FIRST LOAN MODIFICATION AGREEMENT
EXHIBIT 10.1
This First Loan Modification Agreement (this “Loan Modification Agreement”) is entered into as
of March 2, 2010, and is effective as of November 2, 2009, by and between SILICON VALLEY BANK, a
California corporation, with its principal place of business at 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx,
Xxxxxxxxxx 00000 and with a loan production office located at One Newton Executive Park, Suite 200,
0000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (“Bank”) and SOUNDBITE COMMUNICATIONS, INC., a
Delaware corporation, with its principal executive office located at 00 Xxxxxx Xxxxx, Xxxxxxx,
Xxxxxxxxxxxxx 00000 (“Borrower”).
1. DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS. Among other indebtedness and
obligations which may be owing by Borrower to Bank, Borrower is indebted to Bank pursuant to a loan
arrangement dated as of November 2, 2009, evidenced by, among other documents, a certain Loan and
Security Agreement dated as of November 2, 2009 (as amended and affected, the “Loan Agreement”).
Capitalized terms used but not otherwise defined herein shall have the same meaning as in the Loan
Agreement.
2. DESCRIPTION OF COLLATERAL. Repayment of the Obligations is secured by the Collateral as
described in the Loan Agreement (together with any other collateral security granted to Bank, the
“Security Documents”). Hereinafter, the Security Documents, together with all other documents
evidencing or securing the Obligations shall be referred to as the “Existing Loan Documents”.
| 1 | Borrower and Bank hereby agree to revise the Loan Agreement to reflect their original intent regarding the delivery of annual audited financial statements in order to allow Borrower and its accountants with appropriate time to obtain and deliver its annual audited financial statements. Accordingly, Borrower and Bank hereby agree that the Loan Agreement shall be amended by deleting following text, appearing in Section 6.2(a) thereof: |
“ (i) within five (5) days of filing with the Securities and Exchange
Commission, but in any event no later than forty-five (45) days after
the last day of its fiscal year, audited consolidated financial
statements prepared under GAAP on Form 10-K as filed with the
Securities and Exchange Commission, consistently applied, together
with an unqualified opinion on the financial statements from an
independent certified public accounting firm acceptable to Bank in
its reasonable discretion;”
and inserting in lieu thereof the following:
“ (i) within five (5) days of filing with the Securities and Exchange
Commission, but in any event no later than ninety (90) days after the
last day of its fiscal year, audited consolidated financial
statements prepared under GAAP on Form 10-K as filed with the
Securities and Exchange Commission,
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consistently applied, together with an unqualified opinion on the
financial statements from an independent certified public accounting
firm acceptable to Bank in its reasonable discretion;”
| 2 | The Compliance Certificate appearing as Exhibit D to the Loan Agreement is hereby replaced with the Compliance Certificate attached as Schedule 1 hereto. |
4. FEES. Borrower shall reimburse Bank for all legal fees and expenses incurred in
connection with this amendment to the Existing Loan Documents.
5. RATIFICATION OF PERFECTION CERTIFICATE. Borrower hereby ratifies, confirms and
reaffirms, all and singular, the terms and disclosures contained in a certain Perfection
Certificate dated as of November 2, 2009 between Borrower and Bank, and acknowledges, confirms and
agrees the disclosures and information Borrower provided to Bank in the Perfection Certificate have
not changed, as of the date hereof.
6. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever necessary
to reflect the changes described above.
7. RATIFICATION OF LOAN DOCUMENTS. Borrower hereby ratifies, confirms, and reaffirms all
terms and conditions of all security or other collateral granted to the Bank, and confirms that the
indebtedness secured thereby includes, without limitation, the Obligations.
8. NO DEFENSES OF BORROWER. Borrower hereby acknowledges and agrees that Borrower has no
offsets, defenses, claims, or counterclaims against Bank with respect to the Obligations, or
otherwise, and that if Borrower now has, or ever did have, any offsets, defenses, claims, or
counterclaims against Bank, whether known or unknown, at law or in equity, all of them are hereby
expressly WAIVED and Borrower hereby RELEASES Bank from any liability thereunder.
9. CONTINUING VALIDITY. Borrower understands and agrees that in modifying the existing
Obligations, Bank is relying upon Borrower’s representations, warranties, and agreements, as set
forth in the Existing Loan Documents. Except as expressly modified pursuant to this Loan
Modification Agreement, the terms of the Existing Loan Documents remain unchanged and in full force
and effect. Bank’s agreement to modifications to the existing Obligations pursuant to this Loan
Modification Agreement in no way shall obligate Bank to make any future modifications to the
Obligations. Nothing in this Loan Modification Agreement shall constitute a satisfaction of the
Obligations. It is the intention of Bank and Borrower to retain as liable parties all makers of
Existing Loan Documents, unless the party is expressly released by Bank in writing. No maker will
be released by virtue of this Loan Modification Agreement.
10. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective only when it
shall have been executed by Borrower and Bank.
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This Loan Modification Agreement is executed as a sealed instrument under the laws of the
Commonwealth of Massachusetts as of the date first written above.
| BORROWER: | BANK: | |||||||
| SOUNDBITE COMMUNICATIONS, INC. | SILICON VALLEY BANK | |||||||
By:
|
/s/ Xxxxxx X. Xxxxx
|
By: | /s/ Xxxxxx Xxxxx
|
|||||
| Name: Xxxxxx X. Xxxxx | Name: Xxxxxx Xxxxx | |||||||
| Title: Chief Operating Officer and Chief Financial Officer | Title: Vice President | |||||||
The undersigned, SOUNDBITE COMMUNICATIONS SECURITIES CORPORATION, a Massachusetts corporation
(“Guarantor”) hereby: (a) ratifies, confirms and reaffirms, all and singular, the terms and
conditions of (i) a certain Unconditional Guaranty of the obligations of Borrower to Bank dated as
of November 2, 2009 (as amended, the “Guaranty”), and (ii) a certain Security Agreement by
Guarantor in favor of Bank dated as of November 2, 2009 (as amended, the “Security Agreement” );
(b) acknowledges, confirms and agrees that the Guaranty and Security Agreement shall remain in full
force and effect and shall in no way be limited by the execution of this Loan Modification
Agreement or any other documents, instruments and/or agreements executed and/or delivered in
connection herewith; and (c) acknowledges, confirms and agrees that the obligations of Borrower to
Bank under the Guaranty include, without limitation, all Obligations of Borrower to Bank under the
Loan Agreement, as amended by this Loan Modification Agreement.
| SOUNDBITE COMMUNICATIONS SECURITIES CORPORATION | ||||
| By: | /s/ Xxxxxx X. Xxxxx | |||
| Name: | Xxxxxx X. Xxxxx | |||
| Title: | Chief Operating Officer and Chief Financial Officer | |||
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SCHEDULE 1
EXHIBIT D
COMPLIANCE CERTIFICATE
TO: SILICON VALLEY BANK
|
Date: | |
FROM: SOUNDBITE COMMUNICATIONS, INC. |
The undersigned authorized officer of SoundBite Communications, Inc. (“Borrower”)
certifies in such capacity that under the terms and conditions of the Loan and Security Agreement
between Borrower and Bank (as amended, the “Agreement”), (1) Borrower is in complete compliance for
the period ending with all required covenants except as noted below, (2) there are
no Events of Default, (3) all representations and warranties in the Agreement are true and correct
in all material respects on this date except as noted below; provided, however, that such
materiality qualifier shall not be applicable to any representations and warranties that already
are qualified or modified by materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be true, accurate and
complete in all material respects as of such date, (4) Borrower, and each of its Subsidiaries, has
timely filed all required tax returns and reports, and Borrower has timely paid all foreign,
federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as
otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have
been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee
payroll or benefits of which Borrower has not previously provided written notification to Bank.
Attached are the required documents supporting the certification. The undersigned certifies that
these are prepared in accordance with GAAP consistently applied from one period to the next except
as explained in an accompanying letter or footnotes. The undersigned acknowledges that no
borrowings may be requested at any time or date of determination that Borrower is not in compliance
with any of the terms of the Agreement, and that compliance is determined not just at the date this
certificate is delivered. Capitalized terms used but not otherwise defined herein shall have the
meanings given them in the Agreement.
Please indicate compliance status by circling Yes/No under “Complies” column.
| Reporting Covenant | Required | Complies | ||
Compliance Certificate
|
Within five (5) days of filing 10-Q with SEC, but no later than 45 days after quarter end | Yes No | ||
Borrowing Base Certificate with A/R and A/P agings
|
Monthly within 30 days, when Advances are outstanding or have been requested under Section 2.1.1 | Yes No | ||
Board Projections
|
Annually and within 45 days of approval | Yes No | ||
10-Q
|
Within five (5) days of filing with SEC, but no later than 45 days after quarter end | Yes No | ||
8-K
|
Within five (5) days of filing with SEC | Yes No | ||
10-K, together with an unqualified opinion
|
Within five (5) days of filing with SEC, but no later than 90 days after year end | Yes No |
| Financial Covenant | Required | Actual | Complies | |||||||||
Maintain on a Quarterly Basis: |
||||||||||||
Adjusted Quick Ratio |
2.0:1.0 | ____:1.0 | Yes No | |||||||||
Minimum Quarterly Net Revenue |
$ | * | $ | Yes No | ||||||||
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| * | As set forth in Section 6.7(b) of the Agreement. |
The following financial covenant analyses and information set forth in Schedule 1 attached
hereto are true and accurate as of the date of this Certificate.
The following are the exceptions with respect to the certification above: (If no exceptions
exist, state “No exceptions to note.”)
| SoundBite Communications, Inc. | BANK USE ONLY | |||||||
| Received by: | ||||||||
By:
|
||||||||
Name: |
||||||||
| Date: | ||||||||
Title:
|
||||||||
| Verified: | ||||||||
| Date: | ||||||||
| Compliance Status: Yes No | ||||||||
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Schedule 1 to Compliance Certificate
Dated:
In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan
Agreement shall control.
| I. | Adjusted Quick Ratio (Section 6.7(a)) |
Required:
|
2.0:1.0 | |||||||
Actual:
|
:1.0 | |||||||
| No, not in compliance | Yes, in compliance | |||||||
| II. | Minimum Quarterly Net Revenue (Section 6.7(b)) |
Required:
|
Greater of $9,000,000.00, and 75% of Board-approved operating plan | |||||||
Actual:
|
$ | |||||||
| No, not in compliance | Yes, in compliance | |||||||
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