1
10(f) LINE OF CREDIT AGREEMENT, DATED JULY 18, 1996, WITH SILICON VALLEY BANK
2
SILICON VALLEY BANK
AMENDMENT TO LOAN AND
SECURITY AGREEMENT
BORROWER: CAM DATA SYSTEMS, INC.
ADDRESS: 00000 XXXXXXX XXXXXX, XXXXX 000
XXXXXXXX XXXXXX, XXXXXXXXXX 00000
DATE: JULY 18, 1996
THIS AMENDMENT TO LOAN AND SECURITY AGREEMENT is entered into between
SILICON VALLEY BANK ("Silicon") and the borrower named above (the "Borrower").
The Parties agree to amend the Loan and Security Agreement between
them, dated June 30, 1992, as amended by that certain Amendment to Loan
Agreement dated July 7, 1993, and as amended by that Amendment to Loan Agreement
dated June 28, 1994 (as amended, the "Loan Agreement"), as follows. (Capitalized
terms used but not defined in this Amendment, shall have the meanings set forth
in the Loan Agreement.)
1. AMENDED SCHEDULE. The Schedule to Loan and Security Agreement is
amended, effective on the date hereof, to read as set forth on the Amended
Schedule to Loan and Security Agreement attached hereto.
2. FINANCIAL REPORTING. Section 3.7 of the Loan Agreement is hereby
deleted in its entirety and replaced with the following:
3.7 FINANCIAL CONDITION AND STATEMENTS. All financial
statements now or in the future delivered to Silicon have
been, and will be, prepared in conformity with generally
accepted accounting principles and now and in the future will
completely and accurately reflect the financial condition of
the Borrower, at the times and for the periods therein stated.
Since the last date covered by any such statement, there has
been no material adverse change in the financial condition or
business of the Borrower. The Borrower is now and will
continue to be solvent. The Borrower will provide Silicon: (i)
at all times that any Obligations remain outstanding, within
30 days after the end of each month, a monthly financial
statement prepared by the Borrower, and a monthly Compliance
Certificate; the Compliance Certificate shall be
3
in such form as Silicon shall reasonably specify, signed by the
Chief Financial Officer of the Borrower, certifying that throughout
such month, the Borrower was in full compliance with all of the
terms and conditions of this Agreement, and setting forth
calculations showing compliance with the financial covenants set
forth on the Schedule and such other information as Silicon shall
reasonably request; (ii) at all other times, within 30 days after
the end of each fiscal quarter, a quarterly financial statement
prepared by the Borrower, and a quarterly Compliance Certificate;
the Compliance Certificate shall be in such form as Silicon shall
reasonably specify, signed by the Chief Financial Officer of the
Borrower, certifying that throughout such fiscal quarter, the
Borrower was in full compliance with all of the terms and conditions
of this Agreement, and setting forth calculations showing compliance
with the financial covenants set forth on the Schedule and such
other information as Silicon shall reasonably request; (iii) copies
of the Borrower's Reports to the Securities Exchange Commission on
Forms 10-Q and 10-K within five days after the earlier of the date
they are filed or are required to be filed with the Securities
Exchange Commission; and (iv) within 90 days following the end of
the Borrower's fiscal year, complete annual financial statements,
certified by independent certified public accountants acceptable to
Silicon and accompanied by the unqualified report thereon by said
independent certified public accountants.
3. FACILITY FEE. Borrower shall concurrently pay to Silicon a facility
fee in the amount of $1,875.00, which shall be in addition to all interest and
all other fees payable to Silicon and shall be non-refundable.
4. 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.
5. GENERAL PROVISIONS. This Amendment, the Loan Agreement, any prior
written amendments to the Loan Agreement signed by Silicon and the Borrower, and
the other written documents and agreements between Silicon and the 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 the Borrower shall continue in full force and effect and the same
are hereby ratified and confirmed.
4
BORROWER: SILICON:
CAM DATA SYSTEMS, INC. SILICON VALLEY BANK
BY_______________________________ BY______________________________
PRESIDENT OR VICE PRESIDENT TITLE___________________________
BY_______________________________
SECRETARY OR ASS'T SECRETARY
5
SILICON VALLEY BANK
AMENDED SCHEDULE TO
LOAN AND SECURITY AGREEMENT
BORROWER: CAM DATA SYSTEMS, INC.
ADDRESS: 00000 XXXXXXX XXXXXX, XXXXX 000
XXXXXXXX XXXXXX, XXXXXXXXXX 00000
DATE: JULY 18, 1996
CREDIT LIMIT
(Section 1.1): An amount not to exceed the lesser of: (i) $750,000 at any
one time outstanding; or (ii) 75% of the Net Amount of
Borrower's accounts, which Silicon in its discretion deems
eligible for borrowing. "Net Amount" of an account means the
gross amount of the account, minus all applicable sales, use,
excise and other similar taxes and minus all discounts,
credits and allowances of any nature granted or claimed.
Without limiting the fact that the determination of which
accounts are eligible for borrowing is a matter of Silicon's
discretion, the following will not be deemed eligible for
borrowing: accounts outstanding for more than 90 days from the
invoice date, accounts subject to any contingencies, accounts
owing from an account debtor outside the United States (unless
pre-approved by Silicon in its discretion, or backed by a
letter of credit satisfactory to Silicon, or FCIA insured
satisfactory to Silicon), accounts owing from one account
debtor to the extent they exceed 25% of the total eligible
accounts outstanding, accounts owing from an affiliate of
Borrower, and accounts owing from an account debtor to whom
Borrower is or may be liable for goods purchased from such
account debtor or otherwise. In addition, if more than 50% of
the accounts owing from an account debtor are outstanding more
than 90 days from the invoice date or are otherwise not
eligible accounts, then all accounts owing from that account
debtor will be deemed ineligible for borrowing.
6
LETTERS OF CREDIT SUBLIMIT Silicon, in its discretion, will from time to time
during the term of this Agreement issue letters of
credit for the account of the Borrower ("Letters of
Credit"), in an aggregate amount at any one time
outstanding not to exceed $100,000, upon the
request of the Borrower and upon execution and
delivery by the Borrower of Applications for
Letters of Credit and such other documentation as
Silicon shall specify (the "Letter of Credit
Documentation"). Fees for the Letters of Credit
shall be as provided in the Letter of Credit
Documentation.
The Credit Limit set forth above and the Loans
available under this Agreement at any time shall
be reduced by the face amount of Letters of Credit
from time to time outstanding.
INTEREST RATE (Section 1.2): A rate equal to the "Prime Rate" in effect from
time to time, plus 1.00% per annum. 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;" 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.
LOAN ORIGINATION FEE
(Section 1.3): SEE AMENDMENT TO LOAN AND SECURITY AGREEMENT OF
EVEN DATE.
MATURITY DATE
(Section 5.1): JUNE 5, 1997
PRIOR NAMES OF BORROWER
(Section 3.2): ICS
TRADE NAMES OF BORROWER
(Section 3.2): NONE
OTHER LOCATIONS AND ADDRESSES
(Section 3.3): 0000 XXXXXX XXX., XXXXXXX XXXX, XX 00000;
000 XXXXXXX XXXXXX, XXXXXX, XX 00000;
7
MATERIAL ADVERSE LITIGATION
(Section 3.10): NONE
NEGATIVE COVENANTS-EXCEPTIONS
(Section 4.6): Without Silicon's prior written consent,
Borrower may do the following, provided that,
after giving effect thereto, no Event of
Default has occurred and no event has occurred
which, with notice or passage of time or both,
would constitute an Event of Default, and
provided that the following are done in
compliance with all applicable laws, rules and
regulations: (i) repurchase shares of
Borrower's stock pursuant to any employee stock
purchase or benefit plan, provided that the
total amount paid by Borrower for such stock
does not exceed $100,000 in any fiscal year.
FINANCIAL COVENANTS
(Section 4.1): Borrower shall comply with all of the
following covenants. Compliance shall be
determined as of the end of each quarter,
except as otherwise specifically provided
below:
QUICK ASSET RATIO: Borrower shall maintain a ratio of "Quick
Assets" to current liabilities of not less
than 1.25 to 1.
TANGIBLE NET WORTH: Borrower shall maintain a tangible net worth of
not less than $2,000,000.
DEBT TO TANGIBLE
NET WORTH RATIO: Borrower shall maintain a ratio of total
liabilities to tangible net worth of not more
than 1.00 to 1.
PROFITABILITY Borrower shall not incur a loss (after
taxes) for any fiscal year, except that
in a single fiscal quarter during each
fiscal year Borrower may incur a loss
(after taxes) in an amount not to exceed
$100,000.
DEFINITIONS: "Current assets," and "current liabilities"
shall have the meanings ascribed to them in
accordance with generally accepted accounting
principles. "Tangible net worth" means the
excess of total assets over total liabilities,
determined in accordance with generally
accepted accounting principles, excluding
however all assets which would be classified as
intangible assets under generally accepted
accounting principles, including without
limitation goodwill,
8
licenses, patents, trademarks, trade names,
copy rights, and franchises.
"Quick Assets" means cash on hand or on
deposit in banks, readily marketable securities
issued by the United States, readily marketable
commercial paper rated "A-1" by Standard &
Poor's Corporation (or a similar rating by a
similar rating organization), certificates of
deposit and banker's acceptances, and accounts
receivable (net of allowance for doubtful
accounts).
SUBORDINATED DEBT: "Liabilities" for purposes of the foregoing
covenants do not include indebtedness which is
subordinated to the indebtedness to Silicon
under a subordination agreement in form
specified by Silicon or by language in the
instrument evidencing the indebtedness which is
acceptable to Silicon.
OTHER COVENANTS
(Section 4.1): Borrower shall at all times comply with
all of the following additional covenants:
1. BANKING RELATIONSHIP. Borrower shall at all
times maintain its primary banking relationship
with Silicon.
2. BORROWING BASE CERTIFICATE AND LISTING. At
all times that any Obligations remain
outstanding, within 20 days after the end of
each month, Borrower shall provide Silicon with
a Borrowing Base Certificate in such form as
Silicon shall specify, and an aged listing of
Borrower's accounts receivable and accounts
payable. At all other times, within 30 days
after the end of each fiscal quarter, Borrower
shall provide Silicon with a Borrowing Base
Certificate in such form as Silicon shall
specify, and an aged listing of Borrower's
accounts receivable. Additionally, prior to any
new Loans being advanced, Borrower shall
provide Silicon with a current Borrowing Base
Certificate in such form as Silicon shall
specify, and an aged listing of Borrower's
accounts receivable and accounts payable.
3. INDEBTEDNESS. Without limiting any of the
foregoing terms or provisions of this
Agreement, Borrower shall not in the future
incur indebtedness for borrowed money, except
for (i) indebtedness to Silicon, and (ii)
indebtedness incurred in the future for the
9
purchase price of or lease of equipment in an
aggregate amount not exceeding $250,000 at any
time outstanding.
4. COPYRIGHT SECURITY AGREEMENT. Borrower shall
continue in full force and effect the Security
Agreement in Copyrighted Works, executed by
Borrower in favor of Silicon, in conjunction
with the Amendment to Loan Agreement dated July
7, 1993. The Borrower shall cause the Security
Agreement in Copyrighted Works to remain in
full force and effect while any Obligations
remain outstanding.
5. ACCOUNTS RECEIVABLE AUDITS. No accounts
receivable audits as set forth under Section
4.5 of this Agreement shall be required during
periods in which no Obligations remain
outstanding. An accounts receivable audit as
set forth under Section 4.5 of this Agreement
shall be conducted and completed, with
satisfactory results, within 30 days after any
new Loan is made hereunder. Additionally, at
all times that any Obligations remain
outstanding, the accounts receivable audits by
third parties retained by Silicon as set forth
in Section 4.5 of this Agreement shall be
conducted on a semi-annual basis.
BORROWER:
CAM DATA SYSTEMS, INC.
BY_______________________________
PRESIDENT OR VICE PRESIDENT
BY_______________________________
SECRETARY OR ASS'T SECRETARY
SILICON:
SILICON VALLEY BANK
BY_______________________________
TITLE____________________________
10
SILICON VALLEY BANK
CERTIFIED RESOLUTION
BORROWER: CAM DATA SYSTEMS, INC., A CORPORATION ORGANIZED
UNDER THE LAWS OF THE STATE OF DELAWARE
DATE: JULY 18, 1996
I, the undersigned, Secretary or Assistant Secretary of the above-named
borrower, a corporation organized under the laws of the state set forth above,
do hereby certify that the following is a full, true and correct copy of
resolutions duly and regularly adopted by the Board of Directors of said
corporation as required by law, and by the by-laws of said corporation, and that
said resolutions are still in full force and effect and have not been in any way
modified, repealed, rescinded, amended or revoked.
RESOLVED, that this corporation borrow from Silicon Valley Bank
("Silicon"), from time to time, such sum or sums of money as, in the
judgment of the officer or officers hereinafter authorized hereby, this
corporation may require.
RESOLVED FURTHER, that any officer of this corporation be, and he or she is
hereby authorized, directed and empowered, in the name of this corporation,
to execute and deliver to Silicon, and Silicon is requested to accept, the
loan agreements, security agreements, notes, financing statements, and
other documents and instruments providing for such loans and evidencing
and/or securing such loans, with interest thereon, and said authorized
officers are authorized from time to time to execute renewals, extensions
and/or amendments of said loan agreements, security agreements, and other
documents and instruments.
RESOLVED FURTHER, that said authorized officers be and they are hereby
authorized, directed and empowered, as security for any and all
indebtedness of this corporation to Silicon, whether arising pursuant to
this resolution or otherwise, to grant, transfer, pledge, mortgage, assign,
or otherwise hypothecate to Silicon, or deed in trust for its benefit, any
property of any and every kind, belonging to this corporation, including,
but not limited to, any and all real property, accounts, inventory,
equipment, general intangibles, instruments, documents, chattel paper,
notes, money, deposit accounts, furniture, fixtures, goods, and other
property of every kind, and to execute and deliver to Silicon any and all
grants, transfers, trust receipts, loan or credit agreements, pledge
agreements, mortgages, deeds of trust, financing statements, security
agreements and other hypothecation agreements, which said instruments and
the note or notes and other instruments referred to in the preceding
paragraph may contain such provisions, covenants, recitals and agreements
as Silicon may require and said authorized officers may approve, and the
execution thereof by said authorized officers shall be conclusive evidence
of such approval.
RESOLVED FURTHER, that the Silicon may conclusively rely upon a certified
copy of these resolutions and continue to conclusively rely on such
certified copy of these resolutions for all past, present and future
transactions until written notice of any change hereto is given to Silicon
by this corporation by certified mail, return receipt requested.
11
The undersigned further hereby certifies that the following persons are the duly
elected and acting officers of the corporation named above as borrower and that
the following are their actual signatures:
NAMES OFFICE(S) ACTUAL
----- --------- ------
SIGNATURES
----------
______________________________ _________________________
X________________________
______________________________ _________________________
X________________________
______________________________ _________________________
X________________________
______________________________ _________________________
X________________________
IN WITNESS WHEREOF, I have hereunto set my hand as such Secretary or Assistant
Secretary on the date set forth above.
___________________________________
___________
Secretary or Assistant Secretary
