EXHIBIT 10.15
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of March 29, 1999, by
and between Analogy, Inc. and Silicon Valley Bank ("Silicon").
1. DESCRIPTION OF EXISTING INDEBTEDNESS: Among other indebtedness which may be
owing by Borrower to Silicon, Borrower is indebted to Silicon pursuant to, among
other documents, a Loan and Security Agreement, (together with all Schedules
attached thereto) dated March 10, 1997, as may be amended from time to time,
(the "Loan Agreement"). The Loan Agreement provided for, among other things, a
Secured Accounts Receivable Line of Credit in the original principal amount of
Three Million Dollars ($3,000,000). The Loan Agreement has been modified
pursuant to, among other documents, a Loan Modification Agreement and Amended
and Restated Schedule to Loan and Security Agreement dated March 5, 1998
pursuant to which, among other things, the principal amount of the Secured
Accounts Receivable Line of Credit was increased to Five Million Dollars
($5,000,000). Defined terms used but not otherwise defined herein shall have the
same meanings as in the Loan Agreement.
Hereinafter, all indebtedness owing by Borrower to Silicon shall be referred to
as the "Indebtedness."
2. DESCRIPTION OF COLLATERAL AND GUARANTIES. Repayment of the Indebtedness is
secured by the Collateral as described in the Loan Agreement.
Hereinafter, the above-described security documents and guaranties, together
with all other documents securing repayment of the Indebtedness shall be
referred to as the "Security Documents". Hereinafter, the Security Documents,
together with all other documents evidencing or securing the Indebtedness shall
be referred to as the "Existing Loan Documents".
3. DESCRIPTION OF CHANGE IN TERMS.
A. MODIFICATION(S) TO LOAN AGREEMENT (AND SCHEDULE)
1. The paragraph entitled "Maturity Date" is hereby amended to
read as follows:
April 4, 2000, at which time all unpaid principal and
accrued but unpaid interest shall be due and payable.
2. The paragraph entitled "Profitability" is hereby amended to
read as follows:
Borrower shall achieve, on a quarterly basis, at least $1.00
in profits, except that Borrower may suffer quarterly losses
provided such losses shall not exceed $500,000 and shall not
occur for two consecutive quarters.
3. The paragraph entitled "Quick Ratio" is hereby amended to
read as follows:
Borrower shall maintain monthly ratio of Quick Assets to
current Liabilities less deferred revenue of not less than
1.25 to 1.00, increasing at each quarter end to 1.75 to
1.00.
4. The section (d) of the paragraph entitled "Financial
Statements and reports" is hereby amended to read as
follows:
(d) at such times as there are outstanding balances under
the Credit Limit and prior to an advance when there are no
outstanding balances under the Credit Limit, within 20 days
after the last day of each month, a Borrowing Base
Certificate signed by a Responsible Officer, with aged
listings of accounts receivable.
5. The section (f) of the paragraph entitled "Financial
Statements and reports" is hereby deleted.
6. The section (g) of the paragraph entitled "Financial
Statements and reports" is hereby amended to read as
follows:
(g) as soon as available, but no later than 90 days after
the end of Borrower's fiscal year, audited, consolidated
financial statements prepared under GAAP, consistently
applied, together with an unqualified opinion on the
financial statements from an independent certified public
accounting firm acceptable to Bank.
B. WAIVER OF FINANCIAL COVENANT DEFAULT.
Silicon hereby waives Borrower's existing default under the
Loan Agreement by virtue of Borrower's failure to comply
with the Quick Ratio Covenant as of the month ended February
28, 1999. Silicon's waiver of Borrower's compliance of this
covenant shall apply only to the foregoing period.
Accordingly, for the month ending March 31, 1999, Borrower
shall be in compliance with this covenant.
Silicon's agreement to waive the above-described default (1)
in no way shall be deemed an agreement by the Silicon to
waive Borrower's compliance with the above-described
covenant as of all other dates and (2) shall not limit or
impair the Silicon's right to demand strict performance of
this covenant as of all other dates and (3) shall not limit
or impair the Silicon's right to demand strict performance
of all other covenants as of any date.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.
5. PAYMENT OF LOAN FEE. Borrower shall pay to Silicon a fee in the amount of
Twenty Two Thousand Nine Hundred Seventeen Dollars ($22,917) (the "Loan Fee")
plus all out-of-pocket expenses.
6. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor signing
below) agrees that, as of the date hereof, it has no defenses against the
obligations to pay any amounts under the Indebtedness.
7. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing below)
understands and agrees that in modifying the existing Indebtedness, Silicon 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. Silicon's agreement to
modifications to the existing Indebtedness pursuant to this Loan Modification
Agreement in no way shall obligate Silicon to make any future modifications to
the Indebtedness. Nothing in this Loan Modification Agreement shall constitute a
satisfaction of the Indebtedness. It is the intention of Silicon and Borrower to
retain as liable parties all makers and endorsers of Existing Loan Documents,
unless the party is expressly released by Silicon in writing. No maker,
endorser, or guarantor will be released by virtue of this Loan Modification
Agreement. The terms of this paragraph apply not only to this Loan Modification
Agreement, but also to all subsequent loan modification agreements.
8. CONDITIONS. The effectiveness of this Loan Modification Agreement is
conditioned upon Borrower's payment of the Loan Fee.
This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: SILICON:
ANALOGY, INC. SILICON VALLEY BANK
By: /s/ XXXXX X. XXXXXXXX By: /s/ XXXXX XXXXX
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Name: Xxxxx X. Xxxxxxxx Name: Xxxxx Xxxxx
Title: Corporate Controller Title: Assistant Vice President
