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EXHIBITS 10.12.3
SECOND AMENDMENT AND LIMITED WAIVER TO
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT AND LIMITED WAIVER TO LOAN AND SECURITY AGREEMENT
dated as of December 9, 1997 (the "Amendment"), is entered into by and among
3DFX INTERACTIVE, INC., a California corporation ("Borrower"), and SILICON
VALLEY BANK, ("Bank"). Capitalized terms used herein without definition shall
have the same meanings herein as given to them in the Loan Agreement (defined
below).
RECITALS
A. The Borrower and the Bank have entered into that certain Loan and
Security Agreement dated as of August 19, 1996 and amended by that certain Loan
Modification Agreement dated as of August 18, 1997 (as so amended, the "Loan
Agreement") pursuant to which the Bank has agreed to extend and make available
to the Borrower certain advances of money.
B. The Borrower desires that the Bank further amend and waive certain
terms under the Loan Agreement upon the terms and conditions more fully set
forth herein.
C. Subject to the representations and warranties of the Borrower herein
and upon the terms and conditions set forth in this Amendment, the Bank is
willing to so amend the Loan Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing Recitals and
intending to be legally bound, the parties hereto agree as follows:
SECTION 1. THE BORROWER'S REPRESENTATIONS AND WARRANTIES. Borrower
represents and warrants that, immediately before and immediately after giving
effect to this Amendment, no event shall have occurred and be continuing which
constitutes an Event of Default.
SECTION 2. AMENDMENTS TO THE LOAN AGREEMENT.
2.1 Section 1.1 of the Loan Agreement, "Definitions", is
hereby amended by replacing certain definitions and adding new definitions of
the following terms to read as follows:
"'ADVANCE' or 'ADVANCES' means an Advance under the Committed
Revolving Line, the Committed Equipment Line-A, or the
Committed Equipment Line-B."
"'COMMITTED EQUIPMENT LINE-B' means Three Million Dollars
($3,000,000)."
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"'COMMITTED REVOLVING LINE' means Seven Million Dollars
($7,000,000)."
Subparagraph (i) of "ELIGIBLE ACCOUNTS" is hereby
deleted and replaced in its entirety as follows: "(I) Accounts
with respect to an account debtor, including Subsidiaries and
Affiliates, whose total obligations to Borrower exceed
twenty-five percent (25%) of all Accounts, to the extent such
obligations exceed the aforementioned percentage, provided
however, (i) a thirty-five percent (35%) concentration limit
is allowed for Diamond Multimedia, (ii) a thirty-five percent
(35%) concentration limit is allowed for any single account
debtor during any one month, or (iii) as otherwise approved in
writing by Bank;"
"'EQUIPMENT LINE-B MATURITY DATE' means December 9, 2001."
"'EXCHANGE CONTRACT' has the meaning set forth in SECTION
2.1.3."
"'OUTSTANDING BALANCE' means any outstandings, including
Letters of Credit and Exchange Contracts, under the Committed
Equipment Line-A, the Committed Equipment Line-B, or the
Committed Revolving Line."
A new subparagraph (c) is hereby added to the
definition of Permitted Investments" as follows: "(C) Other
investments for the acquisition of assets, intellectual
property, or other products complementary to Borrower's
business in an aggregate amount not to exceed Five Million
Dollars ($5,000,000) during the term of this Agreement."
"'REVOLVING MATURITY DATE' means December 8, 1998."
2.2 The definitions of "COMMITTED EQUIPMENT LINE" and
"EQUIPMENT MATURITY DATE" under Section 1.1 of the Loan Agreement,
"Definitions", are hereby deleted and replaced in their entirety to read as
follows:
"'COMMITTED EQUIPMENT LINE-A' means Two Million Dollars
($2,000,000)."
"'EQUIPMENT LINE-A MATURITY DATE' means August 18, 1998."
All references in the Loan Agreement to "Committed Equipment Line" and the
"Equipment Maturity Date" shall be replaced with "Committed Equipment Line-A"
and "Equipment Line-A Maturity Date", respectively.
2.3 Section 2.1, "Advances", is hereby deleted and replaced in
its entirety as follows:
"2.1 ADVANCES. Subject to and upon the terms and
conditions of this Agreement, Bank agrees to make Advances to
Borrower in an aggregate amount not to exceed (i) the
Committed Revolving Line or the Borrowing Base, whichever
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is less, minus (ii) the face amount of all outstanding Letters
of Credit (including drawn but unreimbursed Letters of Credit)
and minus (iii) the Foreign Exchange Reserve. For purposes of
this Agreement, "BORROWING BASE" shall mean an amount equal to
(i) eighty percent (80%) of Eligible Accounts, provided,
however, that such Borrowing Base shall only apply when
Outstanding Balances under the Committed Revolving Line exceed
Two Million Five Hundred Thousand Dollars ($2,500,000).
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."
2.4 Section 2.1.1(a), "Letters of Credit", is hereby deleted
and replaced in its entirety as follows:
"(a) Subject to the terms and conditions of this
Agreement, Bank agrees to issue or cause to be issued letters
of credit for the account of Borrower in an aggregate face
amount not to exceed (i) the lesser of the Committed Revolving
Line or the Borrowing Base minus (ii) the then outstanding
principal balance of the Advances minus (iii) the Foreign
Exchange Reserve, provided that the face amount of outstanding
Letters of Credit (including drawn but unreimbursed Letters of
Credit) shall not in any case exceed Seven Million Dollars
($7,000,000). Each such letter of credit shall have an expiry
date no later than ninety (90) days after the Revolving
Maturity Date provided that Borrower's letter of credit
reimbursement obligation shall be secured by cash on terms
acceptable to Bank at any time after the Revolving Maturity
Date if the term of this Agreement is not extended by Bank.
All such letters of credit shall be, in form and substance,
acceptable to Bank in its sole discretion and shall be subject
to the terms and conditions of Bank's form of application and
letter of credit agreement."
2.5 Section 2.1.2, "Equipment Advances" is hereby re-numbered
and renamed to Section 2.1.4, "Equipment Line-A Advances".
2.6 A new Section 2.1.3, "Foreign Exchange Contract; Foreign
Exchange Settlements", is hereby added in its entirety as follows:
"2.1.3 FOREIGN EXCHANGE CONTRACT; FOREIGN EXCHANGE
SETTLEMENTS.
(a) Subject to the terms of this Agreement, Borrower
may enter into foreign exchange contracts (the "Exchange
Contracts") not to exceed an aggregate amount of Seven Million
Dollars ($7,000,000) (the "Contract Limit"), pursuant to which
Bank shall sell to or purchase from Borrower foreign currency
on a spot or future basis. Borrower shall not request any
Exchange Contracts at any time it is out of compliance with
any of the provisions of this Agreement. All Exchange
Contracts must provide for delivery of settlement on or before
December 4, 1998. The amount available under the Committed
Revolving Line at any time shall be reduced by the following
amounts (the "Foreign Exchange Reserve") on any given
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day (the "Determination Date"): (i) on all outstanding
Exchange Contracts on which delivery is to be effected or
settlement allowed more than two business days after the
Determination Date, 10% of the gross amount of the Exchange
Contracts; plus (ii) on all outstanding Exchange Contracts on
which delivery is to be effected or settlement allowed within
two business days after the Determination Date, 100% of the
gross amount of the Exchange Contracts.
(b) Bank may, in its discretion, terminate the
Exchange Contracts at any time (i) that an Event of Default
occurs or (ii) that there is no sufficient availability under
the Committed Revolving Line and Borrower does not have
available funds in its bank account to satisfy the Foreign
Exchange Reserve. If Bank terminates the Exchange Contracts,
and without limitation of any applicable indemnities, Borrower
agrees to reimburse Bank for any and all fees, costs and
expenses relating thereto or arising in connection therewith.
(c) Borrower shall not permit the total gross amount
of all Exchange Contracts on which delivery is to be effected
and settlement allowed in any two business day period to be
more than Seven Hundred Thousand Dollars ($700,000) (the
"Settlement Limit") nor shall Borrower permit the total gross
amount of all Exchange Contracts to which Borrower is a party,
outstanding at any one time, to exceed the Contract Limit.
Notwithstanding the above, however, the amount which may be
settled in any two (2) business day period may be increased
above the Settlement Limit up to, but in no event to exceed,
the amount of the Contract Limit under either of the following
circumstances:
(i) if there is sufficient availability
under the Committed Revolving Line in the amount of
the Foreign Exchange Reserve as of each Determination
Date, provided that Bank in advance shall reserve the
full amount of the Foreign Exchange Reserve against
the Committed Revolving Line; or
(ii) if there is insufficient availability
under the Committed Revolving Line, as to settlements
within any two (2) business day period, provided that
Bank, in its sole discretion, may: (A) verify good
funds overseas prior to crediting Borrower's deposit
account with Bank (in the case of Borrower's sale of
foreign currency); or (B) debit Borrower's deposit
account with Bank prior to delivering foreign
currency overseas (in the case of Borrower's purchase
of foreign currency).
(d) In the case of Borrower's purchase of foreign
currency, Borrower in advance shall instruct Bank upon
settlement either to treat the settlement amount as an advance
under the Committed Revolving Line, or to debit Borrower's
account for the amount settled.
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(e) Borrower shall execute all standard from
applications and agreements of Bank in connection with the
Exchange Contracts and, without limiting any of the terms of
such applications and agreements, Borrower will pay all
standard fees and charges of Bank in connection with the
Exchange Contracts.
(f) Without limiting any of the other terms of this
Agreement or any such standard form applications and agreement
of Bank, Borrower agrees to indemnify Bank and hold it
harmless, from and against any and all claims, debts,
liabilities, demands, obligations, actions, costs and expenses
(including, without limitation, attorneys' fees of counsel of
Bank's choice), of every nature and description which it may
sustain or incur, based upon, arising out of, or in any way
relating to any of the Exchange Contracts or any transactions
relating thereto or contemplated thereby."
2.7 A new section 2.1.5, "Equipment Line-B Advances" is hereby
added in its entirety as follows:
"2.1.5 EQUIPMENT LINE-B ADVANCES.
(a) Subject to and upon the terms and conditions of
this Agreement, at any time from the date hereof through
December 9, 1998 (the "Equipment-B Availability End Date"),
Bank agrees to make advances (each an "Equipment-B Advance"
and collectively, the "Equipment-B Advances") to Borrower in
an aggregate outstanding amount not to exceed the Committed
Equipment Line-B. To evidence the Equipment Advance or
Equipment Advances, Borrower shall deliver to Bank, at the
time of each Equipment Advance request, an invoice for the
equipment to be purchased. The Equipment Advances shall be
used only to purchase Equipment and shall not exceed One
Hundred Percent (100%) of the invoice amount of such equipment
approved from time to time by Bank, excluding taxes, shipping,
warranty charges, freight discounts and installation expense.
Software and leaseholds may, however, constitute up to Fifty
Percent (50%) of aggregate Equipment Line-B Advances.
(b) Interest shall accrue from the date of each
Equipment Advance at the rate specified in SECTION 2.3(A), and
shall be payable monthly for each month through the month in
which the Equipment Availability End Date falls. Any Equipment
Advances that are outstanding on the Equipment Availability
End Date will be payable in thirty-six (36) equal monthly
installments of principal, and all accrued interest, beginning
on the Payment Date of each month following the Equipment
Availability End Date and ending on the Equipment Line-B
Maturity Date. Equipment Advances, once repaid, my not be
reborrowed.
(c) When Borrower desires to obtain an Equipment
Advance, Borrower shall notify Bank (which notice shall be
irrevocable) by facsimile transmission to be received no later
than 3:00 p.m. Pacific time one (1) Business Day before the
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day on which the Equipment Advance is to be made. Such notice
shall be substantially in the form of Exhibit B. The notice
shall be signed by a Responsible Officer or its designee and
include a copy of the invoice for the Equipment to be
financed."
2.8 Section 2.3.1, "Interest Rate", is hereby deleted and
replaced in its entirety as follows:
"2.3.1 INTEREST RATE. The interest rate on all Advances shall
be applied as follows:
(a) Any Advances under the Committed Revolving Line
shall bear interest, on the average Daily Balance, at a rate
equal to one-quarter of one (0.25) percentage point above the
Prime Rate.
(b) Any Advances under the Committed Equipment Line-A
shall bear interest, on the average Daily Balance, at a rate
equal to one and one-half (1.50) percentage points above the
Prime Rate.
(c) Any Advances under the Committed Equipment Line-B
shall bear interest, on the average Daily Balance, at a rate
equal to three-quarters of one (0.75) percentage point above
the Prime Rate."
2.9 Section 2.5.1, "Facility Fee", is hereby deleted and
replaced in its entirety as follows:
"2.5.1 FACILITY FEE. A Facility Fee equal to Fourteen
Thousand Dollars ($14,000) for the Committed Revolving Line
and a Facility Fee equal to Six Thousand Dollars ($6,000) for
the Committed Equipment Line-B, for a total Facility Fee of
Twenty Thousand Dollars ($20,000) which fee shall be due upon
execution of this Amendment and shall be fully earned and
non-refundable;"
2.10 Section 2.7, "Term", is hereby deleted and replaced in
its entirety as follows:
"TERM. Except as otherwise set forth herein, this
Agreement shall become effective on the Closing Date and,
subject to SECTION 12.7, shall continue in full force and
effect for a term ending on the later of the Revolving
Maturity Date, the Equipment Line-A Maturity Date, or the
Equipment Line-B Maturity Date. Notwithstanding the foregoing,
Bank shall have the right to terminate its obligation to make
Advances under this Agreement immediately and without notice
upon the occurrence and during the continuance of an Event of
Default. Notwithstanding termination, Bank's Lien on the
Collateral shall remain in effect for so long as any
Obligations are outstanding."
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2.11 Section 6.3, "Financial Statements, Reports,
Certificates", is hereby deleted and replaced in its entirety as follows:
"6.3 FINANCIAL STATEMENTS, REPORTS, CERTIFICATES.
Borrower shall deliver to Bank: (a) within five (5) days of
filing, copies of all statements, reports and notices sent or
made available generally by Borrower to its security holders
or to any holders of Subordinated Debt and all reports on Form
10-K, 10-Q and 8-K filed with the Securities and Exchange
Commission; (b) promptly upon receipt of notice thereof, a
report of any legal actions pending or threatened against
Borrower or any Subsidiary that could result in damages or
costs to Borrower or any Subsidiary of One Hundred Thousand
Dollars ($100,000) or more; and (c) such budgets, sales
projections, operating plans or other financial information as
Bank may reasonably request from time to time.
Immediately prior to an Advance under the Committed
Revolving Line which would increase the Outstanding Balance in
excess of Two Million Five Hundred Thousand Dollars
($2,500,000) under the Committed Revolving Line, Borrower
shall deliver to Bank a Borrowing Base Certificate signed by a
Responsible Officer in substantially the form of EXHIBIT C
hereto, together with aged listings of accounts receivable and
accounts payable. When there is an Outstanding Balance in
excess of Two Million Five Hundred Thousand Dollars
($2,500,000) under the Committed Revolving Line, within twenty
(20) days after the last day of each month, Borrower shall
deliver to Bank a Borrowing Base Certificate signed by a
Responsible Officer in substantially the form of EXHIBIT C
hereto, together with aged listings of accounts receivable and
accounts payable.
When there is an Outstanding Balance, Borrower shall
deliver to Bank within twenty (20) days after the end of each
month a Compliance Certificate signed by a Responsible Officer
in substantially the form of EXHIBIT D hereto. When there is
not an Outstanding Balance, Borrower shall deliver to Bank
with the Form 10-Q a Compliance Certificate signed by a
Responsible Officer in substantially the form of EXHIBIT D
hereto.
Bank shall have a right from time to time hereafter
to audit Borrower's Accounts at Borrower's expense, provided
that such audits will be conducted no more often than every
twelve (12) months."
2.12 Section 6.8, "Quick Ratio", is hereby deleted and
replaced in its entirety as follows:
"6.8 QUICK RATIO. When there is an Outstanding
Balance, Borrower shall maintain, as of the last day of each
calendar month, a ratio of Quick Assets to Current Liabilities
of at least 2.0 to 1.0. When there is not an Outstanding
Balance, Borrower shall maintain, as of the last day of each
calendar quarter, a ratio of Quick Assets to Current
Liabilities of at least 2.0 to 1.0"
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2.13 Section 6.9, "Debt-Net Worth Ratio", is hereby deleted
and replaced in its entirety as follows:
"6.9 DEBT-NET WORTH RATIO. When there is an
Outstanding Balance, Borrower shall maintain, as of the last
day of each calendar month, a ratio of Total Liabilities to
Tangible Net Worth of not more than 1.0 to 1.0. When there is
not an Outstanding Balance, Borrower shall maintain, as of the
last day of each calendar quarter, a ratio of Total
Liabilities to Tangible Net Worth of not more than 1.0 to
1.0."
2.14 Section 6.10, "Tangible Net Worth" is hereby deleted and
replaced in its entirety as follows:
"6.10 MINIMUM DEBT SERVICE COVERAGE RATIO. Upon the
attainment of two consecutive quarters of Minimum Debt Service
Coverage of 1.75:1.00, maintenance of a minimum Debt Service
Coverage shall be required. Borrower shall maintain, as of the
last calendar day of each quarter, a Debt Service Coverage
ratio of at least 1.75 to 1.00. "DEBT SERVICE COVERAGE" is
defined as (A) (i) earnings after taxes plus (ii) total
interest expense plus (iii) non-cash items, divided by (B) (i)
total interest expense plus (ii) current maturities of long
term debt plus (iii) current maturities of capital leases."
2.15 Section 6.11, "Profitability", is hereby deleted and
replaced in its entirety as follows:
"6.11 PROFITABILITY. Borrower may suffer a loss not
to exceed (i) a loss of Two Million Dollars ($2,000,000) for
the third quarter of 1997, (ii) a loss of One Million Dollars
($1,000,000) for the xxxxxx xxxxxxx xx 0000, (xxx) a loss of
Five Hundred Thousand Dollars ($500,000) for the first quarter
of 1998. Borrower shall be profitable for each fiscal quarter
beginning the second quarter of 1998. Borrower shall be
profitable for each fiscal year beginning the fiscal year
1998."
2.16 Section 6.12, "Minimum Liquidity", is hereby deleted and
replaced in its entirety as follows:
"6.12 MINIMUM LIQUIDITY. When there is an Outstanding
Balance under the Committed Equipment Line-A or the Committed
Equipment Line-B, Borrower shall maintain, as of the last
calendar day of each month, a ratio of (i) Liquid Assets to
(ii) the Outstanding Balance under the Committed Equipment
Line-A and the Committed Equipment Line-B of not less than
1.75 to 1.00. Through the Equipment Availability End Date,
when there is not Outstanding Balance under the Committed
Equipment Line-A or the Committed Equipment Line-B, Borrower
shall maintain, as of the last calendar day of each quarter, a
ratio of (i) Liquid Assets to (ii) the Committed Equipment
Line-B of not less than 1.75 to 1.00. "LIQUID ASSETS" means
unrestricted Cash and Cash Equivalents plus net available
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under the Committed Revolving Line. Upon the attainment of two
consecutive quarters of Debt Service Coverage of at least 1.75
to 1.00, maintenance of a Minimum Liquidity Ratio shall no
longer be required."
2.16 The Borrower's address set forth in Section 10, "Notices"
is hereby deleted and replaced in its entirety as follows:
"3Dfx Interactive, Inc.
0000 Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx
Fax: 408/000-0000"
SECTION 3. LIMITED WAIVER. Bank hereby gives formal notice that
Borrower is in default under Section 7.2, "Change in Business", under the Loan
Agreement due to Borrower's relocation to 0000 Xxxxxxx Xxxxx, Xxx Xxxx, XX
00000.
Bank hereby waives Borrower's breach of Section 7.2 for the relocation
to 0000 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000, only. Any further breach of this
section or any other section is not waived.
SECTION 4. LIMITATION. The amendments and waivers set forth in this
Amendment shall be limited precisely as written and shall not be deemed (a) to
be a modification or waiver of any other term or condition of the Loan Agreement
or of any other instrument or agreement referred to therein or to prejudice any
right or remedy which the Bank may now have or may have in the future under or
in connection with the Loan Agreement or any instrument or agreement referred to
therein; or (b) to be a consent to any future amendment or modification to any
instrument or agreement the execution and delivery of which is consented to
hereby, or to any waiver of any of the provisions thereof. Except as expressly
amended hereby, the Loan Agreement shall continue in full force and effect.
SECTION 5. EFFECTIVENESS.
5.1 This Amendment shall become effective upon the last to
occur of:
(A) The execution and delivery of a copy hereof by
the Borrower to the Bank;
(B) The execution and delivery of a copy of the
Corporate Borrowing Resolution; and
(C) The payment of the Facility Fees due under
Section 2.5.1 of the Loan Agreement.
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SECTION 6. RELEASE AND WAIVER. BORROWER HEREBY REPRESENTS AND WARRANTS
TO THE BANK THAT IT HAS NO KNOWLEDGE OF ANY FACTS THAT WOULD SUPPORT A CLAIM,
COUNTERCLAIM, DEFENSE OR RIGHT OF SET-OFF, AND HEREBY RELEASES BANK FROM ALL
LIABILITY ARISING UNDER OR WITH RESPECT TO AND WAIVES ANY AND ALL CLAIMS,
COUNTERCLAIMS, DEFENSES AND RIGHTS OF SET-OFF, AT LAW OR IN EQUITY, THAT
BORROWER MAY HAVE AGAINST BANK EXISTING AS OF THE DATE OF THIS AMENDMENT ARISING
UNDER OR RELATED TO THIS AMENDMENT, THE LOAN AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO THE LOANS CONTEMPLATED HEREBY OR THEREBY OR TO ANY ACT OR
OMISSION TO ACT BY THE BANK WITH RESPECT HERETO OR THERETO.
SECTION 7. COUNTERPARTS. This Amendment may be signed in any number of
counterparts, and by different parties hereto in separate counterparts, with the
same effect as if the signatures to each such counterpart were upon a single
instrument. All counterparts shall be deemed an original of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date first written above.
BORROWER 3DFX INTERACTIVE, INC.
By: /s/ Xxxx Xxxxxx
---------------------------------
Printed Name: Xxxx Xxxxxx
-----------------------
Title: VP Finance
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BANK SILICON VALLEY BANK
By:
---------------------------------
Printed Name:
-----------------------
Title:
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EXHIBIT B
LOAN PAYMENT/ADVANCE TELEPHONE REQUEST FORM
DEADLINE FOR SAME DAY PROCESSING IS 3:00 P.M., P.S.T.
TO: CENTRAL CLIENT SERVICE DIVISION DATE:
FAX#: (000) 000-0000 TIME:
FROM:
CLIENT NAME (BORROWER)
REQUESTED BY:
AUTHORIZED SIGNER'S NAME
AUTHORIZED SIGNATURE:
PHONE NUMBER:
FROM ACCOUNT # ______________________ TO ACCOUNT #
REQUESTED TRANSACTION TYPE REQUEST DOLLAR AMOUNT
-------------------------- ---------------------
PRINCIPAL INCREASE (ADVANCE) $_______________
PRINCIPAL PAYMENT (ONLY) $_______________
INTEREST PAYMENT (ONLY) $_______________
PRINCIPAL AND INTEREST (PAYMENT) $_______________
OTHER INSTRUCTIONS:
All representations and warranties of Borrower stated in the Loan
Agreement are true, correct and complete in all material respects as of the date
of the telephone request for and Advance confirmed by this Borrowing
Certificate; provided, however, that those representations and warranties
expressly referring to another date shall be true, correct and complete in all
material respects as of such date.
BANK USE ONLY
TELEPHONE REQUEST:
The following person is authorized to request the loan payment transfer/loan
advance on the advance designated account and is known to me.
Phone #
----------------------------------------- -----------------
Authorized Requester
Phone #
----------------------------------------- -----------------
Received By (Bank)
---------------------------------------------
Authorized Signature (Bank)
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EXHIBIT C
BORROWING BASE CERTIFICATE*
Borrower: 3Dfx Interactive, Inc.
Bank: Silicon Valley Bank
Commitment Amount: $7,000,000
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*To be utilized when the Outstanding Balance under the Committed Revolving Line
exceeds $2,500,000.
ACCOUNTS RECEIVABLE
1. Accounts Receivable Book Value as of $
2. Additions (please explain on reverse) $
3. TOTAL ACCOUNTS RECEIVABLE $
ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)
4. Amounts over 90 days due $
5. Balance of 50% over 90 day accounts $
6. Concentration Limits $
7. Foreign Accounts $
8. Governmental Accounts $
9. Contra Accounts $
10. Promotion or Demo Accounts $
11. Intercompany/Employee Accounts $
12. Other (please explain on reverse) $
13. TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS $
14. Eligible Accounts (#3 minus #13) $
15. LOAN VALUE OF ACCOUNTS (80% of #14) $
BALANCES
16. Maximum Loan Amount $7,000,000
17. Total Funds Available Lesser of #16 or #15 $
18. Present balance owing on Line of Credit $
19. Outstanding under Sublimits ( ) $
20. RESERVE POSITION (#17 minus #18 and #19) $
The undersigned represents and warrants that the foregoing is true, complete and
correct, and that the information reflected in this Borrowing Base Certificate
complies with the representations and warranties set forth in the Loan and
Security Agreement between the undersigned and Silicon Valley Bank.
COMMENTS:
---------------------------------
By:
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Authorized Signer
BANK USE ONLY
Rec'd By:
-------------
Auth. Signer
Date:
-----------------
Verified:
-------------
Auth. Signer
Date:
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EXHIBIT D
COMPLIANCE CERTIFICATE
TO: SILICON VALLEY BANK
FROM: 3DFX INTERACTIVE, INC.
The undersigned authorized officer of 3Dfx Interactive, Inc. hereby
certifies that in accordance with the terms and conditions of the Loan and
Security Agreement between Borrower and Bank (the "Agreement"), (i) Borrower is
in complete compliance for the period ending ___________________________ with
all required covenants except as noted below and (ii) all representations and
warranties of Borrower stated in the Agreement are true and correct in all
material respects as of the date hereof. Attached herewith are the required
documents supporting the above certification. The Officer further certifies that
these are prepared in accordance with Generally Accepted Accounting Principles
(GAAP) and are consistently applied from one period to the next except as
explained in an accompanying letter or footnotes.
PLEASE INDICATE COMPLIANCE STATUS BY CIRCLING YES/NO UNDER "COMPLIES" COLUMN.
REPORTING COVENANT REQUIRED COMPLIES
------------------ -------- --------
10Q and 10K Within 5 days after filing with the SEC Yes No
A/R & A/P Agings Monthly within 20 days* Yes No
A/R Audit Initial and Annual Yes No
*Due prior to any Advances under the Committed Revolving Line of
$2,500,000 or greater. Due monthly when there is an Outstanding Balance
under the Committed Revolving Line in excess of $2,500,000.
FINANCIAL COVENANT REQUIRED ACTUAL COMPLIES
------------------ -------- ------ --------
Maintain on a Monthly Basis**:
Minimum Quick Ratio 2.0:1.0 ______:1.0 Yes No
Maximum Debt/Tangible Net Worth 1.0:1.0 ______:1.0 Yes No
Liquidity*** 1.75:1.00 ______:1.0 Yes No
Maintain on a Quarterly Basis
Debt Service Coverage**** 1.75:1.00 _____:1.0 Yes No
Profitability: Maximum Loss 3Q97 ($2,000,000) $______ Yes No
Maximum Loss 4Q97 ($1,000,000) $______ Yes No
Maximum Loss 1Q98 ($ 500,000) $______ Yes No
Quarterly, begin 2Q98 Profitable $______ Yes No
Annually, begin FY98 Profitable $______ Yes No
**Maintain on a monthly basis when there is an Outstanding Balance.
When there is not an Outstanding Balance, maintain on a quarterly
basis.
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***Upon the attainment of two consecutive quarters of Debt Service
Coverage of at least 1.75:1.00, Minimum Liquidity shall no longer be
measured. When there is an Outstanding Balance under the Committed
Equipment Line-A or the Committed Equipment Line-B, measurement of this
ratio shall be (i) Liquid Assets divided by (ii) the Outstanding
Balance under the Committed Equipment Line-A and the Committed
Equipment Line-B. through the Equipment Availability End Date, when
there is not an Outstanding Balance under the Committed Equipment
Line-A or the Committed Equipment Line-B, measurement of this ratio
shall be (i) Liquid Assets divided by (ii) the Committed Equipment
Line-B. "Liquid Assets" means unrestricted Cash and Cash Equivalents
plus net available under the Committed Revolving Line.
****Upon the attainment of two consecutive quarters of Debt Service
Coverage of at least 1.75:1.00, the Debt Service Coverage covenant
shall replace the Minimum Liquidity covenant. "DEBT SERVICE COVERAGE"
is defined as (A) (i) earnings after taxes plus (ii) total interest
expense plus (iii) non-cash items, divided by (B) (i) total interest
expense plus (ii) current maturities of long term debt plus (iii)
current maturities of capital leases.
Comments Regarding Exceptions: See Attached.
Sincerely,
--------------------------
SIGNATURE
TITLE
---------------------
DATE
----------------------
BANK USE ONLY
Received by:
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AUTHORIZED SIGNER
Date:
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Verified:
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AUTHORIZED SIGNER
Date:
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Compliance Status: Yes No
3.
16
CORPORATE BORROWING RESOLUTION
Borrower: 3Dfx Interactive, Inc. Bank: Silicon Valley Bank
0000 Xxxxxxx Xxxxx 0000 Xxxxxx Xxxxx
Xxx Xxxx, XX 00000 Xxxxx Xxxxx, XX 00000
I, the undersigned Secretary or Assistant Secretary of 3Dfx
Interactive, Inc. ("Borrower"), hereby certify that Borrower is a corporation
duly organized and existing under and by virtue of the laws of the State of
California.
I FURTHER CERTIFY that at a meeting of the Directors of Borrower (or by
other duly authorized corporate action in lieu of a meeting), duly called and
held, at which a quorum was present and voting, the following resolutions were
adopted.
BE IT RESOLVED, that ANY ONE (1) of the following named officers,
employees, or agents of Borrower, whose actual signatures are shown below:
NAMES POSITIONS ACTUAL SIGNATURES
----- --------- -----------------
L. Xxxxxxx Xxxxxxx Chief Executive Officer ________________________
Xxxx X. Xxxxxx VP Administration and ________________________
Chief Financial Officer
acting for and on behalf of Borrower and as its act and deed be, and they hereby
are, authorized and empowered:
BORROW MONEY. To borrow from time to time from Silicon Valley Bank
("Bank"), on such terms as may be agreed upon between the officers of Borrower
and Bank, such sum or sums of money as in their judgment should be borrowed.
EXECUTE LOAN DOCUMENTS. To execute and deliver to Bank the loan
documents of Borrower, on Bank's forms, at such rates of interest and on such
terms as may be agreed upon, evidencing the sums of money so borrowed or any
indebtedness of Borrower to Bank, and also to execute and deliver to Bank one or
more renewals, extensions, modifications, refinancings, consolidations, or
substitutions for one or more of the loan documents, or any portion of the loan
documents.
GRANT SECURITY. To grant a security interest to Bank in any of
Borrower's assets, which security interest shall secure all of Borrower's
obligations to Bank
NEGOTIATE ITEMS. To draw, endorse, and discount with Bank all drafts,
trade acceptances, promissory notes, or other evidences of indebtedness payable
to or belonging to Borrower or in
1.
17
which Borrower may have an interest, and either to receive cash for the same or
to cause such proceeds to be credited to the account of Borrower with Bank, or
to cause such other disposition of the proceeds derived therefrom as they may
deem advisable.
LETTERS OF CREDIT. To execute letter of credit applications and other
related documents pertaining to Bank's issuance of letters of credit.
FOREIGN EXCHANGE CONTRACTS. To execute and deliver foreign exchange
contracts, either spot or forward, from time to time, in such amount as, in the
judgment of the officer or officers herein authorized.
FURTHER ACTS. In the case of lines of credit, to designate additional
or alternate individuals as being authorized to request advances thereunder, and
in all cases, to do and perform such other acts and things, to pay any and all
fees and costs, and to execute and deliver such other documents and agreements,
including agreements waiving the right to a trial by jury, as they may in their
discretion deem reasonably necessary or proper in order to carry into effect the
provisions of these Resolutions.
BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to
these Resolutions and performed prior to the passage of these resolutions are
hereby ratified and approved, that these Resolutions shall remain in full force
and effect and Bank may rely on these Resolutions until written notice of their
revocation shall have been delivered to and received by Bank. Any such notice
shall not affect any of Borrower's agreements or commitments in effect at the
time notice is given.
I FURTHER CERTIFY that the persons named above are principal officers
of the Borrower and occupy the positions set opposite their respective names;
that the foregoing Resolutions now stand of record on the books of the Borrower;
and that they are in full force and effect and have not been modified or revoked
in any manner whatsoever.
IN WITNESS WHEREOF, I have hereunto set my hand on December 9, 1997 and
attest that the signatures set opposite the names listed above are their genuine
signatures.
CERTIFIED TO AND ATTESTED BY:
X /s/ Xxxx Xxxxxx
-------------------------------------------
*Secretary or Assistant Secretary
X
-------------------------------------------
*NOTE: In case the Secretary or other certifying officer is designated by the
foregoing resolutions as one of the signing officers, this resolution should
also be signed by a second Officer or Director of Borrower.
2.
18
This STATEMENT is presented for filing pursuant to the California Uniform Commercial Code
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FILE NO. OF ORIG. FINANCING STATEMENT 1A. DATE OF FILING OF ORIG. FINANCING STATEMENT 1B. DATE OF ORIG. FINANCING STATEMENT
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DEBTOR (LAST NAME FIRST)
3Dfx Interactive, Inc.
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XXXXXXX XXXXXXX 0X. XXXX, XXXXX
000 Xxxxx Xxxxxx, Xxxxx 000 Xxxxxxxx Xxxx, XX
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ADDITIONAL DEBTOR (IF ANY) (LAST NAME FIRST)
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XXXXXXX XXXXXXX 0X. XXXX, XXXXX
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SECURED PARTY
NAME SILICON VALLEY BANK
MAILING ADDRESS
0000 XXXXXX XXXXX
XXXX XXXXX XXXXX XXXXX XX ZIP CODE 95054
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ASSIGNEE OF SECURED PARTY (IF ANY)
NAME
MAILING ADDRESS
CITY STATE ZIP CODE
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---------------------------------------------
1C. PLACE OF FILING ORIG. FINANCING STATEMENT
Secretary of State
---------------------------------------------
2A. SOCIAL SECURITY NO./FEDERAL TAX NO.
---------------------------------------------
2D. ZIP CODE
94043
---------------------------------------------
3A SOCIAL SECURITY NO. FEDERAL TAX NO.
---------------------------------------------
3D. ZIP CODE
---------------------------------------------
4A. SOCIAL SECURITY NO., FEDERALL TAX NO. OR
BANK TRANSIT AND A.B.A. NO.
---------------------------------------------
5A. SOCIAL SECURITY NO., FEDERALL TAX NO. OR
BANK TRANSIT AND A.B.A. NO.
---------------------------------------------
A [ ] CONTINUATION - The original Financing Statement between the foregoing Debtor and Secured Party bearing the file
number and date shown above is continued. If collateral is crops or timber, check here [ ] and insert description
of real property on which growing or to be grown in item 7 below.
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B [ ] RELEASE - From the collateral described in the Financing Statement bearing the file number shown above, the Secured
Party releases the collateral decribed in item 7 below.
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C [ ] ASSISNGMENT - The Secured Party certifies that the Secured Party has assigned to the Assignee above named, all the
Secured Party's rights under the Financing Statement bearing the file number shown above in the collateral described
in Item 7 below.
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D [ ] TERMINATION - The Secured Party certifies that the Secured Party no longer claims a security interest under the
financing Statement bearing the file number shown above.
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E [X] AMENDMENT - The Financing Statement bearing the file number shown above is amended as set forth in Item 7 below.
(Signature of Debtor required on all amendments.)
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F [ ] OTHER
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This serves to amend the address of Debtor shown in line 2B. The new address is 0000 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000.
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(Date) 19 9. This Space for Use of Filing
3Dfx Interactive, Inc. Officer
By: /s/ Xxxx Xxxxxx VP Finance (Date, Time, Filing Office)
Silicon Valley Bank
By:
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SIGNATURE(S) OF SECURED PARTY(ES) (TITLE)
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Return Copy to
Siliconn Valley Bank
Attn: Loan Services
00000 Xxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
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