Exhibit 10.27

 

 

February 6, 2004

 

 

SILICON GRAPHICS, INC.

SILICON GRAPHICS FEDERAL, INC.

1600 Amphitheatre Parkway

Mountain View, California 94043

Attn:  Jean Furter, Vice President and Treasurer

 

Re:                               Amended and Restated Loan and Security
Agreement

 

Dear Jean:

 

Reference is made to that certain Amended and Restated Loan and Security
Agreement, dated as of September 20, 2002 (as amended, restated, supplemented,
or modified from time to time, the “Loan Agreement”), entered into among Silicon
Graphics, Inc., a Delaware corporation (“Parent”), Silicon Graphics Federal,
Inc., a Delaware corporation (together with Parent, “Borrowers”), the Lenders
signatory thereto (the “Lenders”), and Wells Fargo Foothill, Inc., a California
corporation (formerly known as Foothill Capital Corporation), as the arranger
and administrative agent for the Lenders (“Agent”).  Capitalized terms, which
are used herein but not defined herein, shall have the meanings ascribed to them
in the Loan Agreement.

 

Borrowers have requested that the Loan Agreement be amended to modify Borrowers’
EBITDA covenant calculation, to allow for an add-back of a non-cash charge
associated with Borrowers’ Exchange Offer completed December 22, 2003, for the 3
month period ended December 26, 2003.

 

Subject to the satisfaction of the terms and conditions set forth in this letter
agreement, Agent is willing to grant the amendment requested by Borrowers as
described in the preceding sentence.

 

NOW, THEREFORE, Agent and Borrowers hereby agree to the following:

 

1.                                       SECTION 1.1 OF THE LOAN AGREEMENT IS
HEREBY AMENDED BY AMENDING AND RESTATING THE FOLLOWING DEFINITION IN ITS
ENTIRETY:

 

“‘EBITDA’ means, with respect to any fiscal period, Parent’s and its
Subsidiaries’ consolidated net earnings (or loss), minus interest income and
extraordinary gains, including gains on sale of assets, plus interest expense,
income taxes, and depreciation and amortization for such period, as determined
in accordance with GAAP; provided, however, that EBITDA for the 3 month period
ended December 26, 2003, shall be adjusted to add thereto a non-cash charge
attributable to the Exchange Offer in an amount up to $30,500,000.”

 

2.                                       THE SATISFACTION OF EACH OF THE
FOLLOWING SHALL CONSTITUTE CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS
LETTER AGREEMENT AND EACH AND EVERY PROVISION HEREOF:

 

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A.                                       THE REPRESENTATIONS AND WARRANTIES IN
THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRUE AND CORRECT IN ALL
RESPECTS ON AND AS OF THE DATE HEREOF, AS THOUGH MADE ON SUCH DATE (EXCEPT TO
THE EXTENT THAT SUCH REPRESENTATIONS AND WARRANTIES RELATE SOLELY TO AN EARLIER
DATE);

 

B.                                      NO EVENT OF DEFAULT SHALL HAVE OCCURRED
BETWEEN THE DATE HEREOF AND THE DATE OF THE EFFECTIVENESS OF THIS LETTER
AGREEMENT; AND

 

C.                                       NO INJUNCTION, WRIT, RESTRAINING ORDER,
OR OTHER ORDER OF ANY NATURE PROHIBITING, DIRECTLY OR INDIRECTLY, THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREIN SHALL HAVE BEEN ISSUED AND
REMAIN IN FORCE BY ANY GOVERNMENTAL AUTHORITY AGAINST ANY BORROWER OR AGENT.

 

3.                                       THIS LETTER AGREEMENT CONSTITUTES AN
AMENDMENT TO THE LOAN AGREEMENT.  EXCEPT AS EXPRESSLY SET FORTH HEREIN, THE LOAN
DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT.

 

4.                                       BORROWERS AGREE THAT ALL OF AGENT’S
ATTORNEYS’ FEES AND COSTS IN DRAFTING AND NEGOTIATING THIS LETTER AGREEMENT ARE
PART OF THE LENDER GROUP EXPENSES AND ARE PAYABLE ON DEMAND.

 

5.                                       THIS LETTER AGREEMENT MAY BE EXECUTED
IN ANY NUMBER OF COUNTERPARTS AND BY DIFFERENT PARTIES ON SEPARATE
COUNTERPARTS.  EACH OF SUCH COUNTERPARTS SHALL BE DEEMED TO BE AN ORIGINAL, AND
ALL OF SUCH COUNTERPARTS, TAKEN TOGETHER, SHALL CONSTITUTE BUT ONE AND THE SAME
AGREEMENT.  DELIVERY OF AN EXECUTED COUNTERPART OF THIS LETTER AGREEMENT BY
TELEFACSIMILE SHALL BE EQUALLY EFFECTIVE AS DELIVERY OF A MANUALLY EXECUTED
COUNTERPART.

 

Please indicate your agreement with the foregoing by signing in the space
provided below and returning the same to the undersigned.

 

 

WELLS FARGO FOOTHILL, INC.,

 

a California corporation, as Agent

 

 

 

 

 

By:

/s/ Thomas P. Shughrue

 

Name:

Thomas P. Shughrue

 

Title:

Vice President

 

Acknowledged and Agreed:

 

SILICON GRAPHICS, INC.,

a Delaware corporation

 

By:

/s/ Jean Furter

 

Name:

Jean Furter

 

Title:

Vice President & Treasurer

 

 

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SILICON GRAPHICS FEDERAL, INC.,

a Delaware corporation

 

 

By:

/s/ Jeff Zellmer

 

Name:

Jeff Zellmer

 

Title:

Vice President

 

 

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