THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT
Exhibit
10.1
THIRD
AMENDMENT
TO
This
Third Amendment to Loan and Security Agreement (the “Amendment”) is entered into
as of January 10, 2007, by and between COMERICA BANK (“Bank”) and VITALSTREAM
HOLDINGS, INC., VITALSTREAM, INC. and VITALSTREAM BROADCASTING CORPORATION
(each
a “Borrower” and collectively, the “Borrowers”).
RECITALS
Borrowers
and Bank are parties to that certain Loan and Security Agreement dated as of
October 7, 2004 (as amended from time to time, including without limitation
by
that certain First Amendment to Loan and Security Agreement dated as of December
31, 2005, and that certain Second Amendment to Loan and Security Agreement
dated
as of July 17, 2006, together with any related agreements, the “Agreement”).
Hereinafter, all indebtedness owing by Borrowers to Bank shall be referred
to as
the “Indebtedness.” The parties desire to amend the Agreement in accordance with
the terms of this Amendment.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, the parties agree as follows:
AGREEMENT
| I. |
Incorporation
by Reference. The
Recitals and the documents referred to therein are incorporated herein
by
this reference. Except as otherwise noted, the terms not defined
herein
shall have the meaning set forth in the
Agreement.
|
| II. |
Amendment
to the Agreement. Subject
to the satisfaction of the conditions precedent as set forth in Article
IV
hereof, the Agreement is hereby amended as set forth
below.
|
|
A.
|
The
following defined term in Section 1.1 of the Agreement is hereby
amended
and restated in its entirety to read as
follows:
|
“Revolving
Maturity Date” means June 30, 2007.
| B. |
Bank’s
contact person set forth in Section 10 of the Agreement is hereby
changed
from “Xxxxx Xxxxxx” to “Xxxx
Xxxxxx”.
|
|
C.
|
Section
11 of the Agreement is hereby amended and restated in its entirety
to read
as follows: “
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| 11. |
CHOICE
OF LAW AND VENUE; JURY TRIAL
WAIVER.
|
This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of California, without regard to principles of conflicts
of
law. Jurisdiction shall lie in the State of California. THE UNDERSIGNED
ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT
IT
MAY BE WAIVED UNDER CERTAIN CIRCUMSTANCES. TO THE EXTENT PERMITTED BY LAW,
EACH
PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL
OF ITS, HIS OR HER CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THE MUTUAL BENEFIT
OF ALL PARTIES, WAIVES ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF LITIGATION
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY OTHER DOCUMENT, INSTRUMENT
OR
AGREEMENT BETWEEN THE UNDERSIGNED PARTIES.”
AMENDMENT
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| D. |
Section
12 of the Agreement is hereby amended and restated in its entirety
to read
as follows:
|
| “12. |
REFERENCE
PROVISION.
|
12.1
In
the
event the Jury Trial Waiver set forth above is not enforceable, the parties
elect to proceed under this Judicial Reference Provision.
12.2
With
the
exception of the items specified in Section 12.3, below, any controversy,
dispute or claim (each, a “Claim”) between the parties arising out of or
relating to this Agreement or any other document, instrument or agreement
between the undersigned parties (collectively in this Section, the “Loan
Documents”), will be resolved by a reference proceeding in California in
accordance with the provisions of Sections 638 et seq. of the California Code
of
Civil Procedure (“CCP”), or their successor sections, which shall constitute the
exclusive remedy for the resolution of any Claim, including whether the Claim
is
subject to the reference proceeding. Except as otherwise provided in the Loan
Documents, venue for the reference proceeding will be in the Superior Court
in
the County where the real property involved in the action, if any, is located
or
in a County where venue is otherwise appropriate under applicable law (the
“Court”).
12.3
The
matters that shall not be subject to a reference are the following: (i)
nonjudicial foreclosure of any security interests in real or personal property,
(ii) exercise of selfhelp remedies (including, without limitation, set-off),
(iii) appointment of a receiver and (iv) temporary, provisional or ancillary
remedies (including, without limitation, writs of attachment, writs of
possession, temporary restraining orders or preliminary injunctions). This
Agreement does not limit the right of any party to exercise or oppose any of
the
rights and remedies described in clauses (i) and (ii) or to seek or oppose
from
a court of competent jurisdiction any of the items described in clauses (iii)
and (iv). The exercise of, or opposition to, any of those items does not waive
the right of any party to a reference pursuant to this Agreement.
12.4
The
referee shall be a retired Judge or Justice selected by mutual written agreement
of the parties. If the parties do not agree within ten (10) days of a written
request to do so by any party, then, upon request of any party, the referee
shall be selected by the Presiding Judge of the Court (or his or her
representative). A request for appointment of a referee may be heard on an
ex
parte or expedited basis, and the parties agree that irreparable harm would
result if ex parte relief is not granted.
12.5
The
parties agree that time is of the essence in conducting the reference
proceedings. Accordingly, the referee shall be requested, subject to change
in
the time periods specified herein for good cause shown, to (i) set the matter
for a status and trial-setting conference within fifteen (15) days after the
date of selection of the referee, (ii) if practicable, try all issues of law
or
fact within one hundred twenty (120) days after the date of the conference
and
(iii) report a statement of decision within twenty (20) days after the matter
has been submitted for decision.
12.6
The
referee will have power to expand or limit the amount and duration of discovery.
The referee may set or extend discovery deadlines or cutoffs for good cause,
including a party’s failure to provide requested discovery for any reason
whatsoever. Unless otherwise ordered based upon good cause shown, no party
shall
be entitled to “priority” in conducting discovery, depositions may be taken by
either party upon seven (7) days written notice, and all other discovery shall
be responded to within fifteen (15) days after service. All disputes relating
to
discovery which cannot be resolved by the parties shall be submitted to the
referee whose decision shall be final and binding.
AMENDMENT
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12.7
Except
as
expressly set forth in this Agreement, the referee shall determine the manner
in
which the reference proceeding is conducted including the time and place of
hearings, the order of presentation of evidence, and all other questions that
arise with respect to the course of the reference proceeding. All proceedings
and hearings conducted before the referee, except for trial, shall be conducted
without a court reporter, except that when any party so requests, a court
reporter will be used at any hearing conducted before the referee, and the
referee will be provided a courtesy copy of the transcript. The party making
such a request shall have the obligation to arrange for and pay the court
reporter. Subject to the referee’s power to award costs to the prevailing party,
the parties will equally share the cost of the referee and the court reporter
at
trial.
12.8
The
referee shall be required to determine all issues in accordance with existing
case law and the statutory laws of the State of California. The rules of
evidence applicable to proceedings at law in the State of California will be
applicable to the reference proceeding. The referee shall be empowered to enter
equitable as well as legal relief, enter equitable orders that will be binding
on the parties and rule on any motion which would be authorized in a court
proceeding, including without limitation motions for summary judgment or summary
adjudication. The referee shall issue a decision at the close of the reference
proceeding which disposes of all claims of the parties that are the subject
of
the reference. Pursuant to CCP § 644, such decision shall be entered by the
Court as a judgment or an order in the same manner as if the action had been
tried by the Court and any such decision will be final, binding and conclusive.
The parties reserve the right to appeal from the final judgment or order or
from
any appealable decision or order entered by the referee. The parties reserve
the
right to findings of fact, conclusions of laws, a written statement of decision,
and the right to move for a new trial or a different judgment, which new trial,
if granted, is also to be a reference proceeding under this
provision.
12.9
If
the
enabling legislation which provides for appointment of a referee is repealed
(and no successor statute is enacted), any dispute between the parties that
would otherwise be determined by reference procedure will be resolved and
determined by arbitration. The arbitration will be conducted by a retired judge
or Justice, in accordance with the California Arbitration
Act §1280 through §1294.2 of the CCP as amended from time to time. The
limitations
with
respect to discovery set forth above shall apply to any such arbitration
proceeding.
12.10
THE
PARTIES RECOGNIZE AND AGREE THAT ALL CONTROVERSIES, DISPUTES AND CLAIMS RESOLVED
UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY.
AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF
ITS,
HIS OR HER OWN CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY, AND FOR THE MUTUAL
BENEFIT OF ALL PARTIES, AGREES THAT THIS REFERENCE PROVISION WILL APPLY TO
ANY
CONTROVERSY, DISPUTE OR CLAIM BETWEEN OR AMONG THEM ARISING OUT OF OR IN ANY
WAY
RELATED TO, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.”
| III. |
Legal
Effect.
|
| A. |
The
Agreement is hereby amended wherever necessary to reflect the changes
described above.
Each Borrower understands and agrees that in modifying the existing
Indebtedness, Bank is relying upon such Borrower’s representations,
warranties, and agreements, as set forth in the Agreement. Except
as
expressly modified pursuant to this Amendment, the terms of the Agreement
remain unchanged, and in full force and effect. Bank’s agreement to
modifications to the existing Indebtedness pursuant to this Amendment
in
no way shall obligate Bank to make any future modifications to the
Indebtedness. Nothing in this Amendment shall constitute a satisfaction
of
the Indebtedness. It is the intention of Bank and Borrowers to retain
as
liable parties, all makers and endorsers of Agreement, unless the
party is
expressly released by Bank in writing. No maker, endorser, or guarantor
will be released by virtue of this Amendment. The terms of this paragraph
apply not only to this Amendment, but also to all subsequent loan
modification requests.
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AMENDMENT
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| B. |
This
Amendment may be executed in two or more counterparts, each of which
shall
be deemed an
original, but all of which together shall constitute one instrument.
This
is an integrated Amendment and supersedes all prior negotiations
and
agreements regarding the subject matter hereof. All modifications
hereto
must be in writing and signed by the
parties.
|
| IV. |
Conditions
Precedent. Except
as specifically set forth in this Amendment, all of the terms and
conditions of the Agreement remain in full force and effect. The
effectiveness of this Agreement is conditioned upon receipt by Bank
of
this Amendment, and any other documents which Bank may require to
carry
out the terms hereof, including but not limited to the
following:
|
| A. |
This
Amendment, duly executed by
Borrowers;
|
| B. |
Corporation
Resolutions and Incumbency Certification, duly executed by
Borrowers;
|
| C. |
A
commitment fee from the Borrowers in the amount of
$5,000;
|
| D. |
A
legal fee from the Borrowers in the amount of $250;
and
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|
E.
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Such
other documents, and completion of such other matters, as Bank may
reasonably deem necessary or
appropriate.
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IN
WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.
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VITALSTREAM
HOLDINGS, INC.
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VITALSTREAM
BROADCASTING
CORPORATION
|
|
By:
Xxxxxx
X. Xxxxxx
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By:
Xxxxxx X. Xxxxxx
|
|
Title:
President and COO
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Title:
President and COO
|
|
VITALSTREAM,
INC.
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COMERICA
BANK
|
|
By:
Xxxxxx X. Xxxxxx
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By:
Xxxx
X. Xxxxxx
|
|
Title:
President and COO
|
Title:
Senior Vice President
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AMENDMENT
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