EXHIBIT 10.6
Execution Copy
INNOVEDA, INC.
SECOND AMENDMENT AND WAIVER
THIS SECOND AMENDMENT AND WAIVER (this "AMENDMENT") is entered into as
of November 9, 2001, with an effective date of September 29, 2001 (the
"EFFECTIVE DATE"), by and between INNOVEDA, INC., a Delaware corporation having
its chief executive office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇ ("BORROWER") and FLEET NATIONAL BANK, a national banking association
organized under the laws of the United States of America, as agent ("AGENT"),
and as the sole lender ("LENDER") under the Agreement (as defined below), to
which reference is made for the definitions of all capitalized terms, used, but
not otherwise defined, herein.
R E C I T A L S
WHEREAS, Borrower, Agent and Lender, together with Viewlogic Systems,
Inc., a former Delaware corporation that had its chief executive office at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("VIEWLOGIC") entered
into an Amended and Restated Loan Agreement dated as of July 31, 2000 among
Borrower, Agent, Lender and the other lenders from time to time party thereto
(the "LENDERS"), as amended by a letter agreement dated October 23, 2000
(collectively, the "AGREEMENT"), pursuant to which Lender made a Term Loan to
Borrower in the principal amount of $10,000,000.00 and established a Revolving
Credit Loan Commitment to Borrower in the maximum principal amount of
$6,000,000.00;
WHEREAS, pursuant to a Certificate of Ownership and Merger filed by
Borrower with the Secretary of State of the State of Delaware on
December 26, 2000, Viewlogic was merged with and into Borrower
with Borrower as the surviving entity effective December 31,
2000;
WHEREAS, the Borrower has requested that the Agent waive the Borrower's
failure to comply with (a) certain covenants under the following sections of the
Agreement: (i) Section 4.1.19 with respect to the need to disclose registered
copyrights; (ii) Section 5.1.2 with respect to the amount of business
interruption insurance required; (iii) Section 5.1.24 with respect to the
software escrow requirement; (iv) Section 5.2.8 with respect to the assumed debt
of PADS Software, Inc.; (v) Section 5.2.12 with respect to the Borrower's
Investments in Innoveda Israel Limited and with respect to the notes set forth
on Exhibit 5.2.12.1; and (vi) Section 5.1.13 with respect to the Minimum EBITDA
required for the fiscal quarter ended June 29, 2001, and (b) Section 3 of the
Security Agreement dated as of July 3, 2000 with respect to securities of the
Borrower's wholly-owned Foreign Subsidiary, Innoveda Israel Limited ("Israel")
(collectively, the "COVENANT DEFAULTS"), and the Lenders have agreed to waive
the Covenant Defaults conditioned on the Borrower's agreement to modify the
Agreement on the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the foregoing premises and the
mutual benefits to be derived by Borrower and Agent from a continuing
relationship under the Agreement and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
agree that, effective as of the Effective Date, the Agreement is hereby amended
as follows:
1. The following definitions appearing in Section 1.1 of the Agreement
are hereby amended, respectively in their entirety to read as follows:
1
"APPLICABLE MARGIN" means with respect to Libor Loans, 2.75%, and with
respect to Prime Rate Loans, 1%.
"EBITDA" means, for any fiscal period, consolidated Net Income PLUS, to the
extent accounted for in consolidated Net Income, (i) consolidated Interest
Expense, taxes, depreciation, amortization, (ii) through and including
Borrower's fiscal period ending September 29, 2001, any other non-cash
charges or any non-recurring extraordinary costs incurred by Borrower and
any Subsidiaries, and (iii) commencing with Borrower's fiscal period ending
December 29, 2001, any non-cash stockholder compensation expense incurred
by Borrower, determined on an accrual and consolidated basis in accordance
with GAAP, LESS Capitalized Software Development Costs.
"DEBT SERVICE COVERAGE RATIO" means as at the date of any determination
thereof, the ratio of (i) consolidated EBITDA MINUS the sum of consolidated
Capital Expenditures (including, without limitation, those acquired through
Capitalized Lease Obligations) and cash taxes paid and currently payable
for Borrower's fiscal quarter then ending, to (ii) Total Debt Service.
"LETTER OF CREDIT" means each of the following letters of credit issued by
the Agent for the account of the Borrower:
A. Standby Letter of Credit No. MS1250698 in the Stated Amount of
$250,000.00; and
B. Standby Letter of Credit No. MS1234057 in the Stated Amount of
$180,508.00
as either or both may be amended, substituted or replaced by the Agent from
time to time.
"MATERIAL FOREIGN SUBSIDIARY" means a Foreign Subsidiary with (a) total
assets (excluding intercompany receivables) of U.S.$2,000,000 or more as at
the end of any fiscal quarter of the Borrower, or (b) ten (10) or more
employees, independent contractors or other consultants excluding sales,
sales and customer support, and administrative personnel.
"REVOLVING CREDIT LOAN COMMITMENT" means the Lenders' several commitments
to make Revolving Credit Loans to Borrower in accordance with SECTION 2.1.0
and this Agreement and in the maximum outstanding amount of each Lender's
Pro Rata Share of $430,508 MINUS the stated amount of any Letter of Credit
that has not been paid in full, expired, terminated or cancelled.
"TOTAL DEBT SERVICE" means, at any date of determination, the sum of (i)
consolidated interest expense for the Borrower fiscal quarter then ending,
and (ii) scheduled and mandatory principal payments for the immediately
succeeding Borrower fiscal quarter due on account of any consolidated
Indebtedness of Borrower, but excluding any mandatory payments of principal
required pursuant to SECTIONS 2.6.1.2, 2.6.1.3, 2.6.1.4 and 2.6.1.6.
2
2. The following new definitions are hereby added alphabetically to
Section 1.1 of the Agreement:
"INTERCOMPANY SUBORDINATION AGREEMENT" means that certain Intercompany
Subordination Agreement dated as of November 9, 2001 entered into by the
Borrower and those Subsidiaries from time to time named therein, as may be
amended, supplemented, restated or otherwise modified from time to time.
"STOCK REPURCHASE PROGRAM" means Borrower's stock repurchase plan approved
by Borrower's Board of Directors for the purchase of up to $5,500,000 of
Borrower's capital stock not to exceed 2,000,000 shares thereof.
3. Section 2.1.0 of the Agreement is hereby amended by including the
following paragraph at the end of Section 2.1.0:
Notwithstanding the foregoing provisions of this SECTION 2.1.0, the Lenders
shall have no commitment to make Advances of Revolving Credit Loans, except
that, the Agent may, in its sole and absolute discretion, request that the
Lenders make Advances of Revolving Credit Loans equal to their respective
Pro Rata Share of the amount of any drawing under a Letter of Credit (and
the Lenders each hereby agree to make such advances irrespective of whether
any Default or Event of Default shall have occurred or the failure of
Borrower to satisfy any other term or conditions of this Agreement,
including without limitation those set forth in Article III of this
Agreement), the proceeds of which Advances shall be used to satisfy
Borrower's reimbursement obligations under such Letter of Credit. Any and
all such Revolving Credit Advances shall bear interest at the Effective
Prime. Borrower agrees that promptly upon receipt by Borrower of any tax
refund attributable to Borrower's fiscal period ending September 29, 2001,
Borrower shall deliver to the Agent the amount of such tax refund up to the
aggregate amount of the Revolving Credit Loan Commitment as cash collateral
("CASH COLLATERAL"). Such Cash Collateral shall be held by the Agent in a
cash collateral account (the "CASH COLLATERAL ACCOUNT") pursuant to a Cash
Collateral Account Assignment Agreement, in form and substance satisfactory
to the Agent (the "CASH COLLATERAL ACCOUNT AGREEMENT"). So long as no
Default or Event of Default has occurred which is continuing, the Agent
shall return the amount of Cash Collateral held as collateral for any
Letter of Credit that is paid, terminated of cancelled promptly to Borrower
at such time as the Agent reasonably believes that it has no further
obligations to make payment thereunder.
4. Section 2.6.4 of the Agreement is hereby deleted in its entirety and
intentionally omitted and Section 2.6.1.5 of the Agreement is hereby confirmed
to have been intentionally omitted.
3
5. Section 4.1.19 of the Agreement is hereby amended in its entirety to
read as follows:
SECTION 4.1.19. COPYRIGHTS. EXHIBIT 4.1.19 accurately and completely sets
forth all copyrights of Borrower and/or any of the Subsidiaries registered
with the United States Copyright Office on and after November 1, 2001.
Borrower has not violated in any material respect any of the provisions of
the Copyright Revision Act of 1976, 17 U.S.C. 101, ET SEQ. Borrower has
filed all registration statements, notices and statements of account and
all necessary supplements and adjustment schedules thereto with the United
States Copyright Office and has made all payments to the United States
Copyright Office to obtain and maintain those copyrights which it has
registered with the United States Copyright Office. To the knowledge of
Borrower, no inquiries regarding any copyright listed on Exhibit 4.1.19
have been received by the Copyright Office. Except as set forth in EXHIBIT
4.1.19, Borrower and any Subsidiaries own, possess, or have licenses to use
all the copyrights, and all rights with respect thereto, reasonably
necessary for the conduct of their respective businesses as now conducted,
without, to Borrower's knowledge, any conflict with the rights of others
with respect thereto.
6. The first sentence of Section 4.1.22 of the Agreement is hereby
amended in its entirety to read as follows:
EXHIBIT 4.1.22 attached hereto contains a complete and accurate schedule of
all registered patents and registered trademarks of Borrower and/or any of
the Subsidiaries, and pending applications therefor, and all other
intellectual property (other than copyrights) in which Borrower and/or any
of the Subsidiaries has any rights and which, in the good faith exercise of
Borrower's reasonable business judgment, has significant value to the
conduct of Borrower's and/or any Subsidiary's business, other than
so-called "off-the shelf" software which is generally available to the
general public at retail.
7. The third sentence of Section 5.1.2 of the Agreement beginning with
the word "Maintain" and ending with the phrase "at least $8,000,000" is hereby
amended in its entirety to read as follows:
Borrower shall maintain (i) on the tangible insurable collateral under any
of the Security Documents insurance against loss by fire, hazards included
within the term "extended coverage", and such other hazards, casualties and
contingencies as the Agent may from time to time require, in an amount
equal to the greater of (a) $8,000,000 OR (b) one hundred percent (100%) of
the replacement cost of the collateral under any of the Security Documents,
and (ii) business interruption insurance in an amount equal to the greater
of (a) $2,000,000 or (b) such other amount as is usually carried by
companies in similar businesses and in accordance with the requirements of
any governmental agency having jurisdiction over Borrower and/or any
Subsidiary.
8. Section 5.1.10 of the Agreement is hereby amended in its entirety to
read as follows:
SECTION 5.1.10. MINIMUM DEBT SERVICE COVERAGE RATIO/QUICK RATIO. Maintain
at the end of each fiscal quarter of Borrower both (i) a consolidated Debt
Service Coverage Ratio and (ii) a consolidated Quick Ratio as set forth
opposite such fiscal quarter below:
4
---------------------------------------------------------------------------------------------
MINIMUM DEBT SERVICE
FISCAL PERIOD ENDING COVERAGE RATIO MINIMUM QUICK RATIO
---------------------------------------------------------------------------------------------
9/29/01 NONE [GREATER THAN/EQUAL TO] .95
---------------------------------------------------------------------------------------------
12/29/01 [GREATER THAN/EQUAL TO] 1.50 [GREATER THAN/EQUAL TO] 1.05
---------------------------------------------------------------------------------------------
3/30/02 [GREATER THAN/EQUAL TO] 0.65 [GREATER THAN/EQUAL TO] 1.15
---------------------------------------------------------------------------------------------
6/29/02 [GREATER THAN/EQUAL TO] 1.25 [GREATER THAN/EQUAL TO] 1.25
---------------------------------------------------------------------------------------------
9/28/02 [GREATER THAN/EQUAL TO] 1.15 [GREATER THAN/EQUAL TO] 1.25
---------------------------------------------------------------------------------------------
12/28/02 and thereafter [GREATER THAN/EQUAL TO] 1.25 [GREATER THAN/EQUAL TO] 1.25
---------------------------------------------------------------------------------------------
9. Section 5.1.11 of the Agreement is hereby amended in its entirety to
read as follows:
Section 5.1.11. MINIMUM DEFERRED REVENUE. Maintain at the end of each
fiscal quarter of Borrower Deferred Revenue of not less than $19,000,000.
10. Section 5.1.12 of the Agreement is hereby deleted in its entirety
and intentionally omitted from the Agreement.
11. Section 5.1.13 of the Agreement is hereby amended in its entirety
to read as follows:
SECTION 5.1.13. MINIMUM EBITDA. At the end of each fiscal quarter of
Borrower have consolidated EBITDA of not less than the amount set forth
opposite such fiscal quarter identified below, which commencing with the
Borrower's fiscal quarter ending March 30, 2002 and thereafter shall be
calculated on the basis of a rolling two Borrower fiscal quarters
consisting of the aggregate EBITDA for the Borrower fiscal quarter then
ending and the immediately preceding Borrower fiscal quarter:
----------------------------------------------------------
FISCAL PERIOD ENDING Minimum EBITDA
----------------------------------------------------------
9/29/01 ($2,600,000)
----------------------------------------------------------
12/29/01 $2,800,000
----------------------------------------------------------
3/30/02 and thereafter $4,000,000
----------------------------------------------------------
12. Section 5.1.23 of the Agreement is hereby amended in its entirety
to read as follows:
SECTION 5.1.23. ACQUISITIONS OF ADDITIONAL REGISTERED PATENTS, TRADEMARKS,
COPYRIGHTS, ETC. Concurrently with the acquisition of any registered
trademark, patent, tradename, service ▇▇▇▇ or copyright, notify the Agent
in writing and collaterally assign and grant a first priority perfected
Lien thereon to the Agent pursuant to documents in form and substance
reasonably satisfactory to the Agent, except for any such registered
copyrights that in the good faith exercise of Borrower's reasonable
business judgment, do not have significant value to the conduct of
Borrower's or any of its Subsidiary's businesses.
13. Section 5.1.24 of the Agreement is hereby deleted in its entirety.
5
14. Section 5.2.6 of the Agreement is hereby amended in its entirety to
read as follows:
SECTION 5.2.6. SALE AND LEASEBACK. Sell or transfer any of the Borrower's
or Subsidiaries' properties to any Person with the intention of taking back
a lease of the same property or leasing other property for substantially
the same use as the property being sold or transferred other than with
respect to office equipment used in the ordinary course of business as to
which such sale or transfer is consummated by any Borrower or any
Subsidiary in one or more series of transactions having an aggregate
consideration not to exceed $300,000.
15. Section 5.2.8.6 of the Agreement is hereby amended in its entirety
to read as follows:
SECTION 5.2.8.6. Indebtedness owing by (i) Borrower to any Subsidiary not
to exceed in the aggregate US$500,000 outstanding at any time, or (ii) any
Subsidiary to Borrower or any other Subsidiary, which in the case of any
such Indebtedness described in the foregoing subsections (i) or (ii) has
been subordinated to the Obligations pursuant to the Intercompany
Subordination Agreement and which has not been subordinated in favor of any
Person other than the Agent and/or the Lenders.
16. Section 5.2.12.1 of the Agreement is hereby amended by the
inclusion of the following new subsections (ixi) and (x) immediately at the end
thereof:
(ix) those promissory notes listed on Exhibit 5.2.12.1; and
(x) Investments in the Borrower's wholly-owned Subsidiary, Innoveda Israel
Limited, to the extent required to maintain such Subsidiary's status as an
"approved enterprise" for purposes of certain favorable tax treatments
arising under the law of the State of Israel not to exceed US$100,000 in
the aggregate for any fiscal year of the Borrower.
17. The notice address for the Agent set forth in Section 9.6 of the
Agreement is hereby amended in its entirety to read as follows:
If to Agent:
Fleet National Bank, as Agent
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Technology and Communications, MA DE 10009H
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
18. Any provision of the Agreement notwithstanding, including, without
limitation, Sections 5.2.10, 5.2.11 and 5.2.12 of the Agreement, Borrower shall
not make any repurchases of Borrower's capital stock pursuant to the Stock
Repurchase Program on or after the Effective Date.
19. EXHIBIT 1.1 ("Equity Investments, Ownership Interests and
Subsidiaries"), EXHIBIT 3.1.1.8 ("Permitted Indebtedness and Capitalized
Leases"), EXHIBIT 3.1.1.10 ("Form of Officer's Certificate"), EXHIBIT 4.1.11.1
("Ownership of Properties"), EXHIBIT 4.1.21 ("Material Agreements") and EXHIBIT
4.1.22 ("Patent, Trademark, and other Property Rights") are hereby deleted in
their entirety and replaced with new EXHIBIT 1.1, EXHIBIT 3.1.1.8, EXHIBIT
3.1.1.10, EXHIBIT 4.1.11.1, EXHIBIT 4.1.21 and EXHIBIT 4.1.22 attached hereto.
6
20. New EXHIBITS 5.2.8.6 and 5.2.12.1, attached hereto, are hereby
incorporated into the Agreement.
21. Upon giving effect to this Amendment, the representations and
warranties contained or referred to in Article IV of the Agreement are true and
accurate as of the date of this Amendment, and no Default or Event of Default
has occurred and is continuing or will after giving effect to this Amendment or
the transactions contemplated by this Amendment or the Agreement.
22. This Amendment shall take effect upon the satisfaction of each of
the following conditions and the receipt by Agent of all of the items specified
below (other than any item or conditions expressly deferred or waived in writing
by Agent):
(i) this Amendment and the Cash Collateral Account Agreement, each duly
executed by Borrower;
(ii) certified copies of all votes, consents and authorizations of the
Borrower as may be reasonably required in connection with the
execution and delivery of this Amendment and the Cash Collateral
Account Agreement;
(iii) an Officers Certificate as of September 29, 2001;
(iv) payment to the Agent of an amendment fee in the amount of
$20,000.00;
(v) payment to Agent of all other fees and expenses of Agent,
including, without limitation, the reasonable legal fees and
expenses of Agent's counsel incurred in connection with this
Amendment and the other matters referenced herein;
(vi) an executed post-closing letter in form and substance satisfactory
to the Agent; and
(vii) such other documents, and evidence of completion of such other
matters, as Agent reasonably may deem necessary or desirable and
request from the Borrower.
23. In reliance upon the representations of the Borrower to the Agent
and the Lender that no Default or Event of Default exists under the Agreement
(other than the Covenant Defaults), the Lender hereby waives Borrower's
compliance with the Covenant Defaults. This waiver is limited to the foregoing
covenant default only and is not, nor shall it be construed as, a waiver of any
other default under the Agreement, now existing or hereafter occurring, nor
shall anything herein or the Lender's actions hereunder be construed so as to
imply that the Lender has agreed, or is obligated, to grant any future waivers
under the Agreement.
24. This Amendment is executed as an instrument under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts without regard to its
7
conflicts of law rules. All parts of the Agreement not affected by this
Amendment are hereby ratified and affirmed in all respects, PROVIDED THAT if any
provision of the Agreement shall conflict or be inconsistent with this
Amendment, the terms of this Amendment shall supersede and prevail. Upon and
after the date of this Amendment all references to the Agreement in that
document, or in any related document, shall mean the Agreement as amended by
this Amendment. Except as expressly provided in this Amendment, the execution
and delivery of this Amendment does not and will not amend, modify or supplement
any provision of, or constitute a consent to or a waiver of any noncompliance
with the provisions of the Agreement, and, except as specifically provided in
this Amendment, the Agreement shall remain in full force and effect. This
Amendment may be executed in one or more counterparts with the same effect as if
the signatures hereto and thereto were upon the same instrument.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, each of Borrower, Agent and Lender in accordance
with SECTION 9.5 of the Agreement has caused this Amendment to be executed and
delivered by their respective duly authorized officers as of the date set forth
in the preamble on page one of this Amendment.
BORROWER:
WITNESSED: INNOVEDA, INC.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
------------------------------- -------------------------------------
▇▇▇▇▇ ▇. ▇'▇▇▇▇▇, Vice President
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and Chief Financial Officer
-------------------------------
PRINT NAME
AGENT:
FLEET NATIONAL BANK, as Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
LENDER:
FLEET NATIONAL BANK, as the sole Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
9
EXHIBIT 1.1
Part A
Equity Investments
THE SPROUT GROUP SHALL CONSTITUTE THE FOLLOWING SIX ENTITIES:
1. DLJ Capital Corp.
2. DLJ ESC II, L.P.
3. Sprout Capital VIII, L.P.
4. Sprout Growth II, L.P.
5. Sprout Venture Capital, L.P.
6. The Sprout CEO Fund, L.P.
Part B
Ownership Interests
Innoveda's Common Stock is listed on the Nasdaq National Market.
Part C
Subsidiaries and Other Ownership Interests
1. The following identifies all Subsidiaries of the Borrower which are organized
under the laws of a jurisdiction other than the United States of America
("Foreign Subsidiaries"):
Innoveda's % Jurisdiction of
Name Ownership Interest Organization
---- ----------------- ------------
Innoveda SARL 100% France
Innoveda Limited 100% United Kingdom
Innoveda GmbH 100% Germany
Innoveda KK* 100% Japan
Innoveda Srl 100% Italy
Innoveda Israel Limited.* 100% Israel
Innoveda Finland Oy 100% Finland
Innoveda Foreign Sales Corp. 100% Barbados
*Material Foreign Subsidiary
1
2. The following identifies all the other Subsidiaries of the Borrower which are
not Foreign Subsidiaries ("DOMESTIC SUBSIDIARIES")
Name Innoveda's % Ownership Interest
---- -------------------------------
Transcendent Design Technology, Inc. 100%
Innoveda Korean Holdings, Inc. 100%
First to Market, Inc. 100%
Innoveda Minnesota Holdings, Inc. 100%
2
EXHIBIT 3.1.1.8
PERMITTED INDEBTEDNESS AND CAPITALIZED LEASES
AT&T Phone Equipment Capital Lease Lease #A012151 Schedule 00090
60 Months Commencing 9/30/96 Monthly Payment: $2053.07
AT&T Phone Equipment Capital Lease Lease #A012151 Schedule 00080
60 Months Commencing 9/30/96 Monthly Payment: $1787.36
Indebtedness secured by Lien of Hewlett-Packard
Company Financing Agreement Agreement #4144-53924
(as referenced in Financing Statement #245185, dated June 30, 1994, filed with
the Secretary of State of
Massachusetts and Financing Statement No. 35340 file
on June 30, 1994, with the City Clerk, Marlborough,
Massachusetts)
Indebtedness up to $335,000 to Sanwa Business Credit Corporation pursuant to
that certain Letter Agreement dated December 20, 1994
$18,000,000 demand promissory note from Borrower to Synopsys to be paid out of
proceeds of the Term Loans hereunder
Lease Agreement dated 12/16/98 between Winthrop Resources Corporation and
Viewlogic Systems, Inc. with the following schedules.
Lease Agreement #V1121698, Schedule #A01, Monthly payment $11,740, Outstanding
Principle as of 1/1/00 $291,103.88, Commencement Date 4/1/99, Term 36 months.
Lease Agreement #V1121698, Schedule #A03R, Monthly Payment $2,689, Outstanding
Principle as of 1/1/00 $79,021.52, Commencement Date 11/1/99, Term 36 months.
Lease Agreement #V1121698, Schedule #A02, Monthly payment $11,319, Outstanding
Principle as of 1/1/00 $324,980.71, Commencement Date 10/1/99, Term 36 months.
Lease Agreement #V1121698, Schedule #A02, Monthly payment $1,093, Outstanding
Principle as of 1/1/00 $17,655.05, Commencement Date 6/1/99, Term 36 months.
Lease Agreement #V1121698, Monthly payment estimated $2,367, Commencement Date
Undetermined, Term 36 months.
Master Lease Agreement dated January 18, 1998 between Omniview Design, Inc. and
Sun Microsystems Finance, Monthly payment $475.26, Expires January 31, 2000.
Rental Lease Agreement between Yokokawa Rental and Viewlogic Systems, Inc.
Japan, Monthly payment (approximate) $386, Expires November 30, 2000.
In connection with the merger of PADS Software, Inc. ("PADS") and Borrower,
Borrower assumed certain debt in the amount of $133,333 owed by PADS to HL
Acquisition Corp. There remains a balance of $50,000 due under this debt, which
is payable in three more quarterly payments of $16,667 each.
1
EXHIBIT 3.1.1.10 - FORM OF OFFICER'S CERTIFICATE
OFFICER'S CERTIFICATE
FLEET NATIONAL BANK, AS AGENT
ATTN: [ ]
[ ]
MAILSTOP: [ ]
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Officer's Certificate Required by SECTION 5.3.4 of the Amended
and Restated Loan Agreement dated as of July 31, 2000 among
Innoveda, Inc., Viewlogic Systems, Inc. and Fleet National
Bank, as Agent, as amended (the "Loan Agreement")
Ladies and Gentlemen:
This certificate is submitted by the undersigned (hereinafter the
"Borrower") pursuant to SECTION 5.3.4 of the Loan Agreement. Capitalized terms
used herein have the same meaning as in the Loan Agreement. The Borrower hereby
certifies to the Agent that the following information is true, accurate and
complete as of ______________________________, 20________.
1. MINIMUM DEBT SERVICE COVERAGE RATIO (SECTION 5.1.10)
(i) Net Income (or Net Loss)................................................... $_______________
(ii) Interest Expense........................................................... $_______________
(iii) Taxes...................................................................... $_______________
(iv) Depreciation............................................................... $_______________
(v) Amortization............................................................... $_______________
(vi) [Any other non-cash charges or any non-recurring
extraordinary costs (1)] [Non-cash Stockholder Compensation Expense(2)] $_______________
(vii) Capitalized Software Development Costs..................................... $_______________
(viii) EBITDA [Line (i) PLUS the sum of Lines (ii) - (vi) minus Line (vii)]...... $_______________
(ix) Capital Expenditures(3).................................................... $_______________
(x) Taxes paid and currently payable........................................... $_______________
(xi) Total Debt Service......................................................... $_______________
(xii) Ratio: [Line (viii) minus the sum of Lines (ix) + (x) divided..............
by Line (xi)].................................................. :1.00
____________
(xiii) Minimum Permitted by Agreement................................. :1.00
____________
--------
(1) Applicable for fiscal period ending 9/28/01 only.
(2) Applicable for fiscal quarters ended 12/29/01 and thereafter.
(3) Including those acquired thru Capitalized Lease Obligations
1
2. MINIMUM QUICK RATIO (SECTION 5.1.10)
(i) Cash Equivalent Investments................................................ $_______________
(ii) Accounts Receivable........................................................ $_______________
(iii) Sum of Lines (i) and (ii).................................................. $_______________
(iv) Current Liabilities........................................................ $_______________
(v) Deferred Revenue........................................................... $_______________
(vi) Long Term Debt............................................................. $_______________
(vii) Line (iv) minus Line (v) plus Line (vi).................................... $_______________
(viii) Quick Ratio [Line (iii) / Line (vii)]...................................... $_______________
(ix) Minimum Permitted by Agreement............................................. $_______________
3. MINIMUM DEFERRED REVENUE (SECTION 5.1.11)
(i) Deferred Revenue........................................................... $_______________
(ii) Minimum Permitted by Agreement............................................. $_______________
4. MINIMUM EBITDA (SECTION 5.1.13)
(i) EBITDA [Line 1(viii)]...................................................... $_______________
(ii) Minimum Permitted by Agreement............................................. $ :1.00
_______________
5. MAXIMUM CAPITAL EXPENDITURES (SECTION 5.2.17)
(i) Actual..................................................................... $_______________
(ii) Maximum Permitted by Agreement............................................. $_______________
6. MATERIAL FOREIGN SUBSIDIARIES (SECTION 5.3.4)
As of the date of this Certificate the following Subsidiaries are the
only Material Foreign Subsidiaries:
The Borrower further certifies to the Agent that as of the date hereof
no Event of Default or Default has occurred without having been waived in
writing.
INNOVEDA, INC.
By:
--------------------------------
Name:
Title:
2
EXHIBIT 4.1.11.1
OWNERSHIP OF PROPERTIES**
The following are the locations of all real property leased by the Borrower or
any Subsidiary.
INNOVEDA OFFICE LOCATIONS
DOMESTIC OFFICES
ARIZONA ILLINOIS NORTH CAROLINA
Innoveda, Inc. Innoveda, Inc. Innoveda, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ 3800 ▇. ▇▇▇▇▇ Rd. Suite 300 ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇ T 847-577-7805 / F ▇▇▇-▇▇▇-▇▇▇▇ T ▇▇▇-▇▇▇-▇▇▇▇ / F 919-474-5050
Innoveda, Inc. MARYLAND OREGON
1201 South ▇▇▇▇ School Road Innoveda, Inc. Innoveda, Inc.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇. ▇▇▇▇▇ ▇ Lincoln Center, Suite 400
Mesa, AZ 85210 ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
CALIFORNIA T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇
Innoveda, Inc.
MASSACHUSETTS
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc. PENNSYLVANIA
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc.
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
T 508-480-0881 / F ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Innoveda, Inc. (Transcendent)
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Innoveda, Inc. Innoveda, Inc
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 11149 Research Blvd., Suite 110
Innoveda, Inc. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ T 248-213-0377 / F ▇▇▇-▇▇▇-▇▇▇▇ T ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
T 949-852-3535 / F ▇▇▇-▇▇▇-▇▇▇▇ MINNESOTA Innoveda, Inc
Innoveda, Inc. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
Innoveda, Inc. ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇ T ▇▇▇-▇▇▇-▇▇▇▇
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇
Innoveda, Inc. WASHINGTON
Innoveda, Inc. (Summit) ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ T 507-292-8829 / F ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇
Innoveda, Inc. (PADS) NEW JERSEY
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ Innoveda, Inc. WISCONSIN
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ T ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Innoveda, Inc. T ▇▇▇-▇▇▇-▇▇▇▇ / F 715-830-1449
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
T ▇▇▇-▇▇▇-▇▇▇▇ / F ▇▇▇-▇▇▇-▇▇▇▇
1
INTERNATIONAL OFFICES
---------------------
CANADA
Innoveda, Inc. GERMANY UNITED KINGDOM
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, GmbH Innoveda, LTD
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇-▇▇▇.▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇
▇ ▇▇▇-▇▇▇-▇▇▇▇ ▇-▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
F ▇▇▇-▇▇▇-▇▇▇▇ T 011-49-89-461469-0 ▇▇▇▇ ▇▇▇ U.K.
F 011-49-89461469-69 T ▇▇▇-▇▇-▇▇▇▇▇▇▇▇▇▇
CHINA F ▇▇▇-▇▇-▇▇▇▇▇▇▇▇▇▇
Innoveda, Inc. ISRAEL
Room (1018-1001), 10th Floor Innoveda, Inc.
Beijing Canway ▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
65 ▇▇▇ ▇▇ ▇▇▇ ▇▇, Beijing ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ T 011-972-9-9708708
T ▇▇▇-▇▇-▇▇▇▇▇▇▇▇▇▇ F 011-972-9-9509118
F ▇▇▇-▇▇-▇▇▇▇▇▇▇▇▇▇
JAPAN
FINLAND Innoveda, Inc.
Innoveda Finland Oy 1-26-20 Higashi, Shibuya-ku
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇▇-▇▇▇▇, ▇▇▇▇▇
FIN-90570 T 011-81-3-5485-8101
Oulu, Finland F 011-81-3-5485-8102
T 011-358-8-551-3747
F 011-358-8-551-3750
KOREA
FRANCE Innoveda, Inc.
Innoveda, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇▇▇▇ ▇▇ L'oise ▇▇▇-▇ ▇▇▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇-▇▇
▇▇▇▇▇▇▇▇ Le Beloise - Pontoise ▇▇▇▇▇ ▇▇▇-▇▇▇ ▇▇▇▇▇
95015 Cergy-Pontoise Cedex T ▇▇▇-▇▇-▇▇▇▇▇▇▇▇
France F ▇▇▇-▇▇-▇▇▇▇▇▇▇▇
T 011-33-1-34-251-251
F 011-33-1-34-251-250
**In connection with the merger of Summit Design, Inc. and Viewlogic and the
merger of Innoveda and PADS Software, Inc., the Borrower may not have received
all consents necessary to assign and/or transfer interest in certain of the
aforementioned properties.
2
EXHIBIT 4.1.21
MATERIAL AGREEMENTS***
----------------------
1. Agreement and Plan of Merger and Reorganization by and between PADS
Software, Inc., Innoveda, Innovative Software, Inc. and Kyoden Co.,
Ltd., dated June 2, 2000.
2. MainWin Dedicated Library Reproduction and Distribution Agreement
between Viewlogic and Mainsoft Corporation, effective June 29, 1998.
3. Employment Agreement between Innoveda and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ dated February
25, 1999.
4. Employment Agreement between Innoveda and ▇▇▇▇▇ ▇▇▇ executed May 28,
2000.
5. Lease Agreement between Innoveda and Petula Associates Ltd. And ▇▇▇▇
Creekside Associates II dated October 26, 1993, as amended.
6. Sublease Agreement, dated as of January 1993 between DCL Technologies,
Ltd. and SEE Technologies, Ltd.
7. Distributor Agreement between Innoveda and Seiko Instruments, Inc.,
dated February 1, 1996, as amended.
8. Option Exchange Agreement dated as of June 30, 1998 among Innoveda,
ProSoft Oy, and Optionholders of ProSoft Oy.
9. Employment Agreement between Viewlogic and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated
October 2, 1998.
10. Employment Agreement between Viewlogic and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated
October 2, 1998.
11. VCS OEM Agreement between Viewlogic and Synopsys dated October 2, 1998.
12. FPGA OEM Agreement between Viewlogic and Synopsys dated October 2,
1998.
13. Software Assignment and License Agreement between Viewlogic and
Synopsys dated October 2, 1998.
14. Patent Assignment and Cross-License Agreement between Viewlogic and
Synopsys dated October 2, 1998.
15. Blast Software License and Assignment Agreement between Viewlogic and
Synopsys dated October 2, 1998.
16. Office Lease Agreement between Viewlogic and Rosewood III Associates
Limited Partnership, as amended, dated November 16, 1989.
17. Exclusive Distribution Agreement by and between Viewlogic and Marubeni
Solutions Corporation dated as of January 1, 2000, as amended.
1
18. Secured Promissory Note by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ in
favor of Viewlogic dated August 11, 1999 as amended September 25, 2001.
19. Secured Promissory Note by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ in
favor of Viewlogic dated August 11, 1999 as amended September 25, 2001.
20. Secured Promissory Note by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ in favor of Viewlogic
dated August 11, 1999 as amended September 25, 2001.
21. Secured Promissory Note by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ in favor of Viewlogic
dated August 12, 1999 as amended September 25, 2001.
22. Secured Promissory Note by ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇ in favor of Viewlogic dated
August 11, 1999 as amended September 25, 2001.
23. Software Development, Consulting and Services Agreement dated as of
December 1, 1998 between PADS Software, Inc. and Milena, Inc.
***BORROWER IS A PARTY TO CERTAIN CONTRACTS OR AGREEMENTS WHICH MAY PROHIBIT THE
ASSIGNMENT OR TRANSFER OF ANY INTEREST THEREIN WITHOUT THE CONSENT OF THE OTHER
PARTY OR PARTIES THERETO. CERTAIN OF THE AFOREMENTIONED AGREEMENTS EITHER BY
THEIR TERMS OR BY OPERATION OF LAW MAY PROHIBIT ASSIGNMENT WITHOUT CONSENT OF
THE OTHER PARTY OR PARTIES THERETO.
2
EXHIBIT 5.2.8.6
FORM OF INTERCOMPANY SUBORDINATION AGREEMENT
This INTERCOMPANY SUBORDINATION AGREEMENT (as amended, supplemented,
amended and restated or otherwise modified, this "SUBORDINATION AGREEMENT"),
dated as of November 9, 2001, is among INNOVEDA, INC., a corporation organized
under the laws of Delaware (the "BORROWER"), TRANSCENDENT DESIGN TECHNOLOGY,
INC., a corporation organized under the laws of Delaware, INNOVEDA KOREAN
HOLDINGS, INC., a corporation organized under the laws of Delaware, FIRST TO
MARKET, INC., a corporation organized under the laws of Delaware, INNOVEDA
MINNESOTA HOLDINGS, INC., a corporation organized under the laws of Delaware,
INNOVEDA SARL., a company organized under the laws of the Federal Republic of
France, INNOVEDA LIMITED, a company organized under the laws of the United
Kingdom, INNOVEDA GMBH, a company organized under the laws of the Federal
Republic of Germany, INNOVEDA KK, a company organized under the laws of Japan,
INNOVEDA SRL, a company organized under the laws of Italy, INNOVEDA ISRAEL
LIMITED, a company organized under the laws of Israel, INNOVEDA FINLAND OY, a
company organized under the laws of Finland, INNOVEDA FOREIGN SALES CORP., a
company organized under the laws of Barbados (collectively, together with each
other Subsidiary that may from time to time become a party hereto, the
"SUBSIDIARIES" and together with the Borrower, the "SUBORDINATED DEBTORS"), the
Borrower and the Subsidiaries, other than in their capacity as Subordinated
Debtors (collectively, the "SUBORDINATED CREDITORS") and FLEET NATIONAL BANK, as
agent (together with any successors thereto in such capacity, the "AGENT") for
itself and the various financial institutions or other lenders (the "LENDERS")
as are, or may from time to time become, parties to the Loan Agreement (referred
to below). All capitalized terms used in this Subordination Agreement, unless
otherwise defined in this Subordination Agreement shall have the meanings
provided for in the Loan Agreement (referred to below).
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Amended and Restated Loan Agreement dated as
of July 31, 2000, as amended by a letter agreement dated October 23, 2000 and by
a
Second Amendment and Waiver dated as of November 9, 2001 (as may be further
amended, supplemented, amended and restated or otherwise modified from time to
time, the "LOAN AGREEMENT"), among the Borrower, the Agent and the Lenders, the
Lenders have agreed to provide certain financial accommodations to the Borrower;
WHEREAS, pursuant to SECTION 5.2.8.6 of the Loan Agreement, the
Subordinated Debtors are permitted to have certain intercompany Indebtedness
pursuant to the terms of this Subordination Agreement (such intercompany
Indebtedness collectively referred to as the "INTERCOMPANY DEBT");
WHEREAS, in order for the Intercompany Debt to be permitted under the
Loan Agreement, the Subordinated Debtors and the Subordinated Creditors are
required to execute and deliver this Subordination Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in order to induce the Lenders to continue
to provide financial accommodations to the Borrower under the Loan Agreement,
each Subordinated Creditor and each
1
Subordinated Debtor hereby agrees, for the benefit of each Lender, as follows.
SECTION 1. AGREEMENT TO SUBORDINATE.
(a) Each Subordinated Creditor and each Subordinated Debtor agrees that the
Subordinated Debt (as defined below) is and shall be subordinate, to the
extent and in the manner hereinafter set forth, and junior in right of
payment to the prior payment in full in cash of the Senior Debt (as defined
below). Except as provided in CLAUSE (b) of this Section 1 or unless
otherwise consented to in writing by the Agent, no payment or other item of
value on account of any component of Subordinated Debt shall be made by any
Subordinated Debtor or received or accepted by any Subordinated Creditor
until the indefeasible payment in full in cash of all Senior Debt has been
made and received, all Letters of Credit have expired or been terminated
and all Commitments have been terminated and all payments to the Lenders
have been retained by them for a period of time in excess of all applicable
preference (or other similar) periods under applicable bankruptcy,
insolvency or creditors' rights laws (such date to be the "SENIOR DEBT
TERMINATION DATE"). When used in this Subordination Agreement,
(i) "SENIOR DEBT" means all Obligations (including the aggregate amount
of all Obligations with respect to Letters of Credit and Hedge
Agreements with any Lender), it being expressly understood and agreed
that the term "Senior Debt" shall include, without limitation, (i) any
and all interest accruing as part of the Obligations (whether or not
permitted as a claim under applicable law) after the commencement of
any bankruptcy, insolvency or other proceedings referred to in SECTION
4, notwithstanding any provision or rule of law which might restrict
the rights of any Lender, as against the Borrower or any other Person,
to collect such interest in the manner and to the extent set forth in
this Subordination Agreement, (ii) all renewals, extensions, increases,
refinancings or refundings of such Obligations and (iii) all costs of
enforcement and collection of such Obligations; and
(ii) "SUBORDINATED DEBT" means all Indebtedness, obligations,
liabilities, claims and other amounts of any nature or type now or
hereafter owing to any Subordinated Creditor by any Subordinated Debtor
or to any Subordinated Creditor by any other Subordinated Creditor or
to any Subordinated Debtor by any other Subordinated Debtor in respect
of the Intercompany Debt, interest thereon and fees in respect thereof,
payable from time to time hereafter and any extensions, renewals,
refinancings or refundings thereof in whole or in part.
(b) Until an Event of Default under the Loan Agreement shall have occurred
and be continuing, any Subordinated Debtor may make, and any Subordinated
Creditor may ask, demand, accelerate, make any claim for, ▇▇▇ for, or
otherwise seek to enforce, take or receive from such Subordinated Debtor,
directly or indirectly, in cash or other property or by set-off or in any
other manner (including from or by way of collateral), payment of
Subordinated Debt or interest and/or premium thereon or fees relating
thereto.
SECTION 2. NO SECURITY. The parties hereto agree that no Subordinated
Debtor will give, nor will any Subordinated Creditor receive or accept from any
Subordinated Debtor, any security interest in or Lien on any assets or
properties of any Subordinated Debtor, whether consensual or non-consensual, of
any nature whatsoever to secure any obligations arising in connection with
Subordinated Debt.
2
SECTION 3. TRUST; SECURITY AGREEMENT. Except with respect to payments
of Subordinated Debt permitted by CLAUSE (b) of SECTION 1, each Subordinated
Creditor will hold in trust for, and will promptly pay over to the Agent, all
amounts which such Subordinated Creditor receives on account of the Subordinated
Debt, and each Subordinated Creditor hereby assigns and pledges to the Agent for
its benefit and the ratable benefit of the Lenders, and hereby grants to the
Agent for its benefit and the ratable benefit of each of the Lenders, a security
interest in any and all dividends, distributions and other amounts and all other
property (including any capital stock or other equity interest, collectively
referred to herein as "CAPITAL SECURITIES"), whether now or hereafter existing
or acquired by any Subordinated Creditor on account of the Subordinated Debt.
All amounts so paid, and all payments and distributions on account of the
Subordinated Debt received by the Agent pursuant to SECTION 4 hereof, shall be
applied to the payment of the Senior Debt, or, if in a form other than cash,
shall be held by the Agent for the ratable benefit of the Lenders as security
for the Senior Debt and disposed of in accordance with the Loan Agreement and
applicable law. Upon the occurrence of the Senior Debt Termination Date, any
balance of such amounts or any security remaining in the hands of the Agent
shall be paid over to, reassigned and redelivered to the applicable Subordinated
Creditor, at its cost and expense.
SECTION 4. DISSOLUTION OR INSOLVENCY. Upon any payment or distribution
of assets of any Subordinated Debtor of any kind or character, whether in cash,
property or Capital Securities, to creditors upon any dissolution or winding up
or total or partial liquidation or reorganization of any Subordinated Debtor,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership, or
similar arrangement or other similar proceeding (each of the foregoing, a
"PROCEEDING"), all outstanding amounts in respect of the Senior Debt shall first
be indefeasibly paid in full in cash before any payment is made on account of
any component of the Subordinated Debt. Upon any such dissolution or winding up
or liquidation or reorganization, any payment or distribution of assets of any
Subordinated Debtor of any kind or character, whether in cash, property or
Capital Securities, to which any Subordinated Creditor would be entitled except
for the provisions hereof, shall be paid by such Subordinated Debtor or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution on behalf of such Subordinated Debtor, or by
any Subordinated Creditor (if received by a Subordinated Creditor), directly to
the Agent to the extent necessary to pay the Senior Debt in cash in full, after
giving effect to any concurrent payment or distribution made on account of the
Senior Debt, before any payment or distribution is made to any Subordinated
Creditor on account of the Subordinated Debt. For such purpose, each
Subordinated Creditor hereby assigns to the Agent all right, title, claim and
interest in and to any and all such payments and distributions on account of the
Subordinated Debt (each such right, title, claim and interest, a "CLAIM"). In
furtherance of the terms of this Subordination Agreement, each Subordinated
Creditor hereby irrevocably appoints the Agent as such Subordinated Creditor's
attorney-in-fact, with full authority in the place and stead of such
Subordinated Creditor and in the name of such Subordinated Creditor or
otherwise, from time to time in the Agent's discretion, to take any action and
to execute any instrument which the Agent may deem necessary or advisable to
accomplish the purposes of this Subordination Agreement (including the filing of
claims, proof of claim or other instrument of similar character by the Agent on
behalf (and in the name) of a Subordinated Creditor. Each Subordinated Creditor
hereby acknowledges, consents and agrees that the power of attorney granted
pursuant to this Section is irrevocable and coupled with an interest. Each
Subordinated Creditor shall execute and deliver to the Agent any instruments of
assignment or further assurance of such right, claim, title or interest as the
Agent may hereafter request. The Agent is hereby irrevocably authorized and
empowered, at its election and in its own name or in the name of each
Subordinated Creditor, to execute and file any proof of claim or other document
and to take any and all action with respect to the Subordinated Debt necessary
or appropriate to ensure payment to the Agent of all such
3
payments and distributions made on account of the Subordinated Debt, and for
such purpose each Subordinated Creditor will upon the request of the Agent
assign or endorse and deliver to the Agent any instrument or instruments
hereafter held by such Subordinated Creditor evidencing Subordinated Debt, and
will execute and deliver or will cause to be executed and delivered any and all
affidavits, powers of attorney and other instruments and documents as may be
requested by the Agent for such purpose.
SECTION 5. INSPECTION OF RECORDS. From time to time upon the request of
the Agent, each Subordinated Debtor will permit the Agent to inspect and to make
extracts from its books and records pertaining to any Subordinated Debt, and
each Subordinated Creditor will permit the Agent at all reasonable times to
examine the accounts of such Subordinated Creditor evidencing Subordinated Debt
and any other instrument or instruments hereafter held by such Subordinated
Creditor evidencing Subordinated Debt.
SECTION 6. OBLIGATIONS ABSOLUTE, ETC. So long as any portion of the
Senior Debt remains outstanding, or the Loan Agreement has not been terminated,
this Subordination Agreement and all rights of the Lenders and all obligations
and duties of each Subordinated Debtor and each Subordinated Creditor hereunder
shall continue in full force and effect notwithstanding any action which any
Lender or the Borrower, without notice to or consent of any Subordinated
Creditor, may take or refrain from taking with respect to the Senior Debt,
including (i) any amendment, modification, waiver, extension, increase or
renewal of the Senior Debt or any part thereof or of any instrument or
instruments now or hereafter evidencing the Senior Debt or any part thereof or
of any agreement or agreements (including any Financing Document) now or
hereafter entered into by the Lenders and the Borrower pursuant to which the
Senior Debt or any part thereof is issued or governed, (ii) any change in the
amount, manner or place of payment of, rate of interest on, or in any other term
of, the Senior Debt or any part thereof or any release, compliance or settlement
with respect thereto, (iii) any forbearance or agreement of forbearance with
respect to the Senior Debt, (iv) any substitution, release, non-perfection,
exchange, indulgence, forbearance or other action or dealing with respect to any
collateral security for the Senior Debt, whether such collateral is now or
hereafter existing, (v) any extension of additional credit to the Borrower by
the Lenders, it being understood that all such additional credit will become
Senior Debt for purposes of this Subordination Agreement, (vi) any lack of
validity or enforceability of the Loan Agreement or any other Loan Document or
any other agreement or instrument relating thereto or (vii) any other
circumstance which might otherwise constitute a defense available to, or a
discharge of, the Borrower, any other Subordinated Debtor or any Subordinated
Creditor.
SECTION 7. APPLICATION OF PAYMENTS. All payments and distributions
received by the Agent in respect of the Subordinated Debt, to the extent
received in or converted into cash, may be applied by the Agent, first to the
payment of any and all expenses (including attorneys' fees and legal expenses)
paid or incurred by the Lenders in enforcing or collecting the Senior Debt, in
enforcing this Subordination Agreement, or in endeavoring to collect or realize
upon any of the Subordinated Debt, and any balance thereof shall, solely as
between the Subordinated Creditors and the Agent (except as may be otherwise
provided in the Loan Agreement), be applied by the Agent in such order of
application as the Agent may from time to time select, toward the payment of the
Senior Debt remaining unpaid; but, as between the Subordinated Debtors and the
Subordinated Creditors (other than the Agent and the Lenders), no such payments
or distributions of any kind or character shall be deemed to be payments or
distributions in respect of the Subordinated Debt.
SECTION 8. SUBROGATION. Each Subordinated Creditor agrees that no
payment or distribution to the Agent shall entitle such Subordinated Creditor to
exercise any rights of subrogation in respect thereof
4
until the Senior Debt Termination Date has occurred. Each Subordinated Creditor
agrees that the subordination provisions contained herein shall not be affected
by any action, or failure to act by any Lender which results, or may result, in
affecting, impairing or extinguishing any right of reimbursement or subrogation
or other right or remedy of any Subordinated Creditor.
SECTION 9. WAIVERS BY EACH SUBORDINATED CREDITOR. Except as may be
otherwise provided in the Loan Agreement, each Subordinated Creditor hereby
waives: (a) notice of acceptance of this Subordination Agreement by any Lender
or any other holder of Senior Debt, (b) notice of the existence, or creation or
non-payment of all or any portion of, the Senior Debt and (c) all diligence in
collection or protection of, or realization upon, the Senior Debt, or any part
thereof, or any security therefor.
SECTION 10. NO COMMENCEMENT OF ANY PROCEEDING. Each Subordinated
Creditor agrees that, until the Senior Debt Termination Date has occurred, it
will not commence, or join with any creditor other than the Agent (if the Agent
specifically approves in writing) in commencing, any Proceeding or otherwise
making any Claim.
SECTION 11. SUBORDINATION LEGEND; FURTHER ASSURANCES. Each Subordinated
Creditor and each Subordinated Debtor will cause any promissory note evidencing
Subordinated Debt to be endorsed with the following legend:
"The indebtedness evidenced by this instrument is subordinated to the prior
payment in full in cash of the Senior Debt, as defined in, and to the
extent provided in, the Intercompany Subordination Agreement dated as of
November 9, 2001 by (among others), the maker hereof and payee named herein
in favor of Fleet National Bank, as Agent for the Lenders (as such terms
are defined in, or by reference in, such Intercompany Subordination
Agreement), as amended from time to time."
Each Subordinated Creditor and each Subordinated Debtor each will ▇▇▇▇ its books
of account in such a manner as shall be effective to give proper notice of the
effect of this Subordination Agreement and will, in the case of any Subordinated
Debt which is not evidenced by any instrument, upon the Agent's request, cause
such Subordinated Debt to be evidenced by an appropriate instrument or
instruments endorsed with the above legend. Each Subordinated Creditor and each
Subordinated Debtor will, at its expense and at any time and from time to time,
promptly execute and deliver all further instruments and documents and take all
further action that may be reasonably necessary or desirable, or that the Agent
may request, in order to protect any right or interest granted or purported to
be granted hereby or to enable the Agent to exercise and enforce its rights and
remedies hereunder.
SECTION 12. NO CHANGE IN OR DISPOSITION OF SUBORDINATED DEBT. No
Subordinated Creditor will:
(a) sell, assign, pledge, encumber or otherwise dispose of any or any
part of any Subordinated Debt to any Person or entity other than the
Subordinated Debtors or any other Subordinated Creditor or any of their
respective Subsidiaries that has executed and delivered to the Agent this
Subordination Agreement;
(b) take or permit to be taken, any action to assert, collect or
enforce any Subordinated Debt or any part thereof, except in accordance
with this Subordination Agreement and only as to that portion of the
Subordinated Debt, if any, to which the Subordinated Creditors are
entitled; or
5
(c) permit the terms of any of the Subordinated Debt to be changed in
such a manner as to have an adverse effect upon the rights or interests of
any holder of Senior Debt.
SECTION 13. REPRESENTATIONS AND WARRANTIES. Each Subordinated
Creditor and each Subordinated Debtor hereby represent and warrant as follows:
(a) No default exists in respect of any Subordinated Debt.
(b) This Subordination Agreement has been duly executed and delivered
by it and constitutes the legal, valid and binding obligations of each
Subordinated Debtor and each Subordinated Creditor, enforceable against
each Subordinated Debtor and each Subordinated Creditor in accordance with
its terms, except as the enforceability thereof may be limited by the
effect of general principles of equity and bankruptcy and similar laws
affecting the rights and remedies of creditors generally.
(c) Each Subordinated Creditor owns the outstanding Subordinated Debt
free and clear of any Lien other than Permitted Encumbrances.
SECTION 14. CONSTRUCTION, ETC. This Subordination Agreement is a Loan
Document executed pursuant to the Loan Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in accordance
with the terms and provisions thereof.
SECTION 15. BINDING ON SUCCESSORS, TRANSFEREES AND ASSIGNS; ASSIGNMENT.
This Subordination Agreement shall be binding upon each Subordinated Debtor and
each Subordinated Creditor and their respective permitted successors,
transferees and assigns and shall inure to the benefit of and be enforceable,
except as the enforceability thereof may be limited by the effect of general
principles of equity and bankruptcy and similar laws affecting the rights and
remedies of creditors generally, by each Lender and their respective successors,
transferees and assigns; PROVIDED, HOWEVER, that no Subordinated Debtor or
Subordinated Creditor may assign any of its obligations hereunder without the
prior written consent of the Majority Lenders.
SECTION 16. AMENDMENTS, ETC. No amendment to or waiver of any provision
of this Subordination Agreement, nor consent to any departure by any
Subordinated Debtor or any Subordinated Creditor herefrom, shall in any event be
effective unless the same shall be in writing and signed by the Agent (with the
consent of the Majority Lenders), and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
SECTION 17. ADDRESSES FOR NOTICES. All notices and other communications
provided to any Subordinated Debtor or any Subordinated Creditor under this
Subordination Agreement or any other Financing Document shall be in writing and
given to the Borrower, and all notices and other communications provided to the
Agent under this Subordination Agreement shall be in writing and given to the
Agent at, in each case, the address or facsimile number provided, and otherwise
in accordance with Section 9.6 of the Loan Agreement.
SECTION 18. NO WAIVER; REMEDIES. No failure on the part of the Agent to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
6
SECTION 19. SECTION CAPTIONS. Section captions used in this
Subordination Agreement are for convenience of reference only, and shall not
affect the construction of this Subordination Agreement.
SECTION 20. SEVERABILITY. Wherever possible each provision of this
Subordination Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Subordination
Agreement shall be prohibited by or invalid under such law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Subordination Agreement.
SECTION 21. EXPENSES. Each Subordinated Creditor and each Subordinated
Debtor jointly and severally agree to pay, upon demand, to the Agent any and all
costs and expenses, including, without limitation, reasonable attorneys' fees
and disbursements, which any Lender may incur in connection with the exercise or
enforcement of any of the rights or interest of any Lender hereunder.
SECTION 22. GOVERNING LAW, ENTIRE AGREEMENT, ETC. This Subordination
Agreement shall be governed by and construed in accordance with the laws of The
Commonwealth of
Massachusetts without regard to its conflicts of law rules. This
Subordination Agreement constitutes the entire understanding among the parties
hereto with respect to the subject matter hereof and supersedes any prior
agreements, written or oral, with respect hereto.
SECTION 23. FORUM SELECTION AND CONSENT TO JURISDICTION. Any litigation
based hereon, or arising out of, under, or in connection with, this
Subordination Agreement, or any course of conduct, course of dealing, statements
(whether oral or written) or actions of any lender, any Subordinated Debtor or
any Subordinated Creditor may be brought and maintained in any federal or state
court sitting in The Commonwealth of
Massachusetts; PROVIDED, HOWEVER, that any
suit seeking enforcement against any property may be brought, at the Agent's
option, in the courts of any jurisdiction where such property may be found. Each
Subordinated Debtor and each Subordinated Creditor hereby expressly and
irrevocably submits to the non-exclusive jurisdiction of all federal and state
courts of The Commonwealth of
Massachusetts for the purpose of any such
litigation as set forth above and irrevocably agrees to be bound by any judgment
rendered thereby in connection with such litigation. Each Subordinated Debtor
and Subordinated Creditor which is a Subsidiary hereby irrevocably appoints the
Borrower (in such capacity, the "PROCESS AGENT"), with an office on the date
hereof at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ of America, as its agent to receive, on such Subordinated Debtor's and
Subordinated Creditor's behalf and on behalf of such Subordinated Debtor's and
Subordinated Creditor's property, service of copies of the summons and complaint
and any other process which may be served in any such action or proceeding. Such
service may be made by mailing or delivering a copy of such process to such
Subordinated Debtor and Subordinated Creditor in care of the process agent at
the process agent's above address, and each such Subordinated Debtor and
Subordinated Creditor irrevocably authorizes and directs the process agent to
accept such service on its behalf. Each Subordinated Debtor and each
Subordinated Creditor further irrevocably consents to the service of process by
registered mail, postage prepaid, or by personal service within or without The
Commonwealth of
Massachusetts. Each Subordinated Debtor and each Subordinated
Creditor hereby expressly and irrevocably waives, to the fullest extent
permitted by law, any objection which it may have or hereafter may have to the
laying of venue of any such litigation brought in any such court referred to
above and any claim that any such litigation has been brought in an inconvenient
forum. To the extent that any Subordinated Debtor or any Subordinated Creditor
has or hereafter may acquire any immunity from jurisdiction of any court or from
any legal process (whether through service or notice, attachment prior to
7
judgment, attachment in aid of execution or otherwise) with respect to itself or
its property, it hereby irrevocably waives such immunity in respect of its
obligations under this Subordination Agreement and the other Loan Documents.
SECTION 24. WAIVER OF JURY TRIAL. EACH SUBORDINATED DEBTOR AND EACH
SUBORDINATED CREDITOR EACH HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
SUBORDINATION AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY LENDER, ANY SUBORDINATED DEBTOR OR
ANY SUBORDINATED CREDITOR. EACH SUBORDINATED DEBTOR AND EACH SUBORDINATED
CREDITOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE CONTINUING PROVISION OF FINANCIAL ACCOMMODATIONS BY THE
LENDERS UNDER THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 25. ADDITIONAL PARTIES. Upon the execution and delivery by any
other Person of a supplement in the form of ANNEX I hereto, such Person shall
become either a "Subordinated Debtor," a "Subordinated Creditor" or both
hereunder with the same force and effect as if it were originally a party to
this Subordination Agreement and named as a "Subordinated Debtor," a
"Subordinated Creditor" or both hereunder. The execution and delivery of any
such instrument shall not require the consent of any other party hereto, and the
rights and obligations of each party hereto hereunder shall remain in full force
and effect notwithstanding the addition of any new "Subordinated Debtor" or
"Subordinated Creditor" as a party to this Subordination Agreement.
SECTION 26. Counterparts. This Subordination Agreement may be executed
in a number of identical counterparts, each of which is deemed an original for
all purposes and all of which constitute, collectively, one agreement.
[SIGNATURE PAGES FOLLOW]
8
IN WITNESS WHEREOF, each Subordinated Debtor and each Subordinated
Creditor has caused this Subordination Agreement to be duly executed and
delivered by its respective authorized officer as of the date first written
above.
INNOVEDA, INC.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
TRANSCENDENT DESIGN TECHNOLOGY, INC.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA KOREAN HOLDINGS, INC.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
FIRST TO MARKET, INC.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA MINNESOTA HOLDINGS, INC.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
9
INNOVEDA SARL.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA LIMITED
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA GMBH
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA KK
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA SRL
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LIMITED
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA FINLAND OY
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
INNOVEDA FOREIGN SALES CORP.
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
ACKNOWLEDGED AND ACCEPTED:
FLEET NATIONAL BANK,
as Agent
By:
__________________________________________
Name:
Title:
11
ANNEX I to
Intercompany Subordination Agreement
THIS SUPPLEMENT, dated as of ________________, ____ (this
"SUPPLEMENT"), is to the Intercompany Subordination Agreement dated as of
November 9, 2001 (as amended, supplemented, amended and restated or otherwise
modified, the "SUBORDINATION AGREEMENT"), among the initial signatories thereto
and each other Person (such capitalized term, and other terms used in this
Supplement, to have the meanings set forth in the Subordination Agreement) which
from time to time thereafter became a party thereto pursuant to Section 25
thereof (each, individually, a "SUBORDINATED DEBTOR" or a "SUBORDINATED
CREDITOR"), in favor of the Lenders.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the provisions of Section 25 of the Subordination
Agreement, the undersigned is becoming a Subordinated Creditor and/or a
Subordinated Debtor, or both, as the case may be, under the Subordination
Agreement; and
WHEREAS, the undersigned is obligated to enter into the Subordination
Agreement in order for certain Intercompany Indebtedness to be permitted under
the Loan Agreement;
NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged), the
undersigned agrees, for the benefit of each Lender, as follows.
SECTION 1. PARTY TO SUBORDINATION AGREEMENT, ETC. In accordance with
the terms of the Subordination Agreement, by its signature below the undersigned
hereby irrevocably agrees to become a Subordinated Creditor and/or a
Subordinated Debtor, or both, as the case may be, under the Subordination
Agreement with the same force and effect as if it were an original signatory
thereto and the undersigned hereby (a) agrees to be bound by and comply with all
of the terms and provisions of the Subordination Agreement applicable to it as a
Subordinated Creditor and/or a Subordinated Debtor, or both, as the case may be
and (b) represents and warrants that the representations and warranties made by
it as a Subordinated Creditor and/or a Subordinated Debtor, or both, as the case
may be thereunder are true and correct as of the date hereof. In furtherance of
the foregoing, each reference to a "Subordinated Creditor and a Subordinated
Debtor" in the Subordination Agreement shall be deemed to include the
undersigned.
SECTION 2. REPRESENTATIONS. The undersigned hereby represents and
warrants that this Supplement has been duly authorized, executed and delivered
by it and that this Supplement and the Subordination Agreement constitute the
legal, valid and binding obligation of the undersigned, enforceable against it
in accordance with its terms, except as the enforceability thereof may be
limited by the effect of general principles of equity and bankruptcy and similar
laws affecting the rights and remedies of creditors generally.
SECTION 3. FULL FORCE OF SUBORDINATION AGREEMENT. Except as expressly
supplemented hereby, the Subordination Agreement shall remain in full force and
effect in accordance with its terms.
SECTION 4. SEVERABILITY. In the event any one or more of the provisions
contained in this Supplement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein and in the Subordination Agreement shall not in any
way be affected or impaired.
1
SECTION 5. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS SUPPLEMENT SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
COMMONWEALTH OF
MASSACHUSETTS WITHOUT REGARD TO ITS CONFLICTS OF LAW RULES. THIS
SUPPLEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING
AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE
ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.
SECTION 6. COUNTERPARTS. This Supplement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF ADDITIONAL
SUBORDINATED CREDITOR AND/OR
SUBORDINATED DEBTOR]
By:___________________________
Name:
Title:
ACCEPTED BY:
FLEET NATIONAL BANK,
as Agent
By:
_________________________________________
Name:
Title:
2
EXHIBIT 5.2.12.1
PERMITTED INVESTMENTS
1. In connection with the merger of PADS Software, Inc. and Borrower, Borrower
acquired a promissory note issued by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, an employee of PADS, to
PADS in the amount of $100,000. Innoveda then accepted a revised promissory note
from ▇▇. ▇▇▇▇▇▇▇ in favor of Innoveda. The loan is due and payable in October
2002 or sooner if ▇▇. ▇▇▇▇▇▇▇ resigns his employment at Innoveda or his
employment is terminated by Innoveda for cause. If ▇▇. ▇▇▇▇▇▇▇ remains in the
employ of Innoveda until October 2002, the loan is forgiven.
2. In September 2001, Innoveda amended the promissory notes with Messrs. Herman,
Lucier, O'Brien and ▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇▇▇▇ to eliminate the requirement that
such notes become due and payable on "The date which is eighteen months after
the first date, if any, on which the common stock of Viewlogic Systems, Inc. (or
any security substituted therefor) is listed on a national securities exchange
or the NASDAQ stock market".
3