**Exhibit 10.3**

 

**THIRD AMENDMENT**

**TO**

**CREDIT AGREEMENT (24-MONTH)**

 

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (24-MONTH) (this “Amendment”) is dated as of July 19, 2004, by andbetween **EPICOR SOFTWARE CORPORATION,**a Delaware corporation, as Borrower, and **KEYBANK NATIONAL ASSOCIATION,**as Lender. 

 

RECITALS 

 

A. Lender and Borrower are parties to a Credit Agreement (24-Month) dated as of January 28, 2004, as amended by that certain First Amendment to CreditAgreement (24-Month) and Note dated May 26, 2004, and that certain Second Amendment to Credit Agreement (24-Month) dated as of June 29, 2004 (collectively, the “Credit Agreement”). This Amendment supersedes and replaces the SecondAmendment referred to above. 

 

B. Borrower has requested, andLender has agreed subject to satisfaction of the conditions set forth herein, to modify the Credit Agreement to amend the Minimum Fixed Charge Coverage Ratio for each fiscal quarter commencing with the quarter ending June 30, 2004 through the fiscalquarter ending March 31, 2005. 

 

C. Each capitalized term usedbut not otherwise defined herein shall have the meaning ascribed thereto in the Credit Agreement. 

 

NOW, THEREFORE, the parties hereto agree as follows: 

 

ARTICLE 1 

 

AMENDMENT TO CREDIT AGREEMENT 

 

This Amendment shall be deemed to be an amendment to the Credit Agreement and shall not be construed in any way as a replacement or substitution therefor. All of the terms and conditions of, and terms defined in, thisAmendment are hereby incorporated by reference into the Credit Agreement as if such terms and provisions were set forth in full therein. 

 

1.1 Subparagraph (d) of Section 7.12 (Financial Covenants) of the Credit Agreement is amended to allow the Minimum Fixed Charge Coverage Ratio, asdetermined on the last day of each fiscal quarter commencing with the quarter ending June 30, 2004 through the fiscal quarter ending March 31, 2005, to be not less than 3.00 to 1.00. Thereafter, the Fixed Charge Coverage Ratio, determined as of thelast day of any fiscal quarter, shall be not less than 3.50 to 1.00. 

 

1.2 Section 7.12 (d) of Schedule 2 to the Compliance Certificate attached as Exhibit “B” to the Credit Agreement is amended to allow the Total Fixed Charge Coverage Ratio at the end of each fiscal quarter commencing with thequarter ending June 30, 2004 through the fiscal quarter ending March 31, 2005, to be not less than 3.00 to 1.00. Thereafter, the Total Fixed Coverage Ratio shall be not less than 3.50 to 1.00. 

 

1 

ARTICLE 2 

 

CONDITIONS TO EFFECTIVENESS OF AMENDMENT 

 

2.1 The effectiveness of this Amendment is subject to the fulfillment to the satisfaction of Lender, in its sole discretion, of the following conditionsprecedent: 

 

(a) Borrower shall have executedand delivered to Lender this Amendment; 

 

(b)Lender shall have received appropriate authorization documents, including borrowing resolutions and certificates of incumbency, confirming to its satisfaction that all necessary corporate and organizational actions have been taken to authorizeBorrower to enter into this Amendment; and 

 

(c) Lender shall have received such other documents, instruments or agreements as Lender may require to effectuate the intents and purposes of this Amendment. 

 

ARTICLE 3 

 

REPRESENTATIONS AND WARRANTIES 

 

Borrower hereby represents and warrants to Lender that: 

 

3.1 After giving effect to the amendment of the Credit Agreement pursuant to this Amendment and the consummation of the transactions contemplated hereby(i) each of the representations and warranties set forth in Section 5 of the Credit Agreement is true and correct in all respects as if made on the date hereof (with references to the Credit Agreement being deemed to include this Amendment), and(ii) there exists no Event of Default under the Credit Agreement after giving effect to this Amendment. 

 

3.2 Borrower has full corporate power and authority to execute and deliver this Amendment, and to perform the obligations of its part to be performedunder the Credit Agreement as amended hereby. Borrower has taken all necessary action, corporate or otherwise, to authorize the execution and delivery of this Amendment. No consent or approval of any person, no consent or approval of any landlord ormortgagee, no waiver of any lien or similar right and no consent, license, approval or authorization of any governmental authority or agency is or will be required in connection with the execution or delivery by Borrower of this Amendment or theperformance by Borrower of the Credit Agreement as amended hereby. 

 

3.3 This Amendment and the Credit Agreement as amended hereby are, or upon delivery thereof to Lender will be, the legal, valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms,except as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally. 

 

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ARTICLE 4 

 

MISCELLANEOUS 

 

4.1 The Credit Agreement, the other Loan Documents and all agreements, instruments and documents executed and delivered in connection with any of theforegoing shall each be deemed to be amended hereby to the extent necessary, if any, to give effect to the provisions of this Amendment. Except as so amended hereby, the Credit Agreement and the other Loan Documents shall remain in full force andeffect in accordance with their respective terms. 

 

4.2 Borroweragrees to pay Lender on demand for all reasonable expenses, including reasonable fees and costs of attorneys, incurred by Lender in connection with the preparation, negotiation and execution of this Amendment and any document required to befurnished hereunder. 

 

4.3 This Amendment may be executed in asmany counterparts as necessary or convenient, and by the different parties on separate counterparts each of which, when so executed, shall be deemed an original but all such counterparts shall constitute but one and the same agreement. 

 

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of thedate set forth in the preamble hereto. 

 

EPICOR SOFTWARE CORPORATION,

a Delaware corporation, as Borrower
By: /S/    MICHAEL A.PIRAINO        
Name:
 **Michael A. Piraino**
Title
 **Chief Financial Officer and Senior Vice President**
 

KEYBANK NATIONAL ASSOCIATION,

as Lender
By: /s/    ROBERT W. BOSWELL        
Name:
 **Robert W. Boswell**
Title
 **Vice President**
 

3 

**OFFICER’S CERTIFICATE**

 

Reference is made to that certain Third Amendment to Credit Agreement (24-Month) (as amended, the “CreditAgreement”) dated as of July 19, 2004, amending that certain Credit Agreement, dated January 28, 2004, by and among EPICOR SOFTWARE CORPORATION, a Delaware corporation (the “Borrower”), and KEYBANK NATIONAL ASSOCIATION (the“Lender”) (all capitalized terms used but not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement). 

 

The undersigned, as a Responsible Officer of the Borrower does hereby certify as follows: 

 

1. The representations and warranties of the Borrower contained in the Credit Agreement are true and correct on and as ofthe date hereof (except to the extent such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date); 

 

2. Borrower is in compliance with all the terms and provisions of the Loan Documents to which it is a party, and no Defaultor Event of Default has occurred and is continuing; and 

 

3.There has been no event or circumstance since the date of the Audited Financial Statements which has a Material Adverse Effect. 

 

4. Borrower and its Subsidiaries on a consolidated basis held unrestricted cash (and cash equivalents) of $45,000,000 or more as of June 30, 2004.

 

**[Signature page follows]**

 

Borrower’s Officer’s Certificate 

 

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IN WITNESS WHEREOF, this Certificate is executed as of this 19th day of July, 2004. 

 
**EPICOR SOFTWARE CORPORATION**By: /S/    MICHAEL A.PIRAINO        
Name:
 **Michael A. Piraino**
Title:
 **Chief Financial Officer and Senior Vice-President**
 

Borrower’s Officer’s Certificate 

 

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**CERTIFICATE OF CORPORATE SECRETARY OF EPICOR SOFTWARE CORPORATION**

 

The undersigned, being the duly elected, qualified and acting Secretary ofEPICOR SOFTWARE CORPORATION, a Delaware corporation (the “Company”) does hereby certify as of July 19th, 2004, pursuant to the Credit Agreement (24-Month), dated as of January 28, 2004 (as amended, the “Credit Agreement”) among the Company and KeyBank National Association (the “Lender”) (allcapitalized terms used but not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement), that: 

 

1. Attached hereto as Exhibit A is a true, correct and complete copy of the Company’s Second Restated Certificate of Incorporation, includingall amendments thereto, as certified by the Secretary of State of the State of Delaware and as in full force and effect as of the date hereof; 

 

2. Attached hereto as Exhibit B is a true, correct and complete copy of the Company’s Amended and Restated Bylaws, including all amendmentsthereto, as in full force and effect on the date hereof; 

 

3.Attached hereto as Exhibit C is a true and complete copy of the resolutions adopted by the Company’s Board of Directors relating to the authorization, execution, delivery and performance of the Second Amendment to the Credit Agreementand the documents related thereto, and such resolutions have not been amended, annulled, rescinded or revoked and remain in full force and effect on the date hereof; and 

 

4. Each of the persons listed on Annex A hereto has been duly elected or appointed to the office in the Company setforth opposite his respective name and that the signature appearing opposite each name is his true and genuine signature. 

 

**[Signature page follows]**

 

Borrower’s Certificate of Secretary 

 

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IN WITNESS WHEREOF, this Certificate is executed as of this 19th day of July, 2004. 

 
  /S/    JOHN D.IRELAND        
Name:
 **John D. Ireland**
Title:
 **Secretary**
 

I, Michael A.Piraino, the Chief Financial Officer and Senior Vice-President of the Company, do hereby certify that John D. Ireland is the Secretary of the Company, and the signature appearing opposite his name is his true and genuine signature. 

 

IN WITNESS WHEREOF, I have executed this Certificate as of this19th day of July, 2004. 

 
  /S/    MICHAEL A.PIRAINO        
Name:
 **Michael A. Piraino**
Title:
 **Chief Financial Officer and Senior Vice President**
 

Borrower’s Certificate of Secretary 

 

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**EXHIBIT A**

 

**SECOND RESTATED CERTIFICATE OF INCORPORATION**

 

Borrower’s Certificate of Secretary 

 

**EXHIBIT B**

 

**AMENDED AND RESTATED BYLAWS**

 

Borrower’s Certificate of Secretary 

 

**EXHIBIT C**

 

**RESOLUTIONS**

 

Borrower’s Certificate of Secretary 

 

**ANNEX A**

 

**Name**
  
**Office**
 
**Signature**

L. George Klaus
  Chief Executive Officer, President and Chairman 
/S/    L. GEORGEKLAUS        

Michael A. Piraino
  Chief Financial Officer and Senior Vice-President 
/S/    MICHAEL A.PIRAINO        

John D. Ireland
  Secretary 
/S/    JOHN D.IRELAND        

 

Borrower’s Certificate of Secretary