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Exhibit 10.71
SILICON VALLEY BANK
AMENDMENT TO LOAN AGREEMENT
Borrower: Alpha Microsystems
Address: 2722 South Fairview Street
Santa Ana, California 92704
Dated: March 7, 1996
THIS AMENDMENT TO LOAN AGREEMENT is entered into between SILICON VALLEY
BANK ("Silicon") and the borrower named above (the "Borrower").
The Parties agree to amend the Loan and Security Agreement between them
(the "Loan Agreement") dated July 10, 1995, as amended, effective as of the
date hereof. (Capitalized terms used but not defined in this Amendment, shall
have the meanings set forth in the Loan Agreement.)
1. Modification to Financial Covenants. The section of the Schedule
to the Loan Agreement entitled "Financial Covenants (Section 4.1)" is hereby
deleted in its entirety and replaced with the following:
"Financial Covenants
(Section 4.1): Borrower shall comply with all of the following
covenants. Compliance shall be determined as of the end
of each month, except as otherwise specifically provided
below:
Quick Asset Ratio: Borrower shall maintain a ratio of "Quick Assets" to
current liabilities of not less than 1.00 to 1.
Tangible Net Worth: Borrower shall maintain a tangible net worth of not less
than $4,700,000.
Debt to Tangible
Net Worth Ratio: Borrower shall maintain a ratio of total liabilities to
tangible net worth of not more than 1.25 to 1.
Profitability Borrower shall not incur a loss (after taxes) for the
fiscal year ending February 29, 1996 in excess of
$3,600,000, of which amount $2,000,000 will be
attributable to the write down of Borrower's intangible
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assets. Thereafter, Borrower shall not incur any losses
(after taxes) in any fiscal quarter, other than for
losses (after taxes) in two fiscal quarters during any
fiscal year if the aggregate amount of such losses
for such two fiscal quarters does not exceed $250,000.
Definitions: "Current asset," and "current liabilities" shall have
the meanings ascribed to them in accordance with
generally accepted accounting principles.
"Tangible net worth" means the excess of total assets
over total liabilities, determined in accordance with
generally accepted accounting principles, excluding
however all assets which would be classified as
intangible assets under generally accepted accounting
principles, including without limitation goodwill,
licenses, patents, trademarks, trade names, copyrights,
capitalized software and organizational costs, licences
and franchises.
"Quick Assets" means cash on hand or on deposit in
banks, readily marketable securities issued by the
United States, readily marketable commercial paper rated
"A-1" by Standard & Poor's Corporation (or a similar
rating by a similar rating organization), certificates
of deposit and banker's acceptances, and accounts
receivable (net of allowance for doubtful accounts).
Deferred Revenues: For purposes of the above quick asset ratio, deferred
revenues shall not be counted as current liabilities.
For purposes of the above debt to tangible net worth
ratio, deferred revenues shall not be counted in
determining total liabilities but shall be counted in
determining tangible net worth for purposes of such
ratio. For all other purposes deferred revenues shall be
counted as liabilities in accordance with generally
accepted accounting principles.
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Subordinated Debt: "Liabilities" for purposes of the foregoing covenants do
not include indebtedness which is subordinated to the
indebtedness to Silicon under a subordination agreement
in form specified by Silicon or by language in the
instrument evidencing the indebtedness which is
acceptable to Silicon."
2. Fee. Borrower shall pay to Silicon a fee in the amount of $500,
which shall be in addition to interest and all other amounts due Silicon and
shall not be refundable.
3. Representations True. Borrower represents and warrants to Silicon
that all representations and warranties set forth in the Loan Agreement, as
amended hereby, are true and correct.
4. General Provisions. This Amendment, the Loan Agreement, any prior
written amendments to the Loan Agreement signed by Silicon and the Borrower,
and the other written documents and agreements between Silicon and the Borrower
set forth in full all of the representations and agreements of the parties with
respect to the subject matter hereof and supersede all prior discussions,
representations, agreements and understandings between the parties with respect
to the subject hereof. Except as herein expressly amended, all of the terms and
provisions of the Loan Agreement, and all other documents and agreements
between Silicon and the Borrower shall continue in full force and effect and
the same are hereby ratified and confirmed.
Borrower: Silicon:
ALPHA MICROSYSTEMS SILICON VALLEY BANK
By /s/ MICHAEL J. LOWELL By /s/ TERRY BESS
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President or Vice President Vice President
By /s/ JOHN GLADE
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Secretary or Ass't Secretary
Guarantor's Consent
The undersigned guarantor acknowledges that its consent to the
foregoing Amendment is not required, but the undersigned nevertheless does
hereby consent to the foregoing Amendment and to the documents and agreements
referred to therein and to all
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future modifications and amendments thereto, and to any and all other present
and future documents and agreements between or among the foregoing parties.
Nothing herein shall in any way limit any of the terms or provisions of the
Continuing Guaranty executed by the undersigned in favor of Silicon, which is
hereby ratified and affirmed and shall continue to full force and effect.
ALPHAHEATHCARE, INC.
By: /s/ MICHAEL J. LOWELL
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Title: CFO and Vice President
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