EXHIBIT 10.22
LOAN MODIFICATION AGREEMENT
This LOAN MODIFICATION AGREEMENT is entered into as of June 27, 2000, by
and between SILICON VALLEY BANK, a California-chartered bank with its principal
place of business at 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx, XX 00000 and with a loan
production office located at Wellesley Office Park, 00 Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxx, XX 00000, doing business under the name "Silicon Valley East"
("Bank"), and NETSCOUT SYSTEMS, INC., a Delaware corporation with its principal
place of business at 0 Xxxxxxxxxx Xxxx Xxxxx, Xxxxxxxx, XX 00000 ("Borrower").
RECITALS
Borrower has borrowed money from Bank pursuant to certain Existing Loan
Documents, as defined below. In consideration of certain financial
accommodations from Bank, and Borrower's continuing obligations under the
Existing Loan Documents, Borrower and Bank agree as follows:
1. DESCRIPTION OF EXISTING INDEBTEDNESS. Among other indebtedness which
may be owing by Borrower to Bank, Borrower is indebted to Bank pursuant to,
among other documents, an Amended and Restated Loan and Security Agreement dated
as of March 12, 1998, between Borrower and Bank, as amended by Loan Modification
Agreements dated as of March 11, 1999 and March 10, 2000, providing for a
revolving credit facility up to a maximum principal amount of FIVE MILLION AND
NO/100THS DOLLARS ($5,000,000), as such Loan and Security Agreement may be
further amended from time to time (the "Loan Agreement").
Hereinafter, all Indebtedness owing by Borrower to Bank shall be referred
to as the "Indebtedness."
2. DESCRIPTION OF COLLATERAL. Repayment of the Indebtedness is secured
pursuant to the Loan Agreement. Hereinafter, the Loan Agreement, together with
all other documents securing payment of the Indebtedness, shall be referred to
as the "Existing Loan Documents."
3. DESCRIPTION OF CHANGES IN TERMS.
3.1 MODIFICATIONS TO REVOLVING ADVANCE PROVISIONS. Section 2.1.1(a) of
the Loan Agreement is hereby replaced in its entirety with the following:
(a) Bank will make Advances not exceeding (i) the lesser of (A) the
Committed Revolving Line minus the Cash Management Services Sublimit or
(B) the Borrowing Base, whichever is less, minus (ii) the amount of all
outstanding Letters of Credit (including drawn but unreimbursed Letters
of Credit), minus (iii) immediately upon the closing of the acquisition
by Borrower of NextPoint Networks, Inc., all outstanding principal and
interest under that certain equipment line of credit originally extended
by Bank to NextPoint Networks, Inc. Amounts borrowed under this Section
may be repaid and reborrowed during the term of this Agreement.
4. CONSENT TO ACQUISITION. Bank hereby consents to Borrower's acquisition
of NextPoint Networks, Inc., and waives Borrower's compliance with Sections 7.2,
7.3 and 7.6 of the Loan Agreement for the sole purpose of closing that
acquisition, provided that no Event of Default would exist after giving effect
to that acquisition.
5. FEES. Borrower shall pay to Bank any out-of-pocket expenses incurred
by the Bank through the date hereof, including reasonable attorneys' fees and
expenses, and after the date hereof, all Bank Expenses, including reasonable
attorneys' fees and expenses, as and when they become due.
6. CONDITIONS TO FURTHER ADVANCES. The obligation of Bank to make further
advances to Borrower under this line is subject to the condition precedent that
Bank shall have received, in form and substance satisfactory to Bank, the
following:
(i) this Loan Modification Agreement duly executed by Borrower;
(ii) payment of the fees and Bank Expenses then due specified in
Section 6 hereof;
(iii) such other documents, and competition of such other matters, as
Bank may reasonably deem necessary or appropriate.
7. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
wherever necessary to retain the changes described in this Loan Modification
Agreement.
8. NO DEFENSES OF BORROWER. Borrower agrees that as of this date, it has
no defenses against any of the obligations to pay any amounts under the
indebtedness.
9. CONTINUING VALIDITY. Borrower understands and agrees that (i) in
modifying the Existing Loan Documents, Bank is relying upon Borrower's
representations, warranties and agreements, as set forth in the Existing Loan
Documents, (ii) except as expressly modified pursuant to this Loan Modification
Agreement (including the effects of Section 7 hereof), the Existing Loan
Documents remain unchanged and in full force and effect, (iii) Bank's agreement
to modify the Existing Loan Documents pursuant to this Loan Modification
Agreement shall in no way obligate Bank to make any future modifications to the
Existing Loan Documents, (iv) it is the intention of Bank and Borrower to retain
as liable parties all makers and endorsers of the Existing Loan Documents,
unless a party is expressly released by Bank in writing, (v) no maker, endorser
or guarantor will be released by virtue of this Loan Modification Agreement, and
(vi) the terms of this Section 9 apply not only to this Loan Modification
Agreement but also to all subsequent loan modification agreements, if any.
10. EFFECTIVENESS. This Agreement shall become effective only when it
shall have been executed by Borrower and Bank (provided, however, in no event
shall this Agreement become effective until signed by an officer of Bank in
California).
IN WITNESS WHEREOF, the parties hereto have caused this Loan Modification
Agreement to be executed as a sealed investment as of the date first set forth
above.
"Borrower": NETSCOUT SYSTEMS, INC. "Bank": SILICON VALLEY BANK, doing
business as SILICON VALLEY EAST
By: /s/ XXXX XXXXXXXXXX By: /s/ XXXX XXXXXXX
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Xxxx Xxxxxxxxxx, VP of Finance Xxxx X. Xxxxxxx
SILICON VALLEY BANK
By: /s/ XXXXXX XXXXXX
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Title: DOCUMENTATION OFFICER
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(Signed in Santa Xxxxx County, California)
