EXHIBIT 10.1
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
DATED OCTOBER 22, 2001
This First Amendment to Loan and Security Agreement (the "First Amendment") is
made as of this 14/th/ day of June 2002 by and between SeaChange International,
Inc., a Delaware corporation with its principal place of business at 000 Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx (the "Borrower") and Citizens Bank of
Massachusetts, a bank with offices at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
(the "Lender") in consideration of the mutual covenants contained herein and the
benefits to be derived herefrom. Unless otherwise specified, all capitalized
terms shall have the same meaning herein as set forth in the Agreement (as
defined below).
W I T N E S S E T H:
-------------------
WHEREAS, on October 22, 2001, the Borrower and the Lender entered into
a loan arrangement (the "Loan Arrangement") as evidenced by, amongst other
documents and instruments, a certain Loan and Security Agreement (as amended
from time to time, the "Agreement") by and between the Borrower and the Lender
pursuant to which the Lender agreed to provide certain financial accommodations
to or for the benefit of the Borrower; and
WHEREAS, the Borrower has requested that the Lender amend certain terms
and conditions of the Agreement; and
WHEREAS, the Lender has agreed to so amend the Agreement provided the
Borrower and the Lender entered into this First Amendment; and
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. The definition of EBITDA at the end of Section 14 of the
Agreement is deleted and replaced with the following:
"EBITDA shall mean, for the applicable period, net income from
continuing operations before the payment of interest and taxes,
plus depreciation and amortization, plus non-cash expenses
related to the May 29, 2002 nCube verdict, minus cash payments
related to the nCube verdict including, but not limited to damage
payments, legal expense payments, and interest payments,
determined in accordance with generally accepted accounting
principles;"
2. Section 14(e) of the Agreement is deleted in its entirety and
replaced with the following:
"(e) (Minimum EBITDA) Permit EBITDA to be equal or less than
the amounts for the periods listed blow:
(i) quarter ending April 30, 2002 - $7,000,000.00
-1-
(ii) quarter ending July 31, 2002 - $6,150,000.00
(iii) quarter ending October 31, 2002 - $7,000,000.00
(iv) quarter ending July 31, 2003 - $5,200,000.00
(v) quarter ending April 30, 2003 - $5,600,000.00
(vi) quarter ending July 31, 2003 - $7,000,000.00
and thereafter $7,000,000.00 on a trailing twelve (12) month
basis, to be tested quarterly."
3. Section 14(f) is supplemented by adding the following additional
sentence:
"In calculating net income the Borrower may add back non-cash
expenses related to the May 29, 2002 nCube verdict."
4. Section 15(xii) is supplemented by adding the following
additional language:
"Except as otherwise disclosed in writing by the Borrower to the
Bank,"
5. The Borrower hereby agrees that the liabilities, obligations and
indemnity of the Borrower under the Agreement shall be secured by any and all
collateral now or hereafter granted to the Lender by the Borrower.
6. The Borrower hereby acknowledges and agrees that the Borrower has
no offsets, defenses or counterclaims against the Lender with respect to the
Loan Arrangement or otherwise, and to the extent that the Borrower has any such
offsets, defenses or counterclaims against the Lender, then the Borrower hereby
affirmatively WAIVES and RENOUNCES any such offsets, defenses or counterclaims.
7. This First Amendment and all other documents executed in
connection herewith incorporate all discussions and negotiations between the
Borrower and the Lender either expressed or implied, concerning the matters
contained herein and in such other instruments, any statute, custom or use to
the contrary notwithstanding. No such discussions or negotiations shall limit,
modify or otherwise effect the provisions hereof. The modification amendment, or
waiver of any provision of this First Amendment, the Agreement or any provision
under any other agreement or document entered into between the Borrower and the
Lender shall not be effective unless executed in writing by the party to be
charged with such modification, amendment or waiver, and if such party be the
Lender, then by a duly authorized officer thereof.
8. Except as specifically modified herein, the Agreement shall
remain in full force and effect as originally written, and the Borrower hereby
ratifies and confirms all terms and conditions contained in the Agreement.
9. This First Amendment shall be construed in accordance with and
governed by the laws of the Commonwealth of Massachusetts and shall take effect
as a sealed instrument.
-2-
IN WITNESS WHEREOF, the parties hereof have set their hands and seals
as of the date first written above.
SEACHANGE INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and Chief
Financial Officer
CITIZENS BANK OF MASSACHUSETTS
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
-3-
