SILICON VALLEY BANK
AMENDMENT TO LOAN DOCUMENTS
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BORROWER: ADEPT TECHNOLOGY, INC.
DATE: JUNE 15, 2005
THIS AMENDMENT TO LOAN DOCUMENTS is entered into between Silicon Valley
Bank ("Silicon") and the borrower named above ("Borrower").
The Parties agree to amend the Loan and Security Agreement between
them, dated April 22, 2004 (as otherwise amended, if at all, the "Loan
Agreement"), as follows, effective as of the date hereof. (Capitalized terms
used but not defined in this Amendment, shall have the meanings set forth in the
Loan Agreement.)
1. MODIFIED LETTER OF CREDIT PROVISION. Section 1.6 of the Loan Agreement
is hereby amended to read as follows:
1.6 LETTERS OF CREDIT. At the request of Borrower, Silicon
may, in its good faith business judgment, issue or arrange for
the issuance of letters of credit for the account of Borrower,
in each case in form and substance satisfactory to Silicon in
its sole discretion (collectively, "Letters of Credit"). The
aggregate face amount of all Letters of Credit from time to
time outstanding shall not exceed the amount shown on the
Schedule (the "Letter of Credit Sublimit"), and shall be
reserved against Loans which would otherwise be available
hereunder, and in the event at any time there are insufficient
Loans available to Borrower for such reserve, Borrower shall
deposit and maintain with Silicon cash collateral in an amount
at all times equal to such deficiency, which shall be held as
Collateral for all purposes of this Agreement. Borrower shall
pay all bank charges (including charges of Silicon) for the
issuance of Letters of Credit, together with such additional
fee as Silicon's letter of credit department shall charge in
connection with the issuance of the Letters of Credit. Any
payment by Silicon under or in connection with a Letter of
Credit shall constitute a Loan hereunder on the date such
payment is made. Each Letter of Credit shall have an expiry
date no later than thirty days prior to the Maturity Date.
Borrower hereby agrees to indemnify and hold Silicon harmless
from any loss, cost, expense, or liability, including payments
made by Silicon, expenses, and reasonable attorneys' fees
incurred by Silicon arising out of or in connection with any
Letters of Credit. Borrower agrees to be bound by the
regulations and interpretations of the issuer of any Letters
of Credit guarantied by Silicon and opened for Borrower's
account or by Silicon's interpretations of any Letter of
Credit issued by Silicon for Borrower's account, and Borrower
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AMENDMENT TO LOAN DOCUMENTS
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understands and agrees that Silicon shall not be liable for
any error, negligence, or mistake, whether of omission or
commission, in following Borrower's instructions or those
contained in the Letters of Credit or any modifications,
amendments, or supplements thereto. Borrower understands that
Letters of Credit may require Silicon to indemnify the issuing
bank for certain costs or liabilities arising out of claims by
Borrower against such issuing bank. Borrower hereby agrees to
indemnify and hold Silicon harmless with respect to any loss,
cost, expense, or liability incurred by Silicon under any
Letter of Credit as a result of Silicon's indemnification of
any such issuing bank. The provisions of this Loan Agreement,
as it pertains to Letters of Credit, and any other Loan
Documents relating to Letters of Credit are cumulative.
2. MODIFIED COLLATERAL; INTELLECTUAL PROPERTY EXCLUDED; NEGATIVE
PLEDGE. The following language is hereby added at the end of Section 2 of the
Loan Agreement.
Notwithstanding the foregoing, the Collateral shall not be
deemed to include any Intellectual Property, except that the
Collateral shall include all proceeds of all of the
Intellectual Property (the "Intellectual Property Proceeds"),
including, without limitation, proceeds consisting of accounts
receivable, royalties, license fees, payment intangibles and
other Accounts, general intangibles consisting of rights to
payment, and all proceeds of all of the foregoing. Borrower
has previously executed and delivered to Silicon a Negative
Pledge Agreement with respect to the Intellectual Property and
the same shall continue in full force and effect.
3. MODIFIED CREDIT LIMIT. Section 1 of the Schedule to Loan and
Security Agreement is hereby amended in its entirety to read as follows:
1. CREDIT LIMIT
(Section 1.1): An amount not to exceed the following:
(A) the lesser of:
(i) $5,000,000 at any
one time outstanding
(the "Maximum Credit
Limit"); or
(ii) the sum of the following:
(a) ACCOUNTS LOANS.
Loans (the "Accounts Loans") in a
total amount outstanding at any
time not to exceed 80% (an "Advance
Rate") of the amount of Borrower's
Eligible Accounts (as defined in
Section 8 above) (the "Borrowing
Base");
plus
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(b) OVERADVANCE LOANS.
Silicon may, in its sole and
absolute discretion, make Loans to
Borrower from time to time which
exceed the limitations on borrowing
against Eligible Accounts as set
forth in subparagraph (a) above
(the "Overadvance Loans"). The
aggregate outstanding Overadvance
Loans shall not at anytime exceed
the lesser of:
(1) $1,000,000; or
(2) 30% (an "Advance
Rate") of the amount
of Borrower's
Eligible Accounts
(as defined in
Section 8 above).
Moreover, the aggregate outstanding
Loans shall not at anytime exceed
the Maximum Credit Limit.
plus
(c) FOREIGN ACCOUNTS.
Foreign Accounts (that are
otherwise Eligible Accounts except
for the Account Debtor being
located outside the United States
or Canada and which have not been
pre-approved by Silicon in writing,
are not backed by a letter of
credit satisfactory to Silicon or
are not FCIA insured satisfactory
to Silicon) up to a maximum of 25%
of the Borrowing Base;
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minus
(B) the amount of all outstanding Letters of
Credit (including drawn but unreimbursed Letters
of Credit), and minus the FX Reserve.
Accounts Loans and the Overadvance Loans are
"Loans" for all purposes of this Agreement.
Silicon may, from time to time, modify the Advance
Rates, in its good faith business judgment, upon
notice to the Borrower, based on changes in
collection experience with respect to Accounts or
other issues or factors relating to the Accounts
or other Collateral.
LETTER OF CREDIT
SUBLIMIT
(Section 1.6): The lesser of:
(A) $3,500,000, minus the FX
Reserve; or
(B) an amount equal to (i) the
lesser of the Maximum Credit Limit
or the Borrowing Base, minus (ii)
the FX Reserve, and minus (iii) all
outstanding Loans.
FOREIGN EXCHANGE
CONTRACT SUBLIMIT: The lesser of:
(A) $3,500,000, minus the amount of
all outstanding Letters of Credit
(including drawn but unreimbursed
Letters of Credit): or
(B) an amount equal to (i) the
lesser of the Maximum Credit Limit
or the Borrowing Base, minus (ii)
the amount of all outstanding
Letters of Credit (including drawn
but unreimbursed Letters of
Credit), and minus (iii) all
outstanding Loans.
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AMENDMENT TO LOAN DOCUMENTS
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FX RESERVE: Borrower may enter into foreign
exchange forward contracts with
Silicon, on its standard forms,
under which Borrower commits to
purchase from or sell to Silicon a
set amount of foreign currency more
than one business day after the
contract date (the "FX Forward
Contracts"); provided that (1) at
the time the FX Forward Contract is
entered into Borrower has Loans
available to it under this
Agreement in an amount at least
equal to 10% of the amount of the
FX Forward Contract; and (2) the
total FX Forward Contracts at any
one time outstanding may not exceed
10 times the amount of the FX
Sublimit set forth above. The "FX
Reserve" shall be a reserve (which
shall be in addition to all other
reserves) in an amount equal to 10%
of the total FX Forward Contracts
from time to time outstanding.
Silicon may, in its discretion,
terminate the FX Forward Contracts
at any time that an Event of
Default occurs and is continuing.
Borrower shall execute all standard
form applications and agreements of
Silicon in connection with the FX
Forward Contracts, and without
limiting any of the terms of such
applications and agreements,
Borrower shall pay all standard
fees and charges of Silicon in
connection with the FX Forward
Contracts.
4. MODIFIED INTEREST RATE. Section 2 of the Schedule to Loan and
Security Agreement is hereby amended in its entirety to read as follows:
INTEREST RATE (Section 1.2):
The interest rate shall be based on
Borrower's Adjusted Quick Ratio (as
defined below), as follows:
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Adjusted Quick Ratio as of the end Interest Rate
of a month
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1.5 to 1.0 or greater Prime Rate (as defined
below) plus 0.50%
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Less than 1.5 to 1.0 Prime Rate plus 1.50%
(the "Standard Rate")
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The initial interest rate in effect
on the date hereof shall be the
Standard Rate.
Changes in the interest rate based
on the Borrower's Adjusted Quick
Ratio as provided above shall go
into effect as of the first day of
the month following the month in
which Borrower's financial
statements are received, reviewed
and approved by Silicon. If, based
on the Adjusted Quick Ratio as shown
in Borrower's financial statements
there is to be an increase in the
interest rate, the interest rate
increase may be put into effect by
Silicon as of the first day of the
month closest to the date on which
the financial statements are due,
even if the delivery of the
financial statements is delayed.
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Thus, for example, if Borrower's
Adjusted Quick Ratio as of September
30, 2005 is 2.0 to 1.0 and
Borrower's financial statements as
of September 30, 2005 are received,
reviewed and approved by Silicon on
October 31, 2005, then the interest
rate in effect on November 1, 2005
will be a rate equal to the Prime
Rate plus 1.50%.
If Borrower's Quick Ratio as of
September 30, 2005 is 2.0 to 1 and
Borrower's financial statements as
of September 30, 2005 are received,
reviewed and approved by Silicon on
November 5, 2005, then the interest
rate shall still be adjusted to a
rate equal to the Prime Rate plus
1.50% effective on November 1, 2005.
As used above, "Adjusted Quick
Ratio" shall mean the ratio of (a)
Borrower's cash and cash
equivalents, in each case held at
Silicon, plus 80% of Borrower's
Eligible Accounts to (b) Borrower's
current liabilities determined in
accordance with GAAP less the
current portion of Borrower's
deferred revenues.
All interest shall be calculated on
the basis of a 360-day year for the
actual number of days elapsed.
"Prime Rate" means the rate
announced from time to time by
Silicon as its "prime rate;" it is a
base rate upon which other rates
charged by Silicon are based, and it
is not necessarily the best rate
available at Silicon. The interest
rate applicable to the Obligations
shall change on each date there is a
change in the Prime Rate.
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AMENDMENT TO LOAN DOCUMENTS
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5. MODIFIED UNUSED LINE FEE. The Unused Line Fee in Section 3 of the
Schedule to Loan and Security Agreement is hereby amended to read as follows:
Unused Line Fee: In the event, in any calendar
quarter (or portion thereof at the
beginning and end of the term
hereof), the average daily
principal balance of the Loans
outstanding during the quarter is
less than the amount of the Maximum
Credit Limit, Borrower shall pay
Silicon an unused line fee in an
amount equal to 0.20% per annum on
the difference between the amount
of the Maximum Credit Limit and the
average daily principal balance of
the Loans outstanding during the
quarter, computed on the basis of a
360-day year, which unused line fee
shall be computed and paid
quarterly, in arrears, on the first
day of the following quarter.
6. COLLATERAL MONITORING FEE. The following Collateral Monitoring Fee
is hereby added to Section 3 of the Schedule to Loan and Security Agreement and
shall read as follows:
Collateral Monitoring
Fee: $750 per month, payable in arrears
(prorated for any partial month at
the beginning and at termination of
this Agreement); PROVIDED, HOWEVER,
so long as (i) no Loans are
outstanding, (ii) the Letter of
Credit Sublimit has not been
utilized and (iii) the Foreign
Exchange Contract Sublimit has not
been utilized, then such amount will
be $0.00 per month.
7. MODIFIED MATURITY DATE. Section 4 of the Schedule to Loan and
Security Agreement is hereby amended in its entirety to read as follows:
4. MATURITY DATE
(Section 6.1): June 15, 2006 [One year from the
date of this Amendment].
8. FEE. In consideration for Silicon entering into this Amendment,
Borrower shall concurrently pay Silicon a fee in the amount of $20,000, which
shall be non-refundable and in addition to all interest and other fees payable
to Silicon under the Loan Documents; PROVIDED, HOWEVER, Silicon acknowledges
that the $30,000 Loan Fee set forth in Section 3 of the Schedule to Loan and
Security Agreement has already been paid by Borrower and received by Silicon.
Silicon is authorized to charge said fee to Borrower's loan account.
9. REPRESENTATIONS TRUE. Borrower represents and warrants to Silicon
that all representations and warranties set forth in the Loan Agreement, as
amended hereby, are true and correct.
10. GENERAL PROVISIONS. This Amendment, the Loan Agreement, any prior
written amendments to the Loan Agreement signed by Silicon and Borrower, and the
other written documents and agreements between Silicon and Borrower set forth in
full all of the representations and agreements of the parties with respect to
the subject matter hereof and supersede all prior discussions, representations,
agreements and understandings between the parties with respect to the subject
hereof. Except as herein expressly amended, all of the terms and provisions of
the Loan Agreement, and all other documents and agreements between Silicon and
Borrower shall continue in full force and effect and the same are hereby
ratified and confirmed.
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SILICON VALLEY BANK
AMENDMENT TO LOAN DOCUMENTS
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BORROWER: SILICON:
ADEPT TECHNOLOGY, INC. SILICON VALLEY BANK
BY /s/ Xxxxxx X. Xxxxxx
------------------------------------ BY /s/ Xxxxx Xxxx
PRESIDENT OR VICE PRESIDENT ----------------------------
TITLE: Sr. Vice President
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BY /s/ Xxxxxx X. Xxxxxxxxxx
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SECRETARY OR ASS'T SECRETARY
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