EXHIBIT 10.2
*** CERTAIN CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT.
WAIVER AND AMENDMENT NO. 2 TO
REVOLVING/TERM LOAN AGREEMENT
THIS WAIVER AND AMENDMENT NO. 2 TO REVOLVING/TERM LOAN AGREEMENT
(this "Waiver and Amendment"), dated as of June 28, 2002, is entered into by and
among the financial institutions listed on the signature pages hereof
(individually, a "Lender" and collectively, the "Lenders"), Union Bank of
California, N.A., as Administrative Agent (in such capacity, the "Administrative
Agent"), and ViaSat, Inc., a Delaware corporation (the "Borrower"), with
reference to the following facts:
RECITALS
A. The Borrower, the Lenders and the Administrative Agent are
parties to that certain Revolving/Term Loan Agreement, dated as of June 21,
2001, as amended (the "Loan Agreement"), pursuant to which the Lenders have
provided the Borrower with certain credit facilities.
B. Borrower is currently in default under Section 9.1(c) of the
Loan Agreement given Borrower's failure to comply with each of the following
provisions of the Loan Agreement:
(i) Section 6.13 of the Loan Agreement, due to
Borrower's breach of the minimum quarterly EBITDA covenant for
Borrower's Fiscal Quarter ended March 31, 2002 (Borrower is
required by Section 6.13 of the Loan Agreement to have EBITDA
for each of Borrower's Fiscal Quarters of at least $***, and
Borrower's actual EBITDA for its Fiscal Quarter ended March 31,
2002 was only $2,707,000); and
(ii) Section 6.14 of the Loan Agreement, due to
Borrower's breach of the minimum Tangible Net Worth Covenant for
Borrower's Fiscal Quarter ended March 31, 2002 (Borrower is
required by Section 6.14 of the Loan Agreement to have Tangible
Net Worth as of the last day of each Fiscal Quarter of at least
***, and Borrower's actual Tangible Net Worth as of March 31,
2002 was only $128,491,000).
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The above-mentioned Events of Default hereinafter shall be referred to as the
"Existing Events of Default".
C. Borrower has requested that Lenders waive the occurrence of
the Existing Events of Default and amend Section 6.14 of the Loan Agreement to
facilitate Borrower's future compliance with the minimum Tangible Net Worth
covenant, and make certain other modifications to the Loan Agreement.
D. Lenders are willing to grant such accommodations to Borrower
on the terms and conditions set forth below.
NOW, THEREFORE, the parties hereby agree as follows:
1. Defined Terms. Any and all initially capitalized terms used in this
Waiver and Amendment (including, without limitation, in the recitals hereto)
without definition shall have the respective meanings specified in the Loan
Agreement.
2. Waiver. Lenders hereby waive the occurrence of the Existing Events of
Default. Lenders' waiver hereby of the Existing Events of Default shall
constitute a waiver of only the Existing Events of Default and shall not
constitute a waiver of any other violation of the Loan Agreement other than the
Existing Events of Default.
3. Additional Definitions. Section 1.1 of the Loan Agreement is hereby
amended and supplemented by adding the following new definitions in appropriate
alphabetical order:
"'Accounts Receivable' means any accounts of Borrower
that are treated as accounts receivable under GAAP.
'Accounts Receivable Aging Report' has the meaning
specified in Section 7.1(e).
'Accounts Receivable Reconciliation Report' has the
meaning specified in Section 7.1(e).
'Borrowing Base' means, as of any date of determination,
an amount determined by the Administrative Agent, in its reasonable
discretion, with reference to the most recent Borrowing Base Certificate
delivered by Borrower to the Administrative Agent pursuant to Section
7.3, to be equal to the sum of (a) the Eligible Accounts Component plus
(b) the Eligible Inventory Component.
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*** CERTAIN CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT.
'Borrowing Base Certificate' means a certificate in the
form of Exhibit 7.3, properly completed and signed by a Senior Officer
of Borrower.
'Eligible Accounts Component' means *** times Accounts
Receivable that are not more than ninety (90) days past invoice date;
'Eligible Inventory Component' means the lesser of (i)
*** times Inventory, or (ii) $***.
'Immeon' means Immeon Networks LLC, a joint venture
between Loral Skynet and Borrower.
'Inventory' means any inventory of Borrower that is
treated as inventory under GAAP.
'Maximum Revolving Credit Amount' means, as of any date
of determination, the lesser of (i) the then applicable Borrowing Base
or (ii) the then applicable aggregate Revolving Commitments."
4. Addition of Borrowing Base Limitation as Condition to Advances.
Section 2.1(a) of the Loan Agreement is hereby amended to read in full as
follows:
"(a) Subject to the terms and conditions set forth in
this Agreement, at any time and from time to time from the Closing Date
through the Revolving Loan Maturity Date, each Lender shall, pro rata
according to that Lender's Pro Rata Share of the then applicable
Revolving Commitment, make Advances to Borrower under the Revolving
Commitment in such amounts as Borrower may request that do not result in
the sum of (i) the aggregate principal amount outstanding under the
Revolving Notes and (ii) the Aggregate Effective Amount of all
outstanding Letters of Credit to exceed the Maximum Revolving Credit
Amount. Subject to the limitations set forth herein, Borrower may
borrow, repay and reborrow under the Revolving Commitment without
premium or penalty."
5. Amendment of Tangible Net Worth Covenant. Section 6.14 of the Loan
Agreement is hereby amended to read in full as follows:
"6.14 Tangible Net Worth. Permit Tangible Net Worth as
of March 31, 2002 to be less than $*** or permit Tangible Net Worth as
of the last day of each Fiscal Quarter ending thereafter during the term
of this Agreement to be less than the sum of: (a) $***; (b) 90% of the
cumulative Net Income for the Fiscal Quarter ending June 30, 2002 and
for each Fiscal Quarter ending thereafter (with no deduction for a net
loss in any such Fiscal Quarter); and (c) 100% of the proceeds of any
issuance by Borrower
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of equity securities (except to employees or former employees of
Borrower pursuant to an employee stock option plan maintained by
Borrower) subsequent to the Closing Date."
6. Requirement of Management Letter with Fiscal Year End Financial
Statements. Section 7.1(c) of the Loan Agreement is hereby amended to read in
full as follows:
"(c) As soon as practicable, and in any event within one
hundred twenty (120) days after the end of each Fiscal Year, the
consolidated and consolidating balance sheet of Borrower and its
Subsidiaries as at the end of such Fiscal Year and the consolidated and
consolidating statements of operations, stockholders' equity and cash
flows, in each case of Borrower and its Subsidiaries for such Fiscal
Year, all in reasonable detail. Such financial statements shall be
prepared in accordance with GAAP, consistently applied, and such
consolidated financial statements shall be accompanied by a management
letter and report of PricewaterhouseCoopers LLP or other independent
public accountants of recognized standing selected by Borrower and
reasonably satisfactory to the Requisite Lenders, which report shall be
prepared in accordance with generally accepted auditing standards as at
such date, and shall not be subject to any qualifications or exceptions
as to the scope of the audit nor to any other qualification or exception
determined by the Requisite Lenders in their good faith business
judgment to be adverse to the interests of the Lenders;"
7. Amendment of Annual Projection Requirement. Section 7.1(d) of the
Loan Agreement is hereby amended to read in full as follows:
"(d) As soon as practicable, and in any event not later
than December 31 of each Fiscal Year, a budget and projection by Fiscal
Quarter for the following Fiscal Year (the 'First Year') and by Fiscal
Year for the next succeeding Fiscal Year (the 'Second Year'), including
for the First Year, projected consolidated balance sheets, statements of
operations and statements of cash flow of Borrower and its Subsidiaries,
forecast assumptions, and a budget for Capital Expenditures, and for the
Second Year, projected consolidated condensed balance sheets and
statements of operations and cash flows of Borrower and its
Subsidiaries, forecast assumptions, and a budget for Capital
Expenditures, all in reasonable detail;"
8. Delivery of Accounts Receivable Reconciliation Report . Section
7.1(e) of the Loan Agreement is hereby amended to read in full as follows:
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"(e) As soon as practicable, and in any event not later
than thirty (30) days after the end of each month, an aging of
Borrower's accounts receivable in form and substance reasonably
acceptable to the Administrative Agent ("Accounts Receivable Aging
Report"); and as soon as practicable, and in any event not later than
thirty (30) days after the end of each fiscal quarter of Borrower, a
reconciliation report to reconcile Accounts Receivable aged balances to
the Accounts Receivable listed on the general ledger of Borrower
("Accounts Receivable Reconciliation Report"), provided, that for any
Account Receivable that is (i) more than ninety (90) days past invoice
date and (ii) in an amount in excess of $100,000, Borrower shall provide
the Administrative Agent with a report detailing the business location
of the account debtor that generated the Account Receivable, the type of
Account Receivable (e.g. domestic commercial, domestic governmental,
foreign commercial, etc.) and any other information that the
Administrative Agent may require, in its sole and absolute discretion;"
9. Delivery of Financial Statements of Immeon . The Loan Agreement is
hereby further amended and supplemented by adding therein the following new
Section 7.1(m):
"(m) As soon as practicable, and in any event within
sixty (60) days after the end of each fiscal quarter of Immeon, the
balance sheet of Immeon as at the end of such fiscal quarter of Immeon
and the statements of operations and cash flows for such fiscal quarter
of Immeon, and the portion of the fiscal year of Immeon ended with such
fiscal quarter of Immeon, all in reasonable detail. Such financial
statements shall be certified by the financial officer of Immeon or his
or her designated representative as fairly presenting the financial
condition, results of operations and cash flows of Immeon in accordance
with GAAP (other than footnote disclosures), consistently applied, as at
such date and for such periods, subject only to normal year-end accruals
and audit adjustments;"
10. Delivery of Projections for Immeon . The Loan Agreement is hereby
further amended and supplemented by adding the following new Section 7.1(n):
"(n) As soon as practicable, and in any event not later
than December 31 of each fiscal year of Immeon, a budget and projection
by fiscal quarter of Immeon for the next succeeding fiscal year of
Immeon, including projected balance sheets, statements of operations and
statements of cash flow, forecast assumptions, and a budget for Capital
Expenditures all in reasonable detail;"
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11. Delivery of Borrowing Base Certificate. The Loan Agreement is hereby
further amended and supplemented by adding the following new Section 7.3 as
follows:
"7.3 Borrowing Base Certificate. So long as any Advance
remains unpaid, or any other Obligation remains unpaid or unperformed,
or any portion of the Commitments remains outstanding, Borrower shall,
at Borrower's sole expense, deliver to the Administrative Agent for
distribution by it to the Lenders concurrently with the Accounts
Receivable Aging Report and the Accounts Receivable Reconciliation
Report required by Section 7.1(e), a Borrowing Base Certificate signed
by a Senior Officer or his or her designated representative."
12. Waiver and Amendment Fee. In consideration of Lenders' agreement to
waive the Existing Event of Default and in consideration of the other
accommodations described herein, on the effective date of this Waiver and
Amendment, Borrower shall pay to the Administrative Agent, for the ratable
benefit of Lenders, a one-time amendment fee of $15,000 (the "Waiver and
Amendment Fee"). Borrower acknowledges and agrees that, at the Administrative
Agent's option, the Administrative Agent may effect payment of the Waiver and
Amendment Fee by charging the full amount of such fee, when due, to Borrower's
Revolving Loan account or to Borrower's checking account at Union Bank of
California, N.A.
13. Borrowing Base Certificate. The Loan Agreement is hereby further
amended and supplemented by adding thereto a new Exhibit 7.3 in the form of
Exhibit A to this Waiver and Amendment.
14. Conditions Precedent. The effectiveness of this Waiver and Amendment
shall be subject to the prior satisfaction of each of the following conditions:
(a) This Waiver and Amendment. The Administrative Agent
shall have received an original of this Waiver and
Amendment, duly executed by the Borrower and each of the
Lenders;
(b) Certificate. The Assistant Secretary of Borrower shall
have executed the Certificate of Resolution attached to
this Waiver and Amendment;
(c) Borrowing Base Certificate, Accounts Receivable Aging
Report and Accounts Receivable Reconciliation Report.
The Chief Financial Officer of Borrower shall have
delivered to the Administrative Agent a certified copy
of the Borrowing
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Base Certificate containing Borrowing Base information
for Borrower as of May 30, 2002, and an Accounts
Receivable Aging Report and Accounts Receivable
Reconciliation Report as of the same date.
(d) Other Documents. The Borrower shall have executed and
delivered to the Administrative Agent such other
documents and instruments as the Administrative Agent
may reasonably require.
15. Miscellaneous.
(a) Survival of Representations and Warranties. All
representations and warranties made in the Loan
Agreement or in any other document or documents relating
thereto, including, without limitation, any Loan
Document furnished in connection with this Waiver and
Amendment, shall survive the execution and delivery of
this Waiver and Amendment and the other Loan Documents,
and no investigation by the Administrative Agent or the
Lenders or any closing shall affect the representations
and warranties or the right of the Administrative Agent
or any Lender to rely thereon.
(b) No Events of Default. Except for the Existing Event of
Default, Borrower is not aware of any events which now
constitute, or with the passage of time or the giving of
notice, or both, would constitute, an Event of Default
under the Loan Agreement.
(c) Reference to Loan Agreement. The Loan Agreement, each of
the other Loan Documents, and any and all other
agreements, documents or instruments now or hereafter
executed and delivered pursuant to the terms hereof, or
pursuant to the terms of the Loan Agreement as amended
hereby, are hereby amended so that any reference therein
to the Loan Agreement shall mean a reference to the Loan
Agreement as amended hereby.
(d) Loan Agreement Remains in Effect. The Loan Agreement and
the other Loan Documents remain in full force and effect
and the Borrower ratifies and confirms its agreements
and covenants contained therein. The Borrower hereby
confirms
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that, after giving effect to this Waiver and Amendment,
no Event of Default or Default exists as of such date.
(e) Severability. Any provision of this Waiver and Amendment
held by a court of competent jurisdiction to be invalid
or unenforceable shall not impair or invalidate the
remainder of this Waiver and Amendment and the effect
thereof shall be confined to the provision so held to be
invalid or unenforceable.
(f) APPLICABLE LAW. THIS WAIVER AND AMENDMENT AND ALL OTHER
LOAN DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE DEEMED
TO HAVE BEEN MADE AND TO BE PERFORMABLE IN THE STATE OF
CALIFORNIA AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
(g) Successors and Assigns. This Waiver and Amendment is
binding upon and shall inure to the benefit of the
Lenders and Borrower and their respective successors and
assigns; provided, however, that Borrower may not assign
or transfer any of its rights or obligations hereunder
without the prior written consent of the Lenders.
(h) Counterparts. This Waiver and Amendment may be executed
in one or more counterparts, each of which when so
executed shall be deemed to be an original, but all of
which when taken together shall constitute one and the
same instrument.
(i) Headings. The headings, captions and arrangements used
in this Waiver and Amendment are for convenience only
and shall not affect the interpretation of this Waiver
and Amendment.
(j) NO ORAL AGREEMENTS. THIS WAIVER AND AMENDMENT, TOGETHER
WITH THE OTHER LOAN DOCUMENTS AS WRITTEN, REPRESENTS THE
FINAL AGREEMENT BETWEEN THE LENDERS AND THE BORROWER AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE LENDERS AND THE BORROWER.
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IN WITNESS WHEREOF, the parties have entered into this Waiver
and Amendment by their respective duly authorized officers as of the date first
above written.
VIASAT, INC.
By:
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Rick Baldridge
Executive Vice President, Chief
Operating Officer and Chief
Financial Officer
[Executed: 7/10/02]
Address:
ViaSat, Inc.
6155 El Camino Real
Carlsbad, California 92009
Attn: Rick Baldridge
Executive Vice President,
Chief Operating Officer and
Chief Financial Officer
Telecopier: (760) 476-2200
Telephone: (760) 929-3926
UNION BANK OF CALIFORNIA, N.A., as
the Administrative Agent
By:
---------------------------------
Rick Young
Vice President
Address:
Union Bank of California, N.A.
San Diego Commercial Banking Office
530 "B" Street, 4th Floor, S-420
San Diego, California 92101-4407
Attn: Mr. Rick Young
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Telecopier: (619) 230-3766
Telephone: (619) 230-3756
UNION BANK OF CALIFORNIA, N.A., as
a Lender
By:
---------------------------------
Rick Young
Vice President
Address:
Union Bank of California, N.A.
San Diego Commercial Banking Office
530 "B" Street, 4th Floor, S-420
San Diego, California 92101-4407
Attn: Mr. Rick Young
Telecopier: (619) 230-3766
Telephone: (619) 230-3756
U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By:
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Maureen Sullivan
Vice President
Address:
U.S. Bank National Association
4180 La Jolla Village Drive,
Suite 125
La Jolla, California 92037
Attn: Maureen Sullivan
Telecopier: (858) 597-6651
Telephone: (858) 597-1055
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