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Limited Waiver and Amendment to Loan Documents

Forbearance Agreement

Limited Waiver and Amendment to Loan Documents | Document Parties: APPLIED PRECISION, INC. | Applied Precision Holdings, LLC You are currently viewing:
This Forbearance Agreement involves

APPLIED PRECISION, INC. | Applied Precision Holdings, LLC

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Title: Limited Waiver and Amendment to Loan Documents
Date: 6/30/2006

Limited Waiver and Amendment to Loan Documents, Parties: applied precision  inc. , applied precision holdings  llc
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Exhibit 10.23

Silicon Valley Bank

Limited Waiver and

Amendment to Loan Documents

 

 

 

 

Borrower:

  

Applied Precision Holdings, LLC

 

  

            Applied Precision, LLC

 

 

Date:

  

April 26, 2006

THIS LIMITED WAIVER AND AMENDMENT TO LOAN DOCUMENTS is entered into between Silicon Valley Bank (“Silicon”) and the borrower named above (“Borrower”).

Reference is hereby made to that certain Amended and Restated Loan and Security Agreement between Borrower and Silicon and dated August 17, 2005 (as amended from time to time, the “Loan Agreement”). Reference is also hereby made to that certain Amended and Restated Loan and Security Agreement (Exim Program) between Borrower and Silicon and dated August 17, 2005 (as amended from time to time, the “Exim Loan Agreement”). The Parties agree to amend each of the Loan Agreement and Exim Loan Agreement as follows, 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 or Exim Loan Agreement, as applicable.)

1.     Waiver of Fix Charge Coverage Ratio Financial Covenant Default . Borrower has failed to comply with the Fixed Charge Coverage Ratio Financial Covenant for the compliance period ending January 31, 2006 (the “January FCC Default”) and may possibly fail to comply with such Financial Covenant for the compliance period ending February 28, 2006 (the “Potential February FCC Default”) (the January FCC Default and Potential February FCC Default are hereinafter referred to collectively as the “Covenant Defaults”). Silicon and Borrower agree that the Borrower’s Covenant Defaults are hereby waived. It is understood by the parties hereto, however, that such waiver does not constitute a waiver of any other provision or term of the Loan Agreement or Exim Loan Agreement or any related document, nor an agreement to waive in the future this covenant or any other provision or term of the Loan Agreement or Exim Loan Agreement or any related document.


2.     Modified Section Regarding Letters of Credit. Section 1.6 of the Loan Agreement is hereby amended to read as follows:

1.6 Letters of Credit. At the request of Borrower, Silicon may, in its good faith business judgment, issue or arrange for the issuance of letters of credit for the account of Borrower, in each case in form and substance satisfactory to Silicon in its sole discretion (collectively, “Letters of Credit”). The aggregate face amount of all Letters of Credit from time to time outstanding shall not exceed the amount shown on the Schedule (the “Letter of Credit Amount”). Borrower shall pay all bank charges (including charges of Silicon) for the issuance of Letters of Credit, together with such additional fee as Silicon’s letter of credit department shall charge in connection with the issuance of the Letters of Credit. Any payment by Silicon under or in connection with a Letter of Credit shall constitute a Loan hereunder on the date such payment is made. Each Letter of Credit shall have an expiry date no later than thirty days prior to the Maturity Date. Borrower hereby agrees to indemnify and hold Silicon harmless from any loss, cost, expense, or liability, including payments made by Silicon, expenses, and reasonable attorneys’ fees incurred by Silicon arising out of or in connection with any Letters of Credit. Borrower agrees to be bound by the regulations and interpretations of the issuer of any Letters of Credit guarantied by Silicon and opened for Borrower’s account or by Silicon’s interpretations of any Letter of Credit issued by Silicon for Borrower’s account, and Borrower understands and agrees that Silicon shall not be liable for any error, negligence, or mistake, whether of omission or commission, in following Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments, or supplements thereto. Borrower understands that Letters of Credit may require Silicon to indemnify the issuing bank for certain costs or liabilities arising out of claims by Borrower against such issuing bank. Borrower hereby agrees to indemnify and hold Silicon harmless with respect to any loss, cost, expense, or liability incurred by Silicon under any Letter of Credit as a result of Silicon’s indemnification of any such issuing bank. The provisions of this Loan Agreement, as it pertains to Letters of Credit, and any other Loan Documents relating to Letters of Credit are cumulative.

3.     Modified Credit Limit. That portion of the Credit Limit entitled “Cash Management Services and Reserves” as set forth in Section 1 of the Amended and Restated Schedule to Loan and Security Agreement is hereby deleted and replaced with the following:

 

 

 

 

Letter of Credit Amount

  

 

 

 

(Section 1.6):

  

$250,000 ; provided that the total of


 

 

 

 

  

all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and the FX Reserve, and all amounts for Cash Management Services utilized under the Cash Management Services Amount may not exceed $250,000.

 

 

Cash Management

  

 

Amount :

  

$250,000 ; provided that the total of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and the FX Reserve, and all amounts for Cash Management Services utilized under the Cash Management Services Amount may not exceed $250,000.

 

 

Cash Management

  

 

Services :

  

Borrower may use up to the Cash Management Amount above, for Silicon’s Cash Management Services (as defined below), including, merchant services, business credit card, ACH and other services identified in the cash management services agreement related to such service (the “Cash Management Services”). Silicon may charge to Borrower’s Loan account, any amounts that may become due or owing to Silicon in connection with the Cash Management Services. Borrower agrees to execute and deliver to Silicon all standard form applications and agreements of Silicon in connection with the Cash Management Services, and, without limiting any of the terms of such applications and agreements, Borrower will pay all standard fees and charges of Silicon in connection with the Cash Management Services. The Cash Management Services shall terminate on the Maturity Date.


 

 

 

Foreign Exchange

  

 

Contract Amount :

  

$250,000 ; provided that the total of all outstanding Letters of Credit

 

  

(including drawn but unreimbursed Letters of Credit), and the FX Reserve, and all amounts for Cash Management Services utilized under the Cash Management Services Amount may not exceed $250,000.

 

 

FX Reserve :

  

Borrower may enter into foreign exchange forward contracts with Silicon, on its standard forms, under which Borrower commits to purchase from or sell to Silicon a set amount of foreign currency more than one business day after the contract date (the “FX Forward Contracts”); provided that (1) at the time the FX Forward Contract is entered into Borrower has Loans available to it under the Foreign Exchange Contract Amount in an amount at least equal to 10% of the amount of the FX


 
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