SECTION 4 AMENDMENT. The Agreement is hereby amended as follows, notwithstanding any other conditions precedent contained herein: A. Attachment A to the Agreement is hereby amended by deleting such Attachment A in its entirety and substituting, in lieu thereof, the Attachment A attached hereto. Such new Attachment A shall be effective as of the date specified in the new Attachment A. The changes contained in the new Attachment A include, without limitation, the following: (a)
... Product Financing Charge is increased from Prime Rate plus 0.25% to Prime Rate plus 3.00%; (b) WCO Advance Charge is increased from Prime Rate plus 0.25% to Prime Rate plus 3.00%; (c) PRO Advance Charge is increased from Prime Rate plus 0.25% to Prime Rate plus 3.00%; (d) Credit Line is decreased from Eighteen Million Dollars ($18,000,000.00) to Fourteen Million Dollars ($14,000,000.00); (e) Customer shall be required to maintain the following financial percentage(s) and ratio(s) as of the last day of the fiscal period under review by IBM Credit: Covenant Covenant Requirement, fiscal Covenant Requirement, fiscal quarters ending Requirement, quarters ending October 2001 and fiscal Covenant April/July 2001 thereafter quarters ---------- ------------------- ------------------- ending April 2002 and thereafter ---------- (i) Revenue on an Annual Basis Greater than Zero and Equal to or Greater than Zero and Equal to Greater than Zero and to Working Capital Less than 25.0 :1.0 or Less than 25.0 :1.0 Equal to or Less than 25.0 :1.0 (ii) Net Profit after Tax to Equal to or Greater than 0.10 Equal to or Greater Revenue percent than 0.10 percent (iii) Tangible Net Worth Equal to or Greater than $2.5 Equal to or Greater Million than $5.0 Million B. Schedule A of the Agreement is hereby amended by increasing the Term Loan Finance Charge from Prime Rate plus 0.75% to Prime Rate plus 3.50%. C. Section 2.4. of the Agreement is hereby amended by deleting 2.4. (E) in its entirety and substituting in lieu thereof the following; " (E) In the event of, and within three (3) days after (i) a public offering or private placement of shares of Customer or any of Customer's subsidiaries or (ii) an offering of public or private debt by Customer or any of Customer's subsidiaries, Customer shall make a mandatory prepayment of $750,000 on the term loan.
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