Exhibit 10.1


 


As of April 29, 2003


 


QAD Inc.


6450 Via Real


Carpinteria, California 93013


Attn: Kathleen M. Fisher, Chief Financial
Officer


 


Re:          Loan and Security Agreement


 


Dear Ms. Fisher:


 


Reference is made to that
certain Loan and Security Agreement, dated as of September 8, 2000, by and
between Foothill Capital Corporation (“Lender”) and QAD Inc. (“Borrower”), as
amended (said Loan and Security Agreement, as so amended, hereinafter referred
to as the “Loan Agreement”). 
Capitalized terms, which are used herein but not defined herein, shall
have the meanings ascribed to them in the Loan Agreement.


 


Borrower has requested that
the Loan Agreement be amended with respect to certain covenants of Borrower
pertaining to Borrower’s fiscal year ending January 31, 2004.


 


Subject to the satisfaction
of the conditions set forth herein, Lender is willing to so consent to the
amendment of the Loan Agreement as herein provided.


 


NOW, THEREFORE, Lender and
Borrower hereby agree to the following:


 


1.             Section
7.20(a)(i) of the Loan Agreement is hereby amended and restated in its
entirety as follows:


 


“Minimum EBITDA.  EBITDA, measured on a fiscal quarter-end
basis, of not less than the required amount set forth in the following table
for the applicable period set forth opposite thereto:


 




	
  Applicable
  Amount

  	
   

  	
  Applicable Period

  
	
  $18,190,000

  	
   

  	
  For the 12 month period ending April 30, 2003

  
	
  $20,060,000

  	
   

  	
  For the 12 month period ending July 31, 2003

  
	
  $18,020,000

  	
   

  	
  For the 12 month period ending October 31, 2003

  
	
  $17,170,000

  	
   

  	
  For the 12 month period ending January 31, 2004”

  






 


1

















 


2.             Section 7.20(a)(ii) of the Loan Agreement
is hereby amended and restated in its entirety as follows:


 


“Tangible Net Worth.  Net Worth of at least the required amount
set forth in the following table as of the applicable date set forth opposite
thereto:


 




	
  Applicable
  Amount

  	
   

  	
  Applicable Date

  
	
  $(1,149,000)

  	
   

  	
  April 30,
  2003

  
	
  $(800,000)

  	
   

  	
  July 31,
  2003

  
	
  $1,700,000

  	
   

  	
  October 31,
  2003

  
	
  $5,100,000

  	
   

  	
  January 31,
  2004”

  






 


3.             Section 7.20(b)(i) of
the Loan Agreement is hereby amended and restated in its entirety as follows:


 


“Capital Expenditures. 
Capital expenditures in any fiscal year in excess of $25,500,000.”


 


4.             The satisfaction of each of the
following shall constitute conditions precedent to the effectiveness of this
letter agreement and each and every provision hereof:


 


(a)           The representations and warranties of
the Loan Agreement and the other Loan Documents shall be true and correct in
all respects on and as of the date hereof, as though made on such date (except
to the extent that such representations and warranties relate solely to an
earlier date);


 


(b)           No Default or Event of Default shall
have occurred and be continuing; and


 


(c)           No injunction, writ, restraining
order, or other order of any nature prohibiting, directly or indirectly, the
consummation of the transactions contemplated herein shall have been issued and
remain in force by any Governmental Authority against Borrower or Lender.


 


5.             This letter agreement constitutes
an amendment to the Loan Agreement. 
Except as expressly set forth herein, the Loan Documents shall remain in
full force and effect.


 


6.             Borrower agrees that all of
Lender’s attorneys’ fees and costs in drafting and negotiating this letter
agreement are part of the Lender Expenses and are payable on demand.


 


7.             This letter agreement may be
executed in any number of counterparts and by different parties on separate
counterparts.  Each of such counterparts
shall be deemed to be an original, and all of such counterparts, taken
together, shall constitute but one and the same agreement.  Delivery of an executed counterpart of this
letter agreement by telefacsimile shall be equally effective as delivery of a
manually executed counterpart.


 


2

















 


Please indicate your
agreement to the foregoing by executing a copy of this letter in the space
below.


 


 


	
   

  	
  FOOTHILL
  CAPITAL CORPORATION,

  a California corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  \s\ JOHN
  NOCITA

  	
   

  
	
   

  	
  Name:

  	
   

  	
  John Nocita

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Vice
  President

  	
   

  
							



 


CONSENTED AND AGREED TO:


 


QAD
INC.


a
Delaware corporation


 


 


	
  By: 

  	
   

  	
  \s\ KATHLEEN
  M FISHER

  	
   

  
	
  Name:

  	
   

  	
  Kathleen M.
  Fisher

  	
   

  	 

	
  Title:

  	
   

  	
  CFO

  	
   

  	 

							



 


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