EXHIBIT 10.33
FIRST AMENDMENT TO SECOND RESTATED AND AMENDED LOAN AGREEMENT
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THIS FIRST AMENDMENT TO SECOND RESTATED AND AMENDED LOAN AGREEMENT
(hereinafter called this "Amendment") is entered into as of February 28, 1994,
among VISUAL NUMERICS, INC., a Texas corporation formerly known as IMSL, Inc.
(the "Company"), VISUAL NUMERICS, INC. OF COLORADO, a California corporation
formerly known as IMSL Acquisition Corp., Inc. ("VNIC"), VISUAL NUMERICS, INC.
(EUROPE), a Texas corporation ("VNIE"), and FIRST INTERSTATE BANK OF TEXAS,
N.A., (the "Bank"). Each of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "Guarantor") and ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ joins in the execution hereof for the purpose of acknowledging to the
amendments and other provisions hereof and agreeing to such amendments and other
provisions applicable to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
respectively.
W I T N E S S E T H:
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WHEREAS, the Company, VNIC and the Bank entered into a Second Restated and
Amended Loan Agreement dated as of December 16, 1992 (hereinafter called the
"Agreement"), whereby, upon the terms and conditions therein stated, the Bank
agreed to make available to the Company a credit facility upon the terms and
conditions set forth in the Agreement; and
WHEREAS, the Revolving Note has matured by its terms;
WHEREAS, the Company, the Corporate Guarantors and the Guarantor have
requested the Bank to amend certain covenants of the Company and the Corporate
Guarantors, and to renew and extend the maturity of the indebtedness evidenced
by the Revolving Note;
WHEREAS, subject to and upon the terms and conditions hereinafter stated,
the Bank is willing to do so;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements herein contained, the parties to this Amendment hereby agree as
follows:
SECTION 1. Terms Defined in Agreement. As used in this Amendment, except
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as may otherwise be provided herein, all capitalized terms which are defined in
the Agreement shall have the same meaning herein as therein, all of such terms
and their definitions being incorporated herein by reference.
SECTION 2. Amendments to Agreement. Subject to the conditions precedent
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set forth in Section 3 hereof, the Agreement is hereby amended as follows:
(a) The term "IAC" as used in the Agreement shall mean Visual
Numerics, Inc. of Colorado, a California corporation formerly known as IMSL
Acquisition Corp., Inc.
(b) The definition of "Eligible Accounts" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Eligible Accounts" is substituted in lieu thereof:
"Eligible Accounts means, at any time, the amount equal to
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the aggregate unpaid amount of a Person's accounts, chattel paper,
contract rights, instruments and retail installment contracts for
goods sold and actually delivered or for services rendered by such
Person for which invoices have been issued and payment for which is
due within 30 days, less any down payments; provided, however, there
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shall be excluded from Eligible Accounts (i) any amount billed and
remaining unpaid more than 90 days from the due date, (ii) any amount
due from suppliers of materials or inventory to a Person but only to
the extent that such Person is indebted to such suppliers with respect
to materials or supplies purchased by such Person from such suppliers,
(iii) any account, instrument, chattel paper, contract right, or
retail installment contract in which the Bank does not have a valid
and perfected first priority lien, mortgage or security interest, (iv)
any account arising from sales to or services rendered for any
Subsidiary or Affiliate of a Person, (v) any account arising from
sales to or services rendered for any Governmental Authority of the
United States of America, (vi) any account arising from sales on a
`sale or return', `sale on approval' (as such terms are defined in the
UCC), consignment, or guaranteed sale basis, (vii) any account
rejected by the Bank as unsuitable, (viii) any account which is or may
be subject to a right of setoff, claim or defense, (ix) Credit Card
Receivables, (x) Foreign Accounts Receivable, and (xi) any account
which, when aggregated with all other accounts of the same account
debtor, constitutes more than 10% of a Person's total Eligible
Accounts, to the extent of such excess. Except for retainages in the
ordinary course of business, no account owed by an account debtor to a
Person shall be included as an Eligible Account if more than twenty-
five percent (25%) of the balances then outstanding on accounts owed
by
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such account debtor and any Affiliate of the account debtor to such
Person have remained unpaid for more than ninety (90) days from the
dates of their original invoices. The amount of any Eligible Accounts
owed by an account debtor to a Person shall also be reduced by the
amount of all `contra accounts' and other obligations owed by such
Person to such account debtor."
(c) The definition of "Cash Flow" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Cash Flow" is substituted in lieu thereof:
"Cash Flow means, for any period, the sum of: (i) the Net
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Income from operations for such period, plus (ii) to the extent that
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any of the items referred to in any of clauses (A) and (B) below were
deducted in calculating such Net Income: (A) tax adjusted interest
expense of such Person and its Subsidiaries for such period and (B)
depreciation of such Person and its Subsidiaries for such period."
(d) The following definitions of "Credit Card Receivables," "Eligible
Governmental Receivables," "Foreign Accounts Receivable," "Government
Receivables", "Lockbox Agreement" and "VNIE" are hereby added to Section 1.2 of
the Agreement in the correct alphabetical order:
"Credit Card Receivables means amounts owing for goods sold or
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services rendered, payment for which is initiated or effected by
credit card, including without limitation MasterCard, Visa, American
Express, and Discover."
"Eligible Government Receivables means, at any time, Government
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Receivables so long as the following conditions have been met: (1) the
Bank has received the unaudited financial statements of the Company
and its Subsidiaries as at June 30, 1994 in accordance with Section
5.1(c) hereof, (2) no Default or Event of Default has occurred and is
continuing, (3) all such Government Receivables are invoiced
designating the Lockbox as the address for payment, and (4) the Bank
has received with respect to each such Governmental Receivable all
documents and instruments necessary to comply with the Assignment of
Claims Act, including, without limitation, the following in form and
substance acceptable to the Bank: (A) notice of assignment
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appropriately completed, (B) an instrument of assignment in
appropriate form duly executed and acknowledged by the Company or IAC,
as applicable, to be forwarded by the Bank to the appropriate
contracting officer and disbursing officer (if different from the
contracting officer), and (C) a true, correct and complete copy of the
related contract."
"Foreign Accounts Receivable means accounts, chattel paper,
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contract rights, instruments and retail installment contracts for
goods sold and actually delivered or for services rendered by the
Company or a Corporate Guarantor, as the case may be, (i) from
installations outside of the United States of America or (ii) to or
for a Person not a U.S. citizen or otherwise organized and existing
under the laws of the United States of America or any political
subdivision thereof."
"Government Receivables means any Eligible Account arising from
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sales to or services rendered for any Governmental Authority of the
United States of America."
"Lockbox Agreement means a collateral lockbox agreement, in the
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form attached hereto as Exhibit H, between the Company and the Bank,
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as the same may be amended, modified, supplemented, renewed, extended
or rearranged from time to time."
"VNIE means Visual Numerics Inc. (Europe), a Texas corporation.
----
(e) The definition of "Fixed Charges" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Fixed Charges" is substituted in lieu thereof:
"Fixed Charges means, for any period, the current maturities of
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long-term Indebtedness for such period, plus the current portion of
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Capitalized Leases for such period, plus all tax adjusted interest
expenses for such period."
(f) The definition of "Limited Guaranty" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Limited Guaranty" is substituted in lieu thereof:
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"Limited Guaranty shall mean the Amended and Restated Limited
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Guaranty Agreement, executed by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as the same may be
amended, modified, supplemented, renewed, extended or rearranged from
time to time."
(g) The definition of "Line of Credit Commitment" found in Section
1.2 of the Agreement is hereby deleted from the Agreement and the following
definition of "Line of Credit Commitment" is substituted in lieu thereof:
"Line of Credit Commitment means $1,900,000, which Line of Credit
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Commitment shall automatically reduce on each date set forth below
(each a "Line of Credit Commitment Reduction Date") to the maximum
amount set forth opposite such date:
Line of Credit Line of Credit
Commitment Reduction Date Commitment
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March 31, 1995 $1,500,000
June 30, 1995 $1,100,000
Termination Date -0-,
as such amounts may otherwise be reduced from time to time pursuant to
the terms of this Agreement."
(h) The definition of "Loan Formula" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Loan Formula" is substituted in lieu thereof:
"Loan Formula means at any time the amount equal to the then
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current sum of (i) 80% of the Eligible Accounts of the Company and IAC
directed to the Account, plus (ii) an amount equal to the lesser of
----
(a) 40% of the Eligible Government Receivables of the Company and IAC
directed to the Account, or (b) $200,000."
(i) The definition of "Loan Formula Certificate" found in Section 1.2
of the Agreement is hereby deleted from the Agreement and the following
definition of "Loan Formula Certificate" is substituted in lieu thereof:
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"Loan Formula Certificate means a loan formula certificate in
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substantially the form attached hereto as Exhibit A, setting forth the
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computation of Loan Formula as of the appropriate date."
(j) The definition of "Net Worth" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Net Worth" is substituted in lieu thereof:
"Net Worth of a Person means, at any time, the total assets of
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such Person less the total liabilities of such Person as set forth on
its balance sheet at such date, prepared in accordance with GAAP
consistently applied."
(k) The definition of "Revolving Note" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Revolving Note" is substituted in lieu thereof:
"Revolving Note means the promissory note issued by the Company
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pursuant to Section 3.3 hereof as the same may be renewed, rearranged,
modified, increased or extended at any time, from time to time, which
note was given in renewal, modification, rearrangement and extension
of, but not in novation or discharge of, that certain revolving note
dated December 16, 1992, executed by the Company and payable to the
order of the Bank in the original principal amount of $2,000,000."
(l) The definition of "Tangible Net Worth" found in Section 1.2 of
the Agreement is hereby deleted from the Agreement and the following definition
of "Tangible Net Worth" is substituted in lieu thereof:
"Tangible Net Worth of a Person means, at any time, the Net
------------------
Worth of such Person less: (i) goodwill, including any amounts
(however designated on such balance sheet) representing the cost of
acquisition of Subsidiaries in excess of underlying tangible assets,
(ii) any amounts by which investments in Persons appearing on the
asset side of such balance sheet exceed the proportionate share of
such Person and its Subsidiaries in the book value of the assets of
such Persons, (iii) patents, trademarks, copyrights, deferred charges
(including, but not limited to, unamortized discount and expenses, and
Capitalized Software
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Development Expenses, organizational expenses, experimental and
developmental expenses, but excluding prepaid expenses), intangibles
and other similar assets, and (iv) any treasury stock."
(m) The definition of "Termination Date" found in Section 1.2 of the
Agreement is hereby deleted from the Agreement and the following definition of
"Termination Date" is substituted in lieu thereof:
"Termination Date means December 31, 1995, or such earlier date
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as the commitment of the Bank shall have terminated in accordance with
Sections 7.2 or 7.3 hereof."
(n) The second paragraph of Section 3.3 of the Agreement relating to
when the principal of and interest to accrue on the Revolving Note shall be due
and payable is hereby deleted therefrom and the following paragraph is
substituted in lieu thereof:
"The principal of and interest to accrue on the Revolving Note
shall be due and payable as follows:
Interest to accrue on the Revolving Note shall be due and payable
monthly as it accrues, with the first installment to be due and
payable on February 28, 1994, and with a like installment of all
accrued but unpaid interest to be due and payable on or before the
last day of each succeeding calendar month thereafter until the
principal amount of the Revolving Note is paid in full; and the
principal amount of the Revolving Note shall be due and payable on
each Line of Credit Commitment Reduction Date in an amount necessary
to reduce the outstanding principal amount of the Revolving Note then
outstanding on such date to an amount which does not exceed the Line
of Credit Commitment on such date."
(o) The first sentence of Section 3.4 of the Agreement is hereby
deleted therefrom and the following sentences are substituted in lieu thereof:
"Prior to the Termination Date, the Company shall request
advances under the Line of Credit by giving the Bank notice thereof
prior to 11:00 a.m. Houston, Texas time on the intended borrowing date
in accordance with this Section. Such request must be in writing,
signed
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by an authorized officer of the Company, delivered by telecopy, U.S.
Mail or messenger and shall specify the date (which shall be a
Business Day) of the requested borrowing and the amount requested to
be funded by the Bank and shall be accompanied by a Loan Formula
Certificate. The amount requested by the Company, to the extent
available in accordance with the terms of this Agreement, shall be
made available to the Company by crediting the same, in immediately
available funds, to the account of the Company by the close of
business on said date."
(p) The last sentence of the second to the last paragraph of Section
3.10 of the Agreement is hereby deleted therefrom and the following sentence is
substituted in lieu thereof:
"Payment of $1,000,000 of the amount from time to time outstanding
under the Notes shall be guaranteed by the Guarantor, such guaranty to
be evidenced by a Limited Guaranty and such guaranty and the
Obligations to be secured by pledges of certificated stock acceptable
to the Bank of a market value at all times equal to at least
$1,000,000, including, without limitation, (A) 4,200 shares of stock
of International Business Machines Corporation and (B) 100,000 shares
of St. ▇▇▇▇ ▇▇▇▇ & Exploration Company."
(q) Section 5.1(g) of the Agreement is hereby deleted therefrom and
the following Sections 5.1(g) through 5.1(k) are substituted in lieu thereof and
Section 5.1(h) is hereby relettered Section 5.1(l):
"(g) On each Business Day, a Loan Formula Certificate, setting
forth the computation of the Loan Formula as of the date thereof, (A)
certified by a proper accounting officer of the Company and the
Corporate Guarantor, (B) containing a certificate of a proper
financial officer of the Company and the Corporate Guarantor stating
that a review of the activities of the Company and the Corporate
Guarantors during the period covered by such certificate has been made
under his supervision with a view to determining whether the Company
has kept, observed, performed and fulfilled all of its obligations
under this Agreement, the Notes, the Security Instruments and the
other Loan Documents, and that, to the best of his knowledge,
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during such period, it has kept, observed, performed and fulfilled
each and every covenant in this Agreement, the Notes, the Security
Instruments and the other Loan Documents, and is not at the time in
default under any of the same, or if it shall have been or shall be in
default, specifying the same;
(h) On or before each Tuesday during the term of this Agreement,
a summary agings of accounts receivable of the Company and the
Corporate Guarantors as of the last day of the previous calendar week
and a summary agings of accounts payable of the Company and the
Corporate Guarantors as of the last day of the previous week;
(i) Within 10 days after the end of each fiscal month during the
term hereof, listings (including complete names and mailing addresses)
and agings of accounts receivable of the Company and the Corporate
Guarantors as of the last day of such period and listings and agings
of the accounts payable of the Company and the Corporate Guarantors
(including a report detailing any current vendor that has canceled the
Company's trade credit rights with it) as of the last day of such
period;
(j) At the same time a financial statement is required to be
delivered pursuant to Section 5.1(c) hereof, a certificate of a proper
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financial officer of the Company and the Corporate Guarantors showing
calculations, as applicable, of the financial covenants, as at the
end of, or for, as applicable, the period then ended, set forth in
Sections 5.11 through 5.16 hereof, inclusive;
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(k) Within 30 days after the end of each fiscal month during the
term hereof, a certificate from each Corporate Guarantor (A) certified
by the proper officers of such Corporate Guarantor, (B) stating that a
review of the activities of such Corporate Guarantor during the period
covered by such certificate has been made under his supervision with a
view to determining whether such Corporate Guarantor has kept,
observed, performed and fulfilled all of their obligations under this
Agreement and the other Loan Documents, and that, to the best of his
knowledge, during such period, it has kept, observed, performed and
fulfilled each and every
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covenant in this Agreement and the other Loan Documents, and is not at
the time in default under any of the same, or if it shall have been or
shall be in default, specifying the same; and"
(r) Sections 5.10, 5.11, 5.12, 5.13, 5.14, 5.15, 5.16, and 5.17 of
the Agreement are hereby deleted therefrom and the following sections are
substituted in lieu thereof:
"Section 5.10 Mandatory Payment. At the same time a Loan Formula
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Certificate is required to be delivered pursuant to Subsection 5.1(f)
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hereof, the Company will pay the sum required as a Mandatory Payment,
if any. The Company agrees that, in addition to (and without
limitation of) any right of set-off, banker's lien or counterclaim the
Bank may otherwise have, the Bank shall be entitled, at its option,
and without prior notice to the Company, to offset balances held by it
for account of the Company at any of its offices, before or after
Default, in order to make Mandatory Payments to reduce the amount
outstanding under the Line of Credit to an amount permitted by the
Loan Formula during the applicable period."
"Section 5.11 Current Ratio. The Company and its Subsidiaries
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will maintain, on a consolidated basis, a ratio of (a) Current Assets
to (b) Current Liabilities less Unearned Revenues, at all times during
each period set forth below, of not less than the ratio set forth
below opposite such period:
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Period Ratio
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1/01/94 through 6/29/94 1.0 to 1.0
6/30/94 through 9/30/94 1.0 to 1.0
10/01/94 through 12/30/94 1.1 to 1.0
12/31/94 through 12/31/95 1.2 to 1.0"
"Section 5.12 Indebtedness to Net Worth Ratio. The Company and
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its Subsidiaries will maintain, on a consolidated basis, a ratio of
total Indebtedness to Net Worth, at all times during each period set
forth below, of not greater than the ratio set forth below opposite
such period:
Period Ratio
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1/01/94 through 6/29/94 4.0 to 1.0
6/30/94 through 9/30/94 3.8 to 1.0
10/01/94 through 12/30/94 3.3 to 1.0
12/31/94 through 12/31/95 2.8 to 1.0"
"Section 5.13 Net Worth. The Company and its Subsidiaries will
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maintain, on a consolidated basis, a positive Net Worth, at all times
during each period set forth below, of at least the amount set forth
below opposite such period:
Period Ratio
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1/01/94 through 6/29/94 $3,500,000
6/30/94 through 9/30/94 $3,600,000
10/01/94 through 12/30/94 $4,400,000
12/31/94 through 12/31/95 $5,400,000"
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"Section 5.14 Tangible Net Worth. The Company and its
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Subsidiaries will maintain, on a consolidated basis, a positive
Tangible Net Worth, at all times during each period set forth below,
of at least the amount set forth below opposite such period:
Period Ratio
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1/01/94 through 6/29/94 ($3,750,000)
6/30/94 through 9/30/94 ($3,650,000)
10/01/94 through 12/30/94 ($2,500,000)
12/31/94 through 12/31/95 ($1,600,000)"
"Section 5.15 Cash Flow (less Capitalized Software Development
------------------------------------------------
Expenses) to Fixed Charge Ratio. The Company and its Subsidiaries
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will maintain, on a consolidated basis, a ratio of Cash Flow (less
Capitalized Software Development Expenses) to Fixed Charges,
calculated for each period set forth below as of the last day of such
period, of not less than the ratio set forth opposite such period:
Period Ratio
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1/01/94 through 6/30/94 0.26 to 1.0
1/01/94 through 9/30/94 0.26 to 1.0
1/01/94 through 12/30/94 0.80 to 1.0
1/01/94 through 12/31/94 0.80 to 1.0
1/01/95 through 3/31/95 0.80 to 1.0
1/01/95 through 6/30/95 0.80 to 1.0
1/01/95 through 9/30/95 0.80 to 1.0
1/01/95 through 12/31/95 0.80 to 1.0"
"Section 5.16 Cash Flow to Fixed Charge Ratio. The Company and
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its Subsidiaries will maintain, on a consolidated basis, a ratio of
Cash Flow to Fixed Charges, calculated for each period set forth below
as of the last day of such period, of not less than the ratio set
forth opposite such period:
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Period Ratio
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1/01/94 through 6/29/94 0.56 to 1.0
1/01/94 through 9/30/94 0.56 to 1.0
1/01/94 through 12/30/94 1.14 to 1.0
1/01/94 through 12/31/94 1.20 to 1.0
1/01/95 through 3/31/95 1.20 to 1.0
1/01/95 through 6/30/95 1.20 to 1.0
1/01/95 through 9/30/95 1.20 to 1.0
1/01/95 through 12/31/95 1.20 to 1.0"
"Section 5.17 Recalculation of Financial Covenants. The Bank in
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its reasonable discretion may recalculate the financial covenants set
forth in Sections 5.11 through 5.16 hereof after the Bank's receipt of
the annual audited consolidated financial statements of the Company
and its Subsidiaries prepared as at December 31, 1993 and December 31,
1994."
(s) The Agreement hereby is amended further by adding the following
Sections 5.25, 5.26, and 5.27 thereto immediately after Section 5.24 of the
Agreement:
"Section 5.25 Cash Collateral Account. Notwithstanding any
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provision herein or in the other Loan Documents to the contrary, each
of the Company and the Corporate Guarantors agrees to direct all
customers and licensees to send all sales remittance checks and
license and royalty payments and proceeds to a post office box (the
"Lockbox") designated by the Bank for collection and deposit in, and
to deposit all cash generated by cash sales and cash prepayments at
time of purchase by the Company's and the Corporate Guarantors'
customers, and all proceeds (the "Proceeds") of accounts, accounts
receivable, license agreements, royalty agreements, and credit card
sales received by it into a cash collateral account (the "Account")
designated by the Bank and from which only officers of the Bank can
withdraw funds, all in accordance with the Lockbox Agreement. In
addition, each of the Company and the Corporate Guarantors shall
transfer to the Account,
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on a daily basis, by wire transfer of federal funds, all balances in
deposit accounts maintained at banks and other depositories (other
than the Bank) representing Proceeds of cash sales, and shall direct
all Proceeds of Credit Card Receivables directly to the Account. The
Proceeds shall be deposited promptly (i.e., on the date received if
received prior to 2:00 P.M.) and on the next Business Day if received
after 2:00 P.M. in the Account upon the receipt thereof by the Company
and the Corporate Guarantors in the form received (with any
endorsements necessary for collection). All collected balances in the
Account shall be applied by the Bank to reduce the outstanding
Obligations of the Company to the Bank. As used with respect to the
Account, the term "collected balances" shall mean the amounts in the
Account shown as of 8:00 a.m. on a Business Day as collected from
deposit systems from the previous Business Day plus the amounts in the
Account deemed to be collected as of 10:30 a.m. in the same Business
Day's deposits to the Account. The application of such collected
balances by the Bank shall be as follows: first, to the payment of any
and all fees, costs and expenses, including reasonable attorneys' fees
and professional fees and expenses incurred by the Bank, second to the
balance of interest and/or principal (as determined by the Bank in its
sole discretion) remaining unpaid on the Revolving Note, and then to
the balance of interest and/or principal of Term Note A and Term Note
B (as determined by the Bank in its sole discretion) remaining unpaid
on Term Note A and Term Note B (all applications with respect to the
principal of Term Note A and Term Note B shall be in the inverse order
of maturity)."
"Section 5.26 Blocked Accounts. The Bank may, at any time while
----------------
the Obligations are outstanding or any commitment to make advances
under the Line of Credit is in effect, restrict access by the Company
to any deposit account of the Company maintained at the Bank
(hereinafter referred to as a "Blocked Account"), including, without
limitation, taking any one or more of the following actions with
respect to such Blocked Account: (i) refusing to permit the Company to
make withdrawals of funds from a Blocked Account or transfers from a
Blocked Account to another deposit account of the Company, (ii)
dishonoring any check or draft presented on a Blocked Account (whether
or not said check or draft
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is otherwise properly payable), and (iii) failing to honor any
agreement (including that certain Cash Management Service Agreement--
Money Fund Sweep Service Terms) with the Company to credit the
Company's deposit account with the proceeds of the Company's
beneficial interest in any money market mutual fund account or similar
account (each a `Fund Account') created by the Bank as agent for the
Company as a vehicle for the short-term investment of the Company's
deposits (in which event the Company's beneficial interest in the Fund
Account shall be deemed to be the Blocked Account for purposes of this
Agreement). The Bank shall have no liability to the Company for any
damages, direct or indirect, incidental or consequential, proximately
caused by dishonor of any check or draft presented on a Blocked
Account after said deposit account becomes a Blocked Account (or for
any such damages which are proximately caused by any Fund Account
becoming a Blocked Account). The Bank may take any such action at its
sole discretion, before or after the occurrence of an Event of
Default, and without giving prior notice thereof to the Company or any
of the Guarantors, it being understood and agreed that the purpose
hereof is to permit the Bank to perfect and protect its contractual
security interests in, liens on and pledges of any and all deposit
accounts (including the Company's beneficial interest in any Fund
Account, to the extent such interest may be construed as an interest
in a `deposit account' under applicable law) now or hereafter
maintained by the Company at the Bank, which security interests are
hereby ratified and confirmed in all respects; provided, however, that
the Bank shall use reasonable efforts to give notice to the Company
within a reasonable time after taking any such action, but the Bank
shall have no liability to the Company or any other Person for failure
to do so. The Bank may hold any and all funds on deposit in any
Blocked Account (including the Company's beneficial interest in any
Fund Account which becomes a Blocked Account) as additional Collateral
for the Obligations, or apply all or a portion of said funds to
payment of the Obligations, in such order or manner as the Bank may
determine in its sole discretion. The Bank may at any time and from
time to time release funds from any Blocked Account to the Company in
such amounts, if any, as the Bank may determine in its sole
discretion, but any partial release of funds from a Blocked Account
shall not
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constitute a release of any remaining funds on deposit in the Blocked
Account or a termination of the status of the deposit account as a
Blocked Account. This Agreement shall be cumulative of any other
agreement, arrangement or understanding between the Company and the
Bank respecting the Company's deposit accounts (including, without
limitation, the Cash Management Services Terms and Conditions, and the
Exhibits and attachments thereto), and in the event of any conflict
between this Agreement and any such other agreement, arrangement or
understanding this Agreement shall control."
(t) Section 8.6 of the Agreement is hereby deleted therefrom and the
following Section 8.6 is substituted in lieu thereof:
"Section 8.6 Interest. It is the intention of the parties
--------
hereto to comply with applicable usury laws (now or hereafter
enacted); accordingly, notwithstanding any provisions to the contrary
in this Agreement, the Notes, the other Loan Documents or in any of
the documents securing payment thereof or otherwise relating thereto,
in no event shall this Agreement or such instruments or documents
require the payment or permit the payment, taking, reserving,
charging, or receipt of interest in excess of the maximum amount
permitted by such laws. If any such excess of interest is contracted
for, charged, taken, reserved or received under this Agreement, the
Notes, the other Loan Documents or under the terms of any of the
documents securing payment thereof or otherwise relating thereto or in
the event the maturity of the indebtedness evidenced by any of the
Notes is accelerated in whole or in part, or in the event that all or
part of the principal of or interest on any of the Notes shall be
prepaid, so that under any of such circumstances or any other
circumstance the amount of interest contracted for, charged, taken,
reserved or received under this Agreement, any of the Notes, the other
Loan Documents or under any of the documents securing payment thereof
or otherwise relating thereto, on the amount of principal actually
outstanding from time to time under the respective Note shall exceed
the maximum amount of interest permitted by applicable usury laws, now
or hereafter enacted, then in any such event (i) the provisions of
this Section shall govern and control, (ii) any such excess which may
have been
-16-
collected at final maturity of said indebtedness shall be applied as a
credit against the then unpaid principal amount on the respective Note
and the remainder, if any, shall be refunded to the Person paying the
same, (iii) with respect to subparagraph (ii), upon such final
maturity, the effective rate of interest shall be automatically
reduced to the maximum lawful rate allowed under applicable usury laws
as now or hereafter construed by the courts having jurisdiction
thereof, and (iv) any such excess which may have been charged but not
paid, taken, reserved or received shall be null and void and cancelled
ab initio to the extent of such excess. Without limiting the
foregoing, all calculations of the rate of interest contracted for,
charged, taken, reserved or received under this Agreement, the Notes,
the other Loan Documents or under such other documents or instruments
which are made for the purpose of determining whether such rate
exceeds the maximum lawful rate shall be made, to the extent permitted
by applicable laws, by amortizing, prorating, allocating and spreading
in equal parts during the period of the full stated term of the
indebtedness evidenced by the Notes, all interest at any time
contracted for, charged, taken, reserved or received from the Company
or otherwise by the holder or holders thereof in connection with the
Notes, the other Loan Documents or this Agreement."
(u) The address for notices, requests and demands with respect to the
Company and the Bank set forth in Section 8.8 of the Agreement is hereby amended
to read as follows:
"If to the Company, to Visual Numerics, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President and
Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇"
If to the Bank, to First Interstate Bank of
Texas, N.A.
▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
-17-
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇"
(v) Exhibits A, B and F to the Agreement are deleted therefrom and
Exhibits A, B and F attached hereto are substituted in lieu thereof.
(w) Exhibit H attached hereto is added to the Agreement.
SECTION 3. Conditions of Effectiveness. As a condition precedent to the
---------------------------
effectiveness of this Amendment and the Bank's agreements and obligations
hereunder, including, but not limited to, the Bank's renewal and extension of
the maturity date of the loan evidenced by the Revolving Note, the Company, the
Corporate Guarantor, the Guarantor and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as applicable, shall
have taken the following actions and delivered to the Bank the following
documents and instruments, in form and substance satisfactory to the Bank:
(a) The Company, the Corporate Guarantor, the Guarantor and ▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ shall have duly executed and delivered this Amendment, such
amendments to the original Security Instruments and the other Loan Documents,
such other Loan Documents, and such evidence of filings, acknowledgements or
acceptances of any such documents, as the Bank may reasonably request or
require, all duly executed and delivered by all parties thereto.
(b) The Company shall have delivered to the Bank certificates of the
Secretary or Assistant Secretary of each of the Company and the Corporate
Guarantors setting forth resolutions of its Board of Directors in form and
substance reasonably satisfactory to the Bank with respect to this Amendment.
(c) The Company shall have paid all accrued and unpaid legal fees and
expenses referred to in Section 8.7 of the Agreement and Section 7 hereof to the
extent invoices for such fees and expenses have been delivered to the Company.
(d) The Company shall have paid to the Bank in immediately available
funds (i) all accrued and unpaid interest on the Obligations and (ii) the amount
necessary to reduce the aggregate principal amount of indebtedness and
liabilities of the Company under the Revolving Note to an amount permitted by
the Loan Formula (as amended by the Amendment) and the Agreement.
-18-
(e) The Company shall have delivered copies of any and all documents
and instruments entered into with the former shareholders of Precision Visuals,
Inc. in form, scope and substance acceptable to the Bank.
(f) The Company shall have delivered evidence satisfactory to the
Bank that as of the Closing Date the Bank has a first priority perfected Lien on
the Collateral and that there exist no Liens (other than Permitted Liens) on any
property (real or personal) of the Company or the Corporate Guarantor.
(g) Such other evidence as the Bank may reasonably request to
establish the consummation of the transactions contemplated hereby, the taking
of all proceedings in connection herewith and compliance with the conditions set
forth in this Amendment.
SECTION 4. Representations and Warranties of the Company and the Corporate
---------------------------------------------------------------
Guarantor. Each of the Company and the Corporate Guarantor represents and
----------
warrants to the Bank, with full knowledge that the Bank is relying on the
following representations and warranties in executing this Amendment, as
follows:
(a) Each of the Company and the Corporate Guarantor has corporate
power and authority to execute, deliver and perform this Amendment, and all
corporate action on the part of the Company and the Corporate Guarantor
requisite for the due execution, delivery and performance of this Amendment has
been duly and effectively taken.
(b) The Agreement as amended by this Amendment and the Loan Documents
and each and every other document executed and delivered in connection with this
Amendment to which the Company, the Corporate Guarantor or any of their
respective Subsidiaries is a party constitute the legal, valid and binding
obligations of the Company the Corporate Guarantor and any of their respective
Subsidiaries to the extent it is a party thereto, enforceable against such
Person in accordance with their respective terms.
(c) This Amendment does not and will not violate any provisions of
the articles or certificate of incorporation or bylaws of the Company or the
Corporate Guarantor, or any contract, agreement, instrument or requirement of
any Governmental Authority to which the Company or the Corporate Guarantor is
subject. Neither the Company's nor the Corporate Guarantor's execution of this
Amendment will result in the creation or imposition of any
-19-
lien upon any properties of the Company or the Corporate Guarantor, other than
those permitted by the Agreement and this Amendment.
(d) Neither the Company's nor the Corporate Guarantor's execution,
delivery and performance of this Amendment requires the consent or approval of
any other Person, including, without limitation, any Governmental Authority.
(e) The quarterly unaudited consolidated balance sheet of the Company
and its Subsidiaries as of November 30, 1993, the related consolidated
statements of earnings, capital accounts, and cash flows of the Company for the
quarter then ended and the consolidated balance sheet and related consolidated
statements of earnings, capital accounts and cash flows for the period
commencing the first day of the fiscal year and ending on the last day of such
quarter which have been furnished to the Bank, fairly present the financial
condition of the Company and its Subsidiaries as at such date and the results of
the operations of the Company and its Subsidiaries for the periods ended on such
date, all in accordance with GAAP applied on a consistent basis, and since
November 30, 1993 there has been no material adverse change in such condition or
operations.
(f) Each of the Company and the Corporate Guarantor has performed and
complied with all agreements and conditions contained in the Agreement required
to be performed or complied with by the Company and the Corporate Guarantor
prior to or at the time of delivery of this Amendment.
(g) After giving effect to this Amendment, no Default or Event of
Default exists and all of the representations and warranties contained in the
Agreement and all instruments and documents executed pursuant thereto or
contemplated thereby are true and correct in all material respects on and as of
this date.
(h) Nothing in this Section 4 of this Amendment is intended to amend
any of the representations or warranties contained in the Agreement or of the
Loan Documents to which the Company, the Corporate Guarantor or any of their
respective Subsidiaries is a party. Each of the Company and the Corporate
Guarantor represents and warrants that all of the representations and warranties
contained in the Agreement and all instruments and documents executed pursuant
thereto or contemplated thereby are true and correct in all material respects on
and as of this date, except (i) such representations that relate solely to an
earlier date and that were true and correct on such earlier date, and (ii) the
breach or inaccuracy of representations and warranties about
-20-
which the Bank has been notified in writing prior to the date of this Amendment.
SECTION 5. Reference to and Effect on the Agreement.
----------------------------------------
(a) Upon the effectiveness of Sections 1 and 2 hereof, on and after
the date hereof, each reference in the Agreement to "this Agreement",
"hereunder", "hereof", "herein", or words of like import, shall mean and be a
reference to the Agreement as amended hereby.
(b) Except as specifically amended by this Amendment, the Agreement
shall remain in full force and effect and is hereby ratified and confirmed.
SECTION 6. Defaults and Events of Default. Subject to the satisfaction of
------------------------------
the conditions precedent set forth in Section 3 hereof, the Bank hereby waives
any and all defaults arising out of the failure to comply with the provisions of
Sections 5.11, 5.12, 5.13, 5.14, 5.15, 5.16 and 5.17 of the Agreement prior to
the effective date hereof. With the exception of said defaults, each of the
Company, the Corporate Guarantor, the Guarantor and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ agrees
that no Event of Default and no Default has been waived or remedied by the
execution of this Amendment by the Bank (including, without limitation, the
Event of Default which has occurred and is presently continuing as a result of
the Company's default in payment and performance of its obligations to former
shareholders of Precision Visuals, Inc.), and any such Default or Event or
Default heretofore arising and currently continuing shall continue after the
execution and delivery hereof, and the Bank expressly reserves the right to
exercise any and all remedies available to it under the Agreement or any of the
other Loan Documents (including, without limitation, termination of the Line of
Credit and acceleration of the Notes) with respect to any default under the
Agreement or any of the other Loan Documents previous to, simultaneous with, or
subsequent to the specific defaults waived hereby. Each of the Company, the
Corporate Guarantors, the Guarantor and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ agrees they shall
not alter, amend or waive their rights and obligations with respect to the
Company's agreement with the former shareholders of Precision Visuals, Inc.,
without the prior written sonsent of the Bank.
SECTION 7. Cost, Expenses and Taxes. The Company agrees to pay on demand
------------------------
all reasonable costs and expenses of the Bank in connection with the
preparation, reproduction, execution and delivery of this Amendment and the
other instruments and documents
-21-
to be delivered hereunder, including reasonable attorneys' fees and out-of-
pocket expenses of the Bank. In addition, the Company shall pay any and all
stamp and other taxes and fees payable or determined to be payable in connection
with the execution and delivery, filing or recording of this Amendment and the
other instruments and documents to be delivered hereunder, and agrees to save
the Bank harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes or fees.
SECTION 8. Extent of Amendments. Except as otherwise expressly provided
--------------------
herein, the Agreement and the other Loan Documents are not amended, modified or
affected by this Amendment. Each of the Company and the Corporate Guarantor
ratifies and confirms that (i) except as expressly amended hereby, all of the
terms, conditions, covenants, representations, warranties and all other
provisions of the Agreement remain in full force and effect, (ii) each of the
other Loan Documents are and remain in full force and effect in accordance with
their respective terms, and (iii) the Collateral is unimpaired by this
Amendment.
SECTION 9. Grant and Affirmation of Security Interest.
------------------------------------------
(a) Each of the Guarantor and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ hereby grants a
security interest in the Collateral to secure payment and performance of the
Guaranteed Obligations and all documents and instruments executed in connection
therewith and, each of the Guarantor and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ hereby confirms and
agrees that any and all liens, security interests and other security or
Collateral now or hereafter held by the Bank as security for payment and
performance of the Guaranteed Obligations hereby are renewed, extended and
carried forth to secure payment and performance of all of the Guaranteed
Obligations. The Security Instruments executed by the Guarantor and ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ are and remain legal, valid and binding obligations of the parties
thereto, enforceable in accordance with their respective terms.
(b) Each of the Company and the Corporate Guarantors hereby grants a
security interest in the Collateral to secure payment and performance of the
Notes, and the obligations described in the Agreement and all documents and
instruments executed in connection therewith and, each of the Company and the
Corporate Guarantors hereby confirms and agrees that any and all liens, security
interests and other security or Collateral now or hereafter held by the Bank as
security for payment and performance of the Obligations hereby are renewed,
extended and carried forth to secure payment and performance of all of the
Obligations. The
-22-
Security Instruments executed by the Company and the Corporate Guarantors are
and remain legal, valid and binding obligations of the parties thereto,
enforceable in accordance with their respective terms.
SECTION 10. Guaranties.
----------
(a) VNIC hereby consents to and accepts the terms and conditions of
this Amendment, agrees to be bound by the terms and conditions hereof and
ratifies and confirms that its Guaranty, executed and delivered to the Bank on
December 16, 1992, guaranteeing payment of the Obligations, is and remains in
full force and effect and secures payment of, among other things, the Notes.
(b) The Guarantor hereby consents to and accepts the terms and
conditions of this Amendment, agrees to be bound thereby, and agrees to execute
and deliver to the Bank his Restated and Amended Limited Guaranty Agreement.
The Restated and Amended Limited Guaranty Agreement executed in connection
herewith is given in part in renewal, increase and rearrangement of, and not in
novation or discharge of, the obligations of Guarantor evidenced by that certain
Limited Guaranty Agreement, dated December 16, 1992, in favor of the Bank, said
obligations henceforth to be evidenced thereby and governed by the terms and
provisions thereof.
SECTION 11. Execution and Counterparts. This Amendment may be executed in
--------------------------
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same instrument. Delivery of an executed counterpart of the signature page of
this Amendment by facsimile shall be equally as effective as delivery of a
manually executed counterpart of this Amendment.
SECTION 12. Severability. In the event any one or more provisions
------------
contained in the Agreement or this Amendment should be held to be invalid,
illegal or unenforceable in any respect, the validity, enforceability and
legality of the remaining provisions contained herein and therein shall not be
affected in any way or impaired thereby and shall be enforceable in accordance
with their respective terms.
SECTION 13. Governing Law. This Amendment shall be governed by and
-------------
construed in accordance with the laws of the State of Texas.
-23-
SECTION 14. Headings. Section headings in this Amendment are included
--------
herein for convenience and reference only and shall not constitute a part of
this Amendment for any other purpose.
SECTION 15. Arbitration Program. The parties agree to be bound by the
-------------------
terms and provisions of the current Arbitration Program of the Bank which is
incorporated by reference herein and is acknowledged as received by the parties
pursuant to which any and all disputes arising hereunder, under the Agreement,
under any of the other Loan Documents, or under any of the documents and
instruments contemplated thereby, or pertaining hereto or thereto, shall be
resolved by mandatory binding arbitration upon the request of any party.
SECTION 16. WAIVERS AND RELEASE OF CLAIMS. AS ADDITIONAL CONSIDERATION TO
-----------------------------
THE EXECUTION, DELIVERY, AND PERFORMANCE OF THIS AMENDMENT BY THE PARTIES HERETO
AND TO INDUCE THE BANK TO ENTER INTO THIS AMENDMENT, EACH OF THE COMPANY, THE
CORPORATE GUARANTORS, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, AND THE GUARANTOR REPRESENTS AND
WARRANTS THAT NONE OF THE COMPANY, THE CORPORATE GUARANTORS, ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, OR THE GUARANTOR KNOWS OF ANY FACTS, EVENTS, STATUSES OR CONDITIONS
WHICH, EITHER NOW OR WITH THE PASSAGE OF TIME OR THE GIVING OF NOTICE, OR BOTH,
CONSTITUTE OR WILL CONSTITUTE A BASIS FOR ANY CLAIM OR CAUSE OF ACTION AGAINST
THE BANK OR ANY DEFENSE, COUNTERCLAIM OR RIGHT OF SETOFF TO THE PAYMENT OR
PERFORMANCE OF ANY OBLIGATIONS OR INDEBTEDNESS OF THE COMPANY, THE CORPORATE
GUARANTORS, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, OR THE GUARANTOR TO THE BANK, AND IN THE EVENT
ANY SUCH FACTS, EVENTS, STATUSES OR CONDITIONS EXIST OR HAVE EXISTED, WHETHER
KNOWN OR UNKNOWN, EACH OF THE COMPANY AND THE CORPORATE GUARANTORS FOR ITSELF,
ITS SUBSIDIARIES, THEIR RESPECTIVE REPRESENTATIVES, AGENTS, OFFICERS, DIRECTORS,
EMPLOYEES, SHAREHOLDERS, AND SUCCESSORS AND ASSIGNS, AND THE GUARANTOR AND
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, FOR THEMSELVES AND THEIR HEIRS AND ASSIGNS, HEREBY FULLY,
FINALLY, COMPLETELY, GENERALLY AND FOREVER RELEASES, DISCHARGES, ACQUITS, AND
RELINQUISHES THE BANK AND ITS RESPECTIVE REPRESENTATIVES, AGENTS, OFFICERS,
DIRECTORS, EMPLOYEES, SHAREHOLDERS, AND SUCCESSORS AND ASSIGNS, FROM ANY AND ALL
CLAIMS, ACTIONS, DEMANDS, AND CAUSES OF ACTION OF WHATEVER KIND OR CHARACTER,
WHETHER JOINT OR SEVERAL, WHETHER KNOWN OR UNKNOWN, FOR ANY AND ALL INJURIES,
HARM, DAMAGES, PENALTIES, COSTS, LOSSES, EXPENSES, ATTORNEYS' FEES, AND/OR
LIABILITY WHATSOEVER AND WHENEVER INCURRED OR SUFFERED BY ANY OF THEM PRIOR TO
THE EXECUTION OF THIS AMENDMENT. NOTWITHSTANDING ANY PROVISION OF THIS
AMENDMENT, THE AGREEMENT OR ANY OTHER LOAN DOCUMENT, THIS SECTION 16 SHALL
REMAIN IN FULL FORCE AND EFFECT AND SHALL SURVIVE THE DELIVERY OF THE NOTES,
THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS AND THE MAKING,
-24-
EXTENSION, RENEWAL, MODIFICATION, AMENDMENT OR RESTATEMENT OF ANY THEREOF.
SECTION 17. NO ORAL AGREEMENTS. THE AGREEMENT (AS AMENDED BY THIS
------------------
AMENDMENT) AND THE OTHER LOAN DOCUMENTS, REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
-25-
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized.
COMPANY:
-------
VISUAL NUMERICS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
Name:
Title:
CORPORATE GUARANTORS:
---------------------
VISUAL NUMERICS, INC. OF COLORADO
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name:
Title:
VISUAL NUMERICS, INC. (EUROPE)
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name:
Title:
GUARANTOR:
---------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-26-
BANK:
----
FIRST INTERSTATE BANK OF TEXAS, N.A.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name:
Title:
-27-
EXHIBIT A TO FIRST AMENDMENT TO
-------------------------------
SECOND RESTATED AND AMENDED LOAN AGREEMENT
------------------------------------------
LOAN FORMULA CERTIFICATE AND
CERTIFICATE OF NO DEFAULT
VISUAL NUMERICS, INC.
VISUAL NUMERICS, INC. OF COLORADO
VISUAL NUMERICS, INC. (EUROPE)
The undersigned officers of VISUAL NUMERICS, INC., a Texas corporation (the
"Company"), VISUAL NUMERICS, INC. OF COLORADO, a California corporation
("VNIC"), and VISUAL NUMERICS, INC. (EUROPE), a Texas corporation ("VNIE" and
together with VNIC the "Corporate Guarantors"), hereby certify that the
following computation of the Loan Formula as of _______________, 19___ has been
prepared from the books and records of the Company and the Corporate Guarantors
and is true and correct to the best knowledge and belief of such officers:
1. Total Eligible Accounts of the
Company and the Corporate Guar-
antors pursuant to the terms of
that certain Second Restated and
Amended Loan Agreement dated as of
December 16, 1992, as amended by
that certain First Amendment dated
as of February ____, 1994 (the
"Agreement"), among the Company,
the Corporate Guarantors and First
Interstate Bank of Texas, N.A.
(the "Bank"). (Exhibits A, B and
C attached hereto sets forth the
calculation of Total Eligible $_________
Accounts).
2. 80% of Item 1 above. $_________
3. Total Eligible Government
Receivables of the Company and the
Corporate Guarantors $_________
4. The lesser of (i) 40% of Item 3
A - 1
above or (ii) $200,000 $_________
5. Item 2 above plus Item 4 above. $_________
6. Aggregate amount of principal
indebtedness owing to the Bank
pursuant to Section 3.3 of the
Agreement. $_________
7. Excess Availability (Deficiency)
(Item 5 above minus Item 6 above). $_________
The undersigned officers certify further that a review of the activities of
the Company and the Corporate Guarantors has been made to ascertain whether the
Company and the Corporate Guarantors have kept, observed, performed and
fulfilled all of the Company's and the Corporate Guarantors' covenants,
conditions, representations and warranties under the Agreement, the Notes and
the Security Instruments and that, to the best of their knowledge:
(i) during ___________________ through ________________ the
Company and the Corporate Guarantors have kept, observed, performed and
fulfilled each and every covenant, condition, representation and warranty
contained in the Agreement and the Loan Documents and the Company and the
Corporate Guarantors are not in violation of any of the terms and
conditions contained in the Agreement; and
(ii) as of the date hereof, no Default or Event of Default exists
under the Loan Agreement or any of the Loan Documents.
The chief executive office of the Company remains ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇. The Company has not changed its name from Visual
Numerics, Inc., its identity from a corporation or its corporate structure.
The chief executive office of VNIC remains at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇. VNIC has not changed its name from Visual Numerics, Inc. of
Colorado, its identity from a corporation or its corporate structure.
The chief executive office of VNIE remains at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇. VNIE has not changed its name from Visual Numerics, Inc.
(Europe), its identity from a corporation or its corporate structure.
A - 2
Capitalized terms used herein but not defined herein shall have the meaning
given them in the Agreement.
VISUAL NUMERICS, INC.
By:_________________________________
Authorized Officer
VISUAL NUMERICS, INC.
OF COLORADO
By:_________________________________
Authorized Officer
VISUAL NUMERICS, INC. (EUROPE)
By:_________________________________
Authorized Officer
A - 3
Exhibit A to Loan Formula
Certificate and Certificate of No Default
VISUAL NUMERICS, INC.
CALCULATION OF TOTAL ELIGIBLE RECEIVABLES
Total Accounts Receivable $__________
Less
a. Accounts of account debtors in
excess of 10% of the Company's
Eligible Accounts.
$__________
b. Contra accounts and other
obligations owed by the
Company to account debtors.
$__________
c. Accounts of account debtors
having 25% or more of balances
unpaid for more than 90 days
from date of original invoice.
$__________
d. ______________________________
______________________________
______________________________
______________________________ $__________
Total Eligible Accounts Receivable $___________
A - 4
Exhibit B to Loan Formula
Certificate and Certificate of No Default
VISUAL NUMERICS, INC. OF COLORADO
CALCULATION OF TOTAL ELIGIBLE RECEIVABLES
Total Accounts Receivable $__________
Less
a. Accounts of account debtors in
excess of 10% of VNIC's
Eligible Accounts.
$__________
b. Contra accounts and other
obligations owed by VNIC to
account debtors.
$__________
c. Accounts of account debtors
having 25% or more of balances
unpaid for more than 90 days
from date of original invoice.
$__________
d. ______________________________
______________________________
______________________________
______________________________ $__________
Total Eligible Accounts Receivable $__________
A - 5
Exhibit C to Loan Formula
Certificate and Certificate of No Default
VISUAL NUMERICS, INC. (EUROPE)
CALCULATION OF TOTAL ELIGIBLE RECEIVABLES
Total Accounts Receivable $__________
Less
a. Accounts of account debtors in
excess of 10% of VNIE's
Eligible Accounts.
$__________
b. Contra accounts and other
obligations owed by VNIE to
account debtors.
$__________
c. Accounts of account debtors
having 25% or more of balances
unpaid for more than 90 days
from date of original invoice.
$__________
d. ______________________________
______________________________
______________________________
______________________________ $__________
Total Eligible Accounts Receivable $___________
A - 6
EXHIBIT B
---------
CERTIFICATE OF SUBSIDIARIES
I. Visual Numerics, Inc., a Texas corporation
Subsidiaries:
A. Nihon Visual Numerics Kubushiki Kaisha, (also known as Visual
Numerics, Inc., Japan) (formerly known as IMSL Japan, Inc.) a Japanese
corporation
B. Visual Numerics Inc. (Europe) (formerly known as IMSL (Europe), Inc.),
a Texas corporation
Subsidiaries:
1. Visual Numerics Software GmbH (formerly known as IMSL Germany
GmbH), a German corporation
C. IMSL International, Inc., a U.S. Virgin Islands corporation
D. Visual Numerics, Inc. of Colorado (formerly known as IMSL Acquisition
Corp., Inc. (into which Precision Visuals, Inc. was merged)), a
California corporation
Subsidiaries:
1. Visual Numerics Inc. (France) SARL (formerly known as Precision
Visuals International SARL), a French corporation
2. Visual Numerics International Limited (formerly known a Precision
Visuals International Limited), a U.K. corporation
EXHIBIT H
---------
February ___, 1994
First Interstate Bank of Texas, N.A.
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Lockbox Services Department
Gentlemen:
Commencing March 1, 1994, we propose to utilize the special facilities of
your bank to collect, on a "direct deposit" basis, sales remittance checks from
our customers. The following procedures represent the processing requirements to
be performed by First Interstate Bank of Texas, N.A. (hereinafter referred to as
BANK) for Visual Numerics, Inc., a Texas corporation formerly known as IMSL,
Inc. (COMPANY), until such time as by mutual negotiation the agreement is either
modified or terminated.
1. As agent for COMPANY, BANK will serve P. O. ▇▇▇ #▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇ referred to as "Lockbox", which will be listed in the name of the
COMPANY, and contents deposited therein and credit these proceeds to our Account
Number 2400015281 (the "Account").
The parties agree that there will be several daily pickups which will be
timed to optimize coordination between incoming mail availability and check-
clearing deadlines. The removal of money, checks or other orders for the payment
of money from the Lockbox shall create a bailment and the ▇▇▇▇▇▇-bailee
relationship shall continue until such items are received at the banking house
of the BANK and are accepted and credited to the Account, at which time the
relationship of the COMPANY as a depositor shall commence. The ▇▇▇▇▇▇-bailee
relationship shall also apply to the contents removed from the Lockbox other
than money, checks, drafts or other orders for the payment of money.
2. BANK will open the envelopes picked up from the Lockbox and will
remove the contents thereof. All communications of non monetary nature will be
returned to COMPANY. The checks contained
H - 1
in the envelopes will be inspected and handled in the following manner:
A. ACCEPTABLE PAYEES. It is expected that all checks will be made or
endorsed payable to COMPANY, with the possible exception that some may be an
abbreviation of same or of such slight modification that there would be no
question as to the identity of the payee company. All of these checks will be
processed, forwarded for collection in the normal manner and provisional credit
therefor given to the Account. Checks which are made payable or are endorsed
over to other than those stated above will be returned unprocessed to COMPANY.
B. AMOUNTS DIFFERENT. If a check's written and numeric amounts
differ, the BANK will process as to the written amount.
C. SIGNATURE MISSING. If the drawer's signature is missing and the
check contains no indication of the drawer's name, the check will not be
deposited but will be forwarded to the COMPANY. Otherwise, the BANK will deposit
the check and affix a stamp impression requesting the drawee bank to contact the
drawer for authority to pay the check.
E. PAID-IN-FULL NOTATIONS. Care will be taken to guard against
processing of checks when there exists a possible dispute between the COMPANY
and the customers wherein a restrictive statement such as "Payment in Full" is
included on the remittance check. BANK will exercise due care in an effort to
inspect all incoming items for such conditions; however, BANK will not be liable
if, as a result of ordinary clerical error, any such item is processed contrary
to these instructions.
It is expected by the COMPANY that there may be items where the customer
has made a deduction from the invoice amount and the remittance check is less
than the invoice amount. On all items where no restrictive endorsements such as
"Payment in Full" have been placed on the face of the check, BANK will process
such remittances in the usual manner and provisionally credit the Account with
the amount of the check; otherwise, the item will be returned to COMPANY.
3. The following endorsement will be applied to each check deposited;
"Credited to the account of the within named payee, absence of endorsement
guaranteed First Interstate Bank of Texas, N.A." and items so endorsed and other
items, will be processed as follows:
H - 2
A. BANK will process all such endorsed checks and other negotiable
items and will, each working day, provisionally credit the total amount thereof
to the Account.
B. It is understood that the processing, collection and crediting of
items will be governed by the Uniform Commercial Code as adopted by the State of
Texas.
4. In order to maximize daily receipts and funds availability, BANK will
make one or more deposits each day, depending on volume, and credit the Account.
These deposits will be made in anticipation of major check clearing deadlines.
Photocopies will be taken of each check.
5. BANK will maintain a microfilm record of all checks and other
negotiable items which accompany the remittance in order to reconstruct any
specific deposit by means of duplicate photostats should the need arise and the
request be made. BANK shall not be responsible, however, for any failure to
provide such a record due to ordinary clerical error, unexpected film or
equipment failure, or inability to obtain film or equipment.
6. Each day BANK will provide COMPANY with all remittance papers
(invoices, debit advices, check stubs, photocopy, etc.) which accompany each
check. This data should be forwarded to:
Visual Numerics, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
and charged to COMPANY's Federal Express No. ▇▇▇▇-▇▇▇▇-▇.
7. Charge "returned" items to our account under usual advice and forward
to:
Hold for pickup at
First Interstate Westchase Office
Via inhouse courier.
8. Expenditures incurred by BANK for and on behalf of COMPANY (such as
rental of post office box, "Postage Due" acquisition of endorsement stamps,
etc.) will be charged to the Account and appropriate debit advice sent by mail
to COMPANY. Normal per item charges of the BANK to cover lockbox processing will
be applied against the monthly analysis of the account.
H - 3
9. Non-par exchange charges will be considered on an account
profitability analysis along with all other standard banking fees.
10. In the event of any operational difficulties, any contact with COMPANY
should be directed to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ at the office of the Company, telephone
(713) 954-____.
11. The COMPANY agrees that the BANK's responsibility to the COMPANY under
this agreement shall be limited to the exercise of ordinary care and is subject
to the Terms and Conditions attached hereto as Exhibit A. Establishment of and
---------
substantial compliance with the procedures set forth herein by the BANK shall be
deemed to constitute the exercise of ordinary care; and the COMPANY agrees that
occasional unintentional deviations by the BANK from the procedures set forth
herein shall not be deemed a failure to exercise ordinary care in respect to the
transaction in which the deviations occur.
In no event shall the BANK be liable to the COMPANY for failure to follow
any of the operating procedures set forth above, including, without limitation,
failure to perform any service within the time provided therefor, if the failure
to perform is due to the occurrence of any of the following events: any act or
failure to act by the COMPANY; unexpected mechanical failures of the BANK's
equipment, or a power failure; strikes or lockouts; fire or other casualty; riot
or civil commotion, windstorms, earthquakes, floods, or other Acts of God; delay
in transportation, Government regulations or interferences; or any event beyond
the reasonable control of the BANK.
12. COMPANY agrees that the designated account officers at BANK will be
the only persons authorized to debit the Account or withdraw funds.
13. This agreement is subject to the Cash Management Terms and Conditions
set forth on Exhibit A attached hereto and made a part hereof for all purposes.
---------
VISUAL NUMERICS, INC.
By_______________________________
Name:_________________________
Title:________________________
H - 4
94\DMKO\FIBOT#49\IMSL2\LOCK-BOX.LTR
H - 5
REVOLVING CREDIT NOTE
FIRST INTERSTATE BANK OF TEXAS, N.A.
NO.________ Houston, Texas February ___, 1994 $1,900,000.00
FOR VALUE RECEIVED, the undersigned, VISUAL NUMERICS, INC. (formerly IMSL,
INC.), a Texas corporation (herein called "Maker"), promises to pay to the order
of FIRST INTERSTATE BANK OF TEXAS, N.A. (herein called "Payee," which term
herein in every instance shall refer to any owner or holder of this note) the
sum of ONE MILLION NINE HUNDRED THOUSAND AND NO/100 DOLLARS ($1,900,000.00), or
so much thereof as may be advanced and outstanding from time to time hereunder
by Payee, together with interest on the principal hereof from time to time
outstanding from the date of advancement until maturity, at the per annum rate
hereinafter stated (computed on the basis of a year of 360 days and paid for the
actual number of days elapsed), said principal and interest being payable in
lawful money of the United States of America at the banking quarters of First
Interstate Bank of Texas, N.A., First Interstate Bank Plaza, 1000 Louisiana,
Houston, ▇▇▇▇▇▇ County, Texas, or at such other place in ▇▇▇▇▇▇ County, Texas,
as Payee may designate hereafter in writing to Maker.
This note is issued pursuant to that certain Second Restated and Amended
Loan Agreement dated as of December 16, 1992, by and among Maker, Visual
Numerics, Inc. of Colorado (formerly known as IMSL Acquisition Corp., Inc.), and
Payee, as amended by that certain First Amendment to Second Restated and Amended
Loan Agreement executed on February __, 1994 but effective as of December 15,
1993 (the Second Restated and Amended Loan Agreement, as amended and as it may
hereafter be amended, renewed, supplemented or restated, is referred to as the
"Loan Agreement"), and reference is made hereby to the Loan Agreement for
certain rights as to the prepayment and the acceleration of the maturity hereof.
All capitalized terms used herein but not defined herein shall have the meaning
ascribed to them in the Loan Agreement.
The principal balance hereof advanced and from time to time remaining
unpaid shall bear interest during each day of the term of the loan evidenced
hereby at a variable per annum rate equal to the lesser of (A) a per annum rate
that is equal to the sum (herein called the "Basic Rate") of (i) one percent per
annum plus (ii) the prime rate of interest (herein called the "Prime
Page 1 of 6 Pages
Rate"), being the variable per annum rate of interest most recently announced by
First Interstate Bank of Texas, N.A. (herein sometimes called the "Bank") as its
"prime rate", with the understanding that the Bank's "prime rate" may be one of
several base rates and serves as a basis upon which effective rates of interest
are from time to time calculated for loans making reference thereto and may not
be the lowest of the Bank's base rates, which Basic Rate shall change when and
as the Prime Rate shall change, effective on the day of such change or (B) the
Maximum Rate (hereinafter defined). Notwithstanding the foregoing, if at any
time the Basic Rate shall exceed the Maximum Rate and thereafter the Basic Rate
shall become less than the Maximum Rate, the rate of interest payable hereunder
shall remain at the Maximum Rate until Payee shall have received the amount of
interest it would have received otherwise if the interest payable hereunder had
not been limited to the Maximum Rate during the period of time the Basic Rate
exceeded the Maximum Rate.
All past due principal and interest of this note, whether due as the result
of acceleration of maturity or otherwise, shall bear interest at the lesser of
(1) a rate that is five percentage points above the Prime Rate as it varies or
(2) the maximum lawful rate of interest permitted by the applicable usury laws,
now or hereafter enacted, which interest rate (herein called the "Maximum Rate")
shall change when and as said laws shall change to the extent permitted by said
laws, effective on the day such change in said laws becomes effective, from the
date the payment thereof shall have become due until the same have been fully
discharged by payment.
The principal and interest of this note are due and payable as follows:
(a) Interest hereon shall be due and payable monthly as it accrues,
with the first installment to be due and payable on February 28, 1994, and a
like installment to be due and payable on the last day of each succeeding
calendar month thereafter until the principal amount of this note is paid in
full; and
(b) The principal amount of this note shall be due and payable on each
Line of Credit Commitment Reduction Date in an amount necessary to reduce the
outstanding principal amount of this note then outstanding on such date to an
amount which does not exceed the Line of Credit Commitment on such date.
Page 2 of 6 Pages
Until the Termination Date, subject to the terms and conditions of the Loan
Agreement, the undersigned may borrow, pay, prepay in whole or in part and
reborrow hereunder, so long as not more than the aggregate principal amount at
any one time outstanding under this note does not exceed an amount equal to the
lesser of the Line of Credit Commitment or the Loan Formula; it being expressly
contemplated that, by reason of prepayments hereon, there may be times when no
indebtedness is owing hereunder, but, notwithstanding such occurrences, this
note shall remain valid and shall be in full force and effect as to loans or
advances made subsequent to such occurrences; and it being understood and agreed
that advances and repayments of principal under this note are not limited to the
lesser of the Line of Credit Commitment or the Loan formula but to a maximum of
the lesser of the Line of Credit Commitment or the Loan Formula at any one time
outstanding. Payee may advance funds pursuant to this note from time to time,
and from time to time the under signed will make repayments on the principal of
this note, so that no more than the lesser of the Line of Credit Commitment or
the Loan Formula shall be outstanding at any one time. Each advance and each
payment of principal hereunder shall be reflected by a notation made by Payee in
its business records. The aggregate unpaid principal amount of advances
reflected by the notations made in Payee's business records shall be rebuttably
presumptive evidence of the principal amount owing under this note, which amount
the undersigned unconditionally promises to pay to the order of Payee under the
terms hereof.
Maker and any and all sureties, guarantors and endorsers of this note and
all other parties now or hereafter liable hereon, severally waive, to the extent
permitted by applicable law, grace, demand, presentment for payment, protest,
notice of any kind (including, but not limited to, notice of dishonor, notice of
protest, notice of intention to accelerate and notice of acceleration) and
diligence in collecting and bringing suit against any party hereto, and agree
(i) to all extensions and partial payments, with or without notice, before or
after maturity, (ii) to any substitution, exchange or release of any security
now or hereafter given for this note, (iii) to the release of any party
primarily or secondarily liable hereon, and (iv) that it will not be necessary
for Payee, in order to enforce payment of this note, to first institute or
exhaust Payee's remedies against Maker or any other party liable therefor or
against any security for this note.
Page 3 of 6 Pages
In the event of default hereunder or under any of the instruments securing
payment hereof and this note is placed in the hands of an attorney for
collection (whether or not suit is filed), or if this note is collected by suit
or legal proceedings or through bankruptcy proceedings, Maker agrees to pay all
reasonable attorneys' fees and all expenses of collection and costs of court.
It is the intention of the parties hereto to comply with applicable usury
laws (now or hereafter enacted); accordingly, notwithstanding any provision to
the contrary in this note, or in any of the documents securing payment hereof or
otherwise relating hereto, in no event shall this note or such documents require
the payment or permit the payment, taking, reserving, charging, or receipt of
interest in excess of the maximum amount permitted by such laws. If any such
excess of interest is contracted for, charged, taken, reserved or received under
this note or under the terms of any of the documents securing payment hereof or
otherwise relating hereto, or in the event the maturity of the indebtedness
evidenced by this note is accelerated in whole or in part, or in the event that
all or part of the principal of or interest on this note shall be prepaid, so
that under any of such circumstances or any other circumstance the amount of
interest contracted for, charged, taken, reserved or received under this note or
under any of the instruments securing payment hereof or otherwise relating
hereto, on the amount of principal actually outstanding from time to time under
this note shall exceed the maximum amount of interest permitted by applicable
usury laws, then in any such event (i) the provisions of this paragraph shall
govern and control, (ii) any such excess which may have been collected at final
maturity of said indebtedness shall be applied as a credit against the then
unpaid principal amount hereof and the remainder, if any, shall be refunded to
Maker, (iii) with respect to subparagraph (ii), upon such final maturity, the
effective rate of interest shall be automatically reduced to the maximum lawful
rate allowed under applicable usury laws as now or hereafter construed by the
courts having jurisdiction thereof, and (iv) any such excess which may have been
charged but not paid, taken, reserved or received shall be null and void, and
cancelled ab initio to the extent of such excess. Without limiting the
foregoing, all calculations of the rate of interest contracted for, charged,
taken, reserved or received under this note or under such other documents which
are made for the purpose of determining whether such rate exceeds the
Page 4 of 6 Pages
maximum lawful rate, shall be made, to the extent permitted by law, by
amortizing, prorating, allocating and spreading in equal parts during the period
of the full stated term of the loan evidenced hereby, all interest at any time
contracted for, charged, taken, reserved or received from Maker or otherwise by
Payee in connection with such indebtedness.
Except to the extent required by federal law, this note shall be governed
by and construed under the laws of the State of Texas.
Any check, draft, money order or other instrument given in payment of all
or any portion hereof may be accepted by Payee and handled in collection in the
customary manner, but the same shall not constitute payment hereunder or
diminish any rights of Payee except to the extent that actual cash proceeds of
such instrument are unconditionally received by Payee.
Maker and Payee agree that Tex. Rev. Civ. Stat. ▇▇▇ art. ▇▇▇▇ ▇▇. 15 (which
regulates certain revolving loan accounts and revolving tri-party accounts)
shall not apply to any revolving loan accounts created under this note or
maintained in connection therewith.
To the extent that the interest rate laws of the State of Texas are
applicable to this note, the applicable interest rate ceiling is the indicated
(weekly) ceiling determined in accordance with Article 5069-1.04(a)(1) of the
Texas Revised Civil Statutes, as amended, and, to the extent that this note is
deemed an open end account as such term is defined in Article 5069-1.01(f) of
the Texas Revised Civil Statutes, as amended, the Payee retains the right to
modify the interest rate in accordance with applicable law.
Maker represents and warrants to Payee and to all other owners and holders
of any indebtedness evidenced hereby that all loans evidenced by this note are
for business, commercial, investment or other similar purpose and not primarily
for personal, family, household or agricultural use, as such terms are used or
defined in Texas Revised Civil Statutes, Article 5069-1.04, Texas Credit Code
and Regulation Z promulgated by the Board of Governors of the Federal Reserve
System and under Titles I and V of the Consumer Credit Protection Act.
Page 5 of 6 Pages
This note is given in partial renewal, rearrangement, decrease and
extension of, but not in novation or discharge of, that certain promissory note
(the "Prior Note") dated December 16, 1992, executed by Maker and payable to the
order of Payee, in the original principal amount of $2,000,000. Any and all
liens and security interests securing payment of the Prior Note are hereby
ratified, confirmed, renewed, extended, rearranged and carried forward to secure
payment of this note.
This note is secured and guaranteed as provided in the Loan Agreement and
is entitled to all of the benefits of the Loan Agreement.
VISUAL NUMERICS, INC.
By______________________________
Name:
Title:
Page 6 of 6 Pages
