EXHIBIT 10.40
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of April 27, 2001, by and
between Crossworlds Software, Inc. (the "Borrower") and Silicon Valley Bank
("Bank").
1. DESCRIPTION OF EXISTING INDEBTEDNESS: Among other indebtedness which
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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 September 18, 2000, 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) and a Term Loan in the original principal amount of Seven Hundred
Twenty Two Thousand Two Hundred Twenty Two and 12/100 Dollars ($722,222.12).
Defined terms used but not otherwise defined herein shall have the same meanings
as set forth in 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 by
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the Collateral as described in the Loan Agreement and in an Intellectual
Property Security Agreement dated October 28, 1998.
Hereinafter, the above-described security documents and guaranties, together
with all other documents securing repayment of the Indebtedness shall be
referred to as the "Security Documents". Hereinafter, the Security Documents,
together with all other documents evidencing or securing the Indebtedness shall
be referred to as the "Existing Loan Documents".
3. DESCRIPTION OF CHANGE IN TERMS.
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A. Modification(s) to Loan Agreement.
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1. Section 8.3 entitled "Material Adverse Change" is
hereby amended in its entirety to read as follows:
If there (i) occurs a material adverse change in the
business, operations, or condition (financial or
otherwise) of the Borrower, or (ii) is a material
impairment of the prospect of repayment of any
portion of the Obligations or (iii) is a material
impairment of the value or priority of Bank's
security interests in the Collateral.
2. The following defined terms are hereby amended and/or
incorporated to read as follows:
"Borrowing Base" is 65% of Eligible Accounts plus 60%
of Eligible Foreign Accounts, (not to exceed 25% of
the Borrowing Base) as determined by Bank from
Borrower's most recent Borrowing Base Certificate; as
determined by Bank from Borrower's most recent
Borrowing Base Certificate; provided, however, that
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Bank may lower the percentage of the Borrowing Base
after performing an audit of Borrower's Collateral.
"Eligible Foreign Accounts" are Accounts for which
the account debtor does not have its principal place
of business in the United States, and are Accounts
from Cambridge Technology Partners, CSC Computer
Sciences, Deloitte Consulting Europe, IBM Austria,
IBM UK Limited, Shell International Limited, Siemens,
Siemens Business Services, Sony Broadcast &
Professional, Sony Computer Entertainment.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
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whenever necessary to reflect the changes described above.
5. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor
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signing below) agrees that, as of the date hereof, it has no defenses against
the obligations to pay any amounts under the Indebtedness.
6. PAYMENT OF LOAN FEE. Borrower shall pay Bank a fee in the amount of One
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Thousand Dollars ($1,000)("Loan Fee") plus all out-of-pocket expenses.
7. CONCERNING REVISED ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE. The
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Borrower affirms and reaffirms that notwithstanding the terms of the Security
Documents to the contrary, (i) that the definition of "Code", "UCC" or "Uniform
Commercial Code" as set forth in the Security Documents shall be deemed to mean
and refer to "the Uniform Commercial Code as adopted by the State of California,
as may be amended and in effect from time to time and (ii) the Collateral is all
assets of the Borrower as set forth in the Loan Agreement. In connection
therewith, the Collateral shall include, without limitation, the following
categories of assets as defined in the Code: goods (including inventory,
equipment and any accessions thereto), instruments (including promissory notes),
documents, accounts (including health-care-insurance receivables, and license
fees), chattel paper (whether tangible or electronic), deposit accounts,
letter-of-credit rights (whether or not the letter of credit is evidenced by a
writing), commercial tort claims, securities and all other investment property,
general intangibles (including payment intangibles and software), supporting
obligations and any and all proceeds of any thereof, wherever located, whether
now owned or hereafter acquired.
8. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing
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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. Unless expressly released herein, 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.
9. CONDITIONS. The effectiveness of this Loan Modification Agreement is
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conditioned upon payment of the Loan Fee.
This Loan Modification Agreement is executed as of the date first
written above.
BORROWER: BANK:
CROSSWORLDS SOFTWARE, INC. SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: CFO Title: SVP
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LEGAL OK
SG
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