Exhibit 10.26
AMENDMENT TO LOAN DOCUMENTS
THIS AMENDMENT to Loan Documents (this "Amendment" or the "July 2006
Amendment") is entered into as of July 18, 2006 (the "July 2006 Amendment
Date"), by and between, on the one hand, SILICON VALLEY BANK, a California
corporation ("Bank" or "Silicon"), and, on the other hand, ISILON SYSTEMS, INC.,
a Delaware corporation ("Borrower"), whose chief executive office is located at
000 X. Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000.
RECITALS
X. Xxxxxxxx and Bank are parties to that certain Loan and Security
Agreement, dated June 24, 2004 (as amended, restated, supplemented or otherwise
modified from time to tune, the "Loan Agreement"), between them.
B. Bank has extended credit to Borrower for the purposes permitted in the
Loan Agreement.
X. Xxxxxxxx intends to issue and sell its Series E Preferred Stock to one
or more investors no later than July 31, 2006 and will receive not less than
$10,000,000 in gross cash proceeds of such issuance and sale (such sale, the
"Designated Equity Sale"). Concurrently with the consummation of the Designated
Equity Sale, Borrower, as required by Section 6.10 of the Horizon Sub Debt
Agreement, must pay in full in cash, from the proceeds of the Designated Equity
Sale, all Equipment Loans and all Obligations relating specifically to the
Equipment Loans (collectively, the "Equipment Loan Obligations").
X. Xxxxxxxx has requested, and Bank has agreed, that the following
modifications of the Loan Agreement will become effective, upon the consummation
of the Designated Equity Sale and the concurrent payment in full of the
Equipment Loan Obligations from the proceeds thereof (as required by the Horizon
Sub Debt Agreement): (i) modification of the Credit Limit to reflect the payoff
of the Equipment Loans, and conforming deletion of the SVB Equipment Term Loan
Principal Cap; (ii) increase of the Maximum Revolver Amount from $6,000,000 to
$11,000,000, and conforming modification of the SVB Revolver Principal Cap;
(iii) modification of the Borrowing Base with respect to Eligible Foreign
Accounts; (iv) modification of the concentration limit relative to Eligible
Accounts; (v) grant to Borrower of a "Renewal Option" to extend the Maturity
Date from January 17, 2007 to January 16, 2008; (vi) modification of the
interest rate; (vii) addition of a new Adjusted Quick Ratio financial covenant;
(viii) modification of the Zero Loan Balance Condition; and (ix) modification of
the Liquidity Condition; in each case, all as more fully set forth herein.
E. Bank has agreed to so amend certain provisions of the Loan Agreement,
and also to provide the limited consent and limited waiver set forth in Section
2 below, but only to the extent, in accordance with the terms, subject to the
conditions and in reliance upon the representations and warranties set forth
below.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and other good
and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:
1. DEFINITIONS. Capitalized terms used but not defined in this Amendment
shall have the meanings given to them in the Loan Agreement. The terms "July
2006 Amendment" and "July 2006 Amendment Date," in each case, as defined in the
preamble to this Amendment, hereby are incorporated into the Loan Agreement. The
term "Designated Equity Sale," as defined in Recital C above, hereby is
incorporated into the Loan Agreement. The term "Equipment Loan Payoff," as
defined in Section 3 below, hereby is incorporated into the Loan Agreement.
2. (a) LIMITED CONSENT TO DESIGNATED EQUITY SALE. Bank hereby consents to
solely the Designated Equity Sale, and Borrower and Bank hereby agree that
certain cash proceeds of the Designated Equity Sale shall be used by Borrower to
concurrently pay in full in cash all Equipment Loan Obligations (as required by
Section 6.10 of the Horizon Sub Debt Agreement). It is understood by Xxxxxxxx,
however, that such consent does not constitute a waiver of any term or provision
of the Loan Agreement, or any other Loan Document, in respect of any matter
other than solely the Designated Equity Sale, nor an agreement to waive, in the
future, any term or provision of the Loan Agreement or any other Loan Document
in respect of any matter other than solely the Designated Equity Sale.
(b) LIMITED WAIVER RELATIVE TO DOWNSTREAMING OF FUNDS TO
SUBSIDIARIES. Bank and Borrower hereby agree that, if and to the extent Borrower
transferred to any one or more of Borrower's subsidiaries more than $1,700,000
in the aggregate in the fiscal quarter ended December 31, 2005 in violation of
Section 8(8) of the Schedule to Loan Agreement, then such violation hereby is
waived. It is understood, however, that the foregoing waiver of such violation
does not constitute a waiver of the aforementioned covenant with respect to any
other date or time period, or of any other provision or term of the Loan
Agreement or any other Loan Document, nor an agreement to waive in the future
such covenant with respect to any other date or time period or any other
provision or term of the Loan Agreement or any other Loan Document.
3. ACKNOWLEDGMENT OF PRIOR PAYMENT IN FULL OF LINE A EQUIPMENT LOANS.
Borrower and Bank hereby acknowledge that the Line A Equipment Loans previously
have been paid in full in cash.
4. CONDITIONAL AMENDMENTS TO LOAN AGREEMENT. Solely if and when the
Designated Equity Sale is consummated (but in no event later than July 31, 2006)
and all Equipment Loan Obligations (except that Borrower's indemnification
obligations under Section 12.2 of the Line A Equipment Loan Agreement shall
survive termination of Line A Equipment Loan Agreement) are paid in full in cash
from certain net cash proceeds of the Designated Equipment Sale (no event later
than July 31, 2006), then concurrently therewith:
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4.1 MODIFICATION OF CREDIT LIMIT TO REFLECT PAYOFF OF LINE A
EQUIPMENT LOANS. Section 1(A) of the Schedule to Loan Agreement hereby is
amended and restated in its entirety to read as follows:
(A) Line A Equipment Loans. [Previously repaid in full.]
4.2 MODIFICATION OF CREDIT LIMIT TO REFLECT PAYOFF OF LINE B
EQUIPMENT LOANS. Section 1(B) of the Schedule to Loan Agreement hereby is
amended and restated in its entirety to read as follows:
(B) Line B Equipment Loans. [Repaid concurrently with the
consummation of the Designated Equity Sale and as part
of the Equipment Loan Payoff.]
4.3 INCREASE OF MAXIMUM REVOLVER AMOUNT. The portion of Section 1(C)
of the Schedule to Loan Agreement that currently reads:
As used herein, the term "Maximum Revolver Amount" means
$6,000,000.
hereby is amended and restated in its entirety to read as follows:
As used herein, the term "Maximum Revolver Amount" means
$11,000,000.
4.4 CORRESPONDING MODIFICATION REGARDING PERMITTED CONTRACTUAL
LIMITATIONS ON SVB DEBT. In order to reflect the modifications set forth in
Sections 4.1 through 4.3 above, Section 8(11) of the Schedule to Loan Agreement,
which currently reads as follows:
(11) PERMITTED CONTRACTUAL LIMITATIONS ON SVB DEBT. Borrower
shall not agree with Horizon or any other Person,
whether pursuant to the Horizon Sub Debt Documents or
otherwise, to restrict in any manner the amount of
indebtedness that now or hereafter may be owing by
Borrower to Silicon, except solely that the Horizon Sub
Debt Agreement may require that: (a) no Revolving Loans
may be affirmatively made by Silicon to Borrower at
Borrower's express request therefor, if and to the
extent such requested Revolving Loan, if made, would
cause the portion of all outstanding Revolving Loans
made by Silicon to Borrower that consists solely of
principal to exceed the SVB Revolver Principal Cap (as
defined below); and (b) the portion of all outstanding
Equipment Loans made by Silicon to Borrower that
consists solely of principal shall not exceed Two
Million Three Hundred Twenty Thousand Dollars
($2,320,000) in the aggregate at any one time
outstanding (the "SVB Equipment Term Loan Principal
Cap").
As used herein, the term "SVB Revolver Principal Cap"
means, as of any date of determination, the lesser of
(I) Six Million
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Dollars ($6,000,000), and (II) the sum of the then
aggregate amount of all Accounts of Borrower, plus the
then aggregate value of all Inventory of Borrower, plus
the then aggregate amount of Borrower's unrestricted
cash that is on deposit with Silicon, is subject to
Silicon's continuing first-priority perfected security
interests therein (and no other creditor's security
interests therein, unless the same is subordinated in
favor of Silicon on terms and conditions satisfactory to
Silicon in its good faith business judgment), and is
subject to Silicon's control thereof (and no other
creditor's control thereof). For the avoidance of doubt,
the SVB Revolver Principal Cap shall not limit, and is
not intended to limit, any interest, fees, expenses,
charges, costs, or any other Obligations (except the
principal portion of outstanding Revolving Loans).
hereby is amended and restated in its entirety to read as follows:
(11) PERMITTED CONTRACTUAL LIMITATIONS ON SVB DEBT. Borrower
shall not agree with Horizon or any other Person,
whether pursuant to the Horizon Sub Debt Documents or
otherwise, to restrict in any manner the amount of
indebtedness that now or hereafter may be owing by
Borrower to Silicon, except solely that the Horizon Sub
Debt Agreement may require that no Revolving Loans may
be affirmatively made by Silicon to Borrower at
Borrower's express request therefor, if and to the
extent such requested Revolving Loan, if made, would
cause the portion of all outstanding Revolving Loans
made by Silicon to Borrower that consists solely of
principal to exceed the SVB Revolver Principal Cap (as
defined below).
As used herein, the term "SVB Revolver Principal Cap"
means, as of any date of determination, the lesser of
(I) Eleven Million Dollars ($11,000,000), and (II) the
sum of the then aggregate amount of all Accounts of
Borrower, plus the then aggregate value of all Inventory
of Borrower, plus the then aggregate amount of
Borrower's unrestricted cash that is on deposit with
Silicon, is subject to Silicon's continuing
first-priority perfected security interests therein (and
no other creditor's security interests therein, unless
the same is subordinated in favor of Silicon on terms
and conditions satisfactory to Silicon in its good faith
business judgment), and is subject to Silicon's control
thereof (and no other creditor's control thereof). For
the avoidance of doubt, the SVB Revolver Principal Cap
shall not limit, and is not intended to limit, any
interest, fees, expenses,
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charges, costs, or any other Obligations (except the
principal portion of outstanding Revolving Loans).
4.5 MODIFICATIONS OF BORROWING BASE.
(a) The portion of Section 1(C) of the Schedule to Loan
Agreement that currently reads:
(a) 85% (the "Eligible Accounts Advance Rate" and also
an "Advance Rate") of: (1) the net amount of Borrower's
Eligible Accounts (as defined in Section 8 above); plus
(2) without duplication of any amounts in (1), the net
amount of Borrower's Eligible Foreign Accounts (as
defined in Section 8 above); provided that Revolving
Loans based on Eligible Foreign Accounts shall under no
circumstances exceed the lesser of $1,200,000 or the
amount that would violate the Foreign Accounts/Total
Accounts Condition (as defined below);
hereby is amended and restated in its entirety to read as follows:
(a) 85% (the "Eligible Accounts Advance Rate" and also
an "Advance Rate") of: (1) the net amount of Borrower's
Eligible Accounts (as defined in Section 8 above); plus
(2) without duplication of any amounts in (1), the net
amount of Borrower's Eligible Foreign Accounts (as
defined in Section 8 above); provided that Revolving
Loans based on Eligible Foreign Accounts shall under no
circumstances exceed the lesser of $2,000,000 or the
amount that would violate the Foreign Accounts/Total
Accounts Condition (as defined below);
(b) The portion of Section 1(C) of the Schedule to Loan
Agreement that currently reads:
As used herein, the term "Foreign Accounts/Total
Accounts Condition" means that, as of any date of
determination, the aggregate amount of Revolving Loans
based on Eligible Foreign Accounts shall not exceed an
amount equal to 33% of the Borrower's Accounts.
hereby is amended and restated in its entirety to read as follows:
As used herein, the term "Foreign Accounts/Total
Accounts Condition" means that, as of any date of
determination, the aggregate amount of Revolving Loans
based on Eligible Foreign Accounts shall not exceed an
amount equal to 25% of the Borrower's Accounts.
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4.6 MODIFICATION OF CONCENTRATION LIMIT. The portion of the
definition of "Eligible Accounts" (set forth in Section 8 of the Loan Agreement)
that currently reads as follows:
** (OR, IN THE CASE OF THE ACCOUNT DEBTOR KNOWN AS OFOTO, 50%)
hereby are amended and restated in their entirety to read as
follows:
** (OR, IN THE CASE OF SOLELY ANY ONE (1) ACCOUNT DEBTOR AS OF
ANY DATE OF DETERMINATION, 35%)
4.7 MODIFICATION OF REVOLVER MATURITY DATE. Section 4 of the
Schedule to Loan Agreement hereby is amended and restated in its entirety to
read as follows:
4. MATURITY DATE
(Section 6.1):
All Obligations shall be due and payable in full on the
Maturity Date. As used herein, the term "Maturity Date"
means (a) JANUARY 17, 2007, or (b) solely if the Renewal
Option (as defined below) is timely exercised, JANUARY
16, 2008. References in this Agreement or any other Loan
Document to the "Revolving Maturity Date" or the
"Revolver Maturity Date" shall mean and refer to the
Maturity Date.
Borrower shall have the one-time option to extend the
Maturity Date solely from January 17, 2007 to January
16, 2008 upon the terms and conditions of this paragraph
(the "Renewal Option"). The Renewal Option will be
deemed exercised only if (i) Silicon receives from
Borrower, on or before December 31, 2006, Xxxxxxxx's
written notice to Silicon that Borrower thereby elects
to extend the Maturity Date from January 17, 2007 to
January 16, 2008 (and Borrower and Silicon hereby agree
that any such notice received by Silicon is
irrevocable), and (ii) Silicon receives a Maturity Date
extension fee of $41,250, which fee shall be due and
payable, fully-earned, and non-refundable, on January
17, 2007 (and Xxxxxxxx hereby irrevocably authorizes
Silicon to charge such fee to Xxxxxxxx's loan account on
January 17, 2007 if Silicon receives the notice as
required under clause (i) above).
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4.8 MODIFICATION OF INTEREST RATE. Section 2 of the Schedule to Loan
Agreement hereby is amended and restated in its entirety to read as follows:
2. INTEREST
Interest Rate (Section 1.2):
With respect to all Obligations, a per annum rate equal
to the sum of the "Prime Rate" in effect from time to
time, plus THE APPLICABLE MARGIN (as defined below),
provided that the minimum per annum rate applicable to
all Obligations shall at all times be considered to be
6.25%.
As used herein, the term "Applicable Margin" means, as
of any date of determination: (a) at all times that the
Streamline Provisions are not in effect, 1.00 percentage
point; and (b) at all times that the Streamline
Provisions are in effect, (i) 0.50 percentage points, if
and so long as Borrower's common stock is not publicly
traded on NYSE or NASDAQ, and (ii) 0.00 percentage
points, if and so long as Borrower's common stock is
publicly traded on NYSE or NASDAQ.
Interest shall be calculated on the basis of a 360-day
year for the actual number of days elapsed. As used in
this Agreement, "Prime Rate" means the interest rate
announced from time to time by Silicon as its "prime
rate" (which is a base rate upon which other rates
charged by Silicon are based, and it is not necessarily
the best rate available at Silicon).
The interest rate applicable to the Obligations shall
change on each date there is a change in the Prime Rate.
MINIMUM MONTHLY
INTEREST (Section 12): n/a per month.
4.9 MODIFICATION OF FINANCIAL COVENANT. Section 5 of the Schedule to
Loan Agreement hereby is amended and restated in its entirety to read as
follows:
5. FINANCIAL COVENANTS
(Section 5.1): Borrower shall comply with each of the following
covenants. Compliance shall be determined as of the
end of each month, except as otherwise specifically
provided below:
ADJUSTED
QUICK RATIO: Commencing for the month ending July 31, 2006 and
continuing for each month thereafter, Borrower shall
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maintain an Adjusted Quick Ratio of not less than:
(a) 1.00 : 1.00, with respect to each month ending
prior to January 2007; and (b) 1.25 : 1.00, with
respect to January 2007 and each month thereafter, if
the Renewal Option (as such term is defined in
Section 4 of the Schedule) is timely exercised.
DEFINITIONS: For purposes of the foregoing financial covenants,
the following term shall have the following meaning:
"Adjusted Quick Ratio" means, as of any date of
determination, the ratio of (a) the sum of (i) all
unrestricted cash and unrestricted cash equivalents
maintained on deposit at or invested at or through
Silicon (excluding, however, any "Designated Quarter-
End Advances" (as such term is defined in Section 9
of this Schedule)), plus (ii) the net amount of
Borrower's Accounts, to (b) the result of (i)
Borrower's current liabilities (as determined in
accordance with GAAP), less (ii) Borrower's deferred
revenues (as determined in accordance with GAAP).
4.10 MODIFICATION OF ZERO LOAN BALANCE CONDITION. The portion of
Section 9 of the Schedule to Loan Agreement that currently reads:
As used herein, the term "Zero Loan Balance Condition"
means, as of any date of determination, that no
Revolving Loans, Letters of Credit, FX Forward
Contracts, or Obligations relative to Cash Management
Services have been outstanding, and no requests for
Revolving Loans, Letters of Credit, FX Forward
Contracts, or Cash Management Services, have been made
by Borrower, during the consecutive 30-day period ending
on such date of determination; provided, however, that,
solely for purposes of this definition, Letters of
Credit, FX Forward Contracts, or Obligations relative to
Cash Management Services, in an aggregate amount not to
exceed 15% of the then extant Excess Availability, may
be outstanding or requested without causing the Zero
Loan Balance Condition to be not satisfied; provided,
further, that, solely for purposes of this definition,
Revolving Advances may be made and permitted to remain
outstanding, solely during the consecutive-15-day-period
comprising the last 14 days of any fiscal quarter and
the first day of the immediately following fiscal
quarter, without causing the Zero Loan Balance Condition
to be not satisfied, if and only if all amounts from the
funding of such Revolving Advances (i) remain on deposit
solely in Borrower's
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Deposit Accounts maintained at Bank while such Revolving
Advances remain outstanding, and (ii) are used solely to
repay such outstanding Revolving Advances at the end of
such 15-day period.
hereby is amended and restated in its entirety to read as follows:
As used herein, the term "Zero Loan Balance Condition"
means, as of any date of determination, that no
Revolving Loans, Letters of Credit, FX Forward
Contracts, or Obligations relative to Cash Management
Services have been outstanding, and no requests for
Revolving Loans, Letters of Credit, FX Forward
Contracts, or Cash Management Services, have been made
by Borrower, during the consecutive 30-day period ending
on such date of determination; provided, however, that,
solely for purposes of this definition, Letters of
Credit, FX Forward Contracts, or Obligations relative to
Cash Management Services, in an aggregate amount not to
exceed 15% of the then extant Excess Availability, may
be outstanding or requested without causing the Zero
Loan Balance Condition to be not satisfied; provided,
further, that, solely for purposes of this definition,
Revolving Advances may be made and permitted to remain
outstanding, solely during the
consecutive-5-Business-Day s-period comprising the last
4 Business Days of any fiscal quarter and the first
Business Day of the immediately following fiscal
quarter, without causing the Zero Loan Balance Condition
to be not satisfied, if and only if all amounts from the
funding of such Revolving Advances (i) remain on deposit
solely in Borrower's Deposit Accounts maintained at Bank
while such Revolving Advances remain outstanding, and
(ii) are used solely to repay such outstanding Revolving
Advances at the end of such
consecutive-5-Business-Days-period (such Revolving
Advances described in this proviso, the "Designated
Quarter-End Advances").
4.11 MODIFICATION OF LIQUIDITY CONDITION. The portion of Section 9
of the Schedule to Loan Agreement that currently reads:
As used herein, the term "Liquidity Condition" means, as
of any date of determination, that the sum of Borrower's
Excess Availability (as defined below) plus the
aggregate amount of unrestricted cash of Borrower in
Deposit Accounts maintained at Silicon shall exceed the
sum of $2,000,000 plus the aggregate outstanding amount
of the Obligations.
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hereby is amended and restated in its entirety to read as follows:
As used herein, the term "Liquidity Condition" means, as
of any date of determination, that the sum of Borrower's
Excess Availability (as defined below) plus the
aggregate amount of unrestricted cash of Borrower in
Deposit Accounts maintained at Silicon shall exceed the
sum of $1,000,000 plus the aggregate outstanding amount
of the Obligations.
5. LIMITATION OF AMENDMENTS.
5.1 The modifications set form in SECTION 2 and SECTION 3, above,
are effective for the purposes set forth herein and shall be limited precisely
as written and shall not be deemed to (a) be a consent to any amendment, waiver
or modification of any other term or condition of the Loan Agreement and any
other present or future agreement between Borrower or any guarantor of any of
the Obligations, on the one hand, and/or for the benefit of Bank, on the other
hand, in connection with the Loan Agreement (in each case, as amended, restated,
supplemented, or otherwise modified from time to time, collectively, the "Loan
Documents"), or (b) otherwise prejudice any right or remedy which Bank may now
have or may have in the future under or in connection with any Loan Document.
5.2 This Amendment shall be construed in connection with and as part
of the Loan Documents and all terms, conditions, representations, warranties,
covenants and agreements set forth in the Loan Documents, except as herein
amended, are hereby ratified and confirmed and shall remain in full force and
effect.
6. REPRESENTATIONS AND WARRANTIES. To induce Bank to enter into this
Amendment, Borrower hereby represents and warrants to Bank as follows:
6.1 Immediately after giving effect to this Amendment (a) the
representations and warranties contained in the Loan Documents are true,
accurate and complete in all material respects as of the date hereof (except to
the extent such representations and warranties relate to an earlier date, in
which case they are true and correct as of such date), and (b) no Event of
Default has occurred and is continuing;
6.2 Borrower has the power and authority to execute and deliver this
Amendment and to perform its obligations under the Loan Documents, as amended by
this Amendment;
6.3 The organizational documents of Borrower delivered to Bank on
the Effective Date remain true, accurate and complete and have not been amended,
supplemented or restated and are and continue to be in full force and effect,
except that Borrower's Certificate of Incorporation will be modified or
supplemented after the date hereof in connection with the Designated Equity
Sale, and Borrower hereby covenants and agrees to promptly deliver to Bank true,
correct, and complete copies of such modification/supplement to its Certificate
of Incorporation;
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6.4 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Documents, as amended
by this Amendment, have been duly authorized;
6.5 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Documents, as amended
by this Amendment, do not and will not contravene (a) any law or regulation
binding on or affecting Borrower, (b) any contractual restriction with a Person
binding on Borrower, (c) any order, judgment or decree of any court or other
governmental or public body or authority, or subdivision thereof, binding on
Borrower, or (d) the organizational documents of Xxxxxxxx;
6.6 The execution and delivery by Borrower of this Amendment and the
performance by Borrower of its obligations under the Loan Documents, as amended
by this Amendment, do not require any order, consent, approval, license,
authorization or validation of, or filing, recording or registration with, or
exemption by any governmental or public body or authority, or subdivision
thereof, binding on either Borrower, except as already has been obtained or
made; and
6.7 This Amendment has been duly executed and delivered by Xxxxxxxx
and is the binding obligation of Borrower, enforceable against Borrower in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar
laws of general application and equitable principles relating to or affecting
creditors' rights.
7. FEE. In consideration for Bank entering into this Amendment, Borrower
shall pay Bank a fee of $10,937.50, concurrently with execution and delivery of
this Amendment, which fee shall be non-refundable and in addition to all
interest and other fees payable to Bank under the Loan Documents. Bank is
authorized to charge said fee to Xxxxxxxx's loan account.
8. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
9. EFFECTIVENESS. This Amendment shall be deemed effective upon:
(a) the due execution and delivery to Bank of this Amendment by each
party hereto;
(b) the due execution and delivery to Bank of the amendment (in form
and substance satisfactory to Bank) of the Horizon Subordination Agreement by
each party thereto (a copy of which amendment shall be attached hereto as
Exhibit A); and
[Remainder of page intentionally left blank; signature page immediately
follows.]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered as of the date first written above.
ISILON SYSTEMS. INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Chief Financial Officer
SILICON VALLEY BANK
By: /s/ Xxxxxxx XxXxxxxx
--------------------------------
Name: Xxxxxxx XxXxxxxx
Title: Sr. Vice President
EXHIBIT A
[attach copy of amendment to Horizon Subordination Agreement]
