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EXHIBIT 10.8(n)
AMENDMENT NUMBER SIX TO LOAN AND SECURITY AGREEMENT
This Amendment Number Six to Loan and Security Agreement
("Amendment") is entered into on March 14, 2001, by and among FOOTHILL CAPITAL
CORPORATION, a California corporation ("Foothill") on the one hand, and
INTERNATIONAL REMOTE IMAGING SYSTEMS, INC., Delaware corporation ("IRIS"),
ADVANCED DIGITAL IMAGING RESEARCH, LLC (formerly known as Perceptive Scientific
Instruments, LLC), a Delaware limited liability company ("ADIR"), and STATSPIN,
INC., a Massachusetts corporation ("Statspin") ("Borrowers") on the other hand,
in light of the following:
A. Borrowers and Foothill have previously entered into that
certain Loan and Security Agreement, dated as of May 5, 1998 (as amended, the
"Agreement"). The parties acknowledge that the "Closing Date" of the Agreement
was May 8, 1998.
B. Borrowers and Foothill desire to further amend the
Agreement as provided for and on the conditions herein.
NOW, THEREFORE, Borrowers and Foothill hereby amend and
supplement the Agreement as follows:
1. DEFINITIONS. All initially capitalized terms used in this
Amendment shall have the meanings given to them in the Agreement unless
specifically defined herein.
2. AMENDMENTS. The amendments set forth in this Section 2
shall be effective as of May 8, 2001.
(a) Subsection (c) of the definition of "Eligible
Accounts" in Section 1.1 of the Agreement is amended to read as follows:
"(c) Accounts with respect to which the
Account Debtor is CitiCapital Inc., formerly known as Copelco Capital Inc.
(except for Accounts owed by such Account Debtor arising from the sale of
Equipment by IRIS or StatSpin on terms acceptable to Foothill) or an employee,
Affiliate, or agent of a Borrower;"
(b) The definition of Term Loan in Section 1.1 of the
Agreement is amended to read as follows:
"`Term Loan' has the meaning in Section 2.3
or Section 2.4, as applicable."
(c) Section 2.4 of the Agreement is amended to read
as follows:
"2.4 TERM LOAN. Foothill has agreed to make
a term loan (the "Term Loan") to Borrowers in the original principal amount of
$3,000,000. The Term Loan shall be repaid in 36 installments of principal in the
following amounts:
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MONTH INSTALLMENT AMOUNT
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1 through 36 $83,333.33
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Each such installment shall be due and payable on the first day of each month
commencing on the first day of June, 2001 and continuing on the first day of
each succeeding month until and including the date on which the unpaid balance
of the Term Loan is paid in full. Borrowers shall not prepay the Term Loan
except in accordance with Section 3.6 or 2.5. The outstanding principal balance
and all accrued and unpaid interest under the Term Loan shall be due and payable
upon the termination of this Agreement, whether by its terms, by prepayment, by
acceleration, or otherwise. All amounts outstanding under the Term Loan shall
constitute Obligations.
(d) Section 2.5(c) of the Agreement is amended to
read as follows:
"(c) If, at any time or for any reason, the
principal balance of the Term Loan is greater than an amount equal to: (i) the
result of multiplying (a) Borrowers' annualized Supply and Service Revenue based
on the most recent fiscal quarter, by (b) by the percentage indicated in the
table below opposite the applicable period, less (ii) the amount of IRIS'
warranty reserve:
Period Percentage
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June 30, 2001 - March 31, 2002 30%
June 30, 2002 - December 31, 2002 20%
March 31, 2003 and thereafter 15%
then, Borrowers immediately shall pay to Foothill, in cash, the amount of such
excess to be used by Foothill toward principal installments due under the Term
Loan in inverse order of maturity without penalty."
(e) Section 3.4 of the Agreement is amended to read
as follows:
"3.4 TERM; AUTOMATIC RENEWAL. This Agreement
shall become effective upon the execution and delivery hereof by Borrowers and
Foothill and shall continue in full force and effect for a term ending on May 8,
2004 (the "Renewal Date") and automatically shall be renewed for successive one
year periods thereafter, unless sooner terminated pursuant to the terms hereof.
Either party may terminate this Agreement effective on the Renewal Date or on
any one year anniversary of the Renewal Date by giving the other party at least
90 days prior written notice. The foregoing notwithstanding, Foothill shall have
the right to terminate its obligations under this Agreement immediately and
without notice upon the occurrence and during the continuation of an Event of
Default.
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(f) Section 3.6 of the Agreement is amended to read
as follows:
"3.6 EARLY TERMINATION BY BORROWERS. The
provisions of Section 3.4 that allow termination of this Agreement by Borrowers
only on the Renewal Date and certain anniversaries thereof notwithstanding,
Borrowers have the option, at any time upon 45 days prior written notice to
Foothill, to terminate this Agreement by paying to Foothill, in cash, the
Obligations, in full, together with a premium (the "Early Termination Premium")
equal to the amount of the following, as applicable: (a) 3.00% of the Maximum
Amount if such termination occurs prior to May 8, 2002, (b) 2.00% of the Maximum
Amount if such termination occurs on or after May 8, 2002 and prior to May 8,
2003, and (c) 1.00% of the Maximum Amount if such termination occurs on or after
May 8, 2003."
(g) Section 7.20 of the Agreement is amended to read
as follows:
"(a) TANGIBLE NET WORTH. Consolidated
Tangible Net Worth, measured on a fiscal quarter-end basis, of not less than the
amount set forth in the table below as at the fiscal quarter-end indicated:
Fiscal Quarter Ending Minimum Tangible Net Worth
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June 30, 2001 $ 8,317,000
September 30, 2001 6,059,000
December 31, 2001 5,975,000
March 31, 2002 6,941,000
June 30, 2002 8,884,000
September 30, 2002 9,738,000
December 31, 2002 11,867,000
March 31, 2003 14,146,000
June 30, 2003 15,698,000
September 30, 2003 18,253,000
December 31, 2003 and each fiscal $20,921,000
quarter ending thereafter
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(b) EBITDA. EBITDA, measured on a quarter
basis, of not less than the amount set forth in the table below as at the fiscal
quarter-end indicated:
Fiscal Quarter Ending Minimum EBITDA
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June 30, 2001 $ 1,000,000
September 30, 2001 1,150,000
December 31, 2001 1,300,000
March 31, 2002 1,600,000
June 30, 2002 1,800,000
September 30, 2002 1,800,000
December 31, 2002 2,100,000
March 31, 2003 2,200,000
June 30, 2003 2,600,000
September 30, 2003 2,600,000
December 31, 2003 and each fiscal $ 3,000,000
quarter ending thereafter
(c) MINIMUM GROSS MARGIN. A gross margin of
at least 50% of Supply and Service Revenue."
3. REPRESENTATIONS AND WARRANTIES. Borrowers hereby affirm to
Foothill that all of Borrowers' representations and warranties set forth in the
Agreement are true, complete and accurate in all respects as of the date hereof.
4. NO DEFAULTS. Except as provided in Section 5 below,
Borrowers hereby affirm to Foothill that no Event of Default has occurred and is
continuing as of the date hereof.
5. CONDITIONS PRECEDENT. This Amendment is expressly
conditioned upon the following:
(a) Receipt by Foothill of an executed copy of this
Amendment; and
(b) Payment by Foothill of an amendment fee in the
amount of $30,000, such fee will be charged to Borrowers' loan account pursuant
to Section 2.5(d) of the Agreement.
6. COSTS AND EXPENSES. Borrowers shall pay to Foothill all of
Foothill's out-of-pocket costs and expenses (including, without limitation, the
fees and expenses of its counsel, which counsel may include any local counsel
deemed necessary, search fees, filing and recording fees, documentation fees,
appraisal fees, travel expenses, and other fees) arising in connection with the
preparation, execution, and delivery of this Amendment and all related
documents.
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7. LIMITED EFFECT. In the event of a conflict between the
terms and provisions of this Amendment and the terms and provisions of the
Agreement, the terms and provisions of this Amendment shall govern. In all other
respects, the Agreement, as amended and supplemented hereby, shall remain in
full force and effect.
8. COUNTERPARTS; EFFECTIVENESS. This Amendment may be executed
in any number of counterparts and by different parties on separate counterparts,
each of which when so executed and delivered shall be deemed to be an original.
All such counterparts, taken together, shall constitute but one and the same
Amendment. This Amendment shall
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become effective upon the execution of a counterpart of this Amendment by each
of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment as of the date first set forth above.
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/ XXXXXX XXXX
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Title: Senior Vice President
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INTERNATIONAL REMOTE IMAGING
SYSTEMS, INC., a Delaware corporation
By: /s/ XXXX X. X'XXXXXX
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Title: President
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STATSPIN, INC.,
a Massachusetts corporation
By: /s/ XXXX X. X'XXXXXX
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Title: President
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ADVANCED DIGITAL IMAGING RESEARCH, LLC
(formerly known as Perceptive Scientific Instruments,
LLC), a Delaware limited liability company
By: Statspin, Inc., a Massachusetts corporation,
Its sole Member
By: /s/ XXXX X. X'XXXXXX
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Title: President
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