Exhibit 10.116
SILICON VALLEY BANK
AMENDMENT TO LOAN DOCUMENTS
(EXIM PROGRAM)
BORROWER: VERSO TECHNOLOGIES, INC.
PROVO PREPAID (DELAWARE) CORP.
XXXXXXXX.XXX SOFTWARE, INC.
XXXXXXX (DELAWARE) CORP.
DATE: MARCH 24, 2006
THIS AMENDMENT TO LOAN DOCUMENTS (EXIM PROGRAM) is entered into between
Silicon Valley Bank ("Silicon") and the borrower named above ("Borrower").
Reference is hereby made to that certain Loan and Security Agreement (Exim
Program) between Borrower and Silicon dated February 12, 2003 (as otherwise
amended, if at all, the "Loan Agreement"). Notwithstanding the Maturity Date of
March 17, 2006, since Obligations have remained outstanding, in accordance with
Section 6.3 of the Loan Agreement, the Loan Agreement has continued in full
force and effect. The Parties agree to amend the Loan Agreement, as follows,
effective as of the date hereof; provided, however, that prior to any of the
following modifications going into effect, Silicon must obtain the finalized,
written approval from Exim Bank regarding such modifications. (Capitalized terms
used but not defined in this Amendment shall have the meanings set forth in the
Loan Agreement.)
1. MODIFIED INTEREST PROVISION. Section 9.1 of the Loan Agreement is
hereby amended to read as follows:
9.1 INTEREST COMPUTATION. In computing interest on the Obligations, all
checks and other items of payment received by Silicon (including
proceeds of Receivables and payment of the Obligations in full) shall
be deemed applied by Silicon on account of the Obligations two Business
Days after receipt by Silicon of immediately available funds (except
with respect to wire transfers which shall be deemed applied by Silicon
on account of the Obligations the same Business Day as deemed received
by Silicon), and, for purposes of the foregoing, any such funds
received after 12:00 Noon on any day shall be deemed received on the
next Business Day. Silicon shall not, however, be required to credit
Borrower's account for the amount of any item of payment which is
unsatisfactory to Silicon in its
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SILICON VALLEY BANK AMENDMENT TO LOAN DOCUMENTS (EXIM)
sole discretion, and Silicon may charge Borrower's loan account for the
amount of any item of payment which is returned to Silicon unpaid.
2. MODIFIED INVENTORY SUBLIMIT. That portion of Section 1 of the Schedule
to Loan and Security Agreement (Exim Program) that currently reads as follows:
(b) 65% (an "Advance Rate") of the value of Borrower's Eligible Inventory
(as defined in Section 8 above).
is hereby amended in its entirety to read as follows:
(b) the lesser of:
(I) 65% (an "Advance Rate") of the value of Borrower's Eligible
Inventory (as defined in Section 8 above); or
(II) $3,000,000 through June 30, 2006; $2,750,000 from July 1, 2006
through September 30, 2006 and $2,500,000 from and after October
1, 2006.
3. MODIFIED FOREIGN EXCHANGE CONTRACT SUBLIMIT. The Foreign Exchange
Contract Sublimit set forth in Section 1 of the Schedule to Loan and Security
Agreement (Exim Program) is hereby amended to read as follows:
FOREIGN EXCHANGE
CONTRACT SUBLIMIT: $500,000. The Foreign Exchange Contract
Sublimit set forth in this Agreement is in
addition to the Foreign Exchange Contract
Sublimit set forth in the Non-Exim
Agreement.
Borrower may enter into foreign exchange
forward contracts with Silicon, on its
standard forms, under which Borrower
commits to purchase from or sell to
Silicon a set amount of foreign currency
more than one business day after the
contract date (the "FX Forward
Contracts"); provided that (1) at the time
the FX Forward Contract is entered into
Borrower has Loans available to it under
this Agreement in an amount at least equal
to 10% of the amount of the FX Forward
Contract; and (2) the total FX Forward
Contracts at any one time outstanding may
not exceed 10 times the amount of the
Foreign Exchange Contract Sublimit set
forth above; and (3) the total Foreign
Exchange Contract Sublimit shall not, at
any time, exceed $500,000. Silicon
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SILICON VALLEY BANK AMENDMENT TO LOAN DOCUMENTS (EXIM)
shall have the right to withhold, from the
Loans otherwise available to Borrower
under this Agreement, a reserve (which
shall be in addition to all other
reserves) in an amount equal to 10% of the
total FX Forward Contracts from time to
time outstanding, and in the event at any
time there are insufficient Loans
available to Borrower for such reserve,
Borrower shall deposit and maintain with
Silicon cash collateral in an amount at
all times equal to such deficiency, which
shall be held as Collateral for all
purposes of this Agreement. Silicon may,
in its discretion, terminate the FX
Forward Contracts at any time that an
Event of Default occurs and is continuing.
Borrower shall execute all standard form
applications and agreements of Silicon in
connection with the FX Forward Contracts,
and without limiting any of the terms of
such applications and agreements, Borrower
shall pay all standard fees and charges of
Silicon in connection with the FX Forward
Contracts.
4. MODIFIED INTEREST RATE. The Interest Rate set forth in Section 2 of the
Schedule to the Loan Agreement (Exim Program) is hereby amended in its entirety
to read as follows:
INTEREST RATE (Section 1.2):
A rate equal to the "Prime Rate" in effect
from time to time, plus 2.25% per annum;
provided, however, that the foregoing
interest rate shall be reduced to a rate
equal to the "Prime Rate" in effect from
time to time, plus 1.75% per annum as set
forth below if Borrower achieves EBITDA
(as defined below) in excess of $0.00 for
two consecutive fiscal quarters ending
after the date of this Agreement and for
so long as Borrower maintains EBITDA in
excess of $0.00 for each fiscal quarter
ending thereafter. If Borrower does not
maintain EBITDA in excess of $0.00, the
interest rate will be increased to a rate
equal to the "Prime Rate" in effect from
time to time plus 2.25% per annum.
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SILICON VALLEY BANK AMENDMENT TO LOAN DOCUMENTS (EXIM)
For purposes hereof, "EBITDA" means, on a
consolidated basis, Borrower's earnings
before interest, taxes, depreciation and
other non-cash amortization expenses and
other non-cash expenses, determined in
accordance with generally accepted
accounting principles, consistently
applied.
Changes in the interest rate based on the
Borrower's EBITDA as provided above shall
go into effect as of the first day of the
month following the month in which
Borrower's financial statements are
received, reviewed and approved by
Silicon. If, based on the Borrower's
EBITDA as shown in Borrower's financial
statements there is to be an increase in
the interest rate, the interest rate
increase may be put into effect by Silicon
as of the first day of the month closest
to the date on which the financial
statements are due, even if the delivery
of the financial statements is delayed.
Notwithstanding the foregoing, in no event
shall an interest rate reduction go into
effect if, at the date it is to go into
effect, a Default or Event of Default has
occurred and is continuing.
Interest shall be calculated on the basis
of a 360-day year for the actual number of
days elapsed. "Prime Rate" means the rate
announced from time to time by Silicon as
its "prime rate;" provided that the "Prime
Rate" in effect on any day shall not be
less than 4.25% per annum; it is a base
rate upon which other rates charged by
Silicon are based, and it is not
necessarily the best rate available at
Silicon. The interest rate applicable to
the Obligations shall change on each date
there is a change in the Prime Rate.
5. MODIFIED COLLATERAL MONITORING FEE. The Collateral Monitoring Fee set
forth in Section 3 of the Schedule to the Loan Agreement (Exim Program) is
hereby amended in its entirety to read as follows:
Collateral Monitoring Fee: $1,250, per month, payable in arrears
(prorated for any partial month at the
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SILICON VALLEY BANK AMENDMENT TO LOAN DOCUMENTS (EXIM)
beginning and at termination of this
Agreement).
6. MODIFIED MATURITY DATE. Section 4 of the Schedule to Loan and Security
Agreement (Exim Program) is hereby amended to read as follows:
4. MATURITY DATE
(Section 6.1): March 23, 2007 [364 days from the date
of this Amendment].
7. MODIFIED REFERENCES TO EXIM DOCUMENTS. All references in the Loan
Agreement to a Master Guarantee Agreement shall mean that certain Master
Guarantee Agreement MA05 with an effective date of December 31, 2005. All
references in the Loan Agreement to a Delegated Authority Letter Agreement shall
mean that certain Delegated Authority Letter Agreement DA05 with an effective
date of December 31, 2005. All references in the Loan Agreement to a Loan
Authorization Agreement shall mean that certain Loan Authorization Notice of
approximate even date herewith. All references in the Loan Agreement to a
Borrower Agreement or Exim Borrower Agreement shall mean that certain Borrower
Agreement of approximate even date herewith.
8. PROVO PREPAID (DELAWARE) CORP. AND XXXXXXX (DELAWARE) CORP. Borrower
represents and warrants that each of Provo Prepaid (Delaware) Corp. and Xxxxxxx
(Delaware) Corp. is (i) a wholly-owned subsidiary of Verso Technologies, Inc.,
and (ii) is and will remain throughout the term of the Loan Agreement, inactive
with assets having an aggregate value of no more than $0.00. Borrower covenants
and agrees that while the Loan Agreement is in effect, Borrower shall not
transfer any assets or Collateral to either Provo Prepaid (Delaware) Corp. or
Xxxxxxx (Delaware) Corp.
9. FEES. In consideration for Silicon entering into this Agreement,
Borrower shall concurrently pay Silicon a fee in the amount of $115,000, which
fee shall be non-refundable and in addition to all interest and other fees
payable to Silicon under the Loan Documents. Silicon is authorized to charge
said fee to Borrower's loan account.
10. REPRESENTATIONS TRUE. Borrower represents and warrants to Silicon that
all representations and warranties set forth in the Loan Agreement, as amended
hereby, are true and correct.
11. GENERAL PROVISIONS. This Amendment, the Loan Agreement, any prior
written amendments to the Loan Agreement signed by Silicon and Borrower, and the
other written documents and agreements between Silicon and Borrower set forth in
full all of the representations and agreements of the parties with respect to
the subject matter hereof and supersede all prior discussions, representations,
agreements and understandings between the parties with respect to the subject
hereof. Except as herein expressly amended, all of the terms and provisions of
the Loan Agreement, and all other documents and agreements between Silicon and
Borrower shall continue in full force and effect and the same are hereby
ratified and confirmed.
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SILICON VALLEY BANK AMENDMENT TO LOAN DOCUMENTS (EXIM)
BORROWER: SILICON:
VERSO TECHNOLOGIES, INC. SILICON VALLEY BANK
BY /s/ Xxxxx Xxxx BY /s/ Xxxxx Xxxxxxxx
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Executive Chairman TITLE Relationship Manager - VP
BY /s/ Xxxxxx X. Xxxxxxx
----------------------------
SECRETARY OR ASS'T SECRETARY
BORROWER: BORROWER:
PROVO PREPAID (DELAWARE) CORP. XXXXXXXX.XXX SOFTWARE, INC.
(FKA NACT TELECOMMUNICATIONS, INC.)
BY /s/ Xxxxxx X. Xxxxxxx BY /s/ Xxxxxx X. Xxxxxxx
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PRESIDENT OR VICE PRESIDENT PRESIDENT OR VICE PRESIDENT
BY /s/ Xxxxxx Xxxxxxx BY /s/ Xxxxxx Xxxxxxx
---------------------------- ---------------------------
SECRETARY OR ASS'T SECRETARY SECRETARY OR ASS'T SECRETARY
BORROWER:
XXXXXXX (DELAWARE) CORP.
(FKA MCK COMMUNICATIONS, INC.)
BY /s/ Xxxxxx X. Xxxxxxx
----------------------------
PRESIDENT OR VICE PRESIDENT
BY /s/ Xxxxxx Xxxxxxx
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SECRETARY OR ASS'T SECRETARY
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