FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
Exhibit
10.1
FOURTH
AMENDMENT
TO
THIS FOURTH AMENDMENT to Loan and
Security Agreement (this “Amendment”) is entered into this 28th day of March,
2008, by and between Silicon Valley Bank (“Bank”) and XPLORE TECHNOLOGIES
CORPORATION OF AMERICA, a Delaware corporation (“Borrower”) whose address is
00000 Xxxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000.
Recitals
A. Bank
and Borrower have entered into that certain Loan and Security Agreement dated as
of September 15, 2005, as amended by that certain First Amendment to Loan and
Security Agreement by and between Bank and Borrower dated as of November 28,
2005, that certain Letter amending Loan and Security Agreement by and between
Bank and Borrower dated as of March 30, 2006, that certain Second Amendment to
Loan and Security Agreement by and between Bank and Borrower dated as of May 15,
2006 and that certain Third Amendment to Loan and Security Agreement by and
between Bank and Borrower dated as of February 28, 2007 (as the same may from
time to time be further amended, modified, supplemented or restated, the “Loan
Agreement”).
B. Bank
has extended credit to Borrower for the purposes permitted in the Loan
Agreement.
C. Borrower
has requested that Bank amend the Loan Agreement to (i) extend the maturity
date, (ii) add a requirement that Borrower receive Subordinated Debt proceeds,
and (iii) make certain other revisions to the Loan Agreement as more fully set
forth herein.
D. Bank
has agreed to so amend certain provisions of the Loan Agreement, but only to the
extent, in accordance with the terms, subject to the conditions and in reliance
upon the representations and warranties set forth below.
Agreement
Now,
Therefore, in
consideration of the foregoing recitals and other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows:
1. Definitions. Capitalized
terms used but not defined in this Amendment shall have the meanings given to
them in the Loan Agreement.
2. Amendments
to Loan Agreement.
2.1 Schedule Section 3 (FEES
(Section 1.4)). A new paragraph
is added at the end of Section 3 of the Schedule to the Loan Agreement as
follows:
“Anniversary Fee. On
March 30, 2009, provided that the Maturity Date is extended pursuant to Schedule
9 hereof, an Anniversary Fee of Forty Thousand Dollars ($40,000).”
2.2 Schedule Section 5 (FINANCIAL
COVENANTS (Section 5.1)). A new paragraph
is added prior to the “Definitions” portion of Section 5 of the Schedule to the
Loan Agreement as follows:
“Subordinated
Debt. Borrower shall have received at least Two Million
Dollars ($2,000,000) in proceeds from the issuance of Subordinated Debt no later
than May 30, 2008.”
Bank hereby reserves the right to
modify the financial covenants in this Section in its reasonable business
discretion in connection with the extension of the Maturity Date referenced in
Section 9 of the Schedule.”
2.3 Schedule Section 9 (MATURITY DATE
(Section 6.1)). The Maturity
Date in Section 9 of the Schedule to the Loan Agreement is amended in its
entirety and replaced with the following:
“March
30, 2009, provided however if, on March 30, 2009 Borrower has a Remaining Months
Liquidity of at least 9 months, the Maturity Date shall be automatically
extended to March 30, 2010; for the purposes hereof, “Remaining Months
Liquidity” shall mean the number of months obtained by dividing (i) Borrower’s
unrestricted cash held at Bank plus the lesser of (a) the Maximum Credit Limit
or (b) the Borrowing Base, minus in either case, the outstanding amount of any
Loans made under the Loan Agreement by (ii) Borrower’s monthly EBDA loss based
on the average EBDA loss for the prior three (3) months. For the
purposes hereof, “EBDA” means earnings before depreciation and amortization,
excluding any non-cash expenses related to stock compensation activities and
gains from the Xpad sale, with all such terms being determined in accordance
with GAAP.”
3. Limitation
of Amendments.
3.1 The
amendments set forth in Section
2, above, are effective for the purposes set forth herein and shall be
limited precisely as written and shall not be deemed to (a) be a consent to any
amendment, waiver or modification of any other term or condition of any Loan
Document, or (b) otherwise prejudice any right or remedy which Bank may now have
or may have in the future under or in connection with any Loan
Document.
3.2 This
Amendment shall be construed in connection with and as part of the Loan
Documents and all terms, conditions, representations, warranties, covenants and
agreements set forth in the Loan Documents, except as herein amended, are hereby
ratified and confirmed and shall remain in full force and effect.
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4. Representations and
Warranties. To induce Bank to enter into this Amendment,
Borrower hereby represents and warrants to Bank as follows:
4.1 Immediately
after giving effect to this Amendment (a) the representations and warranties
contained in the Loan Documents are true, accurate and complete in all material
respects as of the date hereof (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct as
of such date), and (b) no Event of Default has occurred and is
continuing;
4.2 Borrower
has the power and authority to execute and deliver this Amendment and to perform
its obligations under the Loan Agreement, as amended by this
Amendment;
4.3 The
organizational documents of Borrower delivered to Bank on September 15, 2005,
remain true, accurate and complete and have not been amended, supplemented or
restated and are and continue to be in full force and effect;
4.4 The
execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, have been duly authorized;
4.5 The
execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not and will not contravene (a) any law or regulation binding on
or affecting Borrower, (b) any contractual restriction with a Person binding on
Borrower, (c) any order, judgment or decree of any court or other governmental
or public body or authority, or subdivision thereof, binding on Borrower, or (d)
the organizational documents of Borrower;
4.6 The
execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not require any order, consent, approval, license, authorization
or validation of, or filing, recording or registration with, or exemption by any
governmental or public body or authority, or subdivision thereof, binding on
either Borrower, except as already has been obtained or made; and
4.7 This
Amendment has been duly executed and delivered by Borrower and is the binding
obligation of Borrower, enforceable against Borrower in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, liquidation, moratorium or other similar laws of general
application and equitable principles relating to or affecting creditors’
rights.
5. Counterparts. This
Amendment may be executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and the same
instrument.
6. Postclosing
Items. No later than thirty (30) days after the execution
hereof, Bank shall have received the Reaffirmation of Intercreditor Agreement
3
substantially
in the form attached hereto as Schedule 2, duly executed and delivered by
Wistron Corporation.
7. Effectiveness. This
Amendment shall be deemed effective upon (a) the due execution and delivery to
Bank of this Amendment by each party hereto, (b) Borrower’s payment of an
amendment fee in an amount equal to Forty Thousand Dollars ($40,000) and (c)
Bank’s receipt of the Acknowledgement of Amendment and Reaffirmation of Guaranty
substantially in the form attached hereto as Schedule 1, duly executed and
delivered by Guarantor,
[Signature
page follows.]
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In
Witness Whereof, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.
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BANK
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BORROWER
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SILICON
VALLEY BANK
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XPLORE
TECHNOLOGIES CORPORATION OF AMERICA
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By: /s/
Xxxxxx Xxxxxxx
Name: Xxxxxx Xxxxxxx
Title: Relationship
Manager
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By: /s/
Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Chief Financial
Officer
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