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EXHIBIT 10.41
SILICON VALLEY BANK
AMENDMENT TO LOAN AGREEMENT
BORROWER: VISTA INFORMATION SOLUTIONS, INC.
DATED: JULY 23, 1998
THIS AMENDMENT TO LOAN AGREEMENT is entered into between SILICON VALLEY
BANK ("Silicon") and the borrower named above (the "Borrower").
The Parties agree to amend, effective as of the date hereof, the Loan and
Security Agreement between them dated April 7, 1998, as amended from time to
time (the "Loan Agreement": terms defined in the Loan Agreement are used
herein as therein defined).
1. NEW DEFINITION. Section 1.1 of the Loan Agreement is hereby amended
to add the following new definition of "Overadvance Amount" that is to be
inserted immediately after the definition of "Obligations".
"Overadvance Amount" means the amount of $250,000 through and including
August 14, 1998, and shall mean S-0- on and after such date.
2. AMENDED SECTION 2.1.1(a). Section 2.1.1(a) of the Loan Agreement is
hereby amended to read as follows:
"(a) Subject to and upon the terms and conditions of this Agreement, Bank
agrees to make Advances to Borrower in an aggregate outstanding amount
not to exceed: (i) the lesser of (x) the Committed Revolving Line or (y)
the Borrowing Base plus the applicable Overadvance Amount, if any, MINUS
(ii) the face amount of all outstanding Letters of Credit (including
drawn but unreimbursed Letters of Credit), MINUS (iii) the Credit Card
Sublimit. Subject to the terms and conditions of this Agreement, amounts
borrowed pursuant to this Section 2.1 may be repaid and reborrowed at any
time during the term of this Agreement."
3. REVISED PERMITTED INDEBTEDNESS. Permitted Indebtedness under the
Loan Agreement shall include an unsecured loan by the president of the
Borrower, Xxx Xxx, to the Borrower in an amount not to exceed $250,000.
4. ADDITIONAL REPRESENTATION. Borrower hereby represents and warrants
to the Bank that all Advances arising from the Overadvance Amount shall be
used exclusively in connection with its acquisition of E/Risk Information
Services.
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
1
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. This Amendment shall be
controlling in the event of any conflicts between any prior written
agreements and amendments between Silicon and the Borrower, on the one hand,
and this Amendment.
SILICON VALLEY BANK AMENDMENT TO LOAN AGREEMENT
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Borrower: Silicon:
VISTA INFORMATION SOLUTIONS, SILICON VALLEY BANK
INC.
By /s/ [ILLEGIBLE] By /s/ [ILLEGIBLE]
------------------------------ ------------------------------
President or Vice President Title Vice President
----------------------------
By ------------------------------
Secretary or Ass't Secretary
2
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LEVY, SMALL & XXXXXX
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone (000) 000-0000
TELECOPY COVER LETTER
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July 31, 1998
0052-1641
TO: MR. XXXXX XXXXXXXX (23 PAGES) FAX # (000) 000-0000
cc: XX. XXXX XXXXXXXX (3 PAGES) FAX # (000) 000-0000
FROM: Xxxxx X. Xxxxxxxx
RE: Silicon Valley Bank/Vista Information Solutions, Inc.
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PLEASE NOTIFY XXXXX XXXX AT (000) 000-0000 IF YOU DO NOT RECEIVE ALL PAGES OF
THIS TRANSMISSION. OUR TELECOPY NUMBER IS (000) 000-0000.
NOTES/COMMENTS:
The information contained in this facsimile message is privileged and
confidential and is intended only for the use of the addressee. If the
reader of this message is not the addressee, or the person responsible
for delivery to the addressee, you are hereby notified that any
dissemination, distribution or copying of the message is strictly
prohibited. If you have received this message in error, please immediately
notify us by telephone and return the original message to us at the above
address via the U.S. Postal Service.
3
[LETTERHEAD]
July 31, 1998
VIA TELECOPIER (000) 000-0000
Mr. Xxxxx Xxxxxxxx
Vista Information Solutions, Inc.
0000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Re: Silicon Valley Bank/Vista Information Solutions Inc.
and E/Risk Information Services
Dear Xx. Xxxxxxxx:
At the request of Xx. Xxxx Xxxxxxxx, enclosed for execution please find
the following documents with respect to the above-referenced transaction.
1. Assumption Agreement.
2. Amendment to Loan Agreement.
3. Amendment to Security Agreement.
4. Corporate Borrowing Resolution (E/Risk)
5. Cross-Corporate Continuing Guaranty.
6. Certified Resolution-Guarantee (Vista information).
7. Certified Resolution-Guarantee (E/Risk Information).
Please make two (2) copies of each of the enclosed and execute where
indicated. please forward both sets of executed documents to Xx. Xxxx
Xxxxxxxx at Silicon Valley Bank, 0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxx, XX
00000 via messenger/hand delivery as soon as possible. I understand from Xx.
Xxxxxxxx that the signatures of E/Risk will need to be provided to a Silicon
office in Northern California. Please contact Xx. Xxxxxxxx regarding the
details of E/Risk's signature.
4
Mr. Xxxxx Xxxxxxxx
July 31, 1997
Page 2
If you have any other questions regarding any of the enclosed, please
contact Xx. Xxxxxxxx.
Sincerely,
/s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
AFC:wbh
Enclosures
cc: Xx. Xxxx Xxxxxxxx (w/o encls. via telecopier (000)000-0000)
(w/encls. via UPS Air)
5
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SILICON VALLEY BANK
ASSUMPTION AGREEMENT
THIS ASSUMPTION AGREEMENT dated as of July 31, 1998 is entered into
between SILICON VALLEY BANK ("Silicon"), on the one side, VISTA INFORMATION
SOLUTIONS, INC. and E/RISK INFORMATION SERVICES ("New Borrower"), on the
other side. Capitalized terms used but not defined in this Agreement, shall
have the meanings set forth in the Loan and Security Agreement between
Silicon, on the one side, and Vista Information Solutions, Inc. (referred to
as the "Existing Borrower"), on the other side, dated April 7, 1998 (as
amended from time to time, the "Loan Agreement").
The parties agree as follows:
1. ASSUMPTION. New Borrower hereby assumes and agrees to pay and
perform when due all present and future indebtedness, liabilities and
obligations of Existing Borrower under, based upon, or arising out of the
Loan Agreement (as amended by that certain Amendment to Loan Agreement being
entered into concurrently herewith between New Borrower, Existing Borrower and
Silicon) and any and all documents, instruments and agreements relating
thereto, including without limitation all of the "Obligations" as defined in
the Loan Agreement. Existing Borrower shall remain as an obligor with respect
to all of the Obligations, and Existing Borrower and New Borrower shall be
jointly and severally liable for all of the Obligations. All references in
the Loan Agreement to "Borrower" shall be deemed to refer, jointly and
severally, to Existing Borrower and New Borrower.
2. GRANT OF SECURITY INTEREST. Without limiting the generality of the
provisions of Section 1 above, as security for all Obligations, New Borrower
hereby grants Silicon a continuing security interest in all of New Borrower's
interest in the types of property described below, whether now owned or
hereafter acquired and wherever located: (a) All accounts, contract rights,
chattel paper, letters of credit, documents, securities, money, and
instruments, and all other obligations now or in the future owing to New
Borrower; (b) All inventory, goods, merchandise, materials, raw materials,
work in process, finished goods, farm products, advertising, packaging and
shipping materials, supplies, and all other tangible personal property which
is held for sale or lease or furnished under contracts of service or consumed
in the New Borrower's business, and all warehouse receipts and other
documents; and (c) All equipment, including without limitation all machinery,
fixtures, trade fixtures, vehicles, furnishings, furniture, materials, tools,
machine tools, office equipment, computers and peripheral devices, appliances,
apparatus, parts, dies, and jigs; (d) All general intangibles including, but
not limited to, deposit accounts, goodwill, names, trade names, trademarks
and the goodwill of the business symbolized thereby, trade secrets, drawings,
blueprints, customer lists, patents, patent applications, copyrights, security
6
SILICON VALLEY BANK ASSUMPTION AGREEMENT
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deposits, loan commitment fees, federal, state and local tax refunds and
claims, all rights in all litigation presently or hereafter pending for any
cause or claim (whether in contract, tort or otherwise), and all judgments
now or hereafter arising therefrom, all claims of New Borrower against
Silicon, all rights to purchase or sell real or personal property, all rights
as a licensor or licensee of any kind, all royalties, licenses, processes,
telephone numbers, proprietary information, purchase orders, and all
insurance policies and claims (including without limitation credit,
liability, property and other insurance), and all other rights, privileges
and franchises of every kind; (e) All books and records, whether stored on
computers or otherwise maintained; and (f) All substitutions, additions and
accessions to any of the foregoing, and all products, proceeds and insurance
proceeds of the foregoing, and all guaranties of and security for the
foregoing; and all books and records relating to any of the foregoing. New
Borrower shall concurrently execute and deliver to Silicon UCC-1 Financing
Statements in such form as Silicon shall specify.
3. 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.
4. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. This Agreement and the
other Loan Documents shall be governed by, and construed in accordance with,
the internal laws of the State of California, without regard to principles of
conflicts of law. Each of Borrower and Silicon hereby submits to the
exclusive jurisdiction of the state and Federal courts located in the County
of San Diego, State of California. BORROWER AND SILICON EACH HEREBY WAIVE
THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY RECOGNIZES
AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT
TO ENTER INTO THIS AGREEMENT. EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS
REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL.
5. GENERAL PROVISIONS. This Agreement, 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
7
SILICON VALLEY BANK ASSUMPTION AGREEMENT
------------------------------------------------
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.
BORROWER: SILICON:
VISTA INFORMATION SOLUTIONS, INC. SILICON VALLEY BANK
By [SIGNATURE ILLEGIBLE] By [SIGNATURE ILLEGIBLE]
------------------------------- -------------------------------
President or Vice President Title
----------------------------
By [SIGNATURE ILLEGIBLE]
-------------------------------
Secretary or Ass't Secretary
NEW BORROWER:
E/RISK INFORMATION SERVICES
By [SIGNATURE ILLEGIBLE]
--------------------------------
President or Vice President
By [SIGNATURE ILLEGIBLE]
---------------------------------
Secretary or Ass't Secretary
8
SILICON VALLEY BANK
AMENDMENT TO LOAN AGREEMENT
BORROWER: VISTA INFORMATION SOLUTIONS, INC.
E/RISK INFORMATION SERVICES
DATED: JULY 31, 1998
THIS AMENDMENT TO LOAN AGREEMENT is entered into between SILICON VALLEY
BANK ("Silicon") and the borrower named above (the "Borrower").
The Parties agree to amend, effective as of the date hereof, the Loan and
Security Agreement between them dated April 7, 1998, as amended from time to
time (the "Loan Agreement", terms defined in the Loan Agreement are used
herein as therein defined).
1. ASSUMPTION AGREEMENT. Borrower is concurrently executing that
certain Assumption Agreement between Borrower and Silicon, pursuant to
which E/Risk Information Services is added as a "New Borrower" (as defined in
the Assumption Agreement).
2. NEW DEFINITIONS. Section 1.1 of the Loan Agreement is hereby amended
to add the following new definitions of "Debt Service Ratio". "Term Loan" and
"Term Loan Payment":
"Debt Service Ratio" means, on a consolidated basis, the ratio of
(a) net income of Borrower before interest, taxes, depreciation and
other non-cash amortization expenses and other non-cash expenses of
Borrower, relating to the immediately preceding four fiscal
quarters, determined in accordance with generally accepted
accounting principles, consistently applied, to (b) the amount of
Borrower's obligations relating to payment of interest on an
annualized basis and current maturities of principal on such
Borrowers' outstanding long term indebtedness, determined in
accordance with generally accepted accounting principles,
consistently applied.
"Term Loan" means a credit extension of $1,500,000.
"Term Loan Payment" has the meaning set forth in Section 2.1.5.
3. NEW SECTION 2.1.5. A new Section 2.1.5 of the Loan Agreement is
hereby added which reads as follows:
2.1.5 TERM LOAN.
(a) Subject to and upon the terms and conditions of this Agreement
(including, without limitation, Bank's review and approval of E/Risk
Information Services' financial statements, for such period(s) as
requested by Bank, reviewed by an independent certified public
accounting firm reasonably acceptable to Bank), Bank shall make a
Term Loan available to Borrower.
9
Silicon Valley Bank Amendment to Loan Agreement
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(b) Borrower shall pay 60 equal installments of principal plus
Interest in the amount of $25,000 (the "Term Loan Payment"). Each
Term Loan Payment shall be due and payable on the first calendar day
of each month (commencing September 1, 1998) during the term hereof.
Borrower's final Term Loan Payment, due on AUGUST 1, 2003, shall
include all outstanding Term Loan principal plus all accrued
interest not yet paid.
(c) The Term Loan shall bear interest at a rate equal to one-half of
one (0.50%) percentage points above the Prime Rate.
4. REVISED BORROWING BASE. The definition of "Borrowing Base" as set
forth in Section 1.1 of the Loan Agreement is hereby amended in its entirety
to read as follows:
"Borrowing Base" means an amount equal to 80% of Eligible Accounts
of Vista Information Solutions, Inc. and 50% of Eligible Accounts of
E/Risk Information Services, as determined by Bank with reference to
the most recent Borrowing Base Certificates delivered by each
Borrower; PROVIDED, HOWEVER, that the percentage with respect to
Eligible Accounts of E/Risk Information Services shall increase from
50% to 75% after an audit of E/Risk Information Services' Accounts
is completed with results satisfactory of Bank, in its sole
discretion, which audit shall be completed as provided in Section
6.3 hereof. Advances will be made to each Borrower based on the
Eligible Accounts of each borrower, subject to the Committed
Revolving Line set forth herein for all Advances to all Borrowers
combined.
5. REVISED COMMITTED REVOLVING LINE. The definition of "Borrowing
Base" as set forth in Section 1.1 of the Loan Agreement is hereby amended in
its entirety to read as follows:
"Committed Revolving Line" means a credit extension of up to
$2,500,000.
6. REVISED REPORTING REQUIREMENTS. Section 6.3 of the Loan Agreement is
hereby amended as follows:
The following new clause (g) shall be added at the end of the first paragraph
of Section 6.3:
and (g) as soon as available, but in any event within ninety (90)
days after the first Advance to E/Risk Information Services, audited
consolidated financial statements of Borrower prepared in accordance
with GAAP, consistently applied, together with an unqualified
opinion on such financial statements of an independent certified
public accounting firm reasonably acceptable to Bank.
The following sentence shall be added at the end of the last paragraph of
Section 6.3:
Bank shall have the right to audit the Accounts of E/Risk
Information Services, at Borrower's expense, within 90 days after
the execution of this Agreement by E/Risk Information Services.
10
Silicon Valley Bank Amendment to Loan Agreement
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7. REVISED QUICK RATIO. The Quick Ratio financial covenant set forth
in Section 6.8 of the Loan Agreement is amended in its entirely to read as
follows:
6.8 QUICK RATIO Borrower shall maintain, as of the last day of
each calendar month, a ratio of Quick Assets to Current Liabilities
of at least 1.50 to 1.0. For purposes of the foregoing, however,
Current Liabilities shall not include deferred revenues.
8. REPLACEMENT OF DEBT-NET WORTH RATIO. With Debt Service Ratio. The
Debt-Net Worth Ratio financial covenant set forth in Section 6.9 of the Loan
Agreement which currently reads as follows:
6.9 DEBT-NET WORTH RATIO. Borrower shall maintain, as of the last
day of each calendar month, a ratio of Total Liabilities less
Subordinated Debt to Tangible Net Worth plus Subordinated Debt of
not more than 1.50 to 1.0. For purposes of the foregoing, however,
deferred revenues shall not be taken into account in computing Total
Liabilities of Tangible Net Worth.
is hereby deleted and replaced with a Debt Service Ratio which shall read as
follows:
6.9 DEBT SERVICE RATIO. Borrower, on a consolidated basis, shall
maintain, as of the last day each fiscal quarter, a Debt Service
Ratio of as least 2.0 to 1.0.
9. REPLACEMENT OF TANGIBLE NET WORTH WITH CASH FLOW RECAPTURE. The
Tangible Net Worth financial covenant set forth in Section 6.10 of the Loan
Agreement which currently reads as follows:
6.10 TANGIBLE NET WORTH. Borrower shall maintain, as of the last
day of each calendar month, a Tangible Net Worth of not less than
$1,750.000.
is hereby deleted and replaced with a Cash Flow Recapture financial covenant
which shall read as follows:
6.10 CASH FLOW RECAPTURE. Within 30 days after the end of each
fiscal quarter, Borrower shall pay to Bank 20% of Borrower's
earnings before interest, taxes, depreciation and amortization in
excess of $750,000 for such quarter ("Recapture Contribution");
provided, however, in no event shall any Recapture Contribution
exceed 25% of Borrower's then outstanding Obligations. The Recapture
Contributions shall be maintained in a separate account maintained
at Bank, shall bear interest at the Bank's then prevailing rates for
other such similar interest bearing accounts and shall constitute
part of Bank's Collateral.
10. Fee. Borrower shall concurrently pay to Silicon a facility fee in
the amount of $5,250, which shall be in addition to all interest and all
other fees payable to Silicon and shall be non-refundable.
11
Silicon Valley Bank Amendment to Loan Agreement
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11. 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.
12. GENERAL PROVISIONS. This Amendment, the Loan Agreement, any prior
written amendments to the Loan Agreement signed by Silicon and the Borrower,
and 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. This Amendment shall
be controlling in the event of any conflicts between any prior written
agreements and amendments between Silicon and the Borrower, on the one hand,
and this Amendment.
Borrower: Silicon:
VISTA INFORMATION SOLUTIONS, INC. SILICON VALLEY BANK
By [ILLEGIBLE] By
--------------------------- ----------------------------
President or Vice President Title
-------------------------
By [ILLEGIBLE]
----------------------------
Secretary or Ass't Secretary
Borrower:
E/RISK INFORMATION SERVICES
By [ILLEGIBLE]
---------------------------
President or Vice President
By [ILLEGIBLE]
----------------------------
Secretary or Ass't Secretary
12
Silicon Valley Bank Amendment to Loan Agreement
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CONSENT
The undersigned acknowledge that their consent to the foregoing
Agreement is not required, but the undersigned nevertheless do hereby consent
to the foregoing Agreement and to the documents and agreements referred to
therein and to all future modifications and amendments thereto, and any
termination thereof, and to any and all other present and future documents
and agreements between or among the foregoing parties. Nothing herein shall n
any way limit any of the terms or provisions of the Continuing Guarantee of
the undersigned, all of which are hereby ratified and affirmed.
Borrower: Silicon:
VISTA INFORMATION SOLUTIONS, INC. E/RISK INFORMATION SERVICES
By [ILLEGIBLE] By [ILLEGIBLE]
--------------------------- ---------------------------
President or Vice President President or Vice President
By [ILLEGIBLE] By [ILLEGIBLE]
---------------------------- ----------------------------
Secretary or Ass't Secretary Secretary or Ass't Secretary
13
