SECOND LOAN
MODIFICATION AGREEMENT
This Second Loan Modification
Agreement (this "Loan Modification Agreement") is entered into as
of June 18, 2009, by and between SILICON VALLEY BANK , a
California corporation, with its principal place of business at
3003 Tasman Drive, Santa Clara, California 95054 and with a
loan production office located at 535 Fifth Avenue, 27th Floor, New
York, New York 10017 ("Bank") and CHYRON CORPORATION , a New
York corporation with its chief executive office located at 5 Hub
Drive, Melville, New York 11747 ("Borrower").
1. DESCRIPTION OF EXISTING
INDEBTEDNESS AND OBLIGATIONS . Among other indebtedness and
obligations which may be owing by Borrower to Bank, Borrower is
indebted to Bank pursuant to a loan arrangement dated as of June
19, 2008, evidenced by, among other documents, a certain Loan and
Security Agreement dated as of June 19, 2008, between Borrower and
Bank, as amended by a certain First Loan Modification Agreement
dated as of April 16, 2009, between Borrower and Bank (as amended,
the "Loan Agreement"). Capitalized terms used but not otherwise
defined herein shall have the same meaning as in the Loan
Agreement.
2. DESCRIPTION OF
COLLATERAL . Repayment of the Obligations is secured by the
Collateral as described in the Loan Agreement (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 Obligations shall be
referred to as the "Existing Loan Documents".
3. DESCRIPTION OF CHANGE IN
TERMS .
A.
Modifications to Loan Agreement.
1.
Borrower agrees and acknowledges that Bank shall, at Bank's sole
discretion and at Borrower's sole expense, audit Borrower's
Collateral within sixty (60) days after 2009 Effective Date No.
2.
2. The
Loan Agreement shall be amended by deleting the following appearing
as Section 2.1.5(c) thereof (entitled "Prepayment Upon an Event of
Loss") in its entirety:
" (c) Prepayment Upon an Event
of Loss . Borrower shall bear the risk of any loss, theft,
destruction, or damage of or to the Financed Equipment. If, during
the term of this Agreement, any item of Financed Equipment becomes
obsolete or is lost, stolen, destroyed, damaged beyond repair,
rendered permanently unfit for use, or seized by a governmental
authority for any reason for a period ending beyond the Equipment
Maturity Date with respect to such Financed Equipment (an "
Event of Loss "), then, within ten (10) days following such
Event of Loss, Borrower shall (i) pay to Bank on account of the
Obligations all accrued interest to the date of the prepayment,
plus all outstanding principal owing with respect to the Financed
Equipment subject to the Event of Loss; or (ii) if no Event of
Default has occurred and is continuing, at Borrower's option,
repair or replace any Financed Equipment subject to an Event of
Loss provided the repaired or replaced Financed Equipment is of
equal or like value to the Financed Equipment subject to an Event
of Loss and provided further that Bank has a first priority
perfected security interest in such repaired or replaced Financed
Equipment. Any partial prepayment of an Equipment Advance paid by
Borrower on account of an Event of Loss shall be applied to prepay
amounts owing for such Equipment Advance in inverse order of
maturity."
and inserting in lieu thereof the
following:
" (c) Prepayment Upon an Event
of Loss . Borrower shall bear the risk of any loss, theft,
destruction, or damage of or to the Financed Equipment. If, during
the term of this Agreement, any item of Financed Equipment becomes
obsolete or is lost, stolen, destroyed, damaged beyond repair,
rendered permanently unfit for use, or seized by a governmental
authority for any reason for a period ending beyond the Equipment
Maturity Date or, as applicable, the 2009 Equipment Maturity Date
with respect to such Financed Equipment (an " Event of Loss
"), then, within ten (10) days following such Event of Loss,
Borrower shall (i) pay to Bank on account of the Obligations all
accrued interest to the date of the prepayment, plus all
outstanding principal owing with respect to the Financed Equipment
subject to the Event of Loss; or (ii) if no Event of Default has
occurred and is continuing, at Borrower's option, repair or replace
any Financed Equipment subject to an Event of Loss provided the
repaired or replaced Financed Equipment is of equal or like value
to the Financed Equipment subject to an Event of Loss and provided
further that Bank has a first priority perfected security interest
in such repaired or replaced Financed Equipment. Any partial
prepayment of an Equipment Advance or 2009 Equipment Advance paid
by Borrower on account of an Event of Loss shall be applied to
prepay amounts owing for such Equipment Advance or 2009 Equipment
Advance in inverse order of maturity."
3. The Loan Agreement shall be
amended by inserting the following new Section 2.1.6 (entitled
"2009 Equipment Advances") to appear immediately following the
existing Section 2.1.5 thereof (entitled "Equipment
Advances"):
" 2.1.6 2009 Equipment
Advances .
(a) Availability . Subject
to the terms and conditions of this Agreement, during Draw Period
No. 2, Bank shall make advances (each, a " 2009 Equipment
Advance " and, collectively, " 2009 Equipment
Advances ") not exceeding the 2009 Equipment Line. 2009
Equipment Advances may only be used to finance Eligible Equipment
purchased within one hundred twenty days (120) days (determined
based upon the applicable invoice date of such Eligible Equipment)
before the date of each 2009 Equipment Advance. All Eligible
Equipment must have been new when purchased by Borrower, except for
such Eligible Equipment that is disclosed in writing to Bank by
Borrower, and that Bank in its sole discretion has agreed to
finance, prior to being financed by Bank. No 2009 Equipment Advance
may exceed one hundred percent (100.0%) of the total invoice for
Eligible Equipment (excluding taxes, shipping, warranty charges,
freight discounts and installation expenses relating to such
Eligible Equipment except to the extent such are allowed to be
financed pursuant hereto as Other Equipment). Unless otherwise
agreed to by Bank, not more than thirty-five percent (35%) of the
proceeds of the 2009 Equipment Line shall be used to finance Other
Equipment. Each 2009 Equipment Advance must be in an amount greater
than or equal to the lesser of: (i) Two Hundred Thousand Dollars
($200,000.00) or (ii) the amount that has not yet been drawn under
the 2009 Equipment Line. After repayment, no 2009 Equipment Advance
may be reborrowed.
(b) Repayment . Each 2009
Equipment Advance shall be payable in (i) thirty-six (36)
consecutive equal monthly installments of principal plus (ii)
monthly payments of accrued interest at the rate set forth in
Section 2.3(a)(iii), beginning on the Payment Date of the month
following the Funding Date of such 2009 Equipment Advance and
continuing on the Payment Date of each month thereafter. All unpaid
principal and interest on each 2009 Equipment
Advance shall be due and
payable in full on the applicable 2009 Equipment Maturity
Date."
4. The Loan Agreement shall be
amended by deleting the following text appearing in Section 2.3(a)
thereof (entitled "Interest Rate"):
" (i) Advances . Subject
to Section 2.3(b), the principal amount outstanding under the
Revolving Line shall accrue interest at a floating per annum rate
equal to the greater of (A) one and one half of one percentage
points (1.50%) above the Prime Rate and (B) six and one half of one
percent (6.50%), which interest shall be payable monthly in
accordance with Section 2.3(f) below."
and inserting in lieu thereof the
following:
" (i) Advances . Subject
to Section 2.3(b), the principal amount outstanding under the
Revolving Line shall accrue interest at a floating per annum rate
equal to: (A) prior to 2009 Effective Date No. 2, the greater of:
(x) one and one half of one percentage points (1.50%) above the
Prime Rate, and (y) six and one half of one percent (6.50%), and
(B) on and after 2009 Effective Date No. 2, the greater of: (x) one
and three quarters of one percentage points (1.75%) above the Prime
Rate, and (y) five and three quarters of one percent (5.75%), which
interest shall in each case be payable monthly in accordance with
Section 2.3(f) below."
5. The Loan Agreement shall be
amended by inserting the following text to appear at the end of
Section 2.3(a) thereof (entitled "Interest Rate"):
" (iii) 2009 Equipment
Advances . Subject to Section 2.3(b), the principal amount
outstanding for each 2009 Equipment Advance shall accrue interest
at a floating per annum rate equal to the greater of: (A) two
percentage points (2.0%) above the Prime Rate, and (B) six percent
(6.0%), which interest shall be payable monthly in accordance with
Section 2.3(f) below."
6. The Loan Agreement shall be
amended by deleting the following appearing as Section 3.4(b)
thereof (entitled "Equipment Advances") in its entirety:
" (b) Equipment Advances .
Subject to the prior satisfaction of all other applicable
conditions to the making of an Equipment Advance set forth in this
Agreement, to obtain an Equipment Advance, Borrower must notify
Bank (which notice shall be irrevocable) by electronic mail or
facsimile no later than 12:00 p.m. Eastern time one (1) Business
Day before the proposed Funding Date. The notice shall be a
Payment/Advance Form, must be signed by a Responsible Officer or
designee, and shall include a copy of the invoice for the Equipment
being financed. If Borrower satisfies the conditions of each
Equipment Advance, Bank shall disburse such Equipment Advance by
transfer to the Designated Deposit Account."
and inserting in lieu thereof the
following:
" (b) Equipment Advances .
Subject to the prior satisfaction of all other applicable
conditions to the making of an Equipment Advance or 2009 Equipment
A
