UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549





FORM 8-K





CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): March 31, 2020





ePlus inc.
EPLUS INC
(Exact name of registrant as specified in its charter)


Delaware

001-34167

54-1817218
(State or other jurisdiction of incorporation or organization)

(Commission File Number)

(I.R.S. Employer Identification No.)

13595 Dulles Technology Drive, Herndon, Virginia 20171-3413
(Address, including zip code, of principal executive offices)

(703) 984-8400
(Registrant’s telephone number, including area code)





Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $.01 par value
PLUS
NASDAQ Global Select Market 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company      ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     ☐


 
Item 1.01  Entry into a Material Definitive Agreement

On March 31, 2020, ePlus Technology, inc., ePlus Technology Services, inc. and SLAIT Consulting, LLC (together the "Company"), wholly owned subsidiaries of ePlus inc. (“ePlus”), entered into  Amendment No. 9 (the "Amendments") to both its Amended and Restated Agreement for Wholesale Financing, dated July 23, 2012, as amended, and Amended and Restated Business Financing Agreement, dated July 23, 2012, as amended, with Wells Fargo Commercial Distribution Finance, LLC ("Wells Fargo") (f/k/a GE Commercial Distribution Finance), in connection with its credit facility.

The Amendments provide for a temporary increase in the aggregate credit limit to $300 million for the 90-day period ending May 5, 2020, and the accounts receivable sub-limit from $50 million to $75 million, for the 60-day period ending April 14, 2020.

The Company maintains deposit accounts with Wells Fargo, and from time to time the Company and its affiliates sell IT products and services to affiliates of Wells Fargo.  There are no other material relationships between the Company and Wells Fargo.

The foregoing description of the Amendments is a summary and is qualified in its entirety by reference to Amendment No. 9 to the Amended and Restated Agreement for Wholesale Financing, and Amendment No. 9 to the Amended and Restated Business Financing Agreement, copies of which is filed as Exhibits 10.1 and 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
 

Item 2.03     Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant
 
The information included in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03 of this Current Report on Form 8-K.
 

Item 9.01 Financial Statements and Exhibits
 
(d) The following exhibits are filed as part of this report:
 
Exhibit No.
Description
   
10.1
Amendment No. 9, dated March 31, 2020, to Amended and Restated Agreement for Wholesale Financing between ePlus Technology, inc., ePlus Technology Services, inc., SLAIT Consulting, LLC and Wells Fargo Commercial Distribution Finance, LLC
   
10.2
Amendment No. 9, dated March 31, 2020, to Amended and Restated Business Financing Agreement between ePlus Technology, inc., ePlus Technology Services, inc., SLAIT Consulting, LLC and Wells Fargo Commercial Distribution Finance, LLC
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 


ePlus inc.









By: /s/ Elaine D. Marion




Elaine D. Marion




Chief Financial Officer


 
Date: April 3, 2020


EXHIBIT 10.1

AMENDMENT #9 TO
AMENDED AND RESTATED AGREEMENT FOR WHOLESALE FINANCING

This Amendment #9 to Amended and Restated Agreement for Wholesale Financing (“Amendment”) is entered into on March 31, 2020, by and among ePlus Technology, inc. (“Technology”), ePlus Technology Services, inc. (“Services”) and SLAIT Consulting, LLC (“SLAIT”; and together with Technology and Services, each sometimes referred to as a “Dealer,” and sometimes referred to collectively, jointly and severally, as “Dealer”) and Wells Fargo Commercial Distribution Finance, LLC (“CDF”) and is to that certain Amended and Restated Agreement for Wholesale Financing dated July 23, 2012, by and between Dealer and CDF (as the same has been amended by that certain Amendment #1 to Amended and Restated Agreement for Wholesale Financing dated July 31, 2014, that certain Amendment #2 to Amended and Restated Agreement for Wholesale Financing dated July 24, 2015, that certain Amendment #3 to Amended and Restated Agreement for Wholesale Financing dated October 20, 2015, that certain Amendment #4 to Amended and Restated Agreement for Wholesale Financing dated July 28, 2016, that certain Amendment #5 to Amended and Restated Agreement for Wholesale Financing dated July 27, 2017, that certain Amendment #6 to Amended and Restated Agreement for Wholesale Financing dated February 15, 2018, that certain Amendment #7 to Amended and Restated Agreement for Wholesale Financing dated January 15, 2019, that certain Amendment #8 to Amended and Restated Business Financing Agreement and Amended and Restated Agreement for Wholesale Financing dated December 12, 2019, and that certain Joinder to Amended and Restated Business Financing Agreement and to Amended and Restated Agreement for Wholesale Financing dated January 19, 2019 and as further amended, restated, amended and restated, modified, extended, renewed, substituted, and/or supplemented, the “Agreement”). All terms which are not defined herein shall have the same meaning in this Amendment as in the Agreement.

WHEREAS, CDF and Dealer desire to amend the terms of the Agreement.

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

1.
Amendments.  Amendments to the Agreement:

a.
Section 2 of the Agreement is hereby deleted in its entirety and replaced with the following:

“Credit Facility. Subject to the terms of this Agreement, CDF agrees to provide to Dealer an inventory floorplan credit facility of (i) except during a Temporary Uplift Period, Two Hundred Fifty Million Dollars ($250,000,000.00), (ii) during any Temporary Uplift Period, Three Hundred Twenty Five Million Dollars ($325,000,000.00) and (iii) during any 2020 Uplift Period, Three Hundred Million Dollars ($300,000,000.00); provided, however, that at no time will the sum of (a) the principal amount outstanding under Dealer’s inventory floorplan credit facility with CDF under this Agreement, (b) the Letter of Credit Obligations (as defined in the BFA (as defined below)) and (c) the principal amount outstanding under Dealer’s Accounts Receivable Facility (as defined in the BFA) (the “Aggregate Outstandings”) exceed the Aggregate Facility Limit (as defined below).  CDF’s decision to advance funds will not be binding until the funds are actually advanced.

In addition, subject to the terms of the Amended and Restated Business Financing Agreement between CDF and Dealer dated July 23, 2012, as amended, restated, amended and restated, modified, extended, renewed, substituted, and/or supplemented from time to time (the “BFA”), CDF agrees to provide to Dealer an accounts receivable facility of: (i) between February 14, 2020 through April 14, 2020 Seventy-Five Million Dollars ($75,000,000.00) and (ii) after April 14, 2020, Fifty Million Dollars ($50,000,000.00); provided, however, that at no time will the Aggregate Outstandings exceed the Aggregate Facility Limit. CDF’s decision to advance funds will not be binding until the funds are actually advanced.

1
If, at any time, the Aggregate Outstandings exceeds the then applicable Aggregate Facility Limit, Dealer will immediately pay to CDF an amount not less than the difference between (i) the Aggregate Outstandings and (ii) the Aggregate Facility Limit.

As used herein, “Aggregate Facility Limit” means (i) except during a Temporary Uplift Period, Two Hundred Fifty Million Dollars ($250,000,000.00), (ii) during any Temporary Uplift Period, Three Hundred Twenty Five Million Dollars ($325,000,000.00) and (iii) during any 2020 Uplift Period, Three Hundred Million Dollars ($300,000,000.00).

As used herein, “Temporary Uplift Period” means the period in any year starting in 2018, beginning on the date of Dealer’s electronic notification to CDF of its election to temporarily increase Dealer’s inventory floorplan credit facility, which such date shall not be earlier than July 1 of such year, and ending on the earlier of (i) the date that is 90 days following the date of such election and (ii) October 31 of such year.

As used herein, “2020 Uplift Period” means the 90 day period ending on May 5, 2020.”

b.
Section 6 of the Agreement is hereby amended by deleting the second to last  sentence in such Section and replacing it with the following:

 “Notwithstanding the foregoing subsections (k) and (l), Dealer, from time to time, may make a dividend to ePlus inc. if, after giving effect to such dividend, and as of the date of such dividend, (i) Dealer is not in default under the terms and conditions of this Agreement, (ii) Dealer’s Available Borrowing is not less than Twenty Million Dollars ($20,000,000.00) and (iii) Dealer does not have any outstandings under its Accounts Receivable Facility with CDF (provided that this clause (iii) shall not apply as of March 31, 2020).”

2.
Each Dealer hereby ratifies and confirms the Agreement, as amended hereby, and each Other Agreement (as defined in Amended and Restated Business Financing Agreement between CDF and Dealer dated July 23, 2012, as amended, restated, amended and restated, modified, extended, renewed, substituted, and/or supplemented from time to time) executed by such Dealer in all respects.

3.
Each Dealer hereby unconditionally releases, acquits, waives, and forever discharges CDF and its successors, assigns, directors, officers, agents, employees, representatives and attorneys from any and all liabilities, claims, causes of action or defenses, if any, and for any action taken or failure to take action, existing at any time prior to the execution of this Amendment.

4.
This Amendment shall be binding upon, inure to the benefit of and be enforceable by the parties hereto and their participants, successors and assigns.

5.
This Amendment may be executed in any number of counterparts, each of which counterparts, once they are executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same agreement. This Amendment may be executed by any party to this Amendment by original signature, facsimile and/or electronic signature.

[Remainder of Page Intentionally Left Blank]


2

IN WITNESS WHEREOF, Dealer and CDF have executed this Amendment as of the date first set forth hereinabove.

 
“DEALER”
         
 
EPLUS TECHNOLOGY, INC.
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
EPLUS TECHNOLOGY SERVICES, INC.
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
SLAIT CONSULTING, LLC
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
“CDF”
         
 
WELLS FARGO COMMERCIAL DISTRIBUTION FINANCE, LLC
         
     
By:
/s/ Jack Morrone
     
Print Name:
 Jack Morrone
     
Title:
Duly Authorized Signatory


3
EXHIBIT 10.2

AMENDMENT #9 TO
AMENDED AND RESTATED BUSINESS FINANCING AGREEMENT

This Amendment #9 to Amended and Restated Business Financing Agreement (“Amendment”) is entered into on March 31, 2020, by and among ePlus Technology, inc. (“Technology”), ePlus Technology Services, inc. (“Services”) and SLAIT Consulting, LLC (“SLAIT”; and together with Technology and Services, each sometimes referred to as a “Dealer,” and sometimes referred to collectively, jointly and severally, as “Dealer”) and Wells Fargo Commercial Distribution Finance, LLC (“CDF”) and is to that certain Amended and Restated Business Financing Agreement dated July 23, 2012, by and between Dealer and CDF (as the same has been amended by that certain Amendment #1 to Amended and Restated Business Financing Agreement dated July 31, 2014, that certain Amendment #2 to Amended and Restated Business Financing Agreement dated July 24, 2015, that certain Amendment #3 to Amended and Restated Business Financing Agreement dated October 20, 2015, that certain Amendment #4 to Amended and Restated Business Financing Agreement dated July 28, 2016, that certain Amendment #5 to Amended and Restated Business Financing Agreement dated July 27, 2017, that certain Amendment #6 to Amended and Restated Business Financing Agreement dated February 15, 2018, that certain Amendment #7 to Amended and Restated Business Financing Agreement dated January 15, 2019, that certain Amendment #8 to Amended and Restated Business Financing Agreement and Amended and Restated Agreement for Wholesale Financing dated December 12, 2019 and that certain Joinder to Amended and Restated Business Financing Agreement and to Amended and Restated Agreement for Wholesale Financing dated January 19, 2019 and as further amended, restated, amended and restated, modified, extended, renewed, substituted, and/or supplemented, the “Agreement”). All terms which are not defined herein shall have the same meaning in this Amendment as in the Agreement.

WHEREAS, CDF and Dealer desire to amend the terms of the Agreement.

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

1.
Amendments.  Amendments to the Agreement:

a.
Section 1.1 of the Agreement is hereby deleted in its entirety and replaced with the following:

““2020 Uplift Period” means the 90 day period ending on May 5, 2020.”

b.
Section 2.1 of the Agreement is hereby deleted in its entirety and replaced with the following:

“2.1 Accounts Receivable Facility. Subject to the terms of this Agreement, CDF agrees to provide to Dealer an Accounts Receivable Facility of: (i) between February 14, 2020 through April 14, 2020 Seventy-Five Million Dollars ($75,000,000.00) and (ii) after April 14, 2020, Fifty Million Dollars ($50,000,000.00) (the “Accounts Receivable Facility Limit”); provided, however, that at no time will (i) the Aggregate Accounts Receivable Outstandings exceed the Accounts Receivable Facility Limit or (ii) the Aggregate Outstandings exceed the Aggregate Facility Limit. CDF’s decision to advance funds will not be binding until the funds are actually advanced.

In addition, subject to the terms of the Agreement for Wholesale Financing, CDF agrees to provide to Dealer an inventory floorplan credit facility of (i) except during a Temporary Uplift Period, Two Hundred Fifty Million Dollars ($250,000,000.00), (ii) during any Temporary Uplift Period, Three Hundred Twenty Five Million Dollars ($325,000,000.00) and (iii) during any 2020 Uplift Period, Three Hundred Million Dollars ($300,000,000.00); provided, however, that at no time will the Aggregate Outstandings exceed the Aggregate Facility Limit.  CDF’s decision to advance funds will not be binding until the funds are actually advanced.

1
If, at any time, the Aggregate Accounts Receivable Outstandings exceed the Accounts Receivable Facility Limit, Dealer will immediately pay to CDF an amount not less than the difference between (i) Aggregate Accounts Receivable Outstandings and (ii) the Accounts Receivable Facility Limit.  If, at any time, the Aggregate Outstandings exceed the Aggregate Facility Limit, Dealer will immediately pay to CDF an amount not less than the difference between (i) Aggregate Outstandings and (ii) the Aggregate Facility Limit.”

c.
The second to last sentence in Section 5.2 is hereby deleted in its entirety and replaced with the following:

“Notwithstanding the foregoing subsections (k) and (l), Dealer, from time to time, may make a dividend to ePlus inc. if, after giving effect to such dividend, and as of the date of such dividend, (i) Dealer is not in default under the terms and conditions of this Agreement, (ii) Dealer’s Available Borrowing is not less than Twenty Million Dollars ($20,000,000.00) and (iii) Dealer does not have any outstandings under its Accounts Receivable Facility with CDF (provided that this clause (iii) shall not apply as of March 31, 2020).”

2.
Each Dealer hereby unconditionally releases, acquits, waives, and forever discharges CDF and its successors, assigns, directors, officers, agents, employees, representatives and attorneys from any and all liabilities, claims, causes of action or defenses, if any, and for any action taken or failure to take action, existing at any time prior to the execution of this Amendment.

3.
This Amendment shall be binding upon, inure to the benefit of and be enforceable by the parties hereto and their participants, successors and assigns.

4.
This Amendment may be executed in any number of counterparts, each of which counterparts, once they are executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same agreement. This Amendment may be executed by any party to this Amendment by original signature, facsimile and/or electronic signature.

[Remainder of Page Intentionally Left Blank]

2

IN WITNESS WHEREOF, Dealer and CDF have executed this Amendment as of the date first set forth hereinabove.

 
“DEALER”
         
 
EPLUS TECHNOLOGY, INC.
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
EPLUS TECHNOLOGY SERVICES, INC.
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
SLAIT CONSULTING, LLC
         
     
By:
/s/ Elaine D. Marion
     
Print Name:
Elaine D. Marion
     
Title:
CFO
   
   
 
“CDF”
         
 
WELLS FARGO COMMERCIAL DISTRIBUTION FINANCE, LLC
         
     
By:
/s/ Jack Morrone
     
Print Name:
Jack Morrone
     
Title:
Duly Authorized Signatory



3