LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of May 2, 2000, by
and between Spectrian Corporation ("Borrower") and Silicon Valley Bank ("Bank").
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 Agreement, dated August 9, 1999, as may
be amended from time to time, (the "Loan Agreement"). The Loan Agreement
provided for, among other things, a Committed Revolving Line in the original
principal amount of Ten Million Dollars ($10,000,000). Defined terms used but
not otherwise defined herein shall have the same meanings as in the Loan
Agreement.
Hereinafter, all indebtedness owing by Borrower to Bank shall be referred to as
the "Indebtedness."
Hereinafter, the above-described documents evidencing or securing the
Indebtedness shall be referred to as the "Existing Loan Documents".
2. DESCRIPTION OF CHANGE IN TERMS.
A. Modification(s) to Loan Agreement
1. Subsections (i) and (iii) under Section 6.7 entitled
"Financial Covenants" are hereby amended to read, in
their entirety as follows:
(i) Quick Ratio. a ratio of Quick Assets to Current
Liabilities plus marketable securities of at least
2.00 to 1.00
(ii) Borrower will have a minimum net profit of $1
for each quarter, except that Borrower may suffer a
loss not to exceed $1,000,000 for the fiscal quarter
ending June 30, 2000.
2 The following defined term under Section 13.1
entitled "Definitions" is hereby amended as follows:
"Revolving Maturity Date" is June 30, 2001.
B. Waiver of Financial Covenant Default(s)
1. Bank hereby waives Borrower's existing default under
the Loan Agreement by virtue of Borrower's failure to
comply with the Profitability covenant as of month
ended March 31, 2000. Bank's waiver of Borrower's
compliance of this covenant shall apply only to the
foregoing period. Accordingly, for the quarter ending
June 30, 2000, Borrower shall be in compliance with
this covenant as amended herein.
Bank's agreement to waive the above-described default
(1) in no way shall be deemed an agreement by the
Lender to waive Borrower's compliance with the
above-described covenant as of all other dates and
(2) shall not limit or impair the Lender's right to
demand strict performance of this covenant as of all
other dates and (3) shall not limit or impair the
Lender's right to demand strict performance of all
other covenants as of any date.
3. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.
4. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor signing
below) agrees that, as of the date hereof, it has no defenses against the
obligations to pay any amounts under the Indebtedness.
5. PAYMENT OF LOAN FEE. Borrower shall pay to Bank a fee in the amount of
Sixteen Thousand Dollars ($16,000) (the "Loan Fee") plus all out-of-pocket
expenses.
6. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing below)
understands and agrees that in modifying the existing Indebtedness, 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 Loan Modification Agreement, the terms of the Existing Loan Documents
remain unchanged and in full force and effect. Bank's agreement to modifications
to the existing Indebtedness pursuant to this Loan Modification Agreement in no
way shall obligate Bank to make any future modifications to the Indebtedness.
Nothing in this Loan Modification Agreement shall constitute a satisfaction of
the Indebtedness. It is the intention of Bank and Borrower to retain as liable
parties all makers and endorsers of Existing Loan Documents, unless the party is
expressly released by Bank in writing. No maker, endorser, or guarantor will be
released by virtue of this Loan Modification Agreement. The terms of this
paragraph apply not only to this Loan Modification Agreement, but also to all
subsequent loan modification agreements.
This Loan Modification Agreement is executed as of the date first
written above.
BORROWER: BANK:
SPECTRIAN CORPORATION SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇
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Title: EUP--CFO Title: Vice President
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