EXHIBIT 10.47
SIXTH AMENDMENT TO AMENDED AND RESTATED
ACCOUNTS RECEIVABLE FINANCING AGREEMENT
This Sixth Amendment (this "Sixth Amendment") to the Amended and Restated
Accounts Receivable Financing Agreement is entered into as of December 12, 2003,
by and among (i) SILICON VALLEY BANK, a California-chartered bank, with its
principal place of business at 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000
and with a loan production office located at One Xxxxxx Executive Park, Suite
200, 0000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, doing business under
the name "Silicon Valley East" ("Bank") and (ii) SATCON TECHNOLOGY CORPORATION,
a Delaware corporation with offices located at 000 Xxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx (FAX 000-000-0000); SATCON POWER SYSTEMS, INC., Delaware
corporation with offices located at 000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx;
SATCON APPLIED TECHNOLOGY, INC., a Delaware corporation with offices located at
000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx; SATCON ELECTRONICS, INC., a Delaware
corporation with offices located at 000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx;
and SATCON POWER SYSTEMS CANADA LTD. a corporation organized under the laws of
the Province of Ontario, Canada with offices located at 000 Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx (individually and collectively, jointly and severally,
"Borrower").
1. DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS. Among other
indebtedness and obligations which may be owing by Borrower to Bank, Borrower is
indebted to Bank pursuant to a certain Amended and Restated Accounts Receivable
Financing Agreement dated as of April 4, 2003, as amended by a certain First
Amendment to Amended and Restated Accounts Receivable Financing Agreement dated
as of June 24, 2003, as further amended by a certain Second Amendment to Amended
and Restated Accounts Receivable Financing Agreement dated as of August 11,
2003, as further amended by a certain Third Amendment to Amended and Restated
Accounts Receivable Financing Agreement dated as of September 2, 2003, as
further amended by a certain Fourth Amendment to Amended and Restated Accounts
Receivable Financing Agreement dated as of September 10, 2003, and as further
amended by a certain Fifth Amendment to Amended and Restated Accounts Receivable
Financing Agreement dated as of October 20, 2003 (as amended from time to time,
the "Loan Agreement"). Capitalized terms used but not otherwise defined herein
shall have the same meaning as in the Loan Agreement.
2. DESCRIPTION OF COLLATERAL. Repayment of the Obligations is secured by the
Collateral as described in the Loan Agreement (together with any other
collateral security granted to Bank, the "Security Documents").
Hereinafter, the Security Documents, together with all other documents
evidencing or securing the Obligations shall be referred to as the "Existing
Loan Documents".
3. DESCRIPTION OF CHANGE IN TERMS.
A. Modifications to Loan Agreement.
1. The Loan Agreement shall be amended by deleting the following
definitions appearing in Section 1, thereof:
""ADJUSTED TANGIBLE NET WORTH" shall mean the excess of
total assets over total liabilities, determined in
accordance with generally accepted accounting principles,
with the following adjustments: (A) there shall be
excluded from assets: (i) notes, accounts receivable and
other obligations owing to Borrower from its officers or
other affiliates, (ii) all assets which would be
classified as intangible assets under generally accepted
accounting principles, including without limitation
goodwill, licenses, patents, trademarks, trade names,
copyrights, capitalized software and organizational costs,
licenses and franchises, (iii) the value of Borrower's
investment in Beacon Power Corporation, and (iv) the value
of Borrower's warrants to purchase Beacon
Power Corporation and (B) there shall be excluded from
liabilities: all indebtedness which is subordinated to the
Obligations under a subordination agreement in form
specified by Bank or by language in the instrument
evidencing the indebtedness which is acceptable to Bank in
its sole discretion.
"ADVANCE RATE" is eighty percent (80.0%) net of Deferred
Revenue and offsets related to each specific Account
Debtor.
"APPLICABLE RATE" is a per annum rate equal to the Prime
Rate plus four percent (4.0%).
"FACILITY AMOUNT" is Five Million Dollars ($5,000,000.00),
provided, however, than until the occurrence of each of
Capitalization Event No. 1 and Capitalization Event No. 2,
and provided that no Event of Default has occurred, the
maximum Facility Amount shall be Three Million One Hundred
Twenty Five Thousand Dollars ($3,125,000.00).
"FACILITY PERIOD" is the period beginning on this date and
continuing until one year from the date of this Agreement,
unless the period is terminated sooner by Bank with notice
to Borrower or by Borrower pursuant to Section 4.3.
"PRIME RATE" is the greater of (i) 4.75% or (ii) Bank's
most recently announced "Prime Rate," even if it is not
Bank's lowest rate."
and inserting in lieu thereof the following:
""ADJUSTED TANGIBLE NET WORTH" shall mean the excess of
total assets over total liabilities, determined in
accordance with generally accepted accounting principles,
with the following adjustments: (A) there shall be
excluded from assets: (i) notes, accounts receivable and
other obligations owing to Borrower from its officers or
other affiliates, and (ii) all assets which would be
classified as intangible assets under generally accepted
accounting principles, including without limitation
goodwill, licenses, patents, trademarks, trade names,
copyrights, capitalized software and organizational costs,
licenses and franchises, and (B) there shall be excluded
from liabilities all Subordinated Debt.
"ADVANCE RATE" is eighty percent (80.0%) net of Deferred
Revenue and offsets related to each specific Account
Debtor, or such other percentage as Bank establishes under
Section 2.2; provided however, if Borrower is unable to
maintain an Adjusted Quick Ratio of at least 1.0 to 1.0,
then the Advance Rate will be eighty percent (80.0%) net
of any offsets related to each specific Account Debtor,
including, without limitation, Deferred Revenue.
"APPLICABLE RATE" is a per annum rate equal to the
aggregate of the Prime Rate plus one and one half of one
percent (1.5%), provided however, if Borrower is unable to
maintain an Adjusted Quick Ratio of at least 1.0 to 1.0 as
of the end of any Reconciliation Period, then the
Applicable Rate will be a per annum rate equal to the
aggregate of the Prime Rate plus three percent (3.0%)
effective as of such Reconciliation Period and for each
Reconciliation Period thereafter. In the event that
Borrower achieves an Adjusted Quick Ratio of at least 1.0
to 1.0 thereafter, then the Applicable Rate shall reduce
to the aggregate of the Prime Rate plus one and one half
of one percent (1.5%), effective for each Reconciliation
Period after Borrower delivers to Bank satisfactory
evidence that
Borrower has achieved such Adjusted Quick Ratio.
"FACILITY AMOUNT" is Six Million Two Hundred Fifty
Thousand Dollars ($6,250,000.00).
"FACILITY PERIOD" is the period beginning on the 2003
Closing Date and continuing until the date which is 364
days after the 2003 Closing Date, unless the period is
terminated sooner by Bank with notice to Borrower or by
Borrower pursuant to Section 4.3.
"PRIME RATE" is the greater of (i) 4.00% or (ii) Bank's
most recently announced "Prime Rate," even if it is not
Bank's lowest rate."
2. The Loan Agreement shall be amended by inserting the following
definitions, in alphabetical order, in Section 1, thereof:
""2003 CLOSING DATE" is December 12, 2003.
"ADJUSTED QUICK RATIO" is the ratio of Quick Assets to
Current Liabilities minus Deferred Revenue.
"CURRENT LIABILITIES" is all obligations and liabilities
of Borrower to Bank, plus, without duplication, the
aggregate amount of Borrower's Total Liabilities which
mature within one (1) year.
"QUICK ASSETS" is, on any date, the Borrower's
consolidated, unrestricted cash, cash equivalents, net
accounts receivable and investments with maturities of
fewer than 12 months determined according to GAAP.
"TOTAL LIABILITIES" is on any day, obligations that
should, under GAAP, be classified as liabilities on
Borrower's consolidated balance sheet, including all
Indebtedness, and current portion Subordinated Debt
allowed to be paid, but excluding all other Subordinated
Debt.
"UNUSED LINE FEE" is defined in Section 3.8."
3. The Loan Agreement shall be amended by deleting the following
text appearing in Section 3.4 thereof:
"On each Reconciliation Day, Borrower will pay to Bank a
Collateral Handling Fee, equal to: (a) 0.55% per month of
the average daily Financed Receivable Balance outstanding
during the applicable Reconciliation Period, prior the
occurrence of Capitalization Event No. 1 and
Capitalization Event No. 2, and (b) 0.45% per month of the
average daily Financed Receivable Balance outstanding
during the applicable Reconciliation Period, after the
occurrence of Capitalization Event No. 1 and
Capitalization Event No. 2."
and inserting in lieu thereof the following:
"On each Reconciliation Day, Borrower will pay to Bank a
Collateral Handling Fee, equal to 0.20% per month of the
average daily Financed Receivable Balance outstanding
during the applicable Reconciliation Period; provided
however, if Borrower is unable to maintain an Adjusted
Quick Ratio of at least 1.0 to 1.0, then the Collateral
Handling Fee will be equal to 0.25% per month of
the average daily Financed Receivable Balance outstanding
during the applicable Reconciliation Period effective as
of such Reconciliation Period and for each Reconciliation
Period thereafter. In the event that Borrower achieves an
Adjusted Quick Ratio of at least 1.0 to 1.0 thereafter,
then the Collateral Handing Fee shall reduce to 0.20% per
month of the average daily Financed Receivable Balance
outstanding during the applicable Reconciliation Period,
for each Reconciliation Period after Borrower delivers to
Bank satisfactory evidence that Borrower has achieved such
Adjusted Quick Ratio."
4. The Loan Agreement shall be amended by inserting the following
new Section 3.8 immediately following Section 3.7 thereof:
"3.8 UNUSED LINE FEE. In the event, in any calendar
quarter after the 2003 Closing Date, the average daily
principal balance of Advances outstanding during the
quarter is less than $5,000,000, Borrower shall pay Bank
an unused line fee in an amount equal to 0.50% per annum
on the difference between $5,000,000 and the average daily
principal balance of the Advances outstanding during the
quarter (the "Unused Line Fee"), which Unused Line Fee
shall be computed and paid quarterly, in arrears, on the
first day of the following quarter."
5. The Loan Agreement shall be amended by deleting the following
text appearing in Section 4.3 thereof, entitled "Early
Termination of Agreement":
"If this Agreement is terminated (A) by Bank in accordance
with clause (ii) in the foregoing sentence or (B) by
Borrower for any reason, Borrower shall pay to Bank a
termination fee in an amount equal to One Hundred Thousand
Dollars ($100,000.00) (the "Early Termination Fee")."
and inserting in lieu thereof the following:
"If this Agreement is terminated prior to six (6) months
after the 2003 Closing Date (A) by Bank in accordance with
clause (ii) in the foregoing sentence or (B) by Borrower
for any reason, Borrower shall pay to Bank a termination
fee in an amount equal to Twenty-Five Thousand Dollars
($25,000.00) (the "Early Termination Fee")."
6. The Loan Agreement shall be amended by deleting the following
text appearing in Section 6.3(D) thereof:
"(ii) as soon as available, but no later than one hundred
twenty (120) days after the end of Borrower's fiscal year,
audited consolidated financial statements prepared under
GAAP, consistently applied, together with an unqualified
opinion on the financial statements from an independent
certified public accounting firm acceptable to Bank;"
and inserting in lieu thereof the following:
"(ii) as soon as available, but no later than ninety (90)
days after the end of Borrower's fiscal year, audited
consolidated financial statements prepared under GAAP,
consistently applied, together with an opinion on the
financial statements from an independent certified public
accounting firm acceptable to Bank;"
7. The Loan Agreement shall be amended by deleting the following
text appearing in Section 6.3(M) thereof:
"(M) Maintain at all times, to be tested monthly, an
Adjusted Tangible Net Worth equal to or greater than the
aggregate of: (a)(i) Four Million Five Hundred Thousand
Dollars ($4,500,000.00) as of the month ended August 31,
2003; (ii) Four Million Eight Hundred Thousand Dollars
($4,800,000.00) as of the month ending September 30, 2003;
(iii) Three Million Seven Hundred Thousand Dollars
($3,700,000.00) as of the month ending October 31, 2003;
(iv) Three Million Six Hundred Thousand Dollars
($3,600,000.00) as of the month ending November 30, 2003;
(v) Four Million Seven Hundred Thousand Dollars
($4,700,000.00) as of the month ending December 31, 2003;
(vi) Three Million Six Hundred Thousand Dollars
($3,600,000.00) as of the month ending January 31, 2004;
(vii) Three Million Five Hundred Thousand Dollars
($3,500,000.00) as of the month ending February 28, 2004
and for each month thereafter, plus (b) 100% of the amount
of proceeds received by Borrower in connection with any
issuance of equity or subordinated debt, including
Capitalization Event No. 1 and Capitalization Event No. 2,
minus (c) a maximum of Seven Hundred Thousand Dollars
($700,000.00) in past and current expenses approved by the
Bank which have been netted out of the X.X. Xxxxxxxxxx
equity/sub debt financing upon the closing of same."
and inserting in lieu thereof the following:
"(M) Maintain: (a) as of the last day of each month
(unless such day is also the last day of a quarter), an
Adjusted Tangible Net Worth of at least Eight Million
Eight Hundred Thousand Dollars ($8,800,000.00), and (b) as
of the last day of each quarter, an Adjusted Tangible Net
Worth of at least Ten Million Three Hundred Thousand
Dollars ($10,3000,000.00), to be tested monthly."
8. The Loan Agreement shall be amended by deleting the following
text appearing in Section 6.4(A) thereof:
"(A) Assign, lease, transfer, sell or grant, or permit any
lien or security interest in the Collateral, except for
transfers (i) of inventory in the ordinary course of
business and (ii) of worn-out or obsolete equipment."
and inserting in lieu thereof the following:
"(A) Assign, lease, transfer, sell or grant, or permit any
lien or security interest in the Collateral, except for
transfers of (i) inventory in the ordinary course of
business (ii) worn-out or obsolete equipment, and (iii)
patents and other intellectual property associated with
Smart Predictive Line Controller technology on terms
acceptable to Bank."
9. The Loan Agreement shall be amended by deleting the following
text appearing in Section 6.4(B) thereof:
"(B) Create, incur, assume, or be liable for any
indebtedness."
and inserting in lieu thereof the following:
"(B) Create, incur, assume, or be liable for any
indebtedness, except for fixed assets currently financed
elsewhere, as well as additional indebtedness up to a
maximum amount of $1,000,000.00 in connection with the
financing of Borrower's existing equipment, provided that
such indebtedness is on terms and conditions reasonably
acceptable to Bank."
4. FEES. Borrower shall pay to Bank a commitment fee equal to Twenty Three
Thousand Two Hundred Fifty Dollars ($23,250.00), which fee shall be due on the
date hereof and shall be deemed fully earned as of the date hereof. The Borrower
shall also reimburse Bank for all legal fees and expenses incurred in connection
with this amendment to the Existing Loan Documents.
5. RATIFICATION OF INTELLECTUAL PROPERTY SECURITY AGREEMENT. Borrower hereby
ratifies, confirms and reaffirms, all and singular, the terms and conditions of
a certain Intellectual Property Security Agreement dated as of December 19, 2002
between Borrower and Bank, and acknowledges, confirms and agrees that said
Intellectual Property Security Agreement contains an ACCURATE and COMPLETE
listing of all Intellectual Property Collateral as defined in said Intellectual
Property Security Agreement, shall remain in full force and effect.
6. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.
7. RATIFICATION OF LOAN DOCUMENTS. Borrower hereby ratifies, confirms, and
reaffirms all terms and conditions of all security or other collateral granted
to the Bank, and confirms that the indebtedness secured thereby includes,
without limitation, the Obligations.
8. NO DEFENSES OF BORROWER. Borrower hereby acknowledges and agrees that
Borrower has no offsets, defenses, claims, or counterclaims against Bank with
respect to the Obligations, or otherwise, and that if Borrower now has, or ever
did have, any offsets, defenses, claims, or counterclaims against Bank, whether
known or unknown, at law or in equity, all of them are hereby expressly WAIVED
and Borrower hereby RELEASES Bank from any liability thereunder.
9. CONTINUING VALIDITY. Borrower understands and agrees that in modifying the
existing Obligations, Bank is relying upon Borrower's representations,
warranties, and agreements, as set forth in the Existing Loan Documents. Except
as expressly modified pursuant to this Sixth Amendment, the terms of the
Existing Loan Documents remain unchanged and in full force and effect. Bank's
agreement to modifications to the existing Obligations pursuant to this Sixth
Amendment in no way shall obligate Bank to make any future modifications to the
Obligations. Nothing in this Sixth Amendment shall constitute a satisfaction of
the Obligations. It is the intention of Bank and Borrower to retain as liable
parties all makers of Existing Loan Documents, unless the party is expressly
released by Bank in writing. No maker will be released by virtue of this Sixth
Amendment.
10. COUNTERSIGNATURE. This Sixth Amendment shall become effective only when it
shall have been executed by Borrower and Bank (provided, however, in no event
shall this Sixth Amendment become effective until signed by an officer of Bank
in California).
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
This Sixth Amendment is executed as a sealed instrument under the laws of
the Commonwealth of Massachusetts as of the date first written above.
BORROWER:
SATCON TECHNOLOGY CORPORATION
By /s/ XXXXX X. XXXXXXX
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Name: XXXXX X. XXXXXXX
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Title VP & CFO
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SATCON POWER SYSTEMS, INC.
By /s/ XXXXX X. XXXXXXX
-----------------------------------------
Name: XXXXX X. XXXXXXX
---------------------------------------
Title VP & CFO
--------------------------------------
SATCON APPLIED TECHNOLOGY, INC.
By /s/ XXXXX X. XXXXXXX
-----------------------------------------
Name: XXXXX X. XXXXXXX
---------------------------------------
Title VP & CFO
--------------------------------------
SATCON ELECTRONICS, INC.
By /s/ XXXXX X. XXXXXXX
-----------------------------------------
Name: XXXXX X. XXXXXXX
---------------------------------------
Title VP & CFO
--------------------------------------
SATCON POWER SYSTEMS CANADA LTD.
By /s/ XXXXX X. XXXXXXX
-----------------------------------------
Name: XXXXX X. XXXXXXX
---------------------------------------
Title VP & CFO
--------------------------------------
BANK:
SILICON VALLEY BANK
By XXXXX XXXXX
------------------------------------------
Title SVP
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