Exhibit 10.1
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of August 19, 1996, by
and between Lightbridge, Inc. ("Borrower") whose address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and Silicon Valley Bank, a California-chartered bank ("Bank"),
with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and with a loan production office located at Wellesley Office Park, ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under the name "Silicon
Valley East".
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 Credit Agreement, dated June 18, 1996,
as may be amended from time to time (the "Credit Agreement"). The Credit
Agreement provided for, among other things, a Committed Revolving Line in the
original principal amount of Four Million and 00/100 Dollars ($4,000,000.00), as
evidenced by an Amended and Restated Promissory Note, dated June 18, 1996 (the
"Working Capital Line of Credit Note"), and a Committed Equipment Line in the
original principal amount of Two Million and 00/100 Dollars ($2,000,000.00), as
evidenced by a Promissory Note, dated June 18, 1996 (the "Equipment Line of
Credit Note"). Defined terms used but not otherwise defined herein shall have
the same meanings as in the Credit 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 a
-------------------------
Security Agreement dated April 1, 1992, as amended, and a Collateral Assignment
of Trademarks dated October 5, 1994.
Hereinafter, the above-described security documents, together with all other
documents securing payment 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 Credit Agreement.
-----------------------------------
1. Section 6.8 entitled "Quick Ratio" is hereby amended in its
entirety, to read as follows:
Borrower shall maintain, as of the last day of each calendar
month, beginning as of the month ended June 30, 1996, a ratio of
Quick Assets to Current Liabilities of at least 1.00 to 1.00.
2. Section 6.10 entitled "Debt-Net Worth Ratio" is hereby amended in
its entirety, to read as follows:
Borrower shall maintain, as of the last day of each calendar
month, beginning as of the month ended June 30, 1996, a ratio of
Total Liabilities to Tangible Net Worth of not more than 1.50 to
1.00.
For calculation purposes, deferred revenue shall be excluded from
the Quick Ratio and Debt-Net Worth Ratio covenants.
1
3. Section 6.9 entitled "Tangible Worth Ratio" is hereby amended in
its entirety, to read as follows:
Borrower shall maintain, as of the last day of each fiscal
quarter, a Tangible Net Worth of not less than eighty percent
(80%) of capital raised following Borrower's successful
completion of an initial public offering.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
------------------
wherever necessary to reflect the changes described above.
5. NO DEFENSES OF BORROWER. Borrower agrees that, as of this date, it has no
-----------------------
defenses against the obligations to pay any amounts under the Indebtedness.
6. CONTINUING VALIDITY. Borrower 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.
7 JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
------------------
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit, or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Bank cannot avail itself of the courts of the Commonwealth of
Massachusetts, then venue shall lie in Santa ▇▇▇▇▇ County, California.
8. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
----------------
only when it shall have been executed by Borrower and Bank (provided. however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Bank in California).
2
This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: BANK:
LIGHTBRIDGE, INC. SILICON VALLEY BANK, doing business as
SILICON VALLEY EAST
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------- -------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇
---------------------- -------------------------
Title: Controller Title: Vice President
---------------------- -------------------------
SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------
Title: Vice President
-----------------------
(Signed at Santa ▇▇▇▇▇ County, CA)
3
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of December 12, 1996,
by and between Lightbridge, Inc. ("Borrower") whose address is ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and Silicon Valley Bank, a California-chartered bank
("Bank"), with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and with a loan production office located at Wellesley Office
Park, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under
the name "Silicon Valley East".
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 Credit Agreement, dated June 18, 1996,
as may be amended from time to time (the "Credit Agreement"). The Credit
Agreement provided for, among other things, a Committed Revolving Line in the
original principal amount of Four Million and 00/100 Dollars ($4,000,000.00), as
evidenced by an Amended and Restated Promissory Note, dated June 18, 1996 (the
"Working Capital Line of Credit Note"), and a Committed Equipment Line in the
original principal amount of Two Million and 00/100 Dollars ($2,000,000.00), as
evidenced by a Promissory Note, dated June 18, 1996 (the "Equipment Line of
Credit Note"). Defined terms used but not otherwise defined herein shall have
the same meanings as in the Credit 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 a
---------------------------
Security Agreement dated April 1, 1992, as amended, and a Collateral Assignment
of Trademarks dated October 5, 1994.
Hereinafter, the above-described security documents, together with all other
documents securing payment 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 Working Capital Line of Credit Note.
------------------------------------------------------
1. The interest rate to be applied to the unpaid principal balance
of the Working Capital Line of Credit Note is hereby decreased,
effective as of this date, to a rate per annum equal to the Prime
Rate (as defined herein).
B. Modification(s) to Equipment Line of Credit Note.
------------------------------------------------
1. The interest rate to be applied to the unpaid principal balance
of the Equipment Line of Credit Note is hereby decreased,
effective as of this date, to a rate per annum equal to one-
quarter of one percentage point (0.250%) above the Prime Rate (as
defined herein).
C. Modification(s) to Credit Agreement.
-----------------------------------
1. The financial covenants set forth in Section 6.8 entitled "Quick
Ratio", Section 6.10 entitled "Debt-Net Worth Ratio" and Section
6.11 entitled "Liquidity" shall now be maintained by Borrower on
a quarterly basis (rather than monthly), beginning with the
quarter ended September 30, 1996.
1
2. Section 2.4(a) entitled "Interest Rate" is hereby amended in its
entirety, to read as follows:
Except as set forth in Section 2.4(b), (i) each Advance shall
bear interest, on the average Daily Balance, at a rate equal to
the Prime Rate, and (ii) each Equipment Advance shall bear
interest, on the average Daily Balance, at a rate equal to one-
quarter of one percentage point (0.250%) above the Prime Rate.
3. Section 6.3 entitled "Financial Statements, Reports,
Certificates" is hereby amended in part, as follows:
Borrower shall deliver to Bank: (a) as soon as available, but in
any event within forty-five (45) days after the end of each
fiscal quarter, beginning with the fiscal quarter ended September
30, 1996, a company-prepared consolidated balance sheet and
income statement covering Borrower's consolidated operations
during such period, certified by an officer of Borrower
reasonably acceptable to Bank.
Within forty-five (45) days after the last day of each fiscal
quarter, beginning with the fiscal quarter ended September 30,
1996, Borrower shall deliver to Bank with the quarterly
financial statements a Compliance Certificate signed by a
Responsible Officer.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
------------------
wherever necessary to reflect the changes described above.
5. NO DEFENSES OF BORROWER. Borrower agrees that, as of this date, it has no
-----------------------
defenses against the obligations to pay any amounts under the Indebtedness.
6. CONTINUING VALIDITY. Borrower 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.
7 JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
------------------
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit, or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Bank cannot avail itself of the courts of the Commonwealth of
Massachusetts, then venue shall lie in Santa ▇▇▇▇▇ County, California.
8. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
----------------
only when it shall have been executed by Borrower and Bank (provided, however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Bank in California).
2
This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: BANK:
LIGHTBRIDGE, INC. SILICON VALLEY BANK, doing business as
SILICON VALLEY EAST
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------- -------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇
---------------------- -------------------------
Title: Controller Title: Vice President
---------------------- -------------------------
SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------
Title: Vice President
-----------------------
(Signed at Santa ▇▇▇▇▇ County, CA)
3
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of March 5, 1997. by
and between Lightbridge, Inc. ("Borrower") whose address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and Silicon Valley Bank, a California-chartered bank ("Bank"),
with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and with a loan production office located at Wellesley Office Park, ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under the name "Silicon
Valley East".
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 Credit Agreement, dated June 18, 1996, as may
be amended from time to time (the "Credit Agreement"). The Credit Agreement
provided for, among other things, a Committed Revolving Line in the original
principal amount of Four Million and 00/100 Dollars ($4,000,000.00), as
evidenced by an Amended and Restated Promissory Note, dated June 18, 1996 (the
"Working Capital Line of Credit Note"), and a Committed Equipment Line in the
original principal amount of Two Million and 00/100 Dollars ($2,000,000.00), as
evidenced by a Promissory Note, dated June 18, 1996 (the "Equipment Line of
Credit Note"). Defined terms used but not otherwise defined herein shall have
the same meanings as in the Credit 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 a
-------------------------
Security Agreement dated April 1, 1992, as amended, and a Collateral Assignment
of Trademarks dated October 5, 1994.
Hereinafter, the above-described security documents, together with all other
documents securing payment 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 Credit Agreement
-----------------------------------
1. Section 2.1.2 entitled "Letters of Credit" is hereby incorporated
into the Loan Agreement as follows:
Letters of Credit. Subject to the terms and conditions of this
-----------------
Agreement, Bank agrees to issue or cause to be issued Letters of
Credit for the account of Borrower in an aggregate face amount
not to exceed (i) the lesser of the $4,000,000.00 or the
Borrowing Base minus (ii) the then outstanding principal balance
of the Committed Revolving Line; provided that the face amount of
--------
outstanding Letters of Credit (including drawn but unreimbursed
Letters of Credit) shall not in any case exceed One Million Two
Hundred Fifty Thousand and 00/100 Dollars ($1,250,000.00) Each
such Letter of Credit shall have an expiry date no later than one
hundred eighty (180) days after the Maturity Date of the Working
Capital Line of Credit Note provided that Borrower's Letter of
Credit reimbursement obligation shall be secured by cash on terms
acceptable to Bank at any time after the Maturity Date if the
term of the Agreement is not extended by Bank. All such Letters
of Credit shall be, in form and substance, acceptable to Bank in
its sole discretion and shall be subject to the terms and
conditions of Bank's form of application and Letter of Credit
agreement.
1
Borrower shall indemnity, defend and hold Bank harmless from any
loss, cost, expense or liability, including, without limitation,
reasonable attorneys' fees, arising out of or in connection with
any Letters of Credit.
Borrower may request that Bank issue a Letter of Credit payable
in a currency other than United States Dollars. If a demand for
payment is made under any such Letter of Credit, Bank shall treat
such demand as an Advance to Borrower of the equivalent of the
amount thereof (plus cable charges) in United States currency at
the then prevailing rate of exchange in San Francisco,
California, for sales of that other currency for cable transfer
to the country of which it is the currency.
Upon the issuance of any Letter of Credit payable in a currency
other than United States Dollars, Bank shall create a reserve
(the "Letter of Credit Reserve") under the Working Capital Line
of Credit for Letters of Credit against fluctuations in currency
exchange rates, in an amount equal to ten percent (10%) of the
face amount of such Letter of Credit. The amount of such reserve
may be amended by Bank from time to time to account for
fluctuations in the exchange rate. The availability of funds
under the Working Capital Line of Credit shall be reduced by the
amount of such reserve for so long as such Letter of Credit
remains outstanding.
2. The first sentence of Section 2.1 entitled "Advances" is hereby
amended in its entirety, to read as follows:
Subject to and upon the terms and conditions of this Agreement,
Bank agrees to make Advances to Borrower in an aggregate amount
not to exceed the committed Revolving Line minus the face amount
of all outstanding Letters of Credit (including drawn but
unreimbursed Letters of Credit) or the Borrowing Base minus the
face amount of all outstanding Letters of Credit (including drawn
but unreimbursed Letters of Credit), whichever is less.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
------------------
wherever necessary to reflect the changes described above.
5. NO DEFENSES OF BORROWER. Borrower agrees that as of this date, it has no
-----------------------
defenses against the obligations to pay any amounts under the Indebtedness.
6. CONTINUING VALIDITY. Borrower 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 Bark 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.
7. JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
------------------
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit. or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Bank cannot avail
2
itself of the courts of the Commonwealth of Massachusetts, then venue shall lie
in Santa ▇▇▇▇▇ County, California.
8. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
----------------
only when it shall have been executed by Borrower and Bank (provided, however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Bank in California).
BORROWER: BANK:
LIGHTBRIDGE, INC. SILICON VALLEY BANK, doing business as
SILICON VALLEY EAST
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------- -------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------- -------------------------
Title: Controller Title: Vice President
---------------------- -------------------------
SILICON VALLEY BANK
By: /s/ ▇▇▇ ▇▇▇▇▇
-------------------------
Name: ▇▇▇ ▇▇▇▇▇
-------------------------
Title: AVP
-----------------------
(Signed at Santa ▇▇▇▇▇ County, CA)
3
FOURTH LOAN MODIFICATION AGREEMENT
This Fourth Loan Modification Agreement is entered into as of June 5, 1997,
by and between Lightbridge, Inc., a Delaware corporation "Borrower") with its
principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and Silicon
Valley Bank, a California-chartered bank ("Bank") with its principal place of
business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and with a loan production
office located at Wellesley Office Park, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under the name "Silicon Valley East".
1. DESCRIPTION OF EXISTING INDEBTEDNESS. Among the indebtedness which may
------------------------------------
be owing by Borrower to Lender (collectively, "Indebtedness"), Borrower is
indebted to Lender pursuant to, among other documents, an Amended and Restated
Credit Agreement, dated as of June 18, 1996, as amended and in effect on the
date hereof (as so amended, the "Loan Agreement"). The Loan Agreement provides
for, among other things, a Committed Revolving Line in the original principal
amount of Four Million and 00/100 Dollars ($4,000,000) (the "Committed Revolving
Line"), including a sublimit for Letters of Credit of One Million Two Hundred
Fifty Thousand and 00/100 Dollars ($1,250,000), and a Committed Equipment Line
in the original principal amount of Two Million and 00/100 Dollars ($2,000,000).
Defined terms used herein without definition shall have the meanings ascribed
thereto in the Loan Agreement.
2. DESCRIPTION OF COLLATERAL. Repayment of the Indebtedness is secured by
-------------------------
the Collateral as described in the Security Agreement and in the Trademarks
Assignment.
Hereinafter, the Loan Agreement, together with all other documents
evidencing or securing the Indebtedness, shall be referred to collectively as
the "Existing Loan Documents."
3. MODIFICATIONS TO LOAN AGREEMENT. The parties hereto agree that the Loan
-------------------------------
Agreement shall be amended as follows:
(a) the definition of "Current Liabilities" in Section 1.1 of the Loan
Agreement is hereby amended by: (1) deleting the fourth fine of said definition
in its entirety; and (ii) inserting in place thereof the following:
"...therein, all outstanding Loans made under...."
(b) The definition of "Loans" in Section 1.1 of the Loan Agreement is
hereby amended by: (i) deleting said definition in its entirety; and (ii)
inserting in place thereof the following:
""Loans" means, collectively, the Advances, Equipment Advances,
Letters of Credit and any other extension of credit by Bank for the
benefit of Borrower hereunder."
1
(c) The definition of "Revolving Maturity Date" in Section 1.1 of the
Loan Agreement is hereby amended by: (i) deleting the reference to "June 5,
1997" included in said definition; and (ii) inserting in place thereof "June 4,
1998."
(d) Section 6.3 of the Loan Agreement is hereby amended by: (i)
deleting the third line of the second full paragraph of said Section 6.3 in its
entirety; and (ii) inserting in place thereof the following:
" ... Exhibit B hereto, together with an aged listing of accounts
---------
receivable."
(e) Section 6.8 of the Loan Agreement is hereby amended by: (i)
deleting said Section 6.8 in its entirety; and (ii) inserting in place thereof
the following:
"Section 6.8 Quick Ratio. Borrower shall maintain, as of the
-----------
last day of each fiscal quarter, a ratio of Quick Assets to Current
Liabilities of at least 3.00:1.0."
(f) Section 6.9 of the Loan Agreement is hereby amended by: (i)
deleting said Section 6.9 in its entirety; and (ii) inserting in place thereof
the following:
"Section 6.9 Tangible Net Worth. Borrower shall maintain, as of
------------------
the last day of each fiscal quarter, a Tangible Net Worth of at least
$25,000,000."
(g) Section 6 of the Loan Agreement is hereby further amended by: (i)
deleting Sections 6.10, 6.11, 6.12 and 6.13 in their entirety; and (ii)
renumbering the remainder of Section 6 accordingly.
(h) Section 8.2(a) of the Loan Agreement is hereby amended by: (i)
deleting said Section 8.2(a) in its entirety; and (ii) inserting in place
thereof the following:
"(a) If Borrower fails to perform any obligation under Sections
6.3, 6.6, 6.7, 6.8 or 6.9 or violates any of the covenants contained
in Article 7 of this Agreement, or"
(i) Exhibits A, B and C of the Loan Agreement are hereby amended by:
-------------------
(i) by deleting said Exhibits A, B and C in their entirety; and (ii) by
----------
inserting in place thereof Exhibits A, B and C attached to this Fourth Loan
-------------------
Modification Agreement.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
------------------
wherever to reflect the modifications described in Section 3 of this Fourth Loan
Modification Agreement.
2
5. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
------------------------------
warrants to Bank as follows:
(a) Borrower has adequate corporate power and authority to execute and
deliver this Fourth Loan Modification Agreement and the other documents executed
and/or delivered in connection herewith (collectively, the "Modification
Documents") and to perform its respective obligations hereunder and thereunder,
and under the Existing Loan Documents, as amended hereby. Each of this Fourth
Loan Modification Agreement and the other Modification Documents has been duly
authorized, executed and delivered by Borrower, and does not contravene any law,
rule or regulation applicable to Borrower or any of the terms of its Certificate
of Incorporation or by-laws, or any other indenture, agreement or undertaking to
which Borrower is a party. This Fourth Loan Modification Agreement and the
other Modification Documents effectively amend the Existing Loan Documents in
accordance with the terms hereof and thereof. Borrower's obligations hereunder
and under the other Modification Documents, and under the Loan Agreement and the
other Existing Loan Documents, each as amended hereby and thereby, constitute
legally valid and binding obligations of Borrower enforceable against Borrower
in accordance with their respective terms.
(b) All of the representations and warranties made by Borrower in the
Loan Agreement and the other Loan Documents are true and correct on the date
hereof as if made on and as of the date hereof and are so repeated herein,
except that representations and warranties of financial statements or conditions
as of an earlier date relate solely to such earlier date.
(c) Upon the execution and delivery of this Fourth Loan Modification
Agreement and the satisfaction of the conditions precedent set forth in Section
6 hereof, no Event of Default shall exist and be continuing.
6. CONDITIONS PRECEDENT.
--------------------
(a) The agreements contained herein and the amendments contemplated
hereby shall not be effective unless each of the following conditions precedent
is satisfied:
(1) All of the representations and warranties made by Borrower in
Section 5 hereof shall be true and correct;
(2) Bank shall have received a Facility Fee equal to one-quarter
of one percentage point of the Committed Revolving Line or Ten
Thousand Dollars ($10,000), which fee shall be fully earned and non-
refundable.
(3) Bank shall have received an opinion of Borrower's counsel in
form and substance satisfactory to Bank;
3
(4) Bank shall have received, in form and substance satisfactory
to Bank, a certificate(s) of the Treasurer of the Borrower as to the
satisfaction of the condition specified in clauses (1), (2) and (3) of
this Section 6(a);
(5) Bank shall have received, in form and substance satisfactory
to Bank, such other documents as Bank shall deem necessary and/or
appropriate.
Upon satisfaction of each of the conditions precedent set forth in this Section
6(a), the agreements contained herein and the amendments contemplated hereby
shall be deemed effective as of the date hereof
(b) From and after the satisfaction of the conditions precedent set
forth in Section 6(a) hereof, Bank's obligations to make any Loans to Borrower
under the Loan Agreement and the other Loan Documents shall be subject to the
additional conditions that (i) all of the representations and warranties made by
Borrower herein, whether directly or incorporated herein by reference, shall be
true and correct immediately prior to the time of the proposed Loan as if made
at and as of such time, except that representations and warranties of financial
statements or conditions as of an earlier date relate solely to such earlier
date, and (ii) no Event of Default, or event or condition which, with notice or
lapse of time, or both, would constitute an Event of Default, would occur after
giving effect to the making of such Loan. From and after the satisfaction of
the conditions precedent set forth in Section 6(a) hereof, each request by
Borrower for a Loan under the Loan Agreement and the other Loan Documents shall
be deemed to be a representation and warranty by Borrower that all of the
conditions precedent in this Section 6(b) have been met.
7. NO DEFENSES OF BORROWER. Borrower agrees that it has no defenses to
-----------------------
the payment of all Obligations, whether under the Loan Agreement, the other Loan
Documents or otherwise.
8. CONTINUING VALIDITY. Borrower understands and agrees that in modifying
-------------------
the Existing Loan Documents, Bank is relying upon Borrower's representations,
warranties and agreements contained in these Modification Documents and in the
Existing Loan Documents. Except as expressly modified pursuant to this Fourth
Loan Modification Agreement, the terms of the Existing Loan Documents remain
unchanged and in full force and effect. Bank's agreement to amend the Existing
Loan Documents pursuant to this Fourth Loan Modification Agreement shall in no
way obligate Bank to make any future amendments or modifications to the Existing
Loan Documents. Nothing in this Fourth Loan Modification Agreement shall
constitute a satisfaction of Borrower's Obligations to Bank. It is the
intention of Bank and Borrower to retain as liable parties all makers and
endorsers of the 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 Fourth Loan Modification Agreement.
4
9. EXPENSES. Borrower agrees to pay to Bank upon demand (a) an amount
--------
equal to any and all out-of-pocket costs or expenses (including legal fees and
disbursements) incurred or sustained by Bank in connection with the preparation
of these Modification Documents and related matters, and (b) from time to time
any and all out-of-pocket costs or expenses (including legal fees and
disbursements) hereafter incurred or sustained by Bank in connection with the
administration of credit extended by Bank to Borrower or the preservation of or
enforcement of Bank's rights under any of the Loan Documents or in respect of
any of Borrower's other obligations to Bank.
10. MISCELLANEOUS. This Fourth Loan Modification Agreement shall be
-------------
considered a "Loan Document" under and as defined in the Loan Agreement. This
Fourth Loan Modification Agreement shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts (without giving
effect to the conflicts of law principles thereof), and shall take effect as a
sealed instrument under such laws. Borrower accepts for itself and in
connection with its properties, unconditionally, the non-exclusive jurisdiction
of any state or federal court of competent jurisdiction in The Commonwealth of
Massachusetts in any action, suit or proceeding of any kind against it which
arises out of or by reason of this Fourth Loan Modification Agreement; provided,
--------
however, that if for any reason Bank cannot avail itself of the courts of The
-------
Commonwealth of Massachusetts, then venue shall lie in Santa ▇▇▇▇▇ County,
California. This Fourth Loan Modification Agreement shall become effective only
when it shall have been executed by Borrower and Bank (provided, however, in no
event shall this Fourth Loan Modification Agreement become effective until
signed by an officer of Bank in California).
IN WITNESS WHEREOF, the parties have caused this Fourth Loan Modification
Agreement to be duly executed and delivered as of the 5th day of June, 1997.
LIGHTBRIDGE, INC.
By: /s/ ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇
-------------------------------------------
Title: President & Chief Executive Officer
-------------------------------------------
SILICON VALLEY BANK, doing business
as SILICON VALLEY EAST
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------------
Title: Vice President
-------------------------------------------
5
SILICON VALLEY BANK
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------
Title: AVP
-------------------------------------------
(signed in Santa ▇▇▇▇▇ County, California)
6
EXHIBIT A
LOAN PAYMENT/ADVANCE TELEPHONE REQUEST FORM
DEADLINE FOR SAME DAY PROCESSING IS 3:00 P.M., P.S.T.
TO: CENTRAL CLIENT SERVICE DIVISION DATE:
FAX#: (408) TIME:
FROM: -------------------------------------------------------------------------
BORROWER'S NAME
FROM: -------------------------------------------------------------------------
AUTHORIZED SIGNER'S NAME
-------------------------------------------------------------------------------
AUTHORIZED SIGNATURE
PHONE: ------------------------------------------------------------------------
FROM ACCOUNT# -------------------------- TO ACCOUNT# --------------------------
===============================================================================
REQUESTED TRANSACTION TYPE: REQUEST DOLLAR AMOUNT
--------------------------- ---------------------
PRINCIPAL INCREASE (ADVANCE) $ ------------------------------
PRINCIPAL PAYMENT (ONLY) $ ------------------------------
INTEREST PAYMENT (ONLY) $ ------------------------------
PRINCIPAL AND INTEREST PAYMENT $ ------------------------------
OTHER INSTRUCTIONS: _____________________________________________________
===============================================================================
All representations and warranties of Borrower stated in the Amended and
Restated Credit Agreement, dated as of June 18, 1996, between Borrower and
Silicon Valley Bank, as amended and in effect as of the date hereof, are true,
correct and complete in all material respects as of the date of the telephone
request for an Advance/Equipment Advance confirmed by this Borrowing
Certificate; provided, however, that those representations and warranties
expressly referring to another date shall be true, correct and complete in all
material respects as of such date.
===============================================================================
BANK USE ONLY
TELEPHONE REQUEST:
-----------------
The following person is authorized to request the loan payment transfer/loan
advance on the advance designated account and is known to me.
------------------------------ --------------------------------
Authorized Requester Phone #
------------------------------ --------------------------------
Received by (Bank) Phone #
-----------------------------------
Authorized Signature (Bank)
===============================================================================
EXHIBIT B
BORROWING BASE CERTIFICATE
Borrower: Lightbridge, Inc.
Bank: Silicon Valley Bank
Commitment Amount: $4,000,000.00
================================================================================
ACCOUNTS RECEIVABLE:
1. Accounts Receivable Book Value as of ________ $ ___________
2. Additions (please explain on reverse) $ ___________
3. TOTAL ACCOUNTS RECEIVABLE $ ___________
ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)
4. Amounts over 90 days due $ ___________
5. Balance of 50% over 90 day accounts $ ___________
6. Concentration Limits $ ___________
7. Foreign Accounts $ ___________
8. Governmental Accounts $ ___________
9. Contra Accounts $ ___________
10. Promotion or Demo Accounts $ ___________
11. Intercompany/Employee Accounts $ ___________
12. Other (please explain on reverse) $ ___________
13. TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS $ ___________
14. Eligible Accounts (#3 minus # 13) $ ___________
15. loan VALUE OF ACCOUNTS (80% OF #14) $ ___________
INVENTORY $ N/A
16. Inventory Value as of _____________ ___________
$ N/A
17. LOAN VALUE INVENTORY (___% OF # 16) ___________
BALANCES
18. Maximum Loan Amount $ ___________
19. Total Funds Available [Lesser of #18 or (#15 plus #17)] $ ___________
20. Present balance owing on Line of Credit $ ___________
21. Outstanding under Sublimits (Letters of Credit) $ ___________
22. RESERVE POSITION (#19 minus #20 and #21) $ ___________
The undersigned represents and warrants that the foregoing is true, complete and
correct, and that the information reflected in this Borrowing Base Certificate
complies with the representations and warranties set forth in the Amended and
Restated Credit Agreement, dated as of June 18, 1996, between the undersigned
and Silicon Valley Bank, as amended and in effect on the date hereof.
COMMENTS:
-------------------------------
By: ---------------------------
Authorized Signer
------------------------------------
BANK USE ONLY
Received by: __________________
Authorized Signer
Date: _________________________
Verified: ____________________
Authorized Signer
Date: _________________________
------------------------------------
19
COMPLIANCE CERTIFICATE
TO: SILICON VALLEY BANK ("Bank")
FROM: LIGHTBRIDGE, INC. ("Borrower")
The undersigned authorized officer of Lightbridge, Inc. hereby certifies
that in accordance with the terms and conditions of the Amended and Restated
Credit Agreement dated as of June 18, 1996 between Borrower and Bank, as amended
and in effect on the date hereof (as so amended, the "Agreement"), (i) Borrower
is in complete compliance for the period ending _______________ with all
required covenants except as noted below and (ii) all representations and
warranties of Borrower stated in the Agreement are true and correct in all
material respects as of the date hereof Attached herewith are the required
documents supporting the above certification. The Officer further certifies
that these are prepared in accordance with Generally Accepted Accounting
Principles (GAAP) and are consistently applied from one period to the next
except as explained in an accompanying letter or footnotes. The Officer
expressly acknowledges that no borrowings may be requested by the Borrower at
any time or date of determination that Borrower is not in compliance with any of
the terms of the Agreement, and that such compliance is determined not just at
the date this certificate is delivered.
Please indicate compliance status by circling Yes/No under "Complies"
column.
Reporting Covenant Required Complies
-------------------------------- ------------------- --------
Monthly financial statements Monthly within 30 days Yes No
Annual (CPA Audited) FYE within 120 days Yes No
A/R Agings Monthly within 25 days Yes No
A/R Audit Annual* Yes No
Financial Covenant Required Actual Complies
-------------------------------- ------------------- ------- --------
Maintain on a Quarterly Basis:
Minimum Quick Ratio 3.00:1.0 ___:1.0 Yes No
Minimum Tangible Net Worth $25,000,000 $______ Yes No
*So long as Loans are outstanding under the Amended and Restated Credit
Agreement, dated as of June 18, 1996, between Borrower and Bank, as amended and
in effect from time to time.
Comments Regarding Exceptions: See Attached
Sincerely,
______________________________
Signature
Title:
Date:
------------------------------------
BANK USE ONLY
Received by: __________________
Authorized Signer
Date: _________________________
Verified: ____________________
Authorized Signer
Date: _________________________
Compliance Status: Yes No
------------------------------------
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of October 15, 1997, by
and between Lightbridge, Inc. ("Borrower") whose address is ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and Silicon Valley Bank, a California-chartered
bank ("Bank"), with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and with a loan production office located at Wellesley Office
Park, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under
the name "Silicon Valley East".
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 Credit Agreement, dated June 18, 1996,
as may be amended from time to time (the "Credit Agreement"). The Credit
Agreement provided for, among other things, a Committed Revolving Line in the
original principal amount of Four Million and 00/100 Dollars ($4,000,000.00), as
evidenced by an Amended and Restated Promissory Note, dated June 18, 1996 (the
"Working Capital Line of Credit Note"), and a Committed Equipment Line in the
original principal amount of Two Million and 00/100 Dollars ($2,000,000.00), as
evidenced by a Promissory Note, dated June 18, 1996 (the "Equipment Line of
Credit Note"). Defined terms used but not otherwise defined herein shall have
the same meanings as in the Credit 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 the
-------------------------
Collateral as described in the Security Agreement and in the Trademarks
Assignment as defined in the Loan Agreement.
Hereinafter, the above-described security documents, together with all other
documents securing payment 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 Equipment Line of Credit Agreement.
---------------------------------------------------------
1. The interest rate to be applied to the unpaid principal balance of
the Equipment Line of Credit Note is hereby decreased, effective as
of the date of this Loan Modification Agreement, to a rate per annum
equal to the Prime Rate, as defined herein.
A. Modification(s) to Credit Agreement.
-----------------------------------
1. Effective as of the date of this Loan Modification Agreement,
Section 2.4(a) entitled "Interest Rate" is hereby amended in its
entirety to read as follows:
Except as set forth in Section 2.4(b), each Advance and each
Equipment Advance shall bear interest at a rate per annum equal to
the Prime Rate.
2. Section 6.3 entitled "Financial Statements, Reports, Certificates"
is hereby amended to require Borrower to provide Bank its interim
consolidated balance sheet and income statement, with a Compliance
Certificate, within thirty (30) days (rather than forty-five (45)
days) after the end of each quarter.
3. Section 6.8 entitled "Quick Ratio" is hereby amended in its entirety
to read as follows:
1
Effective as of Borrower's fiscal quarter ended September 30, 1997,
Borrower shall maintain, as of the last day of each fiscal quarter,
a ratio of Quick Assets to Current Liabilities of at least 2.00 to
1.00.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
------------------
wherever necessary to reflect the changes described above.
5. NO DEFENSES OF BORROWER. Borrower agrees that, as of this date, it has no
-----------------------
defenses against the obligations to pay any amounts under the Indebtedness.
6. CONTINUING VALIDITY. Borrower 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.
7. JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
------------------
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit, or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Bank cannot avail itself of the courts of the Commonwealth of
Massachusetts, then venue shall lie in Santa ▇▇▇▇▇ County, California.
8. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
----------------
only when it shall have been executed by Borrower and Bank (provided, however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Bank in California).
This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: BANK:
LIGHTBRIDGE, INC. SILICON VALLEY BANK, doing business as
SILICON VALLEY EAST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By:
----------------------- -------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name:
----------------------- -------------------------
Title: Chief Financial Officer Title:
----------------------- -------------------------
SILICON VALLEY BANK
By:
-------------------------
Name:
-------------------------
Title:
-----------------------
(Signed at Santa ▇▇▇▇▇ County, CA)
2
SIXTH LOAN MODIFICATION AGREEMENT
This Sixth Loan Modification Agreement is entered into as of June 26, 1998,
by and between LIGHTBRIDGE, INC., a Delaware corporation, with its principal
place of business at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(the "Borrower") and SILICON VALLEY BANK, a California-chartered bank ("Bank"),
with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and with a loan production office located at Wellesley Office Park, ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, doing business under the name "Silicon
Valley East".
1. DESCRIPTION OF EXISTING INDEBTEDNESS. Among other indebtedness which may
------------------------------------
be owing by Borrower to Bank, Borrower is indebted to Bank pursuant to a loan
arrangement dated as of June 18, 1996, evidenced by, among other documents, (i)
an Amended and Restated Promissory Note dated June 18, 1996 in the original
principal amount of Four Million Dollars ($4,000,000.00) (the "Working Capital
Note" or "Working Capital Line"), and (ii) a Promissory Note dated June 18, 1996
in the original principal amount of Two Million Dollars ($2,000,000.00) (the
"Equipment Note" or "Equipment Line") (hereinafter, individually and
collectively, the "Notes"). The Notes are governed by the terms and conditions
of a certain Amended and Restated Credit Agreement dated June 18, 1996 between
Borrower and Bank, as amended by certain Loan Modification Agreements dated as
of August 19, 1996, December 12, 1996, March 5, 1997, June 5, 1997, and October
15, 1997 (as amended, the "Loan Agreement"). Capitalized terms used but not
otherwise defined herein shall have the same meaning as 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 the
-------------------------
Collateral as described in the Loan Agreement, which includes certain Collateral
defined in (i) a Security Agreement dated April 1, 1992 by Borrower in favor of
Bank, as amended by a First Amendment to Security agreement dated October 5,
1994, and (ii) a Collateral Assignment of Trademarks dated as of October 5, 1994
(together with any other collateral security granted to Bank, the "Security
Documents").
Hereinafter, the Security Documents, together with all other documents
evidencing or securing the Indebtedness shall be referred to as the "Existing
Loan Documents".
3. DESCRIPTION OF CHANGE IN TERMS.
------------------------------
A. Modification(s) to Equipment Note.
---------------------------------
1. The maximum principal amount of the Equipment Note is hereby
increased from Two Million Dollars ($2,000,000.00) to Three Million
Dollars ($3,000,000.00).
2. Effective as of October 15, 1997, the interest rate applied to the
unpaid principal balance of the Equipment Line is accruing at a rate
per annum equal to the Prime Rate.
B. Modification(s) to Loan Agreement.
---------------------------------
1. The Loan Agreement shall be amended by deleting the following
definition appearing in Section 1.1 thereof:
"Revolving Maturity Date" means June 5, 1998."
and inserting in lieu thereof the following:
3
"Revolving Maturity Date" means June 4, 1999."
2. The Loan Agreement shall be amended by deleting the following
definition appearing in Section 1.1 thereof:
"Committed Equipment Line" means Two Million Dollars
($2,000,000.00)."
and inserting in lieu thereof the following:
"Committed Equipment Line" means Three Million Dollars
($3,000,000.00). Notwithstanding the foregoing, the Committed
Equipment Line shall be reduced by the outstanding balance of
Equipment Advances made to Borrower pursuant to Section 2.2
hereof."
3. The Loan Agreement shall be amended by inserting after Section 2.2
thereof entitled Equipment Advances the following new section:
"2.2.A. 1998-2001 Equipment Advances.
----------------------------
(a) Subject to and upon the terms and conditions of this Agreement,
at any time from June 26, 1998 (the "Modification Date") through the
-------
date which is thirty-six (36) months from the Modification Date (the
"Second Equipment Availability End Date"), Bank agrees to make
advances (each an "Equipment Advance" and collectively, the
"Equipment Advances") to Borrower in an aggregate outstanding amount
not to exceed the Committed Equipment Line. To evidence the
Equipment Advance or Equipment Advances, Borrower shall deliver to
Bank, at the time of each Equipment Advance request, an invoice for
the equipment to be purchased. The Equipment Advances shall be used
only to purchase Equipment and shall not exceed One Hundred Percent
(100%) of the invoice amount of such equipment purchased by Borrower
in the ordinary course of business, excluding taxes, shipping,
warranty charges, freight discounts and installation expense.
Software may, however, constitute only up Five Hundred Thousand
Dollars ($500,000.00) of aggregate Equipment Advances.
(b) Interest shall accrue from the date of each Equipment Advance
at the per annum rate equal to the Prime Rate and shall be payable
monthly on the Payment Date. Amounts currently amortizing under
Section 2.2 above shall continue to be repaid as provided in Section
2.2 above, and shall continue to be treated as advances under the
Committed Equipment Line. Any Equipment Advances made pursuant to
this Section 2.2.A that are outstanding on any of the following
dates (the "Amortization Dates"), will be payable in Thirty-Six (36)
equal monthly installments of principal, plus all accrued interest,
beginning on the Payment Date of the month following the applicable
Amortization Date, and ending on the thirty-fifth month thereafter.
The Amortization Dates shall be as follows: (i) the date which is
six (6) months from the Modification Date; (ii) the date which is
twelve (12) months from the Modification Date; (iii) the date which
is eighteen (18) months from the Modification Date; (iv) the date
which is twenty-four (24) months from the Modification Date; (v) the
date which is thirty (30) months from the Modification Date; and
(vi) the date which is thirty-six (36) months from the Modification
Date. Equipment Advances, once repaid, may not be reborrowed.
4
(c) When Borrower desires to obtain an Equipment Advance, Borrower
shall notify Bank (which notice shall be irrevocable) by facsimile
transmission to be received no later than 3:00 p.m. Pacific time one
(1) Business Day before the day on which the Equipment Advance is to
be made. Such notice shall be substantially in the form of Exhibit
A. The notice shall be signed by a Responsible Officer or its
designee and include a copy of the invoice for the Equipment to be
financed."
4. The Loan Agreement shall be amended by deleting the following text
appearing the second paragraph of Section 6.3 thereof entitled
"Financial Statements, Reports, Certificates":
"Within twenty-five (25) days after the last day of each
month, Borrower shall deliver to Bank a Borrowing Base
Certificate signed by a Responsible Officer in substantially
the form of Exhibit B hereto, together with aged listings of
---------
accounts receivable."
and inserting in lieu thereof the following:
"Within twenty-five (25) days after the last day of each
month, with respect to which either (i) Obligations are
outstanding, (ii) Advances were made, or (iii) Letters of
Credit were issued, Borrower shall deliver to Bank a Borrowing
Base Certificate signed by a Responsible Officer in
substantially the form of Exhibit B hereto, together with aged
---------
listings of accounts receivable."
5. The Loan Agreement shall be amended by deleting in its entirety the
third paragraph of Section 6.3 entitled "Financial Statements,
Reports, Certificates" and inserting in lieu thereof the following:
"Within forty-five (45) days after the last day of each
quarter, Borrower shall deliver to Bank quarterly financial
statements together with a Compliance Certificate signed by a
Responsible Officer in substantially the form of Exhibit C
---------
hereto."
6. The Loan Agreement shall be amended by deleting Section 7.3 thereof
entitled "Mergers or Acquisitions" and inserting in lieu thereof the
following:
"Mergers or Acquisitions. Merge or consolidate, or permit
--------------------------
any of its Subsidiaries to merge or consolidate, with or into
any other business organization, or acquire, or permit any of
its Subsidiaries to acquire, all or substantially all of the
capital stock or property of another Person without prior
written approval by the Bank."
7. The Compliance Certificate appearing as Exhibit C to the Loan
---------
Agreement is hereby replaced with the Compliance Certificate
attached as Exhibit A hereto.
---------
4. FEE. Borrower shall pay to Bank a modification fee equal to Three Thousand
----
Dollars ($3,000.00) for the Equipment Line, plus Ten Thousand Dollars
($10,000.00) for the Working Capital Line, which fee shall be due on the date
hereof and which shall be deemed fully earned as of the date hereof.
5
5. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended
-------------------
wherever necessary to reflect the changes described above.
6. RATIFICATION OF LOAN DOCUMENTS. Borrower hereby ratifies, confirms, and
------------------------------
reaffirms all terms and conditions of all secured or other collateral granted to
the Bank, and confirms that the indebtedness secured thereby includes, without
limitation, the Indebtedness.
7. NO DEFENSES OF BORROWER. Borrower agrees that, as of this date, it has no
-----------------------
defenses against the obligations to pay any amounts under the Indebtedness.
8. CONTINUING VALIDITY. Borrower 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.
9. JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
------------------
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit, or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Bank cannot avail itself of the courts of the Commonwealth of
Massachusetts, then venue shall lie in Santa ▇▇▇▇▇ County, California.
10. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
----------------
only when it shall have been executed by Borrower and Bank (provided, however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Bank in California).
This Loan Modification Agreement is executed as of the date first written above.
("BORROWER")
LIGHTBRIDGE, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
---------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
---------------------------
Title: Chief Financial Officer
---------------------------
6
(BANK)
SILICON VALLEY BANK, doing business as SILICON
VALLEY EAST
By:______________________________________
Name:____________________________________
Title:___________________________________
SILICON VALLEY BANK
By:______________________________________
Name:____________________________________
Title:___________________________________
(signed in Santa ▇▇▇▇▇ County, California)
7
EXHIBIT A
COMPLIANCE CERTIFICATE
TO: SILICON VALLEY BANK
FROM: LIGHTBRIDGE, INC.
The undersigned authorized officer of LIGHTBRIDGE, INC. hereby certifies
that in accordance with the terms and conditions of the Loan and Security
Agreement between Borrower and Bank (the "Agreement"), (i) Borrower is in
compliance for the period ending ____________________ with all required
covenants except as noted below and (ii) all representations and warranties of
Borrower stated in the Agreement are true and correct in all material respects
as of the date hereof. Attached herewith are the required documents supporting
the above certification. The Officer further certifies that these are prepared
in accordance with Generally Accepted Accounting Principles (GAAP) and are
consistently applied from one period to the next except as explained in an
accompanying letter or footnotes. The Officer expressly acknowledges that no
borrowings may be requested by the Borrower at any time or date of determination
that Borrower is not in compliance with any of the terms of the Agreement, and
that such compliance is determined not just at the date this certificate is
delivered.
Please indicate compliance status by circling Yes/No under "Complies" column.
Reporting Covenant Required Complies
------------------ -------- --------
Quarterly financial statements and CC Quarterly within 45 days Yes No
Annual (CPA Audited) FYE within 120 days Yes No
BBC and A/R Agings Monthly within 25 days Yes No
(when borrowing)
Financial Covenant Required Actual Complies
--------------------------------------- ----------------- -------- --------
Maintain on a Quarterly Basis:
Minimum Quick Ratio 2.0:1.0 ___:1.0 Yes No
Minimum Tangible Net Worth $25,000,000 $_______ Yes No
------------------------------
BANK USE ONLY
Received By: _______________
Date: ______________________
Reviewed
By: ________________________
Compliance Status: Yes/No
------------------------------
Comment Regarding Exceptions:
Sincerely, LIGHTBRIDGE, INC.
______________________ Date:_____________
SIGNATURE
______________________
TITLE
8