: 


  		
	
      The Fiscal Quarter Ending On:  	
      Minimum EBITDA  
	
      September 30, 2008  	
      $0  
	
      December 31, 2008  	
      $1,800,000  
	
      March 31, 2009  	
      $1,800,000  
	
      June 30, 2009  	
      $1,800,000  


  



     (b) For all reporting periods after September 1, 2008,
Section 6.3(d) of the Credit Agreement is deleted in its entirety, and following
is substituted in lieu thereof: 


  “(b)     Excess
  Cash/Marketable Securities plus Availability. Each Borrower covenants that
  on the last day of each calendar month that the sum of (A) the amount of cash
  or marketable securities permitted by Section 14.1.4 of the GE Financing Agreement,
  plus (B) the difference between (i) the Borrowing Base (as defined in the GE
  Financing Agreement) on such date, minus (ii) the sum of (a) the Swingline
  Loan (as defined in the GE Financing Agreement), (b) the Floorplan Shortfall
  (as defined in the GE Financing Agreement), (c) the Letter of Credit Exposure
  (as defined in the GE Financing Agreement) on such date (except to the extent
  that a Revolving Loan Advance (as defined in the GE Financing Agreement) will
  be used immediately to reimburse Letter of Credit Issuer (as defined in the
  GE Financing Agreement) for unreimbursed draws on a Letter of Credit (as defined
  in the GE Financing Agreement)), (d) without duplication, the outstanding Aggregate
  Revolving Loans (as defined in the GE Financing Agreement), (e) the amount
  of the Other Creditor Indebtedness (as defined in the GE Financing Agreement)
  (unless an Intercreditor Agreement in form and substance satisfactory to GE
  has been executed between GE and the holder of such Other Creditor Indebtedness
  (as defined in the GE Financing Agreement)), and (f) the amount of Bid Bonds
  (as defined in the GE Financing Agreement), shall be greater than or equal
  to $1,350,000; provided, however, for the September 30, 2008, October 31,
  2008 November 30, 2008 and December 31, 2008
calculation dates, the foregoing amount shall be $1,125,000.”









     Section Two. Amendment of Credit Agreement Definitions. Annex A of the Credit Agreement is amended by deleting, for all reporting periods after
September 1, 2008, the definition of the term EBITDA, and substituting the following in lieu thereof: 


     “EBITDA” means, for any period of calculation, an amount equal to (A) the sum of (i) Net Income, (ii) Interest
Expense, (iii) income tax expense, (iv) depreciation expense, (v) amortization expense, (vi) non-cash charges relating to any share-based compensation awards, to the extent such non-cash charges were expensed during such period in accordance with
SFAS 123R or are required to be shown as an expense in any financial statements for periods prior to the effective date of SFAS 123R, and (vii) actual cash and non-cash nonrecurring severance and actual cash and non-cash nonrecurring restructuring
charges for such period up to $250,000 in the aggregate in a fiscal quarter and up to $750,000 in the aggregate during the term of this Agreement, plus (B), the sum of (i) all nonrecurring losses under GAAP, and (ii) all extraordinary losses
not otherwise related to the continuing operations of the Borrower in such period, minus (C) the sum of (i) all nonrecurring gains under GAAP, and (ii) all extraordinary gains and income not otherwise related to the continuing operations of the
Borrower in such period. With respect to clause (A)(vii) above, such charges must be incurred in the period in which they are added back to EBITDA, and whether any such charges are added back for a period, shall be at Borrower’s
discretion.” 


     Section Three. Waiver. Borrower has notified the Investment Manager and Lender that it breached its Maximum Total Funded Indebtedness to EBITDA
covenant as set forth in Section 6.3(c) of the Credit Agreement for the fiscal quarter ending September 30, 2008 (the “Financial Covenant Default”). Upon the effectiveness of this Amendment, Investment Manager and Lender hereby waive the
Financial Covenant Default. The waiver contained in this Section is specific in intent and is valid only for the specific purpose for which given. Nothing contained herein obligates the Investment Manager and the Lender to agree to any additional
waivers of any provisions of any of the Loan Documents. The waiver contained in this Section shall not operate as a waiver of Lender’s right to exercise remedies resulting from any other Defaults or Events of Default, whether or not of a
similar nature and whether or not known to Investment Manager or Lender.


     Section Four. Release of Claims. To induce the Investment Manager and the Lender to enter into this Amendment, each of the Borrowers hereby agrees
as follows: 


     (a) each Borrower hereby represents and warrants that there are no known claims, causes of actions, suits, debts, liens, obligations, liabilities, demands, losses, costs and expenses (including
attorneys’ fees) of any kind, character or nature whatsoever, fixed or contingent, which such Borrower may have or claims to have against Investment Manager or Lender, existing or occurring on or prior to the date of this Amendment arising from
or in connection with the Credit Agreement or any of the Loan Documents. 


     (b) each Borrower hereby releases, waives and forever discharges and relieves Investment Manager and Lender and all their respective parents, subsidiaries and affiliates and the officers,
directors, agents, attorneys and employees of each of the foregoing (hereinafter “Releasees”) from any and all claims, liabilities, demands, actions, suites covenants, losses, costs, offsets and defenses of any nature and kind whatsoever,
whether at law or equity of otherwise, whether known or unknown, which such Borrower ever had, now has , or have been caused by any act of commission or omission of Investment Manager or Lender, existing or occurring on or prior to the date of this
Agreement, against or related to the Releasees. 


     Section Five. Representations and Warranties. To induce the Investment Manager and the Lender to enter into this Amendment, each of the Borrowers
hereby warrants and represents to the Investment Manager and the Lenders as follows: 


     (a) all of the representations and warranties contained in the Credit Agreement and each other Loan Document to which such Borrower is a party continue to be true and correct in all material
respects as of the date hereof, as if repeated as of the date hereof, except as otherwise disclosed in MTM’s filings pursuant to the Securities Exchange Act of 1934, as amended, since the date of the Credit Agreement, and (ii) to the extent of
changes resulting from transactions expressly permitted by the Credit Agreement, this Amendment or any of the other Loan Documents, or to the extent that such representations and warranties are expressly made only as of an earlier date; 


     (b) the execution, delivery and performance of this Amendment by such Borrower is within its corporate powers, has been duly authorized by all necessary corporate action, and such Borrower has
received all necessary consents and approvals, if any are required, for the execution and delivery of this Amendment; 


     (c) upon the execution of this Amendment, this Amendment shall constitute the legal, valid and binding obligation of such Borrower, enforceable against such Borrower in accordance with its
terms, except as such enforceability may be limited by (i) bankruptcy, insolvency or similar laws affecting creditors’ rights generally and (ii) general principles of equity; and 










     (d) neither the execution and delivery of this Amendment, nor the consummation of the transactions herein contemplated, nor compliance with the provisions hereof will (i) violate any law or
regulation applicable to any Borrower, (ii) cause a violation by any Borrower of any order or decree of any court or government instrumentality applicable to it, (iii) conflict with, or result in the breach of, or constitute a default under, any
indenture, mortgage, deed of trust, or other material agreement or material instrument to which any Borrower is a party or by which it may be bound, (iv) result in the creation or imposition of any lien, charge, or encumbrance upon any of the
property of any Borrower, except in favor of the Investment Manager and the Lender, to secure the Obligations, (v) violate any provision of the Certificate of Incorporation, By-Laws or any capital stock provisions of any Borrower, or (vi) be
reasonably likely to have a Material Adverse Effect. 


     Section Six. General Provisions.


     (a) Except as herein expressly amended, the Credit Agreement and all other agreements, documents, instruments and certificates executed in connection therewith, are ratified and confirmed in
all respects and shall remain in full force and effect in accordance with their respective terms.


     (b) To induce the Investment Manager and the Lender to enter into this Amendment, the Borrowers, jointly and severally, represent and warrant to the Investment Manager and the Lender that
except for the Events of Default set forth herein or in any prior waiver letter executed by parties, no other Event of Default has occurred. 


     (c) This Amendment embodies the entire agreement between the parties hereto with respect to the subject matter hereof and supercedes all prior agreements, commitments, arrangements,
negotiations or understandings, whether written or oral, of the parties with respect thereto. 


     (d) This Amendment shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to the conflicts of law principles thereof. 


     (e) The effectiveness of this Amendment is conditioned on receipt by Investment Manager of each of the following: (i) this Amendment duly executed by the Borrowers, (ii) a consent from GE
Commercial Distribution Finance Corporation in form and substance reasonably acceptable to Investment Manager, and (iii) payment of all fees and expenses which are due and payable pursuant to Section 1.6 of the Credit Agreement. 










     IN WITNESS WHEREOF, the parties to this Amendment have signed below to indicate their agreement with the foregoing and their intent to be bound thereby.


 

				
	 	COLUMBIA PARTNERS, L.L.C. INVESTMENT
    MANAGEMENT,

as Investment Manager 
	 	 	 
	 	 	 
	 	 	 
	 	By: 	/s/ Jason Crist  
	 	 	Name:   	Jason Crist
	   	   	
Title:  	
Managing Director  
	 	 	 	 
	 	 	 	 
	 	NATIONAL ELECTRICAL BENEFIT FUND,

    as Lender 
	 	 	 	 
	 	By: 	Columbia Partners,
    L.L.C. 
	 	 	Investment Management,
    its Authorized Signatory
	 	 	 	 
	 	By: 	/s/
    Jason Crist
	 	 	 	 
	 	 	Name:    	Jason Crist
	 	 	Title: 	Managing Director 
	 	 	 	 




 











 

	 	MTM TECHNOLOGIES,
          INC., 

          for itself and as Borrowing
          Agent, and as successor by merger with each of MTM Technologies (California),
    Inc., and MTM Technologies (Texas), Inc. 
	 	 	 
	 	 	 	 
	 	By: 	/s/
    J.W. Braukman III
	 	 	 	 
	 	 	Name:      	J.W. Braukman III 
	 	 	Title: 	Senior Vice President and 
	 	 	 	Chief Financial Officer 
	 	 	 	 
	 	 	MTM TECHNOLOGIES
    (US), INC.
	 	 	 	 
	 	By:	/s/
    J.W. Braukman III
	 	 	Name: 	J.W. Braukman III 
	 	 	Title: 	Senior Vice President and 
	 	 	 	Chief Financial Officer 
	 	 	 	 
	 	INFO SYSTEMS, INC.
	 	 	 	 
	 	By:	/s/
    J.W. Braukman III
	 	 	Name: 	J.W. Braukman III 
	 	 	Title: 	Senior Vice President and 
	 	 	 	Chief Financial Officer 
	 	 	 	 
	 	MTM TECHNOLOGIES (MASSACHUSETTS),
    LLC
	 	 	 	 
	 	By:	/s/
    J.W. Braukman III
	 	 	Name: 	J.W. Braukman III 
	 	 	Title: 	Senior Vice President and 
	 	 	 	Chief Financial Officer