EXHIBIT 10.15
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of October 12, 1999, by
and between Data Critical Corp. ("Borrower") and Silicon Valley Bank ("Lender").
1. DESCRIPTION OF EXISTING INDEBTEDNESS: Among other indebtedness which may
be owing by Borrower to Lender, Borrower is indebted to Lender pursuant to,
among other documents, a Promissory Note, dated April 10, 1997, in the original
principal amount of Five Hundred Thousand and 00/100 Dollars ($500,000.00) (the
"Line"), a Promissory Note, dated April 10, 1997, in the original principal
amount of One Hundred Thousand and 00/100 Dollars ($100,000.00) (the "Term Note
#1") and a Promissory Note, dated April 14, 1998, in the original principal
amount of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) (the "Term
Note #2"). The Line, Term Note #1 and Term Note #2 are hereby sometimes referred
to collectively as the "Notes." The Line has been modified pursuant to, among
other documents, a Loan Modification Agreement, dated February 12, 1999,
pursuant to which, among other things, the principal amount was increased to One
Million Five Hundred Thousand and 00/100 Dollars ($1,500,000.00). The Notes,
together with other promissory notes from Borrower to Lender, are governed by
the terms of a Business Loan Agreement, dated April 10, 1997, as such agreement
may be amended from time to time, between Borrower and Lender (the "Loan
Agreement"). 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 Lender shall be referred to
as the "Indebtedness".
2. DESCRIPTION OF COLLATERAL AND GUARANTIES. Repayment of the Indebtedness is
secured by a Commercial Security Agreement, dated April 10, 1997, and an
Intellectual Property Security Agreement dated April 10, 1997.
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.
A. Modification(s) to the Notes.
1. The principal amount of the Term Note #1 is hereby decreased to
Thirty Six Thousand Six Hundred Fifty Four and 26/100 Dollars
($36,654.26).
2. The principal amount of the Term Note #2 is hereby decreased to
One Hundred Thirty Eight Thousand Eight Hundred Thirty Nine and
51/100 Dollars ($138,839.51).
3. The interest rate to be applied to the unpaid principal balance
of the Line is hereby increased, effective as of this date, to
1.50 percentage points over the Lender's current Index.
B. Modification(s) to the Loan Agreement.
1. The paragraph entitled "Financial Covenants" is hereby amended,
in part; to provide that Borrower shall maintain, on a monthly
basis, a maximum negative Tangible Net Worth of $750,000.00; and
to permit Borrower to incur quarterly losses, provided such
losses do not exceed $1,800,000.00 through the fiscal quarter
ending September 30, 1999, decreasing to $900,000.00 for the
fiscal quarter ending December 31, 1999. Thereafter, Borrower
shall breakeven or be profitable.
2. Notwithstanding anything to the contrary contained in the
paragraph entitled "Accounts Receivable and Accounts Payable,"
Borrower's next audit shall be completed no later than November
15, 1999.
3. Notwithstanding anything to the contrary contained in the
paragraph entitled "Financial Statements," Borrower's shall
deliver to Lender, as soon as possible, but in no event later
than November 20, 1999, its October 1999 financial statements
together with Compliance Certificate.
C. Waiver of Financial Covenant Defaults.
1. Lender hereby waives Borrower's existing default under the Loan
Agreement by virtue of Borrower's failure to comply with the; (i)
Adjusted Quick Ratio for the quarter ended September 30, 1999;
(ii) Tangible Net Worth covenant as of the months ended June 30,
1999 through September 30, 1999; and (iii) Profitability covenant
as of the quarters ended June 30, 1999 and September 30, 1999.
Lender's waiver of Borrower's compliance of these covenants shall
apply only to the foregoing period. Accordingly, for the month
ending October 31, 1999, Borrower shall be in compliance with the
Tangible Net Worth covenant and for the quarter ending December
31, 1999, Borrower shall be in compliance with Adjusted Quick
Ratio covenant and Profitability covenant, as amended.
Lender's agreement to waive the above-described defaults (1) in
no way shall be deemed an agreement by the Lender to waive
Borrower's compliance with the above-described covenants as of
all other dates and (2) shall not limit or impair the Lender's
right to demand strict performance of these covenants 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.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
wherever necessary to reflect the changes described above.
5. PAYMENT OF LOAN FEE. Borrower shall pay to Lender a fee in the amount of
Seven Thousand Five Hundred and 00/100 Dollars ($7,500.00) (the "Loan Fee"),
plus all out-of-pocket expenses. Additionally, in the event Borrower is not in
compliance with the Financial Covenants for the month ending October 31, 1999,
Borrower shall pay an additional fee in the amount of Fifty Thousand and 00/100
Dollars ($50,000.00) (the "Additional Loan Fee").
6. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor signing
below) agrees that it has no defenses against the obligations to pay any amounts
under the Indebtedness.
7. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing
below) understands and agrees that in modifying the existing Indebtedness,
Lender 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. Lender's agreement to
modifications to the existing Indebtedness pursuant to this Loan Modification
Agreement in no way shall obligate Lender 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 Lender and Borrower to
retain as liable parties all makers and endorsers of Existing Loan Documents,
unless the party is expressly released by Lender 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.
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8. CONDITIONS. The effectiveness of this Change in Terms Agreement is
conditioned upon Lender's receipt of the Loan Fee.
This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: LENDER:
DATA CRITICAL CORP. SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Title: Chief Financial Officer Title: Vice President
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